164 ANNUAL REPORTS OF DEPARTMENT OF AGRICULTURE. 



not everywhere be justified, the Secretary of Agriculture determined 

 upon an increase of 25 per cent for the first year. At the same time 

 he announced that further increases would be deferred until a spe- 

 cific study of the existing conditions upon each of the National For- 

 ests had been made. Upon the basis of the facts thus obtained, it 

 was stated, additional increases would be made when the real value 

 of the forage upon any Forest was found to be more than the amount 

 charged, but not to become effective before March 1, 1918. 



When the grazing charge has been advanced to cover the full 

 A'alue of the grazing privilege, the income from the National Forests 

 will be close to the cost of operation. The present annual operating 

 cost is about $4,000,000 — less than $600,000 in excess of the receipts 

 last year. An increase in receipts equal to that which took place in 

 1917 would close the gap. 



In this connection the improved demand for National Forest timber 

 calls for brief comment. A 19 per cent gain in the receipts for 

 timber followed a 20 per cent gain in 1916. Last year's rej^ort 

 characterized the gain in 1916 as somewhat abnormal. It Avas then 

 pointed out that tlie improved situation did not bring any increase 

 in the amount of timber put under contracts for sale, but merely ac- 

 celerated the cutting under old contracts. The sale contracts made 

 in 1917 show a striking contrast, since the total volume of sales was 

 more than twice the total of the previous year. 



Unquestionably general conditions affecting the lumber industry 

 improved very materially in 1917, and were reflected in the increased 

 demand for sale contracts as well as in the increased cut and re- 

 ceipts. This is primarily attributable to business activity through- 

 out the country. After the entrance of the United States into the 

 war some further stimulus was given to the lumber business by the 

 orders for material for construction purposes on behalf of the Gov- 

 ernment. Nevertheless, the basic situation in the lumber industry 

 has not changed. An enormous overload of stumpage in private 

 hands and manufacturing facilities far in excess of the capacity of 

 the country to absorb the output are still matters to be reckoned with. 

 Whether the gain made for the last two years will characterize the 

 year 1918 is altogether uncertain. 



The urgent need pointed out in former reports for larger provision 

 for road building in the interest of local and community develop- 

 ment was met by the law^ passed July 11, 1916, commonly known as 

 the Federal aid road act. Section 8 of this act appropriated for 

 roads and trails within or partly within National Forests, and made 

 available until expended, $1,000,000 for the fiscal year 1917 and an 

 equal amount for the nine succeeding years. Immediately upon the 

 passage of the act the formulation of a plan for carrying out the law 

 was undertaken, and on September 1, 1916, regulations embodying 

 the plan were approved by the Secretary of Agriculture. The details 

 of the plan are given later in this report. Eventually this road 

 work will be of very great value in promoting the economic and 

 social progress of many localities now meagerly provided with 

 means of communication and unable to provide them unassisted, and 

 the local development thus promoted will also enhance the usefulness 

 of the Forests to the public and the revenue which the Forests yield. 



A decision of the Supreme Court of the United States, rendered 

 March 19, 1917, that certain water-power companies operating in the 



