Annual Report of the Governor of Alaska

INTRODUCTION

An analysis of the reports that have been received from nearly parts of the Territory indicates that industrial and economic nditions throughout Alaska improved during the fiscal year endJune 30, 1926. Commerce, foreign and domestic, increased out 2.3 per cent over 1924, and it is significant to note that the sports increased in greater proportion than the imports. The year sed with the balance of trade in favor of the Territory amounting $29,024,224. There were no serious epidemics and health condis generally throughout the Territory are much better than they re last year.

Official visits were made to southeastern Alaska, the districts tribtary to the Alaska Railroad and Richardson Highway, the Yukon River Valley below Tanana, and the Seward Peninsula. There is apparent improvement in local industrial conditions in nearly very district visited, with the notable exception of the lower Yukon ver Valley. For many years the residents in that section and e in the lower Kuskokwim Valley derived a substantial revenue m the salmon fisheries. Unrestricted fishing in these districts deted the fisheries to such an extent that they were in danger of 1ng destroyed, and it was necessary to prohibit commercial fishing rexport in both areas if the fisheries are to be perpetuated. The -vitable results of these regulations are apparent on the Yukon; -population is decreasing, below Holy Cross the steamboats have # replaced by small gas boats operating on a bimonthly schedule, y of the traders are reducing their stocks of goods, and in some tances closing out their business; in fact, the entire lower Yukon trict is less prosperous than it has been for years. The reopening the fisheries even to a limited extent would immeasurably improve omic conditions in this district, and at the present time there not seem to be any other way to relieve the depression. This "bon there was an unusually large run of salmon on the Yukon ver. The first king salmon were taken at Kwiguk about May 29, , and it is believed that this may indicate a change of conditions ch will justify a resumption of commercial fishing. The situahas been discussed with the Commissioner of Fisheries, and he agreed to make another investigation of the salmon fisheries in Yukon and Kuskokwim Rivers for the two-fold purpose of ertaining whether or not there has been a sufficient increase in the Fiber of salmon to justify the removal of the present restrictions, if this is not possible an effort will be made to devise some plan will permit the taking of a limited number of king salmon each ar for export.

The value of the fisheries products was slightly less than in 192 although the total investment was about four and one-half millio dollars greater. The exceptional feature was the abnormal growt of the herring industry, in which the capital investment and val of the products increased more than 50 per cent over the previou high record in 1924. The total active investment in the fisheries the Territory in 1925 is estimated to be $67,077,495, and of th sum about 80 per cent is represented in the salmon-canning industr The distribution of this investment according to districts is approx mately as follows: Southeastern Alaska, $33,695,736; central Alask $16,653,059; southwestern Alaska, $16,728,700. The total value the fisheries products, exclusive of aquatic furs, is estimated to $40,038,745, or approximately $250,000 less than the value of t products for the preceding year.

The results of the investigations conducted by the Bureau Fisheries in 1924 indicated the desirability of making certain chang in some of the regulations. Additional areas were closed, the close seasons in other areas were extended, and additional limitations we placed on fishing gear. The attention of Federal and Territori officials was directed to the necessity of devising some plan for t utilization of the waste products from the salmon canneries ar controlling the apparently extravagant consumption of herring the fertilizer plants. It should be possible to so regulate the he ring fisheries as to protect the fish that are too small to be packed. The number of seals in the herds on Pribilof Islands is estimate to be 723,050, or an increase of 25,892 over 1924. It is of intere to compare the census of 1925 with that of 1914. In 1914 it w estimated that the herd contained 294,687 seals, and similar statisti for 1925 place the number at 723,050, indicating that the herd h multiplied about two and one-half times, and this does not accou for the animals that have been killed for their pelts. In 192 19,860 sealskins were taken from the herd. The increase in the he justifies the policy that has been pursued by the Government. T gross value of the skins sold during the fiscal year was $787,384.5 This is a substantial increase over the proceeds derived in 19: and clearly indicates that the industry will ultimately prove to be source of considerable revenue to the Government. Alaska is ent tled to a share in the profits, and at least 50 per cent of the n returns should be given to the Territory for the support of publ schools.

The value of the minerals produced in Alaska in 1925 exceede that of the previous year, and renewed activity is apparent in mar of the mining districts. In the vicinity of Nome the experimen that were conducted by the dredging companies in an effort to pe fect a method for thawing the frozen gravels with cold water we successful, and as a result large areas of low-grade ground may dredged. The extensive developments in the Fairbanks district ha stimulated prospecting for both lode and placer deposits. Develop ment work has been undertaken on a number of small quartz proj erties adjacent to Fairbanks and an increased gold production ma be expected from them. Plans are under way for the installatio of several new dredges in the region tributary to the Tanana Rive This development in the interior of Alaska may be attributed

the completion of the Alaska Railroad, because, without reasonable transportation, it would not be possible to conduct mining operations in that part of Alaska. Most of the gold mined from lodes in Alaska is from the southeastern part of the Territory. The Juneau strict leads in the production, followed by Chichagof Island and Hyder.

The value of the copper produced exceeded that of the preceding Year, although the production was somewhat less. The total ton

of coal mined was considerably less than last year, and correondingly the importation of foreign coal increased. The Alaska val mines are capable of producing sufficient coal for domestic conmption, but the operators have not solved the transportation probJem and are unable to enter the local markets that are not adjacent to he railroad in competition with imported coal.

The petroleum production was confined to the Katalla field as n previous years. The explorations in the Cold Bay district were endoned and the tools and machinery were removed. In the Yakaaza field drilling began early in June, but the work has not proled far enough to enable the operators to determine whether or 14 the field contains oil in commercial quantities.

For many years it has been known that the extensive coastal rests offer excellent opportunities for the development of the pulp i paper industry, but until last year the Government had not de any serious effort to bring these resources to the attention the paper manufacturers. In view of the fact that the timber water power are available, and since the investigations by mpetent authorities had not resulted in any attempt at the utilion of these resources, it was apparent that there must be some ason why capital had not been interested in the paper industry. After careful investigation it appeared that the paper manufacrers had not been fully advised of the possibilities and that the tracts heretofore offered by the Government were not satisfactory. The Secretary of Agriculture authorized changes in the contracts oving the objectionable features and the Government engineers pared exhaustive reports showing the timber resources and the lable undeveloped water power. These reports and the revised iracts were presented to pulp and paper manufacturers throughthe United States and as a result the prospects for early developt in this field are excellent.

The report of the general manager of the Alaska Railroad shows results of efficient management in the administration of that "ject. The gross revenues increased approximately 25 per cent those of 1925, while the cost of operation in all departments materially reduced. The total expense for operation of the line and river boats was 14.2 per cent less than it was in 1925 the total deficit for all expenditures, including the charges to tal account, was decreased 18.3 per cent over that of last year. y-five thousand and thirty-six tons of commercial freight were sported. This is an increase of 20.8 per cent. Fifty-seven and five hundred and sixty-seven revenue passengers were carduring the year. This is 19.2 per cent more than for the preng year. The increase in traffic is significant not only because an increase over the traffic of 1925, but more particularly as

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it indicates a general development of the territory tributary to th railroad. The train service has been improved by adding moto cars to the equipment and operating them between stations on day when the regular trains are not running. The boat service betwee Nenana and Holy Cross was maintained on the same schedule last year and the revenue increased 14.7 per cent. The cost of th department can be materially reduced by the purchase of a bo equipped with a Diesel engine to replace the antiquated steamboa now in service. The cost for operation and maintenance of way the rail lines can not be reduced to the minimum until the railro is completed according to the plans outlined some two years ago, a this can not be done unless the annual appropriations are increase Excellent progress is noted in the construction and maintenan of roads and trails by the Alaska Road Commission and the Burea of Public Roads in cooperation with the Territory. The constru tion of roads and trails is proceeding according to a definite progra that has been concurred in by the Federal and Territorial agenci and when the work is completed there will be a comprehensive, we coordinated system of transportation routes throughout the mo important parts of the Territory. A conference with the chi engineer of the Bureau of Public Roads last winter resulted a change of policy in so far as the construction standards of certa types of roads in Alaska is concerned. Heretofore the standar adopted in other districts were applied in Alaska and in man instances they did not meet conditions. Under the new policy t assistant district engineer assigned to Alaska is permitted to su mit plans for roads and trails which in his opinion more near meet local conditions in the Territory. This change is of the utmo importance to Alaska because under the authority granted a logic development of road construction in the coastal areas is possib There are many districts where pack trails and low-standard wag roads will meet all present needs, and without them the country c not develop, but future conditions may require roads for auto truc and motor transportation. Under the new policy the requiremen may be met as the conditions change, while under the old practi the conditions must have justified the construction of a hig standard road or the project could not be undertaken by t Bureau of Public Roads.

Improvements in the fur-farming industry are indicated by t fact that the investment in livestock and improvements on abo 400 farms in the Territory is estimated by the Biological Surv to be about $6,000,000. The growth of the industry was retard because of the inability of the proprietor to lease or legally occu the public domain, outside of the national forests, for fox farmin This situation was brought to the attention of the Secretary of t Interior, and on his recommendation Congress passed a law la year authorizing the leasing of the public domain for use in t propagation of fur-bearing animals. This privilege places t industry on a much better basis and will encourage further inve ments in the business.

The yearly increase in the number of reindeer exceeds the deman for the meat, and an effort should be made to extend the market a provide adequate transportation to centers of distribution for t frozen meat, otherwise the herds will deteriorate and the rang