372 ANNUAL REPORTS OF DEPARTMENT OF AGRICULTURE. 



the charge annually. But up to the tenth year, wlien complete 

 development should have been secured, the rate is a reduced one, 

 and amounts })aid during!; tlie nonproductive period are credited 

 against the rentals \vhi(;h will be due during the period of partial 

 production. Hence permittees do not eventually pay for occupancy 

 of the land during the period when the nower must continue to run 

 to waste, but they are compelled to mane annual ])ayments, wluch 

 preclude the tying up of power sites in order to restrict production 

 and thereby maintain high rates to the consumer. 



Fundamental!}", the course of the Forest Service in handling 

 water-power questions rests on three jn-inciples: (1) That the Gov- 

 ernment as owner of the land has the riglit to fix the conditions 

 under w'hich a private individual may take possession of it for pri- 

 vate business use; (2) that as trustee for the public it is the duty of 

 the Government, on the one hand, not to permit tlie nse of public 

 property without securing a due return to the public, and on the 

 other hand, that this return should not be obtained on terms which 

 could in any way lessen the supply to the public of an important 

 industrial commodity; and (3) that it is the duty of the Government, 

 in the public interest, to prevent the tying up of power either by specu- 

 lators who initiated rights with a view of selling them out at a high 

 price or by those who would prevent full development of the poten- 

 tial power supply in the interest of market control. 



This policy in no way conflicts with or diminishes the power of the 

 States to regulate corporations engaged in the supply of hydro-electric 

 power. It is considered, for example, that any regulation of rates 

 charged the consumer which may be necessary will naturally be 

 undertaken by the States. Neither is any attempt made at Federal 

 regulation of the corporations engaged in the development of electri- 

 cal power as corporations. The Federal Government takes cogni- 

 zance of the matter simply because, as the ow^ner of title to land 

 held in trust for the people of the United States, it is in duty bound 

 to promote the full development of the natural resources of the land, 

 without directly or indirectly handing them over to private indi- 

 viduals for their exclusive use and benefit. 



A serious if not insurmountable obstacle to the satisfactory han- 

 dling of water power use of the National Forests is the inability of the 

 Secretary of Agriculture, under the present law, to grant any permit 

 not revocable at will. Naturally, capitalists are slow to invest large 

 sums in enterprises which have no assurance of permanent rights. It 

 is highly desirable, therefore, that there should be legislative author- 

 ity for the granting of a permit irrevocable for a considerable term 

 of years, except for the breach of the conditions of use fixed by the 

 permit itself. 



To the use of the Forests shown in connection with the state- 

 ment of receipts must be added the veiy large use for which 

 no charge is made. For the free use of timber see page 26. No 

 permits are issued and no record is kept of the free grazing on the 

 Forests, and therefore an exact statement of it can not be given. 

 Milch cows, work animals, and horses in use, not exceeding 10 head 

 for any one o^\^ler, may be grazed free by settlers within or near the 

 Forests, and b}^ prospectors, travelers, and campers. In Arizona 

 and New Mexico 30 milch goats may be grazed without charge. 

 Free grazing is also allowed for all horses in use by stockmen and 

 by purchasers of timber on the Forests. 



