REPORT OF THE FORESTER. 157 



improved situation did not bring any increase in the sale contracts of 

 the year, which on the contrary fell off, but accelerated somewhat the 

 rate of cutting under old contracts. 



In the first years of administration of the National Forests by the 

 Forest Service timber receipts mounted rapidly. A period of pros- 

 perity and activity in the lumber industry coincided with the opening 

 of the Forests to general use through the energetic development and 

 application of forestry methods. The panic of 1907 completely 

 altered the situation. Vast quantities of private timber are now on 

 the market and stumpage prices have been declining, with the pros- 

 pect of extensive forced liquidation. In consequence the lumber 

 industry is in an unstable and unhealthy condition. This situation 

 naturally affects the demand for Government timber. There is a 

 healthy and increasing local demand for timber needed in the devel- 

 opment of the country, which is being taken care of through sales 

 at an equitable price. Business of this character is growing and bound 

 to continue to grow steadily. Sales for the general market, on the 

 other hand, will fluctuate with the prevailing conditions. In general, 

 however, there will be an increasing total of receipts from timber sales 

 each year. 



With the normal expansion of sales which the demands of a 

 developing country will bring, timber thus will contribute its fair 

 share toward repaying the cost of administering the Forests. Other 

 forms of use also will increasingly contribute to this result. Recrea- 

 tional use is bringing a demand for summer home sites which, though 

 still at an early stage, already has begun to swell the revenue from 

 special-use occupancy to a marked degree. The income from rental 

 of water-power sites is adding its quota. With completion of the 

 water-power developments already under way, to say nothing of new 

 projects, the receipts fund will gain materially unless existing laws 

 are modified. Administration of National Forest water-power sites 

 is logically an integral part of Forest Service administration of the 

 lands embracing these sites, and a reasonable return to the public 

 for their use is no more than fair and just. 



GRAZING FEES. 



The returns from grazing will rise as more stock use the Forests in 

 consequence of range improvement and the development of new 

 ranges. There is now in contemplation an increase in the grazing 

 fee which would result in a marked further addition to the receipts 

 fund. When regulation of grazing on the National Forests began 

 a low scale of charges was adopted. This was necessary at the 

 outset, both to prevent undue disturbance to the live-stock in- 

 dustry, which has been accustomed to using the ranges free of 

 charge, and to facilitate the working out of a system of control 

 which would secure the best use of the range and restoration of 

 its productiveness. During the past 10 years of grazing regu- 

 lation the value of the range to the stockmen has materially 

 increased. Improved methods of managing both the range and the 

 stock have been introduced. Losses are fewer, production is greater, 

 and the product is of a higher quality. At the same time the outside 

 public range has been greatly reduced, while the demand has grown. 



Although there have been some readjustments of grazing charges, 

 there has been no general advance in the rates. Present users of 



