File No. 711.5914/114
Consul Payne to the Secretary of State
St. Thomas, August 14, 1916.
Sir: I have the honor to hereby confirm the Department’s cable of the 5th instant to this Consulate reading as follows: [Printed ante.]
[Page 651]The cable reply from the St. Thomas Consulate, of today’s date, reads as follows:
Referring Department’s fifth, code messages disallowed. Report mailed today.
In connection with the above, I have to report that immediately upon the receipt of the Department’s cabled instruction the Vice Consul had a lengthy conference with Government Secretary Baumann, with whom this office enjoys the friendliest relationship, who promised to render to the Consulate a full report on the subject, and to include copies of all of the agreements made by the local Colonial Government with any individual or concern here as a result of which any special privileges are enjoyed along the lines indicated in the Department’s cable. Late in the afternoon, though, the Government Secretary telephoned to the Consulate to state that it would be impossible for him to redeem the pledge he had made in the morning.
On the following day, the Governor himself requested a conference with me, but upon my arrival at the Government Office, at the appointed hour, the Governor was absent. The Government Secretary, however, intimated to me that the Governor had objected to furnish the consulate with any such information as had been requested until he had received instructions from the Copenhagen Government as to the exact status of affairs respecting the probable sale of the Danish West Indies.
This office felt justified in the course it had pursued, inasmuch as practically all of the information requested was public property, and in many instances, at the time the various agreements were made, was published in the local newspapers. However, the action of the Governor in this instance is only in keeping with his attitude along these lines ever since the present sale question began to assume serious proportions. Taking but one example, when a request was made of him some time ago, through the American Consular Agent in Ste. Croix, for certain data regarding the 1916 sugar crop, he arbitrarily replied, according to the written statement of the Consular Agent, that he would not positively refuse his request but would prefer if he would withdraw it. The Governor has the reputation of being more or less anti-American, and has been strongly opposed to the sale of the islands, and these two conditions will probably explain the reason for his putting obstacles in the way of the Consulate in such a manner as he has done repeatedly, when the office was seeking some special information.
As a result, in order to obtain the information desired, it has become necessary for this office to interview the heads of the various local concerns that enjoy any sort of monopoly; but, owing to the inability of some of these, and the unwillingness of others, to provide full details on the subject, the results met with have not been as satisfactory as was hoped for.
It now appears, from a statement made by Captain H. P. Berg, manager of the West India Company, Limited, that his denials made on the occasion of several former interviews, concerning the existence of any sort of concession granted to the company he represents hexe were absolutely false, and that they do enjoy special [Page 652] privileges that incline to give them a monopoly in their electricity, oil, water, and, possibly, their coal supply business.
According to Captain Berg’s statement, the West India Company has the exclusive privilege for furnishing electricity and electric power to St. Thomas for a period of ten years dating from April, 1915, and with the option for an extension of same for another ten year period, unless the Government should decide to take over the plant in accordance with the terms of a contract which reserves this right. The prices for electricity were determined upon when the agreement was made, and are more or less fixed. No taxes at all are levied upon any department of this plant.
For supplying fuel oil to ships in the St. Thomas harbor, the manager of the West India Company asserts that they have the exclusive and unlimited privilege.
Respecting the future water supply for the town and for the harbor, Captain Berg admits that the Government has made some arrangement with the West India Company, but no details of this arrangement could be ascertained.
As for the harbor coal supply business, it is said that the West India Company possesses no governmental concessions that afford it any special advantage over their competitors, but, owing to the local conditions occasioned by the war, and because of a previous favorable arrangement for the transportation of their coal here, the company is enabled to undersell all others, and consequently, is at present enjoying an absolute monopoly in this business.
Captain Berg states that the West India Company has paid no taxes to the local Government since their establishment here.
As previously reported to the Department, Governor L. C. Helweg-Larsen is the chairman of the board of directors of the West India Company, and is also a large shareholder in this concern. In addition, according to the statements made by members of the local colonial council, the methods that he, as Governor, has employed for “railroading through” the council legislation favorable to the company he represents sound most reprehensible. There is a prevailing opinion here that considerable German money has found its way into the new St. Thomas harbor improvements, although the Governor, the local manager, Captain H. P. Berg, and the German Consul stoutly declare to the contrary.
According to the statement of the German Consul, who is also the local representative of the Hamburg-America Line, the only real estate interests that the Hamburg-America Company has in St. Thomas are the following: The new office building, the superintendent’s residence, the old office building, and the wharf.
An extension to their own wharf, of about equal size, is leased by the Hamburg-America Line from private parties, who own this tract of land on the slope of Orkanshullet Island.
For the purpose of giving the Department a better understanding concerning the ownership and control of lands about the harbor of St. Thomas, there is being transmitted, under separate cover, a map of the harbor, along with three small supplemental maps, where the several wharf holdings have been roughly indicated. This work was done for the consulate by the local Government surveyor, Mr. C. Philipsen, and is regarded as fairly correct, although Mr. Philipsen [Page 653] does not wish same to be considered as in any way an official ruling on the subject.
The lease on the lands rented by the St. Thomas Dock, Engineering and Coaling Company, as well as their exclusive right to operate a dry-dock in the harbor, expires, according to the statement of Captain C. B. Stewart, who is the local manager for the company, as well as the British Consul, in the year 1918.
A copy of the ordinance concerning subsidies from the colonial treasuries of St. Thomas and St. Croix the “West India and Panama Telegraph Company, Ltd.” is enclosed herewith.
The local telephone company appears to have been established under the laws of Denmark, as a joint stock company, in the year 1906, with headquarters in St. Thomas. Governor Larsen and Postmaster Carstensen are the directors of the company, and these two men, with a Mr. Hey, a member of the Danish Landsthing and the company’s original promoter, and two others, make up the entire body of stockholders. The local colonial council, with the approval of the Home Government, has given this company the exclusive right to operate here, and they have to pay a local tax according to the size of their income, which is stated every half year. This tax amounted in 1915 to approximately $50.00. Every five years the Government has the right to regulate the telephone rates, and it also possesses the right, at any time, to take over the concern, by giving due notice and paying the actual cost of the plant.
The company has at present about 140 subscribers, and their rates are $2.50 per month for one telephone; but where a second telephone is installed in a man’s residence, besides his place of business, only $2.00 is charged for the addition. The past year’s running expenses amounted to approximately 9,000 francs ($1,737.00), out of which the directors and the employes received a gratification of 1,000 francs ($193.00). A 10% dividend, as a rule, is paid to the stockholders.
The drug stores, of which one is limited to St. Thomas, and one to each of the towns of Frederiksted and Christiansted in St. Croix, make up, so far as this office has been able to find out, the remainder of the local monopolies. The exclusive right for the operation of a drug store in each of the three named localities is given by the Government, and the resultant exorbitant prices and unsatisfactory service have created much dissatisfaction.
I have [etc.]