Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1922-03-08
MAY NOT ACCEPT
MUSCLE SHOALS
OFFER OF FORD
Would Require Years to
Thresh Out Existing Legal
EntanglementS, Mayo Is
Told BY Kahn.

(liy The AssOriu- 20 A'f9sS
Washington, March CHAIR
man Kahn Of the house militarJ
committee today told w. B. Mayo,
chief Of engineers for Henry Ford,
that it would require years to
to accept the Detroit manufacture
thresh out existing legal entangle-
ments and it was doubtful even
that the government would be able
er's proposed contract for pur-
chase and lease of the nitrate and
power projects at Muscle Shoals,
Alabama.
After the committee adjourned
other committee members said the
legal barriers to acceptance of the
Ford proposal appeared inescap-
able because of the contracts held
by the Alabama Power company
and the Air Nitrates corporation,
which, those concerns claim. give
them exclusive right to purchase
the Warrior steam plant and nj
trate plant No. .. respectively.
Both units would be delivered to
Mr.. Ford with free titles in the
event his proposal as accepted,
and could not DC freed from the
contract conditions without pro-
longed litigation in the courts,
Legal Difficulties.
The discussion Of the legal diff
culties the committee faced in con-
sidering the Muscle Shoals situa-
ton, developed after Mr.. Mayo and
Gray Silver. Washington repre-
sentative of the American farm
bureau federation. had presented
three alterations which they said
Mr.. Ford had agreed to make in
his original offer fer the Shoals
projects.
The first alteration provided for
a fixed capitalization of not less
than $10,000,0O0 for the company
Mr.. Ford would create to operate
the Alabama enterprise. The
amendment was suggested by Sec
retary Weeks when he submitted
the bid to congress in order to safe
guard the governments interests
against failure Of the operating
company to carry out the contract
in good faith for the 100 years it
would he effective
Another Amendment.
Another amendment offered by
Mr.. Mayo was a guarantee to man
ufacture commerce. fertilizers"
rather than nitrates and "other
compounds" while the third pro-
posed to give authority to the COM
pany's directing board to regulate
the delivery of the fertilizers direct
from factory to consumer, making
it impossible for intermediary
agents to handle the products and
increase the price to the farmers
above the s per cent profit charged
by the manufacturing company.
These amendments were accept |
ed by the committee although some
members expressed regret that Mr..
Ford had refused to accept a So
year lease and had insisted upon
the 100-1ear clause.
Chairman Kahn and Representa-
tive Miller, republican. Washing
ton, asked Mr.. Mayo If Mr.. Ford
would further modify his offe~,
the provisions requir-
ing the government to give him |
clear titles to the Warrior steam
plant and nitrate No. ? and wheth-
or Mr.. Ford would agree himself |
to adjust the legal isputes over
the rights claimed by the Alabama |
Power company and the Air ~ |
trates corporation, defraying the
expenses as well.
Governments Business.
Mr.. Mayo replied that the lega!
situation was the governments
business and Mr.. Ford would ct |
be willing to pay the costs Of court
trials, He also insisted that the
Warrior plant was essential to the