The Birmingham age-herald., 1922-02-03

HAM AGE-HERALD, F five hundred thirty-seven dollars (s39,53T, to retire, during the re- maining period of ninety-four (94) years, the total cost of the Wilson dam and it's power house. substruc- lures, superstructures machinery and appliances. including locks, all taken at forty million dollars (S40, ,O0O) i; the sinking fund investments to bear the highest rate of interest obtain able. but not less than 1 per cent (4 per cent) per annum.'
 The other paragraph was No. [ and reads as follows;
 At the beginning of the fourth 64th) year of the lease period, and annually thereafter. the company will pay to the United States sum not greater than seven thousand, ten dollars (s7010), to retire during the remaining period of ninety seven (97) years the total cost of dam No. 3 and its power house, substructure, super structures, machinery and appliances. including lock, all taken at eight million dollars ($S.000,0OO); the sink ing fund investments to bear the but not less than four per cent (4 per cenD per annum.
 Tn the present proposal the subject of amortization is covered in one paragraph, numbered 10, which reads as follows:
 Amortization Proposal
 For the purpose of enabling the government to create and provide a sinking fund to retire the cost of dam No. at the end of 100 years, the company will. at the beginning of the fourth year of the lease period and semi-annually thereafter for the remaining term of the lease, pay to the United States government the sum of $3.505. and for the purpose of en- abling the government to create and provide a sinking fund to retire the cost of dam No. at the end of 100 years, the company will at the be- ginning of the seventh year of the thereafter for the remaining term of the lease, pay to the United States government the sum of $t9,S68.
 Tt will be observed that the pro vision for amortization in the last proposal is very much more favorable to the United States than it was in the offer of July s, 1921. By the earlier proposal the maximum amount which the government could realize from the payments made by MT. Ford at the end of the lease periods would be not to exceed S4S.000,000 ($40,000, 000 in the case of dam No. 2 and $S,000, 900 In the case of dam No. 3. The an- nual payments were in no case to ex- ceed the amounts stipulated, which are the same as in the present pro- posal as in the former proposal, but the former proposal contemplated d reduction in amount of 10 payments to correspond to the excess over ger cent interest which might ba earned by the sinking fund, whereas under the present proposal the an uual installment for amortization IS to be paid regardless of the rate of interest earned by the fund There fore. if the United States should be able to invest the money at a higher rate of interest than 4 per cent the sinking fund at the end of the lease periods would amount to very much more than S4S.0O0,000."
 Means New Appropriations
 Tn the event MT. Ford's proposal is accepted. the governmen must make new appropriations amounting to S40,00000 to S50,000, 900, of which Mir. Ford will have the benefit for ap- pToximately 100 years at four per cent. The company is, of course, bound to keep nitrate plant No. in condition to produce explosives, W Which, as matter of preparedness is of great value to the government, as, no doubt, plant fully organized and in production would be available far sooner than one maintained mere ly in standby. Nevertheless MT. Ford is offering but $5,000,0OO for the titlt tIra vAla ha quarry, the Gorgas- Warrior steam plant, transmission lines and appur- tenances That you may the better understand the value of the property for which Mir. Ford is offering this S5, ,000, 900 l am attaching to this let ter, as exhibit "A" a brief statement prepared by the chief of ordnance showing the cost and estimated salv- age value of these properties. From the table contained Tn this statement it will be seen that these properties cost the United States approximately SS5,000,o0 and that as scrap they are estimated to be worth SS,S12,OOO However, the last column of the table in exhibit "A" indicates that the chief of ordnance believes the war depart ment can dispose of the property for $16,272,O00. Mir. Ford is bound by his
 
 but there is no legal obstacle to prevent his disposlng of the other properties to which he gets title, Should he be able to obtain what the chief of ordnance estimates that the government can secure for the va rious items, namely, $3,0O0,0O0 for the Warrior plants which have an install lation of 10000 horsepower, and $500, 900 for nitrate plant No. 1, and dispose of the Warrior Muscle Shoals transmission lines as transmission line and not as scrap, for s67o,000, and should he obtain S357,O0O for the Waco quarry, he would have left the nitrate plant No. with its SOOuO horsepower steam plant at cost to him of less than $4o0.o00. The in- terest on the proceeds of such pos sible sales would amount to very large sum during the term of the proposed contract. The present reve- nue from rental of the power plant at nitrate plant No. 3 is minimum or $12O,000 per annum, with possibii- ity that in event of operation, 1t may lun to s260,000. The cost of nam
 tenance of nitrate plant No. was approximately S20O.00o during the fis- cal year 1921. The total horsepower
 developed by the three steam plants to which MT. Ford will get title, IS 125, 900, which practically doubles the all-season or primary horsepower to
 be delivered at dam No. ?, tapproxi- mately 500,000 of the horsepower that is to be developed at dam No. Will not be available 365 days in the year)."
 | ADJUSTMENTS