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The rights of the manufacturers of coarse salt arise and are founded on permits or licenses given by the Commissioners of the Land Office. The undersigned does not state more particularly the rights of the salt manufacturers, as he desires only to show that the State has, by virtue of its ownership and contract, exclusive control over the reservation and all the erections thereon. When and on what conditions the State should exercise this power, the undersigned does not propose to consider in this report.
In 1859 the manufacture of salt became quite depressed, and the price of salt was quite low. The competition between the owners of the different fine salt blocks was very great, and the capacity of these fine salt blocks being much greater than their manufacture the value of them was much less than their cost.
As will appear hereinafter, about one-third of the wbole number of these fine salt blocks, if kept in constant operation during the season of seven months, would produce all the salt that was manufactured by the whole 316. This was caused partially by the inability of the State to furnish more water, at least of the best quality, and partially by the unprofitable nature of the manufacture of fine salt.
To obviate this, and to combine and make the manufacture of salt remunerative if not profitable, “ The Onondaga Salt Co” was organized in the winter of 1859 and spring of 1860. It is a corporation under the general manufacturing law, and at first had a capital stock of $160,000. This capital stock was made up by calculating five per cent on the value of all the property employed in and about the reservation in the manufacture of salt, both coarse and fine, which was called $3,200,000, and the owners of each salt block or portion of land occupied with salt covers for the manufacture of coarse salt was called upon and expected to pay and take stock in said corpotion, to the amount of five per cent on this valuation of his property thus used in the manufacture of salt. Almost all the owners did thus subscribe and take stock, and the balance of stock was made up by other persons or owners taking more stock than was allotted, so that over nine-tenths of the stockholders were owners of salt property and in about the same ratio.
After the organization of this corporation, the corporation leased each salt block, and almost all lands used for the manufacture of coarse
salt, of the owners, who were also stockholders. These leases are uniform in their conditions, and a copy of one is included in the testimony submitted and attached to report of majority. By these leases this corporation acquired exclusive control of all lands and property thus leased, and in consideration covenanted to pay quarterly an annual rent equal to 12} per cent, upon a valuation of said property provided for therein. This valuation was afterwards made and according to the testimony of J. W. Barker, superintendent of said corporation, these fine salt blocks were not worth at that time, or just before the organization of this corporation, the valuation. Those valued at $5,000 could have been bought at $4,000, and the undersigned believes some of them even at a lower price. Besides this agreement on their part to thus pay 123 per cent on such valuation, this corporation further covenanted " that (it) the party of the second part will during the period of this lease or grant or until its termination sooner by forfeiture, as above provided, pay all ordinary city, town, county, school and highway taxes, and will at all times make reasonable and proper repairs for the purpose of protecting the said premises from dilapidation and waste by the elements or other causes, and at the expiration of the period aforesaid, or earlier termination of the estate hereby granted, will restore the said premises, erections and appurtenances, in as good repair as the same are when these presents are delivered, excepting only, accidental losses by the elements other than fire."
These leases were all for ten years. Afterwards some of the salt blocks were changed so that salt could be manufactured therein with coal instead of wood, at a cost of from $600 to $1,000, and in such cases the cost or about the cost of such change was added to the first valuation, and 12} per cent paid also on such addition.
Thus, it will be seen, the owners of fine salt blocks, were to, and have, received annually 123 per cent on a valuation (at least, onequarter more than the actual value at that time) over and above all taxes, repairs of every kind, and at the end of term get back their property in the same repair, or rebuilt in case it was destroyed by fire or any other way, "except by the accidental losses by the elements other than fire.” A few owners of coarse salt blocks did not lease, but this corporation afterwards, by contract, obtained control of the sale of all salt thus manufactured.
Thus this Onondaga Salt Company obtained exclusive control of the manufacture and sale of all salt, both fine and coarse, made from the wells on this reservation, and continue to exercise the same. It allots to each salt block the amount of salt it is allowed to make each year and determines the price per bushel it will pay, and usually lets this work to the owner of the block from whom it has taken the lease.
Hence it will be seen, that, although " The Onondaga Salt Co." is the one party in these leases and contracts and the individual or corporate owners of the separate blocks or coarse salt lots and covers are the other party, yet as these same individual or corporate owners are also stockholders in the said corporation in the same ratio as they are owners respectively. Yet the interests of both parties are identical, and that “The Onondaga Salt Co." was organized, for the purpose before stated, by the salt manufacturers by adding five or six per cent to their capital and creating a monopoly in its sale and manufacture.
Since 1860 salt deposits, especially at Saginaw, Mich., or in portions of Canada, have either been discovered or the manufacture therefrom has been much increased and improved. At these places wood, as a fuel, is much cheaper, and as the cost of fuel is the main expense in the manufacture of fine salt, it can, in that particular, be manufactured cheaper. But on account of the purity of the water from the Onondaga springs, its high comparative strength, its exhaustless quantity and the ease with which it is obtained in connection with the improved methods of purifying and manufacturing it into salt, discovered through many costly experiments made by the State and by “The Onondaga Salt Co.," Onondaga salt, for the same quality, is produced cheaper than any other manufactured salt.
The use of coal as a fuel has not only cheapened but improved the manufacture thereof, and as the price of wood can but increase at the place of manufacture where it is usel, while on the contrary the price of coal will doubtless not increase except by increase in price of labor; it is quite probable, if not certain, that this difference on account of the cost of fuel as between Saginaw, the works in Canada and the Onondaga salt springs will become less and less, and
thus enable the Onondaga salt the better to compete with salt from these other parts.
In this connection while referring to causes enabling the Onondaga salt the better to compete in the market with salt from other localities, and especially from Saginaw (which is the principal place from which competition comes westward), the undersigned would call attention to that well known fact that the bulk of freight on the canals and lakes is eastward, and hence that the price of freight is much less from Syracuse westward than from Saginaw eastward. In fact this is so much so that often shippers on the lakes are glad to get salt as ballast while any salt brought eastward must pay full freight. The great weight and bulk of salt according to its value only makes this difference the greater. These causes while they are thus advantageous to Onondaga salt in enabling it to compete with Saginaw salt in its home markets, and markets west of it also, operate favorably in another way. They operate to prohibit the sale of Saginaw salt any great distance eastward, especially not on or near Lake Erie, and thus give the entire control of the price in certain markets to the manufacturers of Onondaga salt. The market thus controlled is found to be all the State of New York, except the river counties, New York city, and some of the south eastern counties. It also includes a portion of Pennsylvania. The competition which prevents Onondaga salt controlling the market.in N. Y. city, and the eastern and south eastern portions of the State, is the low price of foreign salt and the fact of the increased cost of freight eastward from Syracuse, considered in connection with its great weight as compared with its cost; as it gave Onondaga salt the advantage westward, gives foreign salt the advantage in these localities. To counteract this the tolls on the canal on foreign salt when compared with domestic salt are as 27 to 14 which makes a difference of five cents per barrel from Albany to Syracuse, and in that proportion for longer or shorter distances. The Onondaga Salt Company in order to protect itself and its stockholders from the high price of coal produced by another combination well known as the coal monopoly, purchased a coal mine in Pennsylvania sometime about the year 1862. It operated this mine and thus obtained its own coal until the winter of 1865, when it sold this coal mine at an advance of $510,000, and also obtained a contract with the purchaser to furnish this Company .with all the coal it might need for 17 years, at 50 cents above net cost.
Thus organized, the Onondaga Salt Compary have operated these salt springs under these circumstances with the following results, as appears from its books, the sworn statement of its officers, and of Hon. Geo. Geddes, Superintendent of salt springs, and his deputies.
Amount of Salt Produced and Sold, and Price.
This salt was sold in the various markets in about the same ratio each year, and in the year 1866, viz:
Barrels. New York city, 149,663 at $1.67.
$249,937 21 Canada,
102,066 at 1.93.... 196,987 38 Lower lake,
383,380 at 2.03... 778,261 40 Upper lake,
382,234 at 1.99... 760,645 66 State, ...
414,358 at 2.25..... 932,295 50
1,431,701 Av. price, $2.03 $2,918,127 15
This shows the net avails of such sales at Syracuse; and as the sales in the State were in fact $2.35, at Syracuse the allowance of ten cents for selling must have been deducted.
The following is a table of the average cost of transportation and sale of a barrel of salt in each market in year 1866: Upper lake ports
40 cents, Lower
36 New York city
51 The following is a table of the net price realized at Syracuse of all salt sold in different markets for different years :