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$150,000 in Federal funds provided for this project. This made it possible to increase the food supply and the income of the island by the planting of approximately 16,000 acres in subsistence crops and 3,500 acres in cash crops on lands of the Federal Government occupied by the Puerto Rico Reconstruction Administration resettlers. Agronomists gave the resettlers constant advice and supervision in the cultivation, harvesting and marketing of these crops. Seeds produced on 322 acres of beds in the seven Central Service Farms and fertilizers and insecticides were distributed to needy resettlers. These resettlers were not paid for labor on their own parcels, but were paid for work performed in cultivation of the Central Service Farms proper, for the repair and maintenance of intra-farm roads, and for labor in operating and maintaining the Puerto Rico Reconstruction Administration's 37 rural waterworks systems which supply potable water gratis to rural dwellers.
The Castaner project, undertaken several years ago to demonstrate that a large coffee plantation can be made self-sustaining by proper land utilization, soil conservation and crop diversification produced $56,750.94 from the sale of citron, vanilla, coffee, sugarcane, and various minor crops, while furnishing employment to members of more than 200 rural families resettled on one- and two-acre subsistence parcels. In addition to the two 30-bed rural hospitals mentioned in last year's report as established at the Puerto Rico Reconstruction Administration's Castaner and La Plata projects by the National Service Board for Religious Objectors, health units have been opened and are being operated to serve the residents of the Puerto Rico Reconstruction Administration's rural rehabilitation projects in the Zalduondo, San Just, and Comerio areas. Under technical supervision of the planning and direction of the work program by the Puerto Rico Reconstruction Administration as authorized by the Director of Selective Service, these adjuncts of the civilian public service camps are providing invaluable health service to thousands of Puerto Rican rural dwellers for whom such facilities were never before available.
Special attention was given to the cooperatives financed by the Puerto Rico Reconstruction Administration which are engaged in the marketing of produce and the production of commodities for war needs. The Lafayette Sugar Mill Cooperative processed 207,000 tons of cane as compared with 179,000 tons the previous year, and sold all sugar produced to the Commodity Credit Corporation. In its subsidiary solvents plant over 5,000,000 pounds of butyl alcohol and acetone under War Production Board allocations was sold for lendlease and other war requirements. Interest due June 30, 1945, on the Puerto Rico Reconstruction Administration loan of approximately $3,037,450 was paid in advance, and shortly after the end of the fiscal year the cooperative paid $250,000 on principal, although no amortization installments are due until June 1947. However, due to the termination of lend-lease and the uncertain postwar commercial demand for the plant's butyl alcohol and acetone, their production has been stopped and plans for conversion of the plant to the manufacture of industrial alcohol are under consideration. The Los Canos Sugar Mill Cooperative processed approximately 200,000 tons of cane, paid interest accrued and $54,000 of its principal debt to the Puerto Rico Reconstruction Administration under a refinancing arrangement, with the balance of $936,000 payable in annual amortization installments of approximately $50,000 including interest beginning June 30, 1946. Five vegetable-marketing cooperatives previously organized and financed by Puerto Rico Reconstruction Administration increased their volume of business to approximately $500,000 from $300,000 for the fiscal year 1944 and $100,000 for the fiscal year 1943. All met installment obligations to the Puerto Rico Reconstruction Administration on time and one paid 4 years in advance. Two additional vegetable marketing cooperatives, one at Corozal and the other at Barranquitas were organized and financed with Peurto Rico Reconstruction Administration loans totaling $29,000. The Cotton Growers Cooperative Association, to which at one time loans aggregating $125,000 had been made, reduced its existing $63,750 loan to $30,000, having sold 1,756,466 pounds of Sea Island cotton during the fiscal year. The Sociedad Agricola which purchases farm supplies for members and patrons, sold approximately $762,000 of fertilizer, feeds, etc. An additional loan of $20,000 was made to the Puerto Rico Rug Cooperative, composed of rural dwellers, and which had a record volume of business amounting to over $122,000. The cooperative organized and financed the previous year and known as the "Cooperativa de Cosecheros de Cidra", processed approximately 1,100,000 pounds of citron during the fiscal year, representing about one-fourth of the island's total production of a product for which previously there was little encouragement. The accounting and operations of all of these cooperatives sponsored and financed by the Puerto Rico Reconstruction Administration are under its constant supervision.
For the continuation during the fiscal year 1946 of projects similar to those above reported, the President has authorized the Puerto Rico Reconstruction Administration to expend approximately $950,000 out of the Puerto Rico revolving fund. On June 30, 1945, the unobligated balance in this fund was approximately $2,650,000. Anticipated deposits to the revolving fund during the fiscal year 1946 and succeeding years in proceeds derived from projects financed with what were originally 1935 funds, will be somewhat less than the amounts required each year to continue the Puerto Rico Reconstruction Administration's present limited program. Accordingly in a few years the revolving fund will be so depleted that some other source must be found for conserving the social and economic benefits which would be lost if the program were entirely terminated. It is unquestionably true that large expenditures either of insular or Federal funds must be made for many years to come if the permanent reconstruction of the island's distressed economy which President Roosevelt set as a fundamental objective is to be accomplished.
DILLON S. MYER, Director
"THE most important turning point in the comparatively short his'tory of the War Relocation Authority program came toward the end of 1944. On December 17 the War Department announced the revocation of the mass exclusion orders under which it had evacuated all persons of Japanese descent from the West coast area in 1942 and through which it had prohibited their return to that area (except under special military permit) for almost 3 years. Basing its action primarily on the satisfactory progress of the war in the Pacific, the War Department immediately replaced the wholesale exclusion with a greatly modified system of control under which it continued to exclude only those individuals of Japanese descent whose personal records appeared to warrant such restriction. The revocation, designated to take effect on January 2, ended the wartime ejection of the great majority of West coast Japanese from their former homes and marked the beginning of the end of the War Relocation Authority program.
The War Relocation Authority which had been maintaining relocation centers as temporary shelters for the evacuated people and meanwhile helping as many as possible to become reestablished in normal communities outside the western exclusion zone, immediately took steps to realign its basic operations. First, it broadened the scope of its resettlement activities to take in the former evacuated area and thus cover the entire United States. Second, it made plans to speed relocation movement from the centers in order to close all centers except Tule Lake within 6 to 12 months. Third, it abandoned all processing of evacuee records for leave clearance and abolished its leave regulations, with the result that all center residents, except those specifically designated for detention by the War Department or the Department of Justice, were free to leave the centers at any time.
With these changes, the Authority was ready for the first time to move definitely toward ultimate liquidation of all its operations. When the revocation order took effect on January 2, there were slightly over 80,000 persons of Japanese descent still residing in the