The New York herald., 1922-02-24
MUSCLE SHOALS BID
NETS S5S7,OOO,OOO
U. s. Keeps Title to Property,
Engstrum Explains to
War Secretary.

WASHINGTON. Feb. 23.-Consideration
was given to-day by both the War De-
partment and the House Military Com
inittee to the question of disposing of
the Governments power and nitrate
projects at Muscle Shoals, Ala. to pri-
vate enterprises for completion and op-
Grafton.
At the War Department Secretary
Weeks received the final draft of the
offer made by Frederick +. Engstrum
of Wilmington, N. c. At the Capitol
the Military Committee heard Gray Sill
yer and X. +. Bower, Washington, rep
resentative and assistant respectively, OF
the American Federation of Farm Bu-
reaus, who enthusiastically advocated
the proposal made by Henry Ford for
a 100 year lease and outright purchase
of the Muscle Shoals projects. Only
two requests remained before the COM
mittee tonight FOR hearings on the Ford
bid including that of the Alabama
Power Company.
On the floor of the House to-day Rep
resentative Huddleston (Ala.) declared
80 per cent of the people of Alabama
urged acceptance Of the Ford proposal.
He asserted they would rather see the
Tennessee River go embarrassed than
over the Muscle Shoals property.
The outstanding features of the Eng
strum offer were summarized In
statement addressed to Secretary Weeks
as follows:
"The United States is not divested
Of title to any of it's property. but re-
tains ownership and preserves assets of
approximately $141. 100000.
Returns from investment on basis
of 400, 900 k. W. gross development un-
Ger my lease will pay TO the Govern
ment approximately S3,500.00o a year
for fifty years, or total at compound In
terest OF approximately S537. 1000, 900,
which cash will be used to produce cheap
nitrates for fertilizer, or will be turned
into the Treasury at the option of the
Government. This is a liberal return
for investment OF the Government TO pro-
duce the indicated power.
II propose to devote the entire power
development to the fixation of nitrogen
from the air and to the manufacture of
fertilizers. including the operation of a
research plant for development OF the
improved methods for the reduction or
the cost of producing such nitrates.
"The method proposed to finance by
the sale of excess power the manufac-
ture Of nitrates is the only possible
method by which nitrates can be pro-
duced under present known methods and
sold to the American farmer at a price
less than the Chilean products. The
quantity of nitrates and fertilizers an
nually produced will be limited only by
the amount Of excess power sold and the
price at which the nitrates may be sold"
The proposal omitted any provision
for the immediate construction Of dam
No. 3. but said the operating corporation
Mr.. Engstrum would create would bind
itself to build the dam at any time the
Government might desire during the fifty
year life Of the lease. II was stipulated
the Government should pay the cost
plus per cent. OF the completion of the
Wilson dam. the initial alterations of
nitrate plants and 2 and the completion
Of the locks at the Wilson dam, and,
when it was required by the Government.
the cost Of constructing dam No. 3 and
the locks and additional projects.