Thomas there are a few privately owned wells, from which water can be obtained in large quantities at the rate of about $1 per ton. Both the cost and the distance make this source of supply prohibitive except in case of dire necessity, and even if so obtained the cost of transfer from water barges to large numbers of small cisterns would increase the cost enormously. There is practically no fire protection on any of the islands. There are in the towns of St. Thomas, Christiansted, and Frederiksted, volunteer fire departments, the members of which are generally paid small retainer fees. The fire apparatus consists of tanks or tubs mounted on trucks, to which hand pumps are attached, the tubs being filled by hand. The equipment is entirely inadequate and also out of repair, and there is practically no chance of controlling fire when started.

The Government buildings in St. Thomas and St. Croix are without furniture of any kind, except such as has temporarily been left in the buildings by the representative of the Danish Government. All furniture will be removed in the near future. The equipment of the Government offices is very poor. The furniture is very old and in bad condition, and there are none of the facilities which would be considered absolute necessities in any small business house. There is no place to file correspondence and records except on shelves which are congested with the accumulation of many years. There are no safes except a few cast-iron ones with old-fashioned key locks, most of which are out of repair and until a spare confidential locker was obtained from the Prairie there was no secure place where money, code books, etc., could be kept. While not of such vital importance to the welfare and safety of the people as a proper water supply and fire protection, it is considered that the proper outfitting of the office buildings and of Government residences is essential.

11. In connection with the probable expense of maintenance under American administration, with particular reference to the comparatively low rate of salaries paid to officials and employees, there must be taken into consideration the fact that very liberal pensions were allowed by the Danish Government, as also by the local administration. Denmark has also rade special allowances to officials and employees from time to time. During the past year, for instance, every official and employee received a gratuity of 600 franes if married and 400 francs if not married. While it is certain that savings may be made, and in fact have already been made in some cases, by changes in administration and reorganization of certain civil departments, such savings will be comparatively small and will not greatly affect the final result.

12. In addition to the expenditures mentioned above as practically certain, it is probable that the United States will be required to retire some of the St. Thomas Harbor bond issue. The original amount of this issue was about $100,000, of which a certain amount is to be retired each year by the harbor treasury. Prior to 1917. $20.000 of this amount had been paid. Bonds amounting to $2.000 are due for settlement June 11, 1917, and it is not certain that there will be sufficient funds to meet these bonds when due. This bond issue is guaranteed by Denmark, and this guarantee was assumed by the United States, as provided in paragraph “i,” article 3 of the treaty. There are about $15,000 on the books of the harbor reserve fund, but this amount is now offset by a loan obtained from the National Bank of the Danish West Indies.

13. That the islands have been a source of continual expense to Denmark will be seen when it is understood that the net deficit to Denmark during recent years has been about as follows:

1913-14_

1914-151915-16.

Budget estimate, 1917-18_.

$5,600 12,200 34, 800 16.200

14. The above includes the revenue derived from the Danish Colonial Lottery and other revenues which will not be received by the United States. For some years prior to 1907 the islands had incurred a more or less constantly increasing debt to Denmark, which by that time amounted to about 8,000.000 francs. The Danish Government then attempted a reorganization of the financial administration of the islands and this debt was remitted. During the last year or two a new indebtedness has accrued, which on December 31, 1916, amounted to about $30,000. The expenditures during this recent period largely exceed the receipts, and the apparent indebtedness has been caused by a very lax method of handling funds properly belonging to the Danish postal service. It is not possible at this time to determine the amount of the present indebtedness. but it is probably in the neighborhood of $35,000. St. Thomas has a 66 reserve fund invested in Danish bonds, mortgages, and a small amount of

real property, which have a present value of about $45.000. It is assumed that this fund will be practically wiped out in the financial accounting with Denmark. St. Croix has a nominal reserve fund of about $66,000, but further investigation at St. Croix will be necessary before the true present status of this fund can be known

15. Currency.-By a provision in article 3 of the treaty the concession for the establishment of a Danish West India Bank of Issue was extended until 1934, during which period the National Bank of the Danish West Indies has the monopoly to issue bank notes in the Danish West Indian Islands. The standard is the franc, which is also marked as 20 cents. As the franc has a redeemable value of only three-fourths of a Danish kroner, the currency system is somewhat cumbersome, for while prices are quoted in “ dollars," a dollar means 5 francs in local currency, and the American dollar circulates at a premium of about 4 per cent.

16. Accounting system.-The accounting system of the islands appears to be unnecessarily unwieldy and complicated, and it is believed that a complete change to a more simple and direct method is necessary.

17. Taxes.-The tax system is comparatively simple, the direct taxes being principally limited to ground and building tax, lamp tax, and horse, carriage, and boat tax. In St. Thomas and St. John the estiamted amount of ground, building, and house taxes (the most important direct tax), amount to but $16,000. The land tax is levied on cultivated land only, and is at the rate of about 21 cents per acre, except land under sugar cultivation, on which the rate is about 62 cents per acre. (There is, however, practically no sugar grown in these islands.) The house tax is 4 per cent of the rental amount of houses actually occupied, plus about one-half cent per square foot of the total floor area. Remeasurement of buildings should be arranged, as the actual measurement on which the tax is based seems to have been made many years ago. There is no income tax. It is believed that these taxes should be revised as soon as it is practicable to do so.

18. Food supply.-There are practically no food supplies produced on the islands, with the exception of cattle, sheep, hogs, and sweet potatoes, the last being grown in limited quantities only. It is estimated that there are on the island of St. Croix about 7,500 cattle, 3,000 sheep, and 2,000 hogs. Cattle in much smaller quantities are also raised on St. Thomas and St. John. Because of the lack of any local food supply, the people of the islands are dependent upon shipments from the United States or from Porto Rico and the neighboring islands. Fruits and vegetables are brought in small quantities from Porto Rico and Tortola, but the interruption of regular steamship communications with the United States would result in certain hardship and probable starvation.

19. Schools. There are three classes of schools in the Virgin Islands-public, denominational, and private. In the towns of Charlotte Amalie, Frederiksted, and Christiansted there are public schools. Outside of the three towns the country schools are conducted by the Moravian Church and are aided by subsidies from the municinal treasuries. A private high school in Christiansted also received municipal aid. The school director, who has charge not only of the public schools but also exercises supervision over the municipally aided denominational schools, received his salary formerly from the Danish Government, the other expenses of the schools being paid for from the local treasuries. Under the present arrangement the salary of the school director becomes a charge against the appropriation provided by Congress in the act approved March 3, 1917. The former Danish school director continues on under our Government temporarily until the school system can be Americanized. While a complete survey of the school system has not yet been possible, sufficient has been learned to indicate that to inaugurate a proper system of public education for the children of these islands will entail considerable expenditures, for which as yet no adequate funds are available. There are greatly needed here schools for carrying education above the elementary stages along practical lines, so that what native talent there may be in the people may have an opportunity for development along agricultural, trade, and business lines. It is also essential that a normal school be established so that native teachers may be developed under American instructors.

20. Judiciary.-There are three courts in the Virgin Islands, one having Jurisdiction over the islands of St. Thomas and St. John, one having jurisdiction of approximately half of the Island of St. Croix with a court at Frederiksted, and the last having jurisdiction of the other half of St. Croix with a court sitting at Christiansted. The courts here exercise a very paternal in

terest and have an excellent feature in what is called the "conciliation." Where suits are instituted, the court is required to bring before it the parties to the suit, and, with their attorneys excluded from the conference, endeavors to reconcile the point in dispute to the satisfaction of both parties, and thus avoid a suit at law. Where reconciliation is impossible, the plaintiff may then proceed with his suit, being represented by counsel. In both civil and criminal cases a party against whom judgment is rendered has the right of appeal, formerly to the Danish courts, and now to the Circuit Court of Appeals for the Third Circuit of the United States. The only ground of appeal that needs to be stated is that the defendant, or the accused, is dissatisfied with the judgment or sentence imposed. Any sentence involving confinement for more than 60 days may be appealed, and in civil cases the value of the property or thing sued upon is not taken into consideration with an appeal, but appeals may be taken in cases where the amount involved is nominal. Under Danish rule the appeals were frequent since they involved no expense to the litigants, the court being required to make up the proper record and prepare the case for the higher court at its own expense.

21. Laws.—Many of the laws locally applicable in the Virgin Islands have not been translated into English, and the last codification of the laws, ordinances, publications, etc., valid in the Danish West India Islands was published in 1884. As is the case elsewhere, a large part of the law is unwritten, and can only be located by research in the decisions of the Supreme Court of Denmark. It is the intention to endeavor to collect and codify existing laws in the islands and to make recommendations to the colonial councils concerned as to necessary amendments, modifications, and repeals; but it may be anticipated that this will be a work of some time, in view of our present unfamiliarity with the Danish law, as applied in the Virgin Islands. The laws relating to taxes and land tenure are not in accord with the modern laws in force in the various States, and it is believed that a wise readjustment of these laws will have a highly beneficial effect upon the commercial, business, and agricultural interests of the islands.

22. Police.-Prior to our occupation of the islands the police administration was intrusted to the local police force in each town and a gendarmerie corps, which detailed men on the town police forces and also provided for the policing of the country districts. This force of gendarmes, consisting of about 150 men and five officers, was recruited in Denmark, commanded by an officer of the Danish Army, and all its expenses were paid for by the Danish Government. Upon taking over the islands the work formerly performed by the gendarmes was assigned to the garrison of United States marines. To assist them in patroling the country districts, the gendarmes were provided with 32 suddle horses. which have since been sold at public auction, leaving the marines dependent for rapid transportation upon three motorcycles, two motor trucks, and a Ford touring car. The island of St. Croix is well supplied with good roads, so that all parts are accessible by motor transportation. Considerable road work will have to be done in the island of St. Thomas before the island can be properly patroled by motor transportation. There are no roads for wheel transportation in the island of St. John. While at present there is not much suitable material among the natives for increasing the police force, it is believed to be most desirable to increase the native police force as rapidly as suitable material may be developed, in order that the marine garrison may be relieved from the performance of police duty; but there is not available in the local treasuries any money to provide for such increase of the native police force. The marines have performed their police duties in a very efficient manner, and have been several times commended in the local press for their honest and efficient performance of such duties. In view, however, of the fact that over half of the marine battalion is composed of men who are practically recruits, and in view of the fact that performance of civil duties by the marine officers interferes with their military duties, the present arrangement is most unsatisfactory from a military point of view.

23. Labor conditions.-In the island of St. Croix practically the only field for labor is to be found on the sugar plantations. From the information so far received it appears that for a number of years past native labor has left that island and has migrated to Porto Rico and elsewhere in an effort to secure a better livelihood. To replace the native labor which has left the island, the planters of St. Croix, with the assistance of the local government, have recruited new laborers from the island of Barbados. The class of labor recruited has been of a very poor grade, and the authorities of Barbados appear to have taken advantage of the situation to get rid of their undesirables. The results

are what might have been naturally expected, namely, the laborers of St. Croix are generally unsatisfactory and the island has been troubled with unrest and numerous strikes on the various plantations. Both the planters and the laborers are discontented, and, according to present advices, have not succeeded to reaching an agreement relative to rates of pay and other matters in dispute. Since the American occupation good order has been preserved in St. Croix, and, although the economical situation is bad, the occasion has not, in my opinion, arisen for the Government to interfere in the situation. In St. Thomas the laboring class is composed in a large part of natives of the islands, who are a very quiet, peaceably disposed people. Although the large reduction in the shipping using St. Thomas as a port of call has curtailed opportunities for labor, the hurricane which last year devastated the island resulted in an exceptional call for labor, connected with repair of the various buildings damaged. The laboring class of people in both islands have been under the impression that the American occupation would cause a tremendous advance in the price of labor, and that unskilled labor would all be utilized by the United States in developing St. Thomas as a fortified naval base. It was common rumor in the island that the United States had appropriated some $10,000,000, to be expended on the proposed fortifications for the island of St. Thomas. It was also currently believed that the United States would be in the market for large tracts of land at fancy prices.

24. Agriculture. The amount of land cultivated in St. Thomas is too insignificant to have any influence on the local markets. On the island of St. John a large lime plantation had been developed, but was practically wiped out and the trees destroyed during the hurricane of last October. In St. Croix practically the only crop is sugar cane. A few yams are grown, but can not be obtained in any quantity in the market. Owing to bad weather conditions and to labor difficulties the sugar crop in St. Croix for this year will probably be below the average. Several of the planters have also curtailed the amount of land placed under sugar and have turned it into grazing land. Cattle are raised in all of the islands, and meat of a good quality is sufficiently abundant in the local markets at a reasonable price.

25. Administration.--Most of the higher officials of the Government, including all three judges, promptly resigned office on the taking over of the islands by the United States. Temporarily these resignations proved embarrassing, since, with the exception of myself, my two aids, Capt. E. S. Willing, United States Medical Corps; and Second Lieut. L. L. Leech, United States Medical Corps; there were no American officials present to take over the duties of the officials who had resigned. Capt. Willing was the only American official in the island of St. Croix for some weeks, and he fell heir to all the administrative and judicial work of that island. With the advisory assistance of the former Danish Colonial Secretary, he has kept the administration of the island in workable shape, and is to be highly commended for what, under the conditions, I consider most excellent results. Mr. Denzil Noll, LL. D., formerly assistant United States district attorney in Alaska, has recently been appointed as judge for the Frederiksted District of St. Croix, and Capt. Willing has been relieved from some of his numerous duties. He now has under his command three second lieutenants who assist him in the performance of his military duties and in the local police work of the island.

26. The duties of my two aids have been incessant, laborious, and highly diversified, and those duties have been performed to my entire satisfaction. JAMES H. OLIVER.

WEDNESDAY, JULY 25, 1917.

NAVAL ACADEMY.

STATEMENT OF COMMANDER W. H. STANDLEY, UNITED STATES

NAVY.

PAY OF PROFESSORS, ETC.

The CHAIRMAN. You are asking "$25,000 for pay of professors and instructors, including one professor and librarian, fiscal year 1918." Are these civilian instructors?

Commander STANDLEY. Yes, sir; they are civilian instructors. They are required on account of the increase in the number of midshipmen at the academy. The midshipmen have increased from 1,240 to-we estimate, and that is all we can do now-1,500 for the next academic year. We have asked for 13 instructors. That is, we have estimated for 13 instructors, which, at $1,800 a year each, makes $23,400. The original request was for $25,000. The superintendent asked me to increase that to $25,200, which would give us 14 additional instructors, which will be needed.

The CHAIRMAN. Why do you need 14 additional instructors with only 260 additional midshipmen?

Commander STANDLEY. There will be approximately 260 additional midshipmen in the academy. They will all come in the fourth class. These instructors will be divided up. As a matter of fact, the needs at the present time are 5 in the mathematics department and 10 in modern languages and 2 additional in English. That, of course, is on account of the increase of midshipmen.

Mr. SHERLEY. What do you mean-that the 200 additional is an increase that has already taken place?

Commander STANDLEY. I meant the condidates who have just passed the examination.

Mr. SHERLEY. You are asking for 13 additional instructors for 200 boys. That is a pretty heavy number of teachers for that number of boys.

Mr. ROOSEVELT. That is below the average in any institution of learning that I know of.

Mr. SHERLFY. No; that is not below the average.

Mr. ROOSEVELT. There are 260.

Mr. SHERLEY. If you take 260 and divide that number by 17, it is hardly 20.

Mr. ROOSEVELT. The instruction there is run by sections, individual instruction, not large classes.

The CHAIRMAN. How large are the sections?

Commander STANDLEY. We have from 12 to 17. Seventeen men is too much for a section. They are trying to run the modern languages on a basis of 15 per section.

Mr. SHERLEY. That is rather a surprising statement; that 17 men make a section which is too large for one teacher.

Commander STANDLEY. It is a section. They recite in sections of 17 men. The sections come into the class room, and in one hour the instructor must instruct those 17 men, hear them recite, and mark them. He has to do all that in one hour.

Mr. SHERLEY. That is what any teacher would do with a class. The CHAIRMAN. How many professors and instructors have you now?

Commander STANDLEY. We have actually 68 civilian instructors at the present time.

Mr. ROOSEVELT. And how many officers?

Commander STANDLEY. I can not state offhand. We have no officer instructors in the department of mathematics, the department of modern languages, or the department of English, except the two heads of departments-one in mathematics and one in modern languages. The officers have all been detached.