Evening star., 1920-02-18
Mr.. PAYNE WOULD
REJECT BIDS FOR
EX-GERMAN SHIPS
Asks Senate Committee to
Authorize Renewal of
Negotiations.

the thirty lOrmer herman pdSSeHSei
ships offered for sale by the Shipping
Board was recommended to the Sen
ate commerce committee today by
Chairman Payne of the board. who
asked authority to renew negotiations
for sale of the vessels for operation
under the American flag.
Submits Resolution.
The boards recommendation was
contained in the following resolution
submitted to the committee:
Resolved, that with the report sub
mitting the bids to the Senate and
House committees the board states
that it proposes to take the follow
ing action:
THE board believes that in view Of
the uncertainty as to whether the
sales of the eN-German ships would
actually be made. the bids received
are much less than can be obtained
by further negotiations.
, 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 18th and 18th instant be.
and the same are hereby rejected, and
turned.
RESOLVED further, that the sales
division be, and it is hereby, instruct
ed to negotiate further for the sale OF
the said ex-German passenger ships
on the terms heretofore announced in
the original Advertisements. That Is,
'(a). That they be sold only to
American firms. corporations or per-
sons for use under the American flag.
"(b). And offered with reference to
.foh hn1 n
the board, and that each negotiation
when the highest price possible is
reached. be reported to the board for
it's action
Points to Past Sales.
The resolution was embodied in
prepared statement. which Mr.. Payne
read to the committee. He recalled
that the board had sold 1S8 ships in
accord with its policy to dispose of
the fleet to American citizens for
operation under the American flag.
and that eighteen former German
cargo vessels were included in this
number. The price received was $685..
545,947.
Chairman Payne said if the Congress
desired to- change this policy to pub
lie ownership of ships the passenger
liners should not be sold. and Con-
gress should direct the board to spend
the SIS. 200, 900 estimated as necessary
senger vessels.
"It should be understood" he said.
that the ship. whether owned by the
government or by private capital,
must. in either case. be operated by
the shipping companies which are bid
has no adequate organization fer the
direct operation Of ships.
'If the government continues to be
the owner. it must pay the operators
a fixed fee and commission upon
receipts and take whatever profit re-
mains, or if no profit remains, must
bear all the losses
Can Get More Than Appraisal.
The chairman went on to say that
in accord with the joint resolution of
Congress under which the ships were
taken 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
appraised value.
Mr. Payne said passenger ships were
scarce now and building prices high,
but that these conditions might
change and the value of the ships be
correspondingly lessened.
IF we proceed To recondition the
ships, making them fit for passenger
use" continued the chairman. 'it will
take from six to twelve months to put
them into service. Our conviction is
that we will not hereafter be able to
sell the ships for the cost of recondi-
tioning plus the price at which we
can now sell"
Questioned as to the possibility of
the vessels ultimately being sold to
foreign interests, Chairman Payne
told the committee the ships could not
be transferred from under the Ameri-
can flag without permission from the
Shipping Board.
Vessels sold to private operators
for service in lines designated by the
board could not finally and inalterably
be held in those lines without con-
gressional guarantee against loss, the
chairman said.
Asked about the ownership of the
International Mercantile Marine,
Chairman Payne declared that investi-
CATION by the board had shown the
company to be 100 per cent American
Authority to Sell ships.
Discussing the authority given the
board to sell ships. Chairman Payne
said:
I'VE understand it Is the policy of
Congress that we cannot operate ships
sell all ships after five years"
Senator Ransdell. democrat Louisi-
ana, asked as to the boards power to
compel purchasers Of ships to keep
them permanently under the American
flag.
Commissioner Stevens replied for
the chairman that additional legislation
would be necessary, as the boards
present power over the transfer of ves-
sells to foreign flags was only for the
war period.
Replying to Senator Calder, republi-
can. New York, Chairman Payne said
shipping men felt that the government
would not discriminate against Amerj
can ship operators in competition with
foreign ships in the matter of prohibi-
ton"
Concluding his statement, Chairman
Payne said the resolution presented to
the, committee was approved-Ay the
Shipping Board by a vote of 3~to 1.
Mr.. stevens Opposed Sale.
Commissioner Stevens, who voted
against further attempts to sell the
ships at present, then was called He
said he based his objection to the
present sale of the fleet on the ground
that true value of the vessels had
never been determined and the board s
estimates were guess work"
Replying to Senator Nelson, repub-
ncan, Minnesota. Mr.. Stevens said the
real value of the ships could be de-
| termined by deferring the sale and max
ing an appraisal.
morrow and then John d. York, rep
resenting William Randolph Hearst,
! will appear.
| HAWAII DEMANDS SHIPS
WITH REASONABLE RATES
! Consideration of necessities of
| American island possessions in franz