New Britain herald., 1920-02-18
Chairman Payne of Ship ping Board Would Have Them Sold to American Firms.
FOR USE ONLY UNDER
 STARS AND STRIPES

Washington, Feb. 1S.-Rejection of all bids received for the 30 former German passenger ships offered for sale cy the shipping board was rec commended to the senate commerce committee today by Chairman Payne of the board, who asked authority to renew negotiations for sale of the ves- se1s for operation under the American flag.
 Recommendations Presented.
 The boards recommend dation was contained in the following resolution submitted to the con1niLtee:
 "Resolvcd, that with the report sub- hitting the bids to the senate and house committees the board states that 1t proposes to take the following action: ss
 The board believes that in view of the uncertainty to whether the sales of the eX-German ships would actually be made, the bids received are much less than can be obtained by further resolutions.
 Resolved, that the bids received on the goth of January in response to the advertisement for sealed bids and those received at the public auction held on the 16th and 17th inst. be and he same are hereby rejected and that the checks of the bidders be re- turned.
 r"Resolved further, that the sales di- vision be and it is hereby instructed to negotiate further for the sale of the said ex-German passenger ships on the terms heretofore announced in the original advertisement: That is,
 Only Under American Flag.
 ''a-That they be sold to American firms, corporations or persons for use under the American flag.
 fb-And offered with reference to the routes or services established by the board and that each negotiation wbea the highest. nnice possible is reached be reported to the board for it's action
 1sS Ships Arc Sold.
 The resolution was embodied in a prepared statement which MT. Payne read to the committee. He recalled that the board had sold 1SS ships in accord with its policy to dispose of the fleet to American citizens for operation under the American flag and that IS former German cargo vessels were included in this number. The price received was S93, 545,947.
 Chairman Payne said if the con- gress desired to change this policy to public ownership of ships the pas senger liners should not be sold and congress should direct the board to spend the $75,0O0.O00 estimated as necessary to convert them from troop to passenger vessels.
 Tt should be understood" he said, that the ships, whether owned by the government or by private capital, must in either case be operated by the shipping companies which are bid- ding for the ships, The government ha no adequate organization for di- rect operation of ships.
 If Govt. Retains Vessels.
 If the government continues to be the owner, it must pay the operators a fixed fee and comm ission upon re- ceipts and take whatever profit re- mains. or if no profit remains must bear all the losses.
 The chairman went on to say that in accord with the joint resolution of congress under which the ships were ken over a naval board had ap- praised the craft and that the prices at which the board could sell now were substantially in excess of the value. Mr. Payne said passenger ships were scarce now and building prices high. but that these conditions might change and the value or the SnlpS pc correspondingly lessened.
 "Tf we proceed to recondition the l ships making them fit for passenger use," continued the chairman, ''it will take from six to 12 months to put them into service. Our conviction is that we will not hercaf fter be able to sell the ships for the cost of recon ditioning plus the price at which We now can sell tbem.'
 Possibility of Sale.
 Questioned as to the possibility of vessels ultimately being sold to for eign interests Chairman Payne told the committee the ships could not be transferred from under the American flag without permission from the Shipping board.
 Vessels sold to private operators for service in lines designated bN the board could not finally and unalter- i ably be held in those lines without 1 congressional guarantee against loss, 1 he said.
 Asked about the ownership of the l Mercantile Marine, i Chairman Payne declared thai inves- ! tigation by the board had shown the : company to he 100 per cent !, American.
 Policy of Congress. 1
 Discussing the authority given the 1 board 10 sell ships Chairman Payne 1 said:
 I've understand jt is the policy Of | congress that We cannot operate ships 1
 (Coutinuede on Eleventh Pagel