Every evening, Wilmington daily commercial., 1918-02-12
HOG ISLAND EXPERT
FACES SENATE GRILL
Vice President of Am. Int1. Ship
building Corp. to Testify
Treasury Looting Charged.
By Associated Press TO Every Evening

Nv Associated Press 10 Every Evening
WASHINGTON, Feb. II.
The Senate committee on commerce has
determined to make the most searching
investigation of the Hog Island ship
building situation.
Disclosures made before the committee
bywitnesses of the highest crediblity have
convinced the members that only by the
exercise of every energy and by the appll--
cation of every possible pressure OF
authority at their command can the
public be satisfied with the conditions
existing in the Delaware river PROJECT,
where seemingly the United States govern
nent is about to find that it must spend
at least $50 600, 900 where government
and civilian experts previously estimated
an expenditure of only S2l ,0o0,O would
have suihcHd.
In the House, yesterday afternoon,
Irvine l.. Lenroot. Republican CIV is
made the charge that through laxness oi
the system of contract making employed
by the United States shipping Board $
Emergency Fleet Corporation, the Ameri-
can International Corporation ana It's
Subsidiary. the American international
shipping Co, had been placed IN po.
sition TO loot the Treasury Of millions oi
dollars, and that apparently they had
hccn successful.
PRICE OF ACREAGE DOUBLED.
The committee yesterday questioned
,onhr one witness, Col. Black of Phlladel-
phia. one Of the former owners OF Hog
island who sold his property TO the gov
crnunsnt for its great yard for $1,000 an
acre. where less than a year ago he had
held his fraction of Hog Island at an
option of 81 900 per acre
Tho committee WAS not surprised at
,hss MULTIPLICATION of value. II was the
hot al
r,,,,yrd no more for his land than the
sx,rencirs Of the situation demanded, or
the increase in the actual need for the
territory for shipyard purposes warranted
But TODAY the committee Will be-
I'm it's actual delvirrg INTO the vltals OF
The Hog Islands project. George J. Bald
v1n. vn-o-prsssident OF the American In
Sornational Shipbnldlng Company, VIII
S.kr the stand. He will be Interrugated
m regard to the list of sub-contractors
and supply contractors serving the Hog
Island project with materials. 1t will be
che rnds=avor OF the committee to dis
ooyxr relationships between the directors
c{ the American international Corpora
tim and the hundred or more maGuiao-
timing concerns throughout the United
states IN which members of this group
of directors are IntEpSted.
Mr.. BALDWIN Is rcputed to know moro
about the Hog Island deal than any other
oAir7al The Senators are prlmed Tor
him. He Is expected to explain what
fecor. have contributed TO the huge cost
Of the shirvard and the alleged inetii-
cheney and jdleness of workmen.
CORPORATION PROTECTED.
,,al,S,s or the contract. Senators say.
sbou that The American International
CORPORATION is fully protected. The only
redress Of th,s government, they assert
* IN take advantage of . provision for
the government to take over the work
and reimburse the corporation for what
has been done.
As for salvae ing the alleged misspent
funds. senator lfletcher, chairman of the
committee, points ont the Fleet Corpora
tIon NAV withhold the fee OF SO 100000
the American international Corporation
! ~ receive for building the l20 ships
The government. pays all bills for ma.
terlals labor and the overhead, which
includes the adm nistrstlve salary rOllse
The Fleet Corporation also pays for the
materials going into the ships, and pays
the charges for labor and superlntend-
cnce al sub-contTActorS-
The Senators polrs, out that the contract
provides the agent Irsust be governed BY
orders of the owner, and this feature, they
sa,d Is important, lnasmuch as J. W
rovie. the Fleet Corporations plant en-
rncer At Hog Island, testified Saturday
thst the American International Ship
b,uIdunc Corporation officials showed
NtfLn. II anv, inclination to accept his
recommendations This clause follows:
'@rhe asent shall In the performance OF
MS agreements comply with and be bound
by an directions. instructions and deci-
saoos of the owner, or Its authorized rep
rp,.-,tatIvy.s: and compliance by the agent
Ir1STr-gcrlOre n p de-
rision shall be a justification and pro
tectaon TO the agent for any action so
taken
The contract specifies that fifty cargo
vessels. each OF : 500 deadwelght tons
and seventy ffteen-knot troop and cargo
shlus. each Of 5000 tons, are 10 be built.
The feet corporation is empowered to
use the plant to install machinery IN
wood hulls or require the agent, the A. I.
S. c., al terms TO be liked.
Deliveries were TO be made on the fol-
kming dates from early IN September,
when the contract was signed:
Caryo vessels twenty-five within thlr-
tern and one-haf months; twenty-five
within eighteen and One-haf months
Troop vessels-Twenty-fiv within fif-
teen months; twenty-five within twenty
months; twenty within twenty-five
months
The estimated cost of each cargo vessel
Is sI,lO0OOO, and each troop vessel ST.
$4,000. The corporation is allowed FIVE
Der cent fec on each ship. amounting TO
$4,000 per cargo vessel, and SS2,500 per
troop vessel Ii the actual cost Is less
than estimated, the corporation receives
oue-third of the saving.
Premiums fer early delivery not exceed
ing Sl4. 600 per cargo vessel. and Sl7 500
per troop vessel, also are provided.
The FIVE per cent fee Is decreased II
rhe actual cost exceeds the estimated
o~t. and then ONLY one-half OF the ex-
o.rs l. reduced. Damages for delays,
h n prescribed, cannot exceed S14, 900 pei
cargo vessel. or sI7, 500 per cargo vessel
80 that the average minimum fee for each
cargo carrier Will be $4I 600 and for each
transport &65,OO0.