Mr. MOORE. That is true, it is not going to be a substantial part of our operations.

Mr. ROOSEVELT. Thank you.

Mr. WARD. Your reasons for going into Samoa is strictly following the fish and looking for a new field of supply?

Mr. MOORE. That is right.

Mr. WARD. Is it your opinion then, in view of the additional expense and the distance involved, do you think that Samoa could ever affect the west coast fisheries, as far as cheap labor supply, or competition?

Mr. MOORE. I think not. I do not believe that any production from Samoa will affect the total volume of operations of our west coast plants.

I pointed out, Mr. Roosevelt, in my memorandum to you, that my company, the Van Camp Sea Food Co., does not contemplate making large profits in American Samoa. There may be some advantages gained on the one hand, but these advantages are definitely offset by additional expenses that we do not normally have stateside. The wages are not up to the minimum wage stateside, but I have pointed out that we have a plan in effect now that will increase those wages to the employee automatically, and we are hopeful that in this period of years that these increments will be forthcoming and the employee will become more proficient and will warrant this additional expense to the company.

Mr. ELLIOTT. When do these 2 cents per hour per year increments go into effect, Mr. Moore?

Mr. MOORE. They went into effect last October and they will continue.

Mr. ELLIOTT. Next October will be the next one, and your employees will get a 2 cent per hour raise?

Mr. MOORE. Yes, that will be the next one. That is the anniversary date for all employees who were with us as of October of 1955, and new employees will receive their increments on the anniversary date of their employment, that is, new employees that may come into the plant.

Mr. ELLIOTT. Do you have any assurance that you will be able to lease this plant at the end of 5 years. You have used up 2 years

now.

Mr. MOORE. Our lease agreement with the Government now, which is dated and this is a new agreement-dated January 1, 1956, is for a period of 5 years and has 3 options of 5 years each for a total of 20 years.

Mr. ELLIOTT. At the end of each 5-year period, you have an option to renew for another 5 years if you desire, up to a total of 15 years? Mr. MOORE. A total of 20 years.

Mr. ROOSEVELT. I think that it might be helpful, because the Department of the Interior representative is here, if he came prepared with the actual agreement, for inclusion in the record.

Mr. MOORE. I have a copy of the lease with me, if you would like to have it.

Mr. ROOSEVELT. Either you can supply it or the Department of the Interior.

Mr. MOORE. Surely.

Mr. ELLIOTT. Let it go in the record at the point following the memorandum which Mr. Roosevelt offered a while ago.

Without objection, it will be included at that point.

Mr. MOORE. I apologize for the fact this is a copy or duplication of the original lease, but you will find it complete.

Mr. ELLIOTT. Gentlemen, is there objection to a recess now until 2 o'clock?

Mr. COLLINS. Mr. Chairman, may I interrupt for just a moment. I think that I can say what I would like to say.

My name is Linton Collins. We are presenting the lease, and I want to call particular attention to section 7, subhead 1, which provides that only United States citizens and nationals will be employed in the cannery, and related shore activities, except as approved in writing by the Governor, and no aliens or their dependents shall be allowed to enter American Samoa in connection with fishing operations relating to the cannery, without the permission in writing of the Governor.

The question was raised concerning the hiring of aliens. And may I also at this time present to you, which I am sure most of you have seen, the Committee Print No. 4, 84th Congress, of a Special Subcommittee on Territorial and Insular Affairs of the Committee on Interior and Insular Affairs of the House, pursuant to House Resolution 89 of the 83d Congress.

This gives a pretty good background of the American Samoan economic and political and historical situation, and particularly refers to the operations on page 6, I think it is-on page 12-of Mr. Harold Gatty, about whom some reference was made earlier in the morning.

I am sure that Congressman Aspinall, who conducted this hearing, would be very happy to give you any of the information that he may have concerning the entire economic situation there.

Mr. ROOSEVELT. Also, on page 13, I think, of that same report, there is a summation by Congressman Aspinall as to the effect of the wageand-hour law on the economy of the island; is that correct?

Mr. COLLINS. I was going to read that. He pointed out in connection with the bringing in of new industry into the island, speaking of the wage-and-hour law:

The act's minimum wage of 75 cents per hour is entirely out of proportion to the local wage scale in the South Pacific, and would upset the economic balance unless American Samoa could somehow be exempted from its provisions.

I think that is all, sir.

Mr. ELLIOTT. Does that mean that you will not have any more testimony?

Mr. COLLINS. Unless there are any questions that you would desire to ask of Mr. Moore. We will try to get, by Friday morning, the information that has been requested this morning, and present that to you, and if there is any other information we can get for you, we will certainly be happy to give it to you.

Mr. ELLIOTT. Thank you very much.

Now, Mr. Moore, have you concluded with your testimony?
Mr. MOORE. I believe so, Mr. Elliott.

If there are any questions

Mr. ELLIOTT. I am sure that we will have some questions. Would you rather come back at 2 o'clock or would you rather finish now? Perhaps we will finish now.

Mr. LANDRUM. I wanted to ask specifically about the manufactured cost of your Samoa product when it reaches the American market. As I understand you now, it is considerably more, in manufactured cost, than your American product. That accounts for your losing money, I take it.

Mr. MOORE. No; the cost of the finished product is approximately the same as the cost of our product developed here.

Mr. LANDRUM. By the time you get it here?

Mr. MOORE. By the time we get it here; yes. There is no particular advantage gained in the production costs of the Samoa product over the production cost of our stateside operation.

Mr. LANDRUM. Then, the effect of your operation there is to add industrial growth and a source of employment to the American Samoans.

Mr. MOORE. That is right, sir.

Mr. LANDRUM. That is all, Mr. Chairman.

Mr. Coon. I have no questions, Mr. Chairman.

Mr. ROOSEVELT. I just have two brief questions. One is this: If I understand the quotation that Mr. Collins gave us concerning the lease, you are presently restricted to employing, except for the exceptions noted, American nationals. I would like to ask you specifically your position if the committee felt that it was necessary to have this legislation restricted to bona fide residents of Samoa, and to exclude any possibility of contracting labor under this exemption to go to the area to take part in the operation.

Mr. MOORE. There is no objection to that, Mr. Roosevelt.

Mr. COLLINS. May I interrupt, Mr. Roosevelt, that the only question would be the verbiage which would not preclude administrative personnel from the continental United States going out. He has mentioned there are 6 or 8 of them out there.

Mr. ROOSEVELT. I see. Secondly, and I want to phrase this to escape any effect of its being a threat, because I know you would imply no threat, but on page 6 of your memorandum to me, there is a statement that the closing of the cannery would have a deleterious effect upon the economy of American Samoa and would be a further discouragement to other industries which might go into these islands.

By implication, that means to me that if you cannot get this relief that you would feel that it would be impossible for you to continue the operation, and again I want to emphasize that that would have to have some substance behind it. In other words, what you have in essence said is that this is important to the economy there, and which I believe it is, and on the other hand, I have to be shown that without this relief it would not be possible for you to operate. I am speaking strictly from your point of view, that this has nothing to do with the social effect that might accrue to having out-of-line income come to this part of the population. But I, for one, would want-and I think the committee would want some information to back up the statement that you would not consider this possible of continuation unless the relief which you seek is granted.

Mr. MOORE. Are you asking that we give you a statement that says that unless we get this we will not continue?

Mr. ROOSEVELT. If the cost of your product as delivered to the American market today is approximately the same, which I think you answered when Mr. Landrum asked you the question, obviously

then an increase in labor cost under the wage-hour law as would now be required if you did not get this relief would put your cost out of line, unless I am wrong in my statement. If I am wrong, I wish you would correct me.

Mr. MOORE. It would put our costs out of line.

Mr. ROOSEVELT. And therefore, in order to maintain the operation at approximately the same cost as your west-coast operation, you would have to have this relief in order to stay in the islands.

Mr. MOORE. That is right, sir.

Mr. LANDRUM. Am I correct in recalling from the earlier part of your statement that there is absolutely no subsidy connected with this, and your entire operations are paid by your own company?

Mr. MOORE. There is no subsidy, Mr. Landrum.

Mr. LANDRUM. There is no subsidy from the Samoan government or from the United States Government?

Mr. MOORE. That is right, sir. There is none.

Mr. ELLIOTT. Will you furnish, at your convenience, for the record, and within a week, if you can, the dollar volume of wages paid to your employees within the period of any past year that is available to you, without going to a lot of trouble to get it?

Mr. MOORE. You want the payroll?

Mr. ELLIOTT. The total amount of wages paid to Samoans for any recent yearly period that it is possible for you to get, without too much trouble.

(The information referred to was subsequently supplied, but, in order to prevent disclosure of confidential trade information, is not printed.)

Mr. MOORE. We will do that, sir.

Mr. WARD. Up to this point you have done nothing to develop the fishing angle of it through American Samoans, have you?

Mr. MOORE. We have done something, but not enough where we can point out that there is an active group of Samoan fishermen. Mr. WARD. Have you paid any Samoan fishermen ?

Mr. MOORE. I believe not. Of course, fishermen are generally paid on a catch basis anyway, but I do not believe that there have been any Samoans compensated for fishing activities.

Mr. WARD. Have you worked out, possibly, a scale of paying them in comparison with the other pay scale there, that you will as soon as you get into that?

Mr. MOORE. I think that we will do that, and there is no question about it, and it would probably have to stay pretty close to the scale for our cannery people.

Mr. WARD. All right.

Mr. ELLIOTT. What is the value, Mr. Moore, of the buildings that you have there at the cannery, and in connection with the cannery now, the reasonable value of them?

Mr. MOORE. At the beginning, at the behest of the Department of the Interior, we insured that property, the buildings and equipment, for $200,000, I believe. I believe it was around $200,000. Since then we have made an additional capital investment of approximately a quarter of a million dollars, which brings it up to about half a million dollars.

Mr. ELLIOTT. The original buildings are owned by the government of American Samoa?

Mr. MOORE. That is right, sir.

Mr. ELLIOTT. The new additions that you referred to were built by the Van Camp Co. and are owned by Van Camp, I presume.

Mr. MOORE. The additions are principally in the form of equipment rather than in buildings, although we made some additions to a building or to some buildings down there. We also replaced two docks for the fishing boats. They were in very bad repair.

Mr. ROOSEVELT. Those remain the property of the Government?
Mr. MOORE. We cannot pull them out and take them back.
Mr. ELLIOTT. Are there any further questions?

Mr. MOORE. Mr. Chairman, with your permission, I might point out that we get back to this need for a refrigeration plant which will be borne by the Van Camp Sea Food Co. It will probably require a plant of approximately 1,000 tons capacity in order to receive these fish for this cannery operation down there. We estimate the cost at somewhere in the neighborhood of $200,000, or maybe more, or maybe less. This is an additional expense that we have to look forward to, along with the expense of training Samoans as fishermen and assisting them in the acquisition of necessary boats, and so forth.

Mr. ELLIOTT. When will the refrigeration plant be built?

Mr. MOORE. I do not know, sir. We are now primarily concerned with this relief we hope from the Wage and Hour Act.

Mr. ROOSEVELT. Under your contract with the Government, would that remain the property of the Van Camp Co., or would it be the property of the United States Government?

Mr. MOORE. The refrigeration plant, you mean?

Mr. ROOSEVELT. Yes.

Mr. MOORE. Well, that is another thing. Of course, it cannot be taken with you if you leave.

Mr. ROOSEVELT. You can take all of the equipment out, however. Mr. MOORE. We could take all of the equipment out; yes. The property, that is the building, is the only thing that we could own. We cannot own land in Samoa, and we will not be able to purchase land. We will have the ownership of a building, and the equipment in it, and in the event we discontinue operations down there we would be faced then with the problem of selling an item that is not very marketable. We could pull out the equipment, that is true.

Mr. GRAHAM. There is no agreement by the Government to purchase any of it?

Mr. MOORE. No, sir.

Mr. COON. Is this motorship that you are using now for refrigeration, is that considered a kind of a temporary measure until you know whether you are going to continue?

Mr. MOORE. It is temporary by virtue of the fact that it is expensive and it is not desirable and we know that the only economical method for refrigerating fish is with a shoreside plant. There are too many logistics problems involved in maintaining a motorship operation in that area.

Mr. CooN. And you expect, then, to build this other refrigeration plant if you get relief from the Wage and Hour Act?

Mr. MOORE. I am sure that we will, sir. We cannot maintain an operation on the volume necessary to operate at a profitable basis without it.