, 1925-01-15

$50
have been met at maturity. The
whole state has been benefited. AT
the same time the Farm Loan
Board has been guided by sound bus.
mess principles in the granting of
all loans; so tina out of $40 now
outstanding. there are not more than
twenty delinquent. Under the pres.
ent careful policy, these loans con.
stitute a safe investment for the
state.
The demand for loans under this
law has been so great that the en-.
tire appropriation has been exhaust
ed. and the applications which con-
tlnue to be received Indicate that a
much larger sun may be probably
used for this purpose. The state
cannot afford to abandon this policy
Of relief. The agricultural and live.
stock interests have constituted the
very backbone OF our state, and to
fail at this time of depression TO ex-
tend to them all possible assistance,
would be to ignore a moral obliga-
ton and at the same time TO com.
NIT a serious economic mistake.
1t has been held that the farm
loan appropriation does not now
constitute a revolving fund. I rec.
ommend that $500. 100000 be added
to the investment already made un-
der this act, and that the fund be
made revolving.
State OIL Royalties.
II is fortunate that the state has
available from It's mineral lands the
I mnnaNr fNNtf wrLf1A - 1T
public service. The permanent school
fund is larger than ever before, but
In this connection. It is only proper
TO point out that there has been
some decrease in the annual revenue
owing TO the falling off of produc.
ton in the light oil fields. which
have heretofore been the principal.
II not the only source of production
In the state. On the other hand. un.
less the oil output falls off excessive.
ly, the income from this source
ought to show another increase dur
ing the present biennium. owing to
n substantial increase of the rate of
royalty exacted during this admin.
istration in certain leases. particu.
larly on the OUTPUT of section Sc in
the Salt renk field. When this tract
vas leased for five-year period, be.
ginning October l, 1919 and ending
September 81, 1924, and royalty ac.
cruing to the state was fixed at 80
i-3 per cent. The new lease, execut.
ed in 1928 for the five.year period be.
ginning October /, 1924. Increased
this royalty to 65 per cent. AS
Stunning that the production during
this first year OF the new lease will
be as large as It was during the last
year Of the old lease, the income
to the state from this tract alone
will. II is estimated. be approximate.
~ $500 900 900 greater than under
tho old contract. During the fun
term Of the new lease. there would
on this basis. be n net increase of
the states income from this source
alone of two and a half million dol
lars. The terms OF the new contract
providing for the sale OF the states
royalty oil at a minimum Of $3.50
per barrel. guarantee the state
against loss from reduction in tho
price Of oil. Even though the pro.
Lduotion from this tract should he
materially reduced during the com.
us ave tAA lit NtIftlH OF the new
contract are so much more advan-
tageous than those of the old, that
this income is almost certain to be
greater than ever before.
In like nj the royalty on
some Of the state oil lands in the
Grass Creek field was increased dur.
ing this administration from % per
cent to 40 per cent.
The Importance to the state of
this revenue suggests at once the
reasonnbleneas OF the recommend
ton which has been made by the
Commissioner Of Public Lands that
his office be enabled by proper an
preparation to employ three oil and
gas gaugers for the three large
fields. whose duty II should be to
Keep accurate check upon the pro
duction Of the states oil lands.
Black on Investigations. :
In this connection. ] would point
out, that while The income Of the
state from It's light oil fields las
probably now reached its peak. the
future holds bright prospects for
revenue from the eventual develop.
ment Of the heavy or black oil areas.
At the present time there Is little or
no market for Wyoming black oil.
and. as n consequences, yields known
to contain 1t are not being drilled
II this development could be encour.
aged the state would reap enor,
nous advantage. This would come
not only indirectly, from the expan
sion OF tho oil industry. but directly
in royalties.
II is my opinion that an investi-
CATION should be authorized by a
n~on-salarled commission. TO be ap.
pointed by the governor. for the pur-
pose OF determining what. II any.
thing. the state may do TO open a
market for this product. Some feas.
bic way might be found, for ex.
ample, to use the asphalt from wy.
oning oils on the state Highways.
We have developed a splendid sys-
tenn of roads and have been enabled
TO do so In large measure by the
Income from u oil lands. Our
roads would DO further improved
and the income increased. II It were
found practicable to use our own
black oil In their construction.
School Amendment.
Perhaps, one OF the most import
ant subjects which viii engross your
attention Is that which concerns the
exercise OF the power vested In the
legislature at the last election by the