The Pensacola journal. (Pensacola, Fla.) 1898-1985, 1922-03-08
Doubtful If Government Will Be
Able to Accept Detroit Man.
ufacturer's Offer.
BECAUSE OF CONTRACTS
HELD BY OTHER CONCERNS
Members Express Regret that
Ford Refuses to Accept
Fifty-Year Lease.
fRy rhe AssoeIated Presal


WARRINGTON, March 7.-Chairmar
Kahn OF the house military committee
today told w B. Mayo. chief OF e2gi-
neers for Henry Ford, that It would re,
auiro years TO thresh out existing lega
entanglements and It was doubtful ever
then that the government would be able
TO accept the Detroit manufacturer
proposed contract for purchase and lease
OF the nitrate and power projects q.
Muscle Shoals.
After the committee adjourned, ether
committee members said the legal bar
rlerS to acceptance OF the Ford proposal
appeared inescapable because OF the con-
tracts held by the Alabama Power com
pany and the Air Nitrates corporation,
which. those concerns claim. give them
exclusive rights to purchase the Warrior
steam plant and nitrate plant Nc. ., re-
ypecsively, Both units would be delly-
hied to Mr.. Ford With free titles in The
event his proposal was accepted and
couiG not be freed from the contract
conditions without prolonged litigation
IN the courts
The discussion of the legal difficulties
in the committee IN considering the Mus
Gle Shoals situation developed after Mr..
Mayo and Gray Silver, Washington rep
resontative OF the American Farm Blu
reau Federation, had presented three al
torations which, they said. Mr.. Ford had
agreed to make in his original offer for
the Shoals projects.
The first alteration provides for q
fixed capitalization of not less than s10.-
GEO 900 for tho company Mr.. Ford would
create 10 operate the Alabama enter
prise. The amendment was suggested
by Secretary Weeks when he submitted
the bid to congress, in order to safe
guard the governments interests against
failure Of tho operating company to
carry out the contract in good faith for
tho 100 years II would be effective
Another amendment offered by Mr..
Mayo was a guarantee TO manufacture
Commercial fertilizers" rather than nj
trates and "other compounds" while the
third proposed 70 give authority 20 the
canpany's directing board to regulate
the delivery OF the fertilizers direct from
factory TO consumer, making it iInpossi-
BILE for intermediary agents 20 handle
tho products and increase the price to
the farmers above the s per cent profit
charged By tho manufacturing company.
The amendments were welcomed by
the committee, although some members
expressed regret that Mr.. Ford had re.
fused 70 accept 50-year lease and had
insisted upon the 10O-year clause. Rep
resentative Green, republican, Vermont,
declared ho was strongly opposed to
changing the public policy limiting the
issuance Of leases on public properties
10 so years and said It would be unwise
10 make an exception to it for Mr.. Ford.
Chairman Kahn and Representative
oIiiler republican, Washington, asked
Mr. Mayo II Mr.. Ford would further
slons requiring the government to give
him clear titles to the Warrior steam
plart and nitrate plant No. . and
whether Mr.. Ford would agree himself
10 adjust the legal disputes over the
rights claimed by the Alabama Power
company and the Air Nitrates corpora
tion, dcfraying the litigation expenses as
well.
Mr. Mayo replied in each instance that
the legal situation was the governments
business and Mr.. Ford would not be will
ing 90 pay tho costs OF court trails. lie
also insisted that the Warrior plant was
essential to the plans for Muscle Shoals
dsvslopmcnt that AIR. Ford had in mind.
Mr. Kahn said attorneys for the power
company and tho nitrate corporation has
advised him they would insist that the
government discharge the ohligations II
Lad assumed whes contracts for the
construction OF the two units were exc
Suted with war department. officials ana
options given their clients for exclusive
purchase OF the two plants in the event
,he government ever decided to ser
them. Under their separate vrarnin-s
that they would refuse 10 submit 70 tha
disposition OF the properties to Mr.. Ford
i and would battle for their rights nom
the lowest 70 tho highest courts Mr.
kahn said. he was unable to see how
th& government could enter into me
Agreement proposed by Mr.. Ford "a the
extent OK delivering the PLANTS to him
FOR immediate develcpment or for future
operation. II the courts upheld the now
er company oad nitrate corporation in
this rnal decision.
Mr. Mayo revealed that it was Mr
Fe1dE intcnt1ou q besin WORK Al MaS-
Gle Shoals this summer,