Mr. PHILLIPS. That is all right. I didn't find out about your hearing until you had gone from McKinley Park, and it was rather curious why we didn't know about it and what the content was, but I am glad that point was brought up.

There is one question in the tourist program in the Territory that many people talk about of being of major importance, and that is the Alaskan Highway and feeding people into the Territory. That certainly is the second avenue to funnel people into the Territory. However, I think it will not gain its major importance until paving. is done on the highway. It is an adventure, I will grant you, to go over the Alaska Highway, but most of the tourists like to do it one way after they find out what kind of an adventure it is. I think the paving of the Alaska Highway, certainly we will get the volume in the Territory of Alaska necessary to make money.

Mr. ABBOTT. Have the people in travel agencies in the Territory itself promoted a fly-in-drive-out or fly-in-sail-out, that is, cooperating with competing means of transportation program?

Mr. PHILLIPS. The first active thing that was done was just recently, within the last month, the Alaska Visitors' Association Board meeting at McKinley Park, and it was suggested that it would be wise to investigate the possibility of special back haul freight rates on automobiles on sea transportation in order to be able to sell this very idea you are talking about, because it certainly would sell, because I get people in the office every day during the tourist season wondering what they can do with their car because they do not want to drive back over the highway and would like to fly.

Mr. ABBOTT. Matson and United, I believe, have an informal working agreement because of the very pleasant 41⁄2 to 5-day trip out, and then perhaps fly back or vice versa, and that appears to be a major contributing factor to increased utilization to both and mutual advantage of both.

Mr. PHILLIPS. That is true also in South America with Pan America and the Grace Line. However, recognize here there is no passenger service. So it means shipping the car itself, a freight problem in getting the car back, or selling it here, and we have a limited market for all the cars that come over the highway.

With those observations, I would just like to say briefly: We have daily problems in this industry we are certainly not going to bother you with. We solve them in the main by ourselves.

However, there are two problems I would like to mention here, and favorable consideration of these problems would help us immeasurably in the immediate future that means tomorrow, in the 1956 season—in the development of the tourist industry.

Problem No. 1 is McKinley National Park and Hotel. McKinley Park is important because it is the No. 1 attraction to Alaska. That is universally known. It takes very little or no selling people on McKinley, and that is the place they want to go when they come here. So it is obviously the thing to build our tourist program around. I would like to make a couple of comments.

No. 1, McKinley National Park Hotel and the National Park itself should be opened. There is no question in our minds that this should happen.

No. 2. It is imperative that a decision be made by someone immediately. That means by November 1.

Would you like to have me expand on that, why that is necessary? Mr. ABBOTT. Are you saying that it is imperative a decision be made on the previous point you just made?

Mr. PHILLIPS. The park hotel will be opened or the park will be opened.

Mr. ABBOTT. Well, could you state why?

Mr. PHILLIPS. Yes. No. 1, the 1955 season is over, and we are for all practical purposes in our groundwork half-way through the 1956 season. All plans have to be made and folders have to be made, publicity has to be put out, selling has to be done. This selling will start taking place about November 1. If you have nothing to sell, obviously you are not going to sell very much of it.

In any company that does a national advertising job or promotion job we are talking about a sizable expenditure of funds-you have to have your plans, your pricing, you have to know what is going to be offered for the following year. This has to take place before November 1. Everything will be in the mail before the end of the year and actual bookings will take place.

This year, as you know, we did not know the park hotel would be open until 2 weeks before the summer came.

Through some research we just completed, it may be interesting to know that 66% percent of the gross business that went through McKinley National Park Hotel was booked by our company. This was booked on strictly blind faith that the hotel would be opened. We have set a policy this year that we will not take the gamble again this year because it costs us money to do so, and if we can't have a decision we will be forced not to include McKinley Park Hotel.

Mr. ABBOTT. On that point, Mr. Phillips, the committee chairman asked that I stop at the Park Service regional headquarters at San Francisco, en route here.

I did consult with the people there, having previously talked with Mr. Wirth while in Washington, the Director of the National Park Service. I would suggest, Mr. Chairman, that in light of the testimony we received at McKinley Park Hotel as to the conversion, for example, of their steam heating plant and other expenditures which are being made, that an inquiry could be directed to Mr. Wirth. It would certainly not be an unreasonable request to have a determination prior to that date as to whether the McKinley Park Hotel will be opened.

Mr. O'BRIEN. I agree with you, Mr. Abbott, there has to be a decision, and there is no reason why not in time to be helpful to these people.

Is it the opinion of the committee that such a communication should be sent?

Without objection, then that will be done.

Mr. Abbott, would it be your suggestion, too, that the committee would express a belief that the hotel should be kept open? Did not Mr. Wirth suggest to you that we look into that particular thing?

I do not think a recommendation which might be printed some months hence in the committee report would be of any great value. I think it might be desirable-that is strictly my own opinion-if the committee feels the hotel should be kept open, that we should express that belief in the same communication to Mr. Wirth.

Mr. ABBOTT. It would be my suggestion-in light of the testimony of the gentleman speaking for National Park Concessions, Inc., and if Mr. Wirth is aware of the figures presented as to operating costs and as to the operations during the past season that certainly in view of the rather substantial expenditures to be made this fall you can reach no other conclusion but that the park should be kept opened. That is qualified, as I say, as to whether or not the Park Service is in agreement. The National Park Concessions, Inc., has been used in areas where you cannot competitively attract concessionaires, and we understood from the gentleman who appeared that they stood ready, if requested.

Mr. DAWSON. That is their rule anyway. So that within the committee the judgment Mrs. Pfost, of course, is chairman of the committee which has the National Parks

(Discussion off the record.)

Mr. O'BRIEN. I think that is a very fine suggestion.

Mr. BARTLETT. Has Alaska Visitors' Association heard anything from the hotel?

Mr. PHILLIPS. No, they have not, and we requested that we be furnished with an answer, but we have not been furnished.

Mr. BARTLETT. Well, has there been any indication of attitude? Mr. PHILLIPS. The only thing that I can say and as you gentlemen know, there have been moneys appropriated for maintenance this winter-it would indicate to us that they were thinking of opening it. Also, they are building a very expensive road into McKinley Park. There is a substantial investment in the park hotel itself. It would seem logical that they just wouldn't let it fall into the ground. However, you can't gamble on that when it costs as much as it does to promote the business.

Mr. ABBOTT. According to the testimony given there is justification of an expenditure, a rather substantial expenditure, for conversion of their present steam heating plant and a $60,000 item for standby heat in the hotel. As it now stands on an annual basis, the cost of the conversion would be amortized, I believe the gentleman said, in approximately 3 years, because it would be reduced to some $30,000 a year with such programing of funds, then either you are going to continue spending other sums next season, or you are not. It would follow that you are going to take advantage of the expenditures now being made.

Mr. PHILLIPS. I would like to offer an observation here, too, that if they can keep the park open for, say, 2 years, that I understand is the period in which the road will be completed and automobiles will be able to come into the park, and consequently get volume into the park, which is the only thing that will make money at the hotel. Possibly that would be a good outlook if we could plan for 2 years on the thing.

There are a couple of things that we noticed through complaints and through working very close with it. I think it would be wise if, in operating the park hotel itself, that they didn't try to make up the deficit on the food, for instance. People paid relatively high prices on the food of inferior quality this summer.

Mr. ABBOTT. But marshaling for us comments of guests as they left the park, I believe the testimony was that there were few complaints about food, that charges are reasonable. There were a few

complaints about not being able to see the principal attraction from the hotel. There was a 13,000-foot obstacle outside the hotel to viewing Mount McKinley. Complaints about access roads. And beyond that I believe the testimony there was that as far as the food was concerned, neither in the rates to be charged for the rooms proper nor in the food itself, was there substantial complaint.

Mr. O'BRIEN. I understood there was one more complaint, the buses. The people seemed, from what they reported to us, much more concerned about their posterior than interior.

Mr. PHILLIPS. May I ask who made the statement that there were no complaints on food?

Mr. ABBOTT. Well, now, understand I am reaching back into my memory from a number of people we heard, but the manager of the hotel, a Mr. Hanson, stated, and I believe Mr. Jacobs and Purcellwas that his name- -the two Park Service people who were there, bore that out, that they felt and the comments they invited their guests to make, that their food was not exorbitant, which did not necessarily parallel comments of tourists in areas outside McKinley Park Hotel. Mr. PHILLIPS. I just wonder if you have been in business yourself, you may realize many times the businessman is the last one to really get the complaints, and I am thinking in terms of making money in the park, and you have to do that with volume. instance, if you have a man with a family of 4 or 5 people in his family, and he is going to drive in there, is he going to pay the rates of the rooms and meal prices for a family that, as I say I doubt it.

For

Mr. ABBOTT. Is the Alaska Visitors' Association enthusiastic enough about keeping McKinley Park Hotel up to make up the $30,000 deficit?

Mr. PHILLIPS. They have no facilities-I mean they haven't the money. They couldn't if they wanted to.

Mr. ABBOTT. You people had the benefit of a survey of a tourismpossibilities of recreation survey, I believe William Stanton, on contract with the Department of the Interior. It was completed after field work in 1951 and 1952. It appears it was completed in 1953. Did that serve a useful purpose?

Mr. PHILLIPS. Yes; it did. And you have anticipated my second point. So if you let me go ahead with that, I have a couple of details. Mr. TAYLOR. Before we go on to that, we understood from the menu that we saw posted, that the highest priced meal on the menu for that one day was $5.95 for a T-bone steak, 16-ounce, and we———— Mr. PHILLIPS. Did you eat one?

Mr. TAYLOR. No; and the fact was we complimented Mr. Hanson, the manager, off the record, as I recall, on the level of the prices, that is what was listed on the menu. As far as the rooms were concerned, I recall particularly that he told us that for student groups and tourists-the NEA, I believe, he said had one there this summer- -that the rooms without bath, 2 in a room, would be $6 per night. We complimented him on those prices, because we had just come from one of the other parks in the States where similar prices would be considerably higher.

Mr. PHILLIPS. That is interesting, because we handled the NEA group this year, and all the others, and if anything, we pay a premium on the rooms. We have never received a room in McKinley Park for $6 a person.

Mr. TAYLOR. Without bath?

Mr. PHILLIPS. Without bath; no, sir. Most of the tourists insist on rooms with a bath.

Mr. TAYLOR. I think he told us they had 12 rooms.

Mr. PHILLIPS. It may touch a very few people, but not the majority of the people, if such a rate exists.

Mr. ABBOTT. In any case, Mr. Phillips, your primary concern or the thing upon which you would concentrate your energy is the assurance that the hotel be kept open before you start substituting your management for the management designated by the Department of the Interior as to how it will be run if it is kept opened?

Mr. PHILLIPS. That is true, and I did not mean to be presumptuous. I was just offering a few suggestions here as I have heard them, because I happen to meet all the people that come in. And in the effort of making the thing profitable for the Department of the Interior or whoever operates it, some of those things might be considered.

Also, there is one other thing I would like to say: That one of the complaints, of course, is the lack of activity in McKinley National Park, but I know with proper planning, and if people know that the thing is going to be opened from year to year, I am sure that there is ample private interest in capital to develop entertainment facilities in the park, which would not fall right on the park itself in the cost of keeping the thing open.

Mr. TAYLOR. Would there be any possibility of having a winter program for skiing up there, or is it too cold?

Mr. PHILLIPS. No. In fact, I am sure such a program would be possible. I think they found in the past that they lost nothing but money by keeping it open in the wintertime. Those things are certainly possible, but you have to have volume again in order to do it. It is a little difficult. The last winter it was open it was made almost an impossibility to go there because of the railroad schedule. So it eliminated problems in the wintertime.

To be brief, I will go on to my other point. That is the problem of research that Mr. Abbott brought up, the survey that he pointed out. That is the only one in my experience that I know of that has been anywhere near comprehensive or touched on the tourist problem in Alaska.

I would like to recommend that thought be given to a continual, periodical research program in order to aid us in logical development in Alaska. I think it is not only valuable to us that are trying to make a living from it and develop it here, but also valuable to yourselves in the way of getting accurate information.

If you are reading the report, the 1952 report right now, it is very obsolete and inaccurate for the picture today. The housing situation, for one, is certainly not represented in there at all, and as in any industry, be it heavy industry, oil, or anything else, most industries have a research program of some kind.

As individuals, I doubt if there are any of us that have that kind of money to carry on a Territorywide research program. Dr. Stanton has suggested that he thought it would be adequate to have a research program every other year or to stretch it maybe every third year, but right now he thought every other year would be wise.

I could guess at a cost, I suppose, and it would be strictly a guess. Possibly the first year, in order to set up standards and get into a