The Bismarck Tribune Newspaper, January 10, 1928, Page 7

) EUEBUAY, JANUARY 10, 1928 Ladies and Gentlemen of the Legislative Assembly: You have been called ieee t ion in . order that you may exercise the ai the through the Constitution ore State, tecting‘ certain rights of the Parrett North Dalote aguinst ae mapoeoacis and un- persistent raids made pos beg the scrupulous Politicians aided, apparently b; y sais tory °Nerth Dakota is primarily an agricultuy, state! our cipal product ing hard pring wheeh ‘or @ num st TR the Re perere of this sta! fact if Ne kota is to survive as an te, oer pied industry pid be made fe area ental at in- a chance st least equal to that he ne dustries. There must be 8 rea and more general solutions of a step to force such resdjustments, the voters - orth De adopted several constitutional amendmen givi state a ri rere in suc och eateptae a sald hike bahgieyd fs ultural interests and the interests of our a ple gener: Out of this has grown the state 1 x and niill the Bank Sf North Dakota, the state Bonding Cae, i Compensation, Hail Insurance, and other mea- res. Friends’ Eterpal Vigilance el che More or less compulsory features in ive institutions, with the levator Association act, ineu: % 6 unfair competition; but at every petlrns the piceeepedaned these maceeires, ae paid lobbyists exercising all the tic and nly serial aie ¢] mand in order to influence ‘anes on the part of friends of agit steadfastness of progressive t! some cases, executive veto have Stood sistent raids, and the people's interest. The State Mill and averse, oper on @ com- petitive basis and confronted ith jhe pranltn of ¥ marie ite ial ted oe et and “naa ie opt their special identities, have to repeated attempts at destruction. When fe a that has been said, written, and done the years pines thege state industries comm: ne ting, we can ‘wonder Poni the nie atte ve not com- ee suce thei Two political factions Nate ay - I gerhead ae the of the oie Mill_and The ta 1 pro- ponsored by the ictire te Lage, a fae aeatieeed 5 popular adoption of the necessa phere con ae ‘gmend- nit at ere pied m ine fi cist een he ject seth sos ool “Polen cow caerestions pea Gunpaign spelibinders Sees made litical cate of the State Mill ce Elevater. Great daily newspapers have devoted 5; uence to con- stant attacks on ndasteial enterpees ow by the bearer at and built with the taxpayers’ credi majority of St ar mabenene pe tare eta ot oo! pai » have ut and jen' their influence to of destruc: This publicity, hurtful te these enterprises and damaging te the state as a whole, has been bap en throughout the nation. It has at all times de ed. business at home and beyond the state boundaries. has. come very close to wrecking the export market entirely. ome ie publicit; is been bret the im; ae je audit Ritkatign) wen oe the month ly reports issued e mill and elevator auditor and the eee em. loyed by the Industrial Commission and paid a the mill abeut by partment, there are three separate and complete semi- annual audits. I am delivering to you copies of these ai reports, as well as the report of the Fact Finding Commjt- tee appointed by your senate. A perusal of these will ha ily prove to any fair minded man and bie that bi ing of such conflicting and divergin: ging repert ports can but ts one pl e, —that of destroying the effectiveness of the mill elevator organization. There should be no secrecy in public business, but I ur; t: ly recommend that you enact legislation that will give tl public enterprises at least a measure of the same protection that private capital enjoys, and will at the same time give the people full protecti gaint dishonesty and the per- petuation ad chance var be Management. To make an auditors’ bat our economic «pelitical issues is unsound cor anaretaer ridiculous. To illustrate the auditing situation that the Terminal Ele- vater and eed, Hil must face in its operation, one coneréte exam) * amplesmey pe daily nemapaper + Sd the state, on March 18th, 1935, carried front es to the effect that the State Mill cand Elevator had shown 8 record breaking logs for 4 month of February, 1926. It stated the loss to be $60,318.54 for the month, on‘ the @uthority of evn incu Commis- sion’s auditor. The news not on! wide publicity in this state, but was made a subj ibjicity in other states. It could and did have no other ect pe than to injure the State Mill in the sale of its preducts. Again, on August 21st, 1926, leading newpperiiy ott of the state carried gn a sociated Press news ite: the semi-annual at id and repeating that the State Mill aa Elevator had ace record Joss of $50,312.54 during the month of Febraar. 1926. However, later, after the damaging effects of thi publicity had been existent for some ten months, the Tapert of the audit for the year 1926 by the audjtor for the In- dustria] Commission, as published in the newspapers on Jan- uary 2ist, 1927, showed that in fact the loss of the State Mill and Elevator ee ey ey atten ry, 1 st Te net .54, but only » lucting for jnterest and depreciation. mere misters ‘was made in the February and ka hich» was later corrected, the State Mill and Elevator was made the subject hi very damaging and detrimental news in jts business opeya- ‘ions. State Pays“Interest Regularly ° For the conétruction of the State Mill and Terminal Eleva- tor eae, faraithes as you pil ro th mee Jf tadaiong gum and for of the in the = ot eS s. he iatere waren! thee onde regularly every year by state. es chi arged on the construction bonds js Beste per cent, ani colisiing bonds 5% per cent. fifst it m these bonds, $250,000, becomes due July 1, 1928. on cost the state $3,052,034.40. The s ps $3,000,- bs furnjshed by. ba Depots: was pala by a lean sate irom the Bank of Dakota, apen wi the State ay ond edgar rd Svat ior he out of its re tarts Phone mes year, the paid ill! has had the interest won such } char 7 he ennial interest cherge aie unt to Toes.bao tt est cl ; ny rel agaiaat ao ar eee a seu sites, is rs 10. m is means, on a ign ioe of ou egch year, an we I sualen to rh thi, the eae iy Fadl with e plant ie nonlyg the rate of og i. means, on 8 fis See ent oe yor Napeil od boa meio ii ota ee etal aha re Sorin a 8 dding By alent reciation charged up to fe Deeba 31, to to $856 300.40 Although such, dey eareclatiie is has be charged by tors as the plants fe ions have been ‘made in interest iM, nace “bas 31, 1987 = wy I for THE BISM. oe devedatiea charges,'to which I oe the actual operat- x interest “eee 7, oF ae sagen an actual 100,200 nie tga ate 206. fer 81, Seas ce the mpbeatiba of the pilent, sant theres Operating’ pretite iguresGiaay that the plant at hae the Gach = ’ 247,682.84 or pr y in its possess: ' sae = that during my 6 my eiministatl of an Saat capital, or ieee sy tte more q gt o4 Pay Something oe on ew, with your eee ta ple com i ay je made to pay ou! epee pad ner tea: something upon the bonds, issued by chgitg state ev a excees debt created in the construction of the eat above the amount of the construction bon Se Mat $160,206.57 can now peid out of the earnings the plant, without impairing the efficient hed of the ot, t & needed working capital. I carbene that hs slgtive assembly confirm Chapter a 1, Mans of 194 9, and Section Section nx of C a Pog seem to provide a eat oe ee justrial je em sha out of the earnings trea’ ition i ae Elevator Association, spay, to Mkts tate - hm ORAyS a8 the Commissi available 0 t pose of paying said fe‘and interest oo the and Elevator bonds), the law tina at: “In THaLing such payment the i Sartcan with the State Treagurer 6] are me {b0,000 in excess of the smount of the con, was spent in building the p! it the excess oe t mene fitgt m pajd and the tolance out of the $160, applied in ent upon Bes principal of the bonds maturing Julv 1, 1998. I betots mea check for $160,206.57 issued by Mr. the 4 ane aes en Tesgaingl ph as and bs id le r) ‘reasurer for the purpose of carryin, my engevetion. T request your concurrence’ in my Ting OnE BY Fact_Finding Committee to look into matters pertaining e the Terminal Elevator and Mill. This committee held va- rious meetin: at ng the course of the session and made various repofts relative to the business of the plant dur- i the year 1926, but made no reference to any other year. 0 At the ase legislative assembly the Senate a) create report made ‘to the Senate was adopted and publ ener repost of-the committee was also published, and ery ite voted to continue the committee for the purpose by having it report at the next session. Administrative Changes Are Made Last spring another report was made by this committee and communicated to me, and I was informed by the cam- mittee that the report was not for publication but was ~ constructive criticism, Upon the receipt of this r made some investigation into the matters contained in tne report and also made — administrative chanies ia the operation of the plant. Last Sagat the committee made Cate! teport, after some investigation at Grand Forks, which was made public. This showed it to be the intent Bed committee to afford constructive criticism regarding ths oh siete of the plant, and not any purpose of injuring e The two reports communicated to me, as well as the last Tepo of the committee, which was porns, have not as x gy tg considered or acted upon by the Senate or the ing nied *asagai rs blighed fi thy tha: ese were pul or no other e in te, injre the Blank in ie ae leee and, in ada ada ition, 2 affoy litical background for criticizing my ers my adi arte istration of the plant. The publication of ae eithe ro bee a directly seated, implying ‘musmanage’ r or indi iy 1» ment of the plant, and even actual dishonesty. The public- ity has, in a manner at at affected not only the ¢tand- ing, honesty and integrity oe ns in charge of operating the plant, are anh administration as well. Session Called to Consider Reports The only courses open to me of responding to such publicity Controversy: or fo Being sauhect matter, bate s thy bagi ont ys or to bring subject matters before ° lative Assembly which had created the Fact Findis ° mittee. I chose the latter course, and this Special sien has gen called for the purpose of fully considering de 5 its report, the Fact Lin Committee touched upon three Fe car oF criticism: rehaees of wheat from commission houses (2) Sale of fica into eastern test d 5 jour into eastern territory, an (3) Feed Sales. T have given attention to the investigation of these mat teys and am ready to submit to this hora body of ven ffey and others covering each of the matters, as well ap other matters affecting the Peal h of the plant. The Terminal Elevator and State Mill is a large, modern institution that must handle our grain and the flour manufac- tured from our grain in competition with similar inatitu- tions, located in other states, philing the grain of our Dro ducers. Our institution is confronted with the seme lems that similar institutions in other states find ai ing them. This includes not only questions poe the ability to get the right kind of grain for milling, wi is the big problem of others, but in addition, ours pre solve the question of serving our praduesre fy oe a particular market for a particular high quality of grain tl is produced in North ta, and algo to seeure for this grain in the markets of this country, the reco; ognition to =n it is entitled as a superfor quality of hard spring from which the best grade of bread making flour is “An inwentigaton covering purchases of ile or sales ts manufactured from sych grajn, must ; sarily include considerations of the husiness methods custom. of arily practiced by similar institutions in the mar our country, in order to understand what are usually con- B: red efficient and businesslike methods for the suecess- tion of a large plant like the State Mill and Termi- rey nal Blev ar in order to operate the plant at anywhere near its capacity. & When the operation of the Terminal Elevator and State Mil] was commenced, a condition was faced where producers of oyr grain in this state were handling or marketing it through well established channels. This was. through the means of clevators, farmers elevators, or 60-termed “line. eleva- toys,” commission houses in a foreign state that financed these elevators in handling grajn, and other commiapion houses jn other states that p sed grain from these elevators, or fag it for them on foreign markets, such as homme Protein Is Establi Prier to the the artebhonreent of of the Terminal elevator and mall a “8 Grand Pipi) Ka i olen ‘were eld by our rain. Ow. putchapers & ree rae pods he a protein in their a yy we know that the grain of our producers, in me eetaring fleus, js bought and sold almost exclusively basis of protein content. We know, also, that :jn facturing flour from our wheat it is not iy nacesiary & a at ee chased Sige ie locali- ties, i or ib alaned to Pate ce its 60 that spall snes tes i atone f pat appli Me trans- the flour after it is manufactur: will give your attention to the ti sar Bente ‘plant at, Grand Forkp on find, T think, that when wma f sa ahead rae on =i a omm| Soper Coorg the Ste cae ? rw het ; Ie f01 me ari be araiabe if iit fart or ae 8 a for our praduycers mi of west to Polini to re ae it was nat se Incl’ rea ee ote len ok commission nee a vib dually te Wd is Wate. Paap - ag ‘ind, tere, ot bo) 2 bat plant iy cate ange vet sttamapth ‘1 po st ry ier Etae baal an be re t ia te pr Being Ne and wl ‘that this sole on rk: to sight ten baal cf bo 2 valle te sent ate te re tarminal au aye ee apele ot £4 i pee “ctianal the state, or to com- oH 34 cane oul ida at ‘ar it Jocal eleva wipe series do business wi’ our eine ina sufficiently lapge volt yee te furnish Ng wheat needed by cur State Mil s 7 het the Mill must. st ly, purchase frem Mon! ontang in cart Ki t larly me arthee ot fralen or, Kk aeeeh of relight ¢ hu reigh| repared an 6 ubmait to Legh a Fane fre ‘our f present wast buyer showing the amount of urchased from our prodycers, Sea elovatre and other phe this state, or outelde the stat font este in eabtern oo tery, I y Kinky eae of that such ‘ wore fet ot oni le at st log “4p then prevailing in the east, but in man: fae at Bigiee, merket price then tavalled ia iu at you give consi ation te satarn oa e years as well as east- bass * i iia your attention to the ie at ih is pa ea ee exclusive! hard § saa Eve cae: 4 now eo Teal ui ea a recast ich is its ae or Saar au tte ne com: mand an ist Taher, vee as compared hh patent flout a ™ iderable “aie aaa Be saad faode trom North De- C the matter of feed sales I am prepayed to fur- nish evidence ety tl of fed the feed fice ‘at made, snd a5 ceeee, et ‘usual basis followed by other sats Rag etal Sie ae pre jen of the fe tepizain Cadi a beatae to feed a8 well as other years. ‘oncerning Porcher sored of wheat made in 1096 by the ies Sore eat bi ¥ fural at aa under 6 content tet cond ine exiting 108 Saad to flour. me To ee atten the same time to pyrchases LL in re yar " al I as in the year 19! in Committee Ip Criticized I make no criticism of ‘the Fact Hipente Aes, The members of oe com ae acted and for se purpose of h jording comptractie re means of invest SFeelon cose te dl limited, becaure ti 4 had little me eer ee furnighed no ison moneys by ¢ Legislative Agsembly. 7 received “ wi bed informa- tioy 4 what might Fried “a one-sided source. or tal he te institution ml our well as rite maton rd eal of Ace in nH Aptnsates te other in inde g e of ins which - a vipmede st the depraned cn ‘condi tion of agti- culture, and nded of the lowes ible eM ae to be applied ee sporting farm jucts. Interstate Commerce Commission is now conta ne * § a snarl eee tion of f it far. ‘upon agricultural Product H nor eet this ‘state I have taken part i this Svestigetien have propesed to the Interstate Commerce Commission, oa am seeking to secure leper tae freight retes for our farmers on their grain from their fields of ie etton to the markets and fields of cones ption. I am also trying to secure transit privi chi are in, just as the ears and other mills our state vibe joy, 80 that on North Dakota grain on mipriata and mills can cmane mith merkets and ole outside the state, on @ basis of equality. I am also seeking to s jor rmgen s of cleaned, or staged no i gee aie Be S poalig for os doing. We ha Irony. che shewn in I this heoving ¢ ore Inter- state Gommeres ission thet our people are shi out of Pe state every ee Toone mill we to pay the frei ht ay race no Bey. te more then 460,00 yo Poa mals our rete ie ‘te macs to our stock, hogs ante iy com investigation a have asked for a break in frei a rates within our state, and for propertional rates within state for our at A ite ste oq Minespe jis and Dutath enjoy on rem fe no respon why the -é le et our state bh shot fnot 1 have at least a ager the Peis of ity, to handle our own products. T think we aré ott to lower and better freight rates. I think that the Commission, in the inveniiaeon ao pending, will récognize that wo are entitled to have State Should Here J Its syd a Ladaatries There is no reason why this Id not build up within its borders industries Piaitty of handling, merket- ing and manufacturing our own products. There 5 no rea- industries outside our state should son why markets ai to rode market and manufacture continue orien all of our All of our c! Atigeny, 8 tand unjted in the demand that our pi ince: ae citizens, ‘and on Cities be given at least a onal “ne le a 192 the ple of pos those ssed by those without our « Wil Watt, 2 a rember cf this Assembly, presented passration | in this fare investigation Comm conditions ba 14 like to have every member of it i ie Bro ser bly vous Mr. Watt's testimony. as I have Fopeatediy stated, I em; Metis “that our. aq, Sande in 8 class by itself, particularly our wheat of Hguier Pare, variety. It is of particularly high qual- ity ons entit! o @ higher price wherever it may be mare! make it 1a) d nie am realm vhs ae erat ANd ad worth more because of such quality. t i Em thi: thet eae i. Eh se its feces ee em its a mF eigter state of cakaae. ane produces high nin frome, the esi perry but our q Saaeeee end belisve cytes yiise, ses ye to the Bi oy of their ein cinta a fvight rates on it for 5 we Built, or > ft homme,” They bavwe fought for and sectred on thei For et years it ha less to transpor! it, oF to the east coast, oF the than North D in soa fame market. lis and handle nd ges ove over the to give its or of its revenues. All of the vital necessity of our problems and to do it at once. ceyned, interested and for us to cooperste in a sat ey Agencies, but with all a betas and the eitizens of our State ” our pea As a result of Interstate Comm State is more vita: Commission and before our own road Commission, it hes been shown that our State produces figs percentage of the in the United States. state is e re. large percentage of the grain predui Quy elevator ifapacity in the local elevators of limited as well as storage capacity upon our farms. sult is that over 50% of our grain production must be ge lines to Pipa fo New Grleane end tnter 0 New Orleans ai mar) & ir the ¥ det! 1 Government. ig pet arin te attention to our par gee ly cons han we are. It is now time arias nat oy, with Federal imony we have given in biereeny cast oeerbatt at once by the railways as soon as threshing time occurs. As sqon as reshing time comes, strings of cars are sgsembled by the railways eo that shipping of wheat can ivi at once and the grain be carried to outside terminals, almost always with dirt and dockage in it, and this in order that the local ejevators can keep on functioning and remain open for See, n The consequence is that a tremendous quantity of grain goes in # short time to outside terminals, creating conditjons of congestion not only on the railways but in serve to have no Meee qutside terminals. This at fect than to tend to lower the price of the grain on account of such congestion. Not only that, but grain that stores in lotal elevators as well as grain that he shipped out, the great majority of actual load of actual wheat at outside terminals. Grand Forks Terminal Elevator Helps farmer all is all thus increasing the The Terminal Elevator of the state at Grand Forks and the market there has sided as it could in this movement. fully equinned terminal and market there exists. Our producer or shipper can have his grain graded, tested for protein, dried. or sto} clgane ed; he can offer it for sale there, of course, if it be unloaded There: the producer or Senet, must pay a tran. apolis or Duluth. This penalty we expect it It; harge that he does not have to at Minne- : ‘ives ‘Duluth. TI ? t to pt removed in the case now pending. Our producer or shipper, however, if he sells a bis. grein at our Terminal is not penalized. does not sell it there and wants to ship it f If ind either to eg eee or pul el he may do so by diversion ‘without tra cl fereeery, courpe, ] higited i teaches backwards be 2H ner had of the state for the major part. Yet Te inal vipbeanrypat PE et eet but see at ‘dine wes os congertion mane only at our it our Terminal may hes * ue Ferminal has fod as much as 1500 car loads of grain in onth. Its ca: oa ti thts fall there were Pt00 to 600 carloads o! the railways back in North Dakota a to our Terminal. We have no trouble in grain at the capacity of our Federa! warehou tuillion_ bushels, another million bu mill, Farmers’ ahs ators are now us: tent the same oe ity at our Te: able is all her rroeotel to tal and this hee happened is required e Terminal. We can unload 144 carloads per but our storage capacity is limited for private storage. which is eae one for the considerable ex- the amount avail- re of the demands. even though the shipper is penal pacity, of course, is limited. At @rain on awaiting tranoporiation “Rs for storing his grain at our Terminal be aomnse we abserb of this penalty if such shipper stores hi veep with m4 iven length of time. The point of all this is, thet there Piety bie linea Parket for our produ ans vind to the source of t is grain and gives to him a chance to market his home or at other markets without additional Sale ora cl basis of its protein value to to store the actual grain at home on the content. The terminal has already ee its the nanelive tas Railway handicaps in rates production. It not only serves the home, but nae 8 ribs him an additional merket at rove to him at home 2 knowledge of the grade and at ance its activities. lack of more storage “capi int pag xtent of its operations. But the need and val inal facilities wit! Already statements, and promises have in the State has Licuy diet Setar ragi m mi railway bestictes bé removed on the handling of grain mee in our state, ussell-M: fore the Interstate Commerce Commission in the hi T have mentioned, that if certain railway handicaps itional tesminal elevators will be built id dice Be ital within our state. Mr. Helm, President of the Siler Milling Company, stated in his Krebs ded t. have asked to be removed, be removed, that he would make a promise to open up again Flour Mills in the state that have been closed. ees Terminal Elevator at Fargo T have gone int Into’ ito this matter at some length for the of additional terminal st of storing our grain st. the pro ety now of of showing the necessi this state and the necess: stead of in other states a1 ing to your earnest consideration t! home i e erection of a terminal elevator at Fargo that wad serve and can serve the balance of our state not now se ved by the Terminal at Grand Forks. Before the Interstate Commerce Commission it was shown that if there were facilities at Fargo to create s terminal market t Provide facil: that the stete was entitled to it. If we can ® market could be established there and the vias. on grain adjusted the same as they will be at Grand oe first au eeHen to be asked after this statement is: How much would thi a statement dd to taxation on North Dakota farms? In mitted by the State Tax Commissioner, it is shown that the average assessed net valuation of s quarter section farm in North Dakota is $2,882.00. This statement shows fe that the Mill and Elevator at Grand Forks cost: nd one-half million dollars. This has cost the owner f rter section farm in this state for the six since the construct Stil and Blevater, fifey= since the cons: ion of the State M two cents each ier ego or about tate Me att per bushel on a huadred bushel This covers the ill] and Elevater at Grand Forks. The project at Fargo would cost not to exceed one-fourth of the present Mill a Elevator. The people in the southern half of the state are entitled to just — eed marketirig facilities as ee people in the northern hal upqupetionsbly, with such a market established at ie oe Peo le in the grain business ond themselves buil He emety ample to take care of everything coming in over jorthern Pacific Rajlroad. ats the new misled used in Harring At marketing faciliti ge machinery, such es the combines has become necessary to have terminal jes closer to the producer. The grain harvest- this method is very often ‘wet and damp ae was ~~ ie Stand shi ing for any dinance nor storing for an: hou roperly dried. The terminal faci! (a 0 would be the grain people buil ry time witho Grand Forks aa such grain, and wit! ane 7] - sufficient to take care of their storage facilities, we would be in @ position to market our grain in an orderly way. We have e levator capacity back in the state for about thirty-seven million basbels of grain, and the farmers have With the added fac assured of put way so that it the millers could be sure of getting our hard spring and algo assure us of getting the premium on our which we are Tighetally entitfed. 0 Marketin, Combines We must bear in mind years that we in North Dakota have about marketing our own grain. There are nee outside our state who pee most eat so-called industrial program ‘S - Nev Dakota in recent years. The pu has been on this year and in pr see by the farmers nd reasons (aie ‘mies pon gloat fa! Tepe set ty ae ees ci eral Paul cy, ian the Pmt made by the a Waging fio in 1028, it is on i, very Fao to shy