The Daily Alaska empire Newspaper, December 8, 1934, Page 1

THE DAILY A VOL. XLV., NO. 6826. ASKA EMPIRE “ALL THE NEWS ALL THE TIME” UNEAU, ALASKA, SATURDAY, DECEMBER 8, 1934. FRANCE TAKES ST METZGAR GIVES MINE'S REPLY IN TAX ARGUMENT Complete Text of A. J. Letter Read at Coun- cil Meeting L. H. Metzgar, General Superin- tendent of the Alaska Juneau Gold Mining Company, presented his re- ply to the tax exemption question raised by James Wickersham for- mer Delegate to Congres from Al- aska, at the regular meeting of | the City Council last night. Wickersham, in a letter to the Mayor and City Council dated November 5, protested the tax agreement made between the City of Juneau and the mine corpora- ‘ion in 1913. Complete Text The complete text of Mr. Metz- gar's reply follows: “This will acknowledge the letter of November 5 from the Honorable James Wickersham, referring to the matter of tax exemption for a certain part of the Alaska Juneau millimg plant, which you have re- ferred to me for answer and com- ment,. “The tax agreement of March 7,| 1913, was a mutual agreement by | which the City of Juneau stood to | lose nothing and to gain much, andl by which the Alaska Juneau Gold | Mining Company effected some! saving by having the mill some-§ what closer to the mine than would | have been the case had the mill been built outside the city limits. | The Mayor and the City Council | were of the opinion that it would be good business for the city to gain the services that the company would be able to give and further, that there would be an advantage to the ecity in having the plant built close in, where all the services to employees could be supplied by the several business houses already established in the city. Loss to Business “If the mill had been built farth- er out, the company would un- doubtedly have established board- ing houses, commissaries and dwell- | ings. When the Alaska Juneau planned the erection of a milling plant it was entirely practicable for them to build this plant on ground already owned outside the city lim- its. If a tax exemption was grant- ed, it was planned to build this mill partly in the city limits. Under the circumstances, the city lost nothing in tax revenue when it made the agreement of March 7, 1913. “Had the tax agreement not been entered into, the mill would have been built outside the city limits and while the services, which were offred by the company and ac- cepted by the ecity, might have been furnished in any event, it would have been on quite a dif- ferent basis. The city gained at no cost to the taxpayers, services worth many times the amount any taxes would have been. “The two principal direct serv- ices were to furnish water for fire protection, and tailings for filling the streets. Fire Aid Given “The water service consists of an adequate supply of water for fire fighting purposes at all times. In the summer time this water is furnished from the flow of water held under company water rights on Gold Creek; and in the winter time it is water purchased from the Alaska Electric Light and Pow- er Company and salt water from the pumping plant in the com- pany’s power, plant. The city fire protection water supply pipe is not connected below and beyond the Alaska Juneau system, but is con- nected direct to the main on Al- aska Juneau property and is a part Kills Man, Goes to Show to Think it Over, Returnsto | Her Home, Summons Police PETALUMA, Cal, Dec. 8—The |went to a show “to think it over.” bullet pierced body of William She returned home after the mati- Kessler, of Oakland, was found in |nee yesterday afternoon and then 2 quiet farm house near here last | summoned the police. night. Chief Peters said she shot Kess- Chief of Police Robert Peters said | ler because he threatened to leave Mrs. Edith Wagner, aged 60 years, \ her and return to his estranged confessed she shot Kessler, thcn\wue in Oakland. service, but what it would cost the misunderstanding of the facts. city to duplicate and maintain it. “The company pays to the Ter- . ritory of Alaska a substantial Company May Retract |amount annually in taxes and the “Should the Council propose o Territory in turn assists the City ask the company to surrender its of Juneau in the upkeep of its rights under the contract, they in schools. The company pays to the turn must offer fo surrender the Federal Government a very large jcity’s rights under the same con- amount annually in taxes and the jtract. This the Council could not City of Juneau in turn has re- afford to do, for it would involve ceived from the Federal Govern- the abandonment of what is now ment large amounts of money (in generally refered to as the city’s | proportion to its population) for salt water system, to say nothing|the betterment of the city streets, *Y_UUNG TEACHER | Post Believed to Have Broken A AT FORT YUKON TAKES OWN LIFE MEMBER OF ASSOCIATED PRESS PRICE TEN CENTS D FOR YUGOSLAVIA Juneau Friends of Gertrud Keturi Shocked at News of Suicide Gertrude Keturi, 22-year-old pri- mary teacher in the Territorial School at Fort Yukon, committed’ suicide Friday morning, according to word received this morning at the office of A. E. Karnes, Terri- torial Commission . of Education, from Anna Hughes, Principal of {the Fort Yukon school. The radio message stated that the reason for the tragedy was unknown and that she would send details by letter. Miss Keturi came to Juneau last spring with Miss Lovetta Gusky, from San Jose about the other rights under the contract. The installation of this system was immediately followed by a reduction in insurance rates; its abandonment would immediate- ly be followed by an advance in insurance rates. The amount which the taxpayers save on insurance premiums, is many times as great as the amount which the city could possibly collect from the Al- aska Juneau in taxes. ' Would it not be folly to relieve the tax- payers of a portion of their tax burden; and by the same act, to place upon them an insurance bur- den of far greater proportions? And what City Council would assume the responsibility of deliberately subjecting the City to this in- creased and unnecessary fire haz- ard? “At the time the agreeme: made it was becoming evident that something more substantial in use, fire engines and take care of auto- mobile traffic which was rapidly developing. It was apparent to the than the piling and plank streets, then would be necessary to carry million dollars w. lete. “Thus, it will be seen that while these taxes depend on profits and are indirect, nevertheless the City of Juneau derives a very substantial benefit from the taxes paid by the company. “Lucky” Phrase Hit “The most casual krowledge of Alaska Juneau operations which may be obtained from the com- pany's reporfts, from the public daily press, and from technical journals, shows that the company is not a lucky and wealthy cor- poration. “From the time the mill was built until late in 1927, no profit whatver was made. In fact, an in- debtedness of some three million /dollars was accumulated. This three million dollars was advanced AL Was|py the non-resident officials and |stockholders in an attempt to keep ithe enterprise from being a fail- ure. A large portion of this three as spent in Juneau for wages. “After the profits began Ir 1527, fellow graduate Teachers College in California, and during the summer the young woms- en were employed here in the Juneau Ice Cream Parlor. Both were highly recommended as teach- ers by the college and by Lester D. Henderson, former Territorial Com- | missionr of Education. Miss Gusky was given a teaching position at Bethel. Miss Keturi, who received her AB. degree in education in 1933, spent her early girlhood in Flat, Alaska, where she lived.until she completed her grammar school edu- cation. Her father, Oscar Keturi and an uncle, Gus Notila, are still engaged in placer mining near that community. She attended Broad- way High School .in Seattle and the High School of Commeree in Detroit, Mich., before attending college. Friends of the fou:aer teacher in Juneau were at a loss to account for her taking her life as she seemed of a happy temperament and was delighted to return to Alaska when she received her posi- tion with the Territorial Schools in the air 2 hours and 26 minutes. Donati, of Italy. Post will send his baragraphs to Washington for calibration. The present record is 47,352.2 fe 1 Wiley Post, (inset above) world flier, and recently in Juneau, made his second hop into the strato- sphere yesterday in his remodeled monoplane Winnic Mae (above) and when he landed at Bartels- ville, Oklahoma, he stated he believed he had set a new altitude record arcund 55,000 feet. Post was ¢t which is held by Lieut. Renato COUNCIL HOLDS Foreign Credits Seized LONG BUSINESS MEETING FRIDAY Ten Major Items Consid-| ered by City Fathers | in Session 1 Italy Makes Move to Stop Gold Flow—Order Is Given Citizens i | ROME, Dec. 8—Forcible conver- sion of all foreign credits held by | Considering ten major items of | citizens has been ordered by the; business, the City Council met at|Cabinet in a final attempt to halt ity Hall last night for a regular|the gold hemorrhage from the .eiling. Al Councilmen and May-|Bank of Italy. or Isadore Goldstein were present.| All citizens have been ordered | More than three hours were re-|to turn over to the National Insn—; quired to dispense with the many | tute, for foreign exchange, all subjects presented for Council ac- | foreign credits for which they will' tion. | be given lira at the current rate City Council that the filling of it took until December 1930 to pay the streets was imperative. Where off this accumulated indebtedness to obtain cheaply, the necessary of three million dollars. At the be- material for filling was soon to be | 8inRIng of 1927, with an accumu- a matter of importance the city. lated indebtedness of over three last September. She left Juneau for Skagway and made the trip to Fort Yukon down the Yukon River from Whitehorse. Most important of the various items was the tax exemption pro-| test filed by James Wickersham, | !former Delegate to Congress from: Alaska, against the Alaska Juneau | of exchange, The Institute then| can use the foreign credits instead | of gold to pay for imports. | .- v million dollars, it seemed doubtful Neel Fill Material |if the enterprise could survive. The |mill at that time was as much of |a liability as an asset. Only by |the strictest ecomomy, up to and since that time, has the enter- \prise been able to operate at a |profit. The tax exemption was not, nor has it ever been, entire. | Profits Not Large | “At no time have the profits, as compared to investment, been huge, |nor even out of proportion with a |reasonable return on the invest- |ment. The dividends do not all go to large stockholders in New York or elsewhere. There are about 3,000 {small stockholders living in various |parts of the United States. “During the period January 1, {1915, to November 1, 1934, the Al- |aska Juneau has paid $17,000,000 in wages to employees living in the City of Juneau. Most of this money has been spent in Juneau “Without this’' agreement, and had the mill been built outside the city limits, but still within a rea- sonable hauling distance of the city, the city might have been able to make some arrangement with the company to furnish tailings for filing the streets. With the mill outside the city limits, and no obligations on the part of the company in the way of an agree- ment, it is hardly probable that a company, as hard pressed for money as was the Alaska Juneau for many years, would have sup-| plied these tailings for filling with- | out charge. “If the tailings had been sold to the city even at a figure one- fourth the cost of quarrying, crush- ing, and loading, a very substantial | cash income would have been de- | rived by the company. ! KETCHIKAN BETTER HOUSING PROGRAM STARTS WITH BANG With $6,000 worth of loans from Ketchikan banks under FHA pro- “In addition to furnishing tail- | ings, including the upkeep of bunk- ers, free of charge to the city, this and a large proportion of the taxes ipaid has come directly from this | payroll. visions reported by Lester O. Gore, chairman of the Better Homes Committee in the First City, with- in two days ending last night, the campaign in that city got off with a bang, according to John E. Pe- gues, FHA Director for Alaska, who returned to Juneau on the mo- torship Northland. Mr. Pegues has spent the last week in Ketchikan getting the FHA program introduced and hold- ing meeting with the property owners and business men, similar to those held in Juneau recently. “The people there are enthusiastic over the possibilities for improving their homes under the provisions Gold Mining Company. The reply to the protest by L. H. Metzgar, corporation, also was read. The only action taken by the Council, after a short discussion, was to turn the matter over to City Attorney H. L. Faulkner for his legal interpretation and advice. ‘The complete details of this con- troversy are reported elsewhere in The Empire. Gravity Oil Burners Another item of importance which the Council considered was the written protest of the Alaska Mine Workers Union on the ru- mored abolishment of gravity oil |burners as a fire hazard. Mayor Goldstein explained that the Council, at its last November |session, did not intend to give the . {impression that it favored such an |JUry Which reached its verdict at General Superintendent of the mine | MOSES PHILLIPS FOUNDGUILTY OF - MANSLAUGHTER | | | Much Business Transacted; in U. S. District Court This Morning | Guilty of manslaughter was the | verdict returned by the jury m| | the Moses Phillips case when the | United States District Court opened | |at 10 o'clock this morning. A seal- |ed verdict was returned by the 13:15 o'clock this morning after de- DIMOND SHOWS IMPROVEMENT, BARTLETT SAYS Former Secretary to Dele- gate Arrives to Join FHA Staff Here Delegate Anthony J. Dimond had hown vast improvement following his recent operation in Washing- ton, D. C., before he left the Na- tional Capitol on November 23, de- clared E. L. Bartlett, who arrived in Juneau last night to assume his position as Assistant Director of FHA in Alaska. Mr. Bartlett, who has been sec- retary to Delegate Dimond since the latter assumed office two years ago, will make his headquarters in Juneau and will be joined in two or three months by Mrs. Bartlett and their small daughter, who ac- companied him west. They are now visiting friends in Spokane, Wash- ington and from there will con- tinue to Los Angeles, California to visit Mrs, Bartlett’s mother, Mrs. V. L. Gaustad. FHA is going over splendidly throughout the States, from the East Coast to the West Coast, Mr. Bartlett declared. People are par- ticularly enthusiastic over the modernization and improvement of homes, under the provisions of ‘Title I, and many are taking ad- vantages of the facilities of FHA, he said. On his way north Mr, Bartlett stopped over for several days in Ketchikan where J. E. Pegues, FHA Director for the Territory, was in- troducing FHA and assisting the civic committee, headed by Lester 0. Gore, to get the Better Homes abolishment. The body merely wanted, he said, to seek some method of supervising the burners’ *‘Campalgn started. He accompanied | liberating since 5:30 o'clock yester- | npy [pegues to Juneau on the mo- Ju:lay afternoon when it received ‘he;wrshlp Northland, and is tempor- service has been extended to any | of FHA,” Mr. Pegues said. | and all property owners who de- sired to fill their lots. Many own- ers have availed themselves of the use of tailings for filling and many lots have been filled, materially lessening fhe fire risk in the town as a ‘whole. Breakwater Given “The dumping of tailings into Gastineau Channel has created a breakwater that furnishes protec- tion to the whole waterfront and “The total dividends paid by the |Alaska Juneau Gold Mining Com- !pany to date amount to $3749,- 000, the first payment of a divid- |end having been made in 1931. | Money Re-Invested | “In addition to the dividends |paid, a surplus was accumulated which made possible the purchase |of the old Gastineau property from {the Alaska Mining and Power Com- (pany. This shows that instead of |the profits being at once ‘carried creates a small boat harbor in| oyt of Alaska by non-resident of- g::; D’xrmihgm:xfiy of the com- | ficiais and stockholders, they have = A bm‘kww"e farther | peen very materially reinvested in from Juneau, it would farther |additional property for the stab- th d not afford jlization and continuation of op- e protection it now does. |erations by the company; of the whole system. “It is true that water is furnish- ed for fire fighting purposes only, but in the event of fire all the facilities of the company are avail- able to the city, even to the extent of interrupting milling operations to furnish sufficient water. There is at all times an operator on duty at the company's central power plant and his instructions are to give precedence to water for fire fighting purposes and, if necessary, to start the salt water pumps, of which there are two available at all times. Such service as this would be entirely out of the reach of the city if they had fo supply an adequate plant and pay for up- keep and operators’ wages. The measure of value is not what it costs the company to maintain this wi‘;;l"heng;:_' h;!s been given a lease |which is very substantially bene- inal rental ($10.00 per |ficial to the taxpayers and resi- ;:muml on sufficient ground for | dents of the City of Juneau. e construction of a road, to make | “without the benefits derived floats in this harbor a | Sgdain ccessible 10| from the Alaska Juneau operation these concessions have been grant- | ed in a spirit of cooperation. | difficulty in maintaining itself at “These services alone, instead of |all and lorm. s 3 the taxes in som being ‘meagre considerations’ were | other would be much m:ht t] v services which were at the ti | e ‘me of | they now are. making the agreement, and would | “All . have been ever since, so costly as|sg;, of the people who have re- » ided in Juneap for ten to have been unobtainable b; i frpadynd 2 inable by the longer, will remember the condi- | tion of the city from 1922 to 1927, Indirect Tax Shown | The operations Alask: “The implication, that the amount | tineay mine :‘dmugn .:ofpfi' paid by the company as city taxes never to r | esume as b is the only tax ‘money paid by the Alaska Juneau was }u:l“:gh a d‘?: Company from which the city de-| A rives benefit, is apt to lead to a' (Continued on Page Seven) The city would have Every bank in Southeast Alaska, except the Banks of Alaska in Skagway and Wrangell, are now qualified to make loans under the modernization program of FHA, according to Mr. Pegues. He will leave next week for Skagway (o confer with E. A. Rasmuson, Pres- ident of the Banks of Alaska, on the matter of bringing the Skag- way and Wrangell banks in. To assist the Ketchikan Better Homes Campaign, Harry I. Lucas, Executive Assistant to the Director of FHA, will leave Juneau on Mon- day and on his return north, will stop over in Petersburg for a short stay to get the better hous- installation and operation to elim- inate -all possible fire hazards. Thirdly, the Council listened to a verbal protest from the Juneau Unemployed League. Mayor Gold- stein replied that there was not ome case on record of any person who was in need of relief being turned .down after proper applica- tion had been made to the city welfare agency. The Mayor said the city is work- ing at all times in strict co-lopera- | ; Phillips was indicted by the | grand jury and charged with mur- ‘der in the second degree for the ‘a.lleged killing of John Lindoff at | Hoonah on August 12, by stabbing | with a knife. The case went to trial | on Thursday morning in the United | | States District Court with Grover | C. Winn and Henry Roden repre- ,senfing the defendant and Assist- |ant U. S. Attorney George W. Fol- | ta and Assistant U. 8. Attorney Arthur Henderson to Wilfred Stump handling the case for the United States. . Jury Members Those serving on the jury were | Catherine Balog, Mrs. H. 8. Graves, | L. E. Tucker, Mrs. C. F. Brown, tion with the Government on PWA | projects. The Government furnish- | es the men, and the city provides| all tools, equipment, and gas and oil for truck use. ing program started there, Mr. Pe- gues announced. During their absence E. L. Bart- lett, Assistant Director, will be in charge of the Juneau office. — ee— Trial of Error Is New Deal’s Pathway to Economic Recovery PHILADELPHIA, Pa. Dec. 8.— Donald R. Richberg told the mem- 1 New Work | Chester Barnessen, Kenneth Cole, n this same line, the Council|joe Nello, Sadie Cashen, Ethel E. approved the plans for the con- Haines, Sam Christensen, Lloyd struction of a cement trestle and | winter and A. J. Streed. retaining wall on Calhoun Avenue | Sentence of Phillips was defer- at Fifth Street. The blue-prints | yeq by Judge George F. Alexander. were submitted by City Engineer|Tne sentence for manslaughter in Martin Lagergren and Consulting | he Territory of Alaska can be from Engineer O. H. Stratton. The Coun- one to twenty years, according to cil directed City Clerk A. W. Hen- U. 8. Clerk of the Court R. E. ning to prepare a call for bids on Coughlin. this work, the second major PWA Further Court Business nroject.’ undertaken by the city. J. H. Fraser and Larry Bunger, ‘The first of these projects—the | charged with selling beer and wine { arily making his home at the Gas- tineau Hotel. Previous to his position as secre- tary to Delegate Dimond Mr. Bart- lett was on the editorial staff of the Fairbanks News Miner and is well known throughout the Terri~ tory. Be Awnded Nobel Prize OSLO, Norway, Dec. 8.—Arthur Henderson, President of the Leagus of Nations' Disarmament Confer- ence, will be awarded a Nobel Peace prize next Monday. This i accord- ing to a brief announcement made here today. I DELEGATE A. J. DIMOND VALESCING AT WASHINGTON RESIDENCE Delegate Anthony J. Dimend, who recently underwent a major operation in Washington, D. C, was able to leave the hospital on November 25 and is now convalesc- ing at his apartment in the Na- tional Capital. He is permitted to bers of the Academy of Political |Proposed bridge over Gold Creek— | without a license, pleaded not Sit up and receive visitors, accord- Science that the “long slow pro- |i5 to be started next week. The | guilty in the U. S. District Court ing to letters received from him in cess on the trail of error is the Council gave the Mayor approval|this morning following the verdict Juneau on the last mail, and is New Deal's pathway to economic recovery and is the sole alterna- tive to state Socialism. “We must develop new agencies of human cooperation to meet the new economic conditions produced by industrial revolution, to sign a contract with O. Eikland in the Phillips case. and H, Kinney, successful bidders Given Five Years for the job. | Willie James, who pleaded guil- Election Ballot | ty to statutory rape, was sentenced Councilman Henry Messerschmidt to serve five years in the peniten- - (Continued on Page Eighu) | " (Continued on Page Five.) expecting to be back at his office the latter part of this month. PR 553 1 GREUEL ENTERS HOSPITAu Hugh Greuel entered St. Ann's Hospital late this morning for a tonsilectomy. " IN GENEVA BY FOR. MINISTER 1Solemn Declaration Spoken Before Council of League of Nations RELIGIOUS HOLIDAY STAYS HOSTILITIES Both Hungarian and Yugo- slav Governments Min- imize Friction GENEVA, Dec. 8—France dra- matically resumed discussion of the Central European conflict before the Council of the League of Na- tions with the declaration by For- eign Minister Laval that “in this grave affair, France stands beside Yugoslavia.” Amid impressive silence, Laval said that enemies, in striking at King Alexander were ‘‘striking at peace and it was the work of King Alexander that they sought to destroy and his peace policy. It depends upon this Council of the League of Nations to see that peace shall not be placed in peril.” FEAR OF ATTACK SZEGED, Hungary, Dec. 8.—Fear of attack by Chetniks, armed Serb forces from the south, were allayed today as the religious holiday was marked by a general quiet in the troubled region. A few more refu- gees straggled across the border from Yugoslavia and contributed their part to the uproarious dem- onstration against Yugoslavia by Hungarian University students. Posting of a heavy guard of police around the university and else- where in the city was taken as a precaution against further disor- ders. Refugees told of several forays of Serbs across the border into Hungary and farmers offered to arm as emergency force but the Government declined to adopt such action. COMMENT WITHHELD BUDAPEST, Dec. 8 —Members of the Hungarian Cabinet withheld comment on Yugoslavia's expelling Hungarians but turned attention to relief of refugees with an appar- ent willingness to allow popular in- dignation to subside. MILDER POLICY BELGRADE, Dec. 8.—It is indi- cated here that the Government will go ahead with the expulsion of Hungarians but will use a milder policy, Officials are minimizing the gravity of friction between the two countries. STOCK PRICES ARE IRREGULAR, SHORT SESSION NEW YORK, Dec. 8.— Stocks turned slightly irregular at the short session today and activity was only moderate. Several favor- ites held- steady. CLOSING PRICES TODAY NEW YORK, Dec. 8-—Closing quotation of Alaska Juneau mine stock today is 18, American Can 106'2, Anaconda 11%, Armour N 5%, Bethlehem Steel 30%, Calumet and Hecla 3%, Curtiss-Wrigat 3%, General Motors 32%, Internatiomal Harvester 39%, Kennecott 17%, United States Steel 38, Pound $4.94% . - e ENDS SEATTLE VISIT Mrs. Malcolm E. Morrison, who has been visiting in Seattle for several weeks, is a passenger for her Juneau home aboard the Alas- ka.