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The Chief of Engineers after due consideration of these reports concurs in the views and recommendations of the Board.

The improvement is recommended provided that responsible local agencies furnish assurances satisfactory to the Secretary of War that they will: (a) Provide free of cost to the United States, all lands, easements, rights-of-way, and spoil disposal areas required for the new work and subsequent maintenance when and as required; (6) hold and save the United States free from damages due to the construction works; and (c) provide, when needed, additional terminal facilities open to all on equal terms.

The cost to the United States for construction is estimated in the report at $242,000.

The annual carrying charges are estimated at $14,414, including $5,000 annually for increased cost of maintenance.

Benefits will accrue from saving of vessel time awaiting high tide. Fifty-nine of the larger vessels, having loaded drafts of more than 30 feet, will use the harbor each year. With the present harbor depths, each of these boats would be delayed either outside the bar or at their berths an average of 312 hours. For the 59 vessels, the total time lost would be 206 hours annually, which is evaluated at $20,600.

The benefit-cost is 1.46.

In the interest of economical operation of the deeper-draft vessel now more commonly in use a deeper channel is required.

That concludes my statement, sir.

Mr. LARCADE. Are there any questions by members of the committee?

Colonel MOORE. With respect to this project, I have another comment to make, Mr. Chairman. It has come to our attention very recently that a substantial portion of the commerce on which the estimated savings are based has now vanished. Included in the benefits computed by the district engineer in his report were $4,200 for the saving in vessel time to 12 vessels each carrying a load of 8,000 tons of phosphate rock, a total of 96,000 tons, and we have been informed, as I said, that the fertilizer company which has been bringing in that rock, has now transferred its operations to Tampa, a surprise move to local interests and one which was not contemplated in the report. If the savings from that source are excluded from the computed savings, the benefits are reduced to $14,000 as compared with annual charges of $40,414, giving a ratio of approximately unity. We have been unable to disclose in the short time available what traffic, if any, would replace that traffic that has been lost. I can only say that that rock is handled over a terminal with bulk handling facilities, that is, modern facilities for the handling of bulk products in general.

Fernandino, for its size is a highly industrialized community and my personal feeling is that there will be traffic to replace that 'phosphate rock of some kind, but I do not know what it is, and hence any excess of benefits over costs in this case at present is somewhat problematical.

Mr. WHITTINGTON. If you find any additional traffic that would be benefited or promoted before these hearings have been concluded, a revision of your statement will be necessary and will you kindly insert it in the record ?

Colonel MOORE. Yes, sir.
Mr. LARCADE. Without objection, it is so ordered.

Colonel MOORE. I would like to recommend that the committee approve the project. Unless traffic does develop sufficient to provide a substantial margin of benefit over costs, the work would not be prosecuted.

Mr. PICKETT. In your brief analysis of the report which is contained in this separate sheet that is attached to it, you will find the last sentence of the page that for 59 vessels, the total time lost would be 206 hours annually, evaluated at $20,600. I take it from what you have just stated the reference to the loss of profits of 12 vessels that those 12 will be part of the 59 on which you base your original estimate, is that correct?

Colonel MOORE. The statement contained on the mimeographed sheet which you have is subject to interpretation. The report estimates that 59 night vessels lose a total time of 206 hours annually. However, the district engineer doubted whether 7 of those, which are large tankers, would actually come in there. He eliminated them from consideration and gave the final benefits based on 52 ships—and with benefits at $18,200 rather than $20,600. The 12 vessels transporting the phosphate rock which I mentioned are included in the 52, and the savings to them are $4,200, reducing the benefits to $14,000, slightly below the annual charges. There is still

, however, the possibility that those 7 tankers would come in, which would raise the benefits. Some of them might come in at least, which would raise the benefit above unity.

Mr. LARCADE. Are there any questions?

Mr. FORD. Colonel Moore, did the change of one particular company from Fernandino to Tampa, so far as operations are concerned, result from delay in constructing or authorizing this project?

Colonel MOORE. I can't say, Mr. Ford. There possibly may be some management problems involved.

Mr. Ford. How far is Tampa from here?

Colonel- MOORE. This is on the east coast. Tampa is on the west coast of Florida, about 200 miles distant.

Mr. WHITTINGTON. Where does that phosphate rock come from? Colonel MOORE. Florida.

Mr. WHITTINGTON. Does it come by Tampa or will Mr. Bennett cover that matter?

Mr. BENNETT. I can cover that.
Mr. WHITTINGTON. Mr. Bennett will answer that question.

Mr. PICKETT. Would Mr. Bennett also give us the information as to when the company made its change from Fernandino to Tampa?

Mr. WHITTINGTON. All right, fine. Mr. LARCADE. Thank you very much, Colonel. We will now be pleased to hear from Congressman Charles E. Bennett.

STATEMENT OF HON. CHARLES E. BENNETT, A REPRESENTATIVE

IN CONGRESS FROM THE STATE OF FLORIDA

Mr. BENNETT. I am Congressman from the Second District of Florida. This project is included in my district. Fernandina Harbor is one of the oldest good harbors in the United States. I believe it is one of the best natural harbors on the Atlantic seaboard. It has had a very colorful history, going back to pirate days when flags of Mexico and Venezuela flew over it. It is very close to the Atlantic Ocean. As you will note, some of the natural depths of this harbor are 40 feet and over.

It is a very unusual harbor, and due to that fact, it has developed into a very strong industrial town. It has two very large corporations, the Rayonier Corp., which has a rayon pulp mill there which produces things that go into the production of rayon, as you know, and other materials of that kind, and then there is the Container Corp. of America, which has a $6,000,000 plant at Fernandina, which produces kraft paper and boxes. The Rayonier Corp. plant at the present time is about a $6,000,000 plant also. The total annual pay roll of these two plants is upward of $2,000,000 a year and the quantity of products put out by these two plants is large and increasing. Further, there is a substantially large factory which produces fish oil from the menhaden fish, and fertilizer, two products of the menhaden fish. All these three installations are pretty large installations. There are a lot of other industries in this area, but those are three of the largest. Until recently phosphate was shipped from Fernandina.

That phosphate came into Fernandina at all is an example of what a good harbor it is for it is mined at a distance.

Mr. WHITTINGTON. How does phosphate get into this picture, Mr. Bennett?

Mr. BENNETT. I don't really believe it is a very large portion of the picture at all, though its recent loss does account for a number of those ships and it reduces the cost-benefit ratio. Fernandina is one of several ports that have been used for phosphate transportation. It is brought by rail or truck to Fernandina and then it is shipped eastward, or to whatever points it is going to go to, instead of going all the way around Florida. There is an excellent harbor at Fernandina, which is actually on an island that is connected by railroad and by train and by road with the main transportation facilities on land.

Mr. WHITTINGTON. You heard the statement of the representative of the Corps of Engineers with respect to the removal of this phosphate business to Tampa. Now, in your opinion, will that not eliminate the need for the improvement of this project?

Mr. BENNETT. I think it is a borderline case of cost-benefit ratio to be honest with you, but I don't actually believe in the future that it is going to be a borderline case, because Fernandina is a very, very solid

sort of town. It has tremendous energies for a town of 5 or 6 thousand people. Many much larger cities don't have much larger interests than they have in Fernandina. It is an excellent port, and a natural port very close to the Atlantic Ocean. This means Fernandina will always be an industrial town, and these manufacturing installations that are there are fairly old as compared with most other industries of a like kind in the South. That doesn't mean they are 50 or 60 years old, but I think the menhaden fish factory runs back some years, and the Rayonier and the Kraft Corp.'s probably are about 15 years old, something like that. That is old for this section of the country.

Mr. WHITTINGTON. Your frankness is very helpful to me as a member of the committee.

Mr. BENNETT. I always believe in being frank. I would tell you just exactly what I feel about it from the beginning to the end.

Mr. WHITTINGTON. That always helps.

Mr. BENNETT. There is no use in kidding ourselves about anything. I believe that Fernandina Harbor has an excellent future, as it has centuries of an excellent past. I believe the phosphate industry has never been any large portion of the economy. It does involve itself fairly materially in the cost-benefit ratio in this thing, but not so terribly materially. The original benefit-cost ratio, I believe, was 1.46, and as the colonel has testified, it will probably be reduced if the phosphate were taken out to about even Stephen, about 1 to 1 ratio; but bear in mind that there are tremendous natural port assets—timber and menhaden assets for this particular harbor, it isn't in the book for Fernandina to dry up. It just can't dry up, because it is too wonderful a location. It is too close to the deep water off the Atlantic Coast and it is too good a natural port. So it isn't going to fold up, and there is no danger of it doing so. As a matter of fact, phosphate represents only a relatively small portion of its industry at the present time.

Nr. WHITTINGTON. There is already an existing project in that harbor?

Mr. BENNETT. Yes, sir.
Mr. WHITTINGTON. That is all I want to ask you.

Mr. BENNETT. I will try to be brief, but I want to point out to you there are about 5,000 feet right now of good wharfage in this town, excellent wharfage. The phosphate company informs me that it doesn't have any doubt that it is going to get somebody else to take over its wharves.

Mr. LANHAM. May I ask you a question? These phosphate deposits that are in Florida are, I believe, supposed to be the largest phosphate deposits in the southeastern part ?

Mr. BENNETT. They are the largest so far as I know in the world. Florida produces more phosphates than any comparable area in the world.

Mr. LANHAM. One reason they changed the shipping point to Tampa was to transport phosphate up to Mobile and Gulfport, wasn't it?

Mr. BENNETT. I think that it was. Actually, the phosphate removal matter came very late to me, just as it did to the colonel here. It came late to all of us. I didn't know anything about it until the last minute, and I don't think there was a decision made until fairly recently. I don't think it is necessarily a permanent decision.

Mr. LANHAM. Isn't there under construction in the port of Mobile or adjacent to the Mobile area a phosphate processing plant?

Mr. BENNETT. That I don't know of, sir. I am trying to be honest about all this. I don't actually know that Florida is the greatest phosphate producing area in the world, but I think that that is true. That is something I didn't expect to be called to testify upon here and I don't like to be making broad statements without knowing it to be true, but I think that it is.

I would like to mention in closing that I have been in touch with the city manager down there. They have a very progressive young man there, Ed Meisenhelder, and he has told me he doesn't have much doubt they will get something else in there; and, as a matter of fact, he has had information in the last few days that the Rayonier Corp. is now starting something that they hadn't done in the past with shipping. They have started European shipment of pulp material abroad within the last short period of time, last week or so. They have already sent, I think, 10,000 tons to Italy and they expect to pick that up right along. So there isn't any doubt that Fernandina is a permanent, good port and I recommend it to you. I think this project is justified at the present time, because I do think that the potentialities of Fernandina are not anything we have to worry about. It has been a good port for 300 years and it is going to be a good port right along.

Mr. WHITTINGTON. Thank you very much.

Mr. LARCADE. Are there any other witnesses to appear on this project?

Thank you very much, Mr. Bennett. If you desire to revise your remarks or make or file any additional statement

Mr. BENNETT (interposing). I have an additional statement, a typewritten statement, which I will hand to the reporter.

(The statement submitted by Mr. Bennett follows:)

STATEMENT BY HON. CHARLES E. BENNETT

I am Charles. E. Bennett, Representative from Florida's Second Congressional District. I am grateful for this opportunity to speak before the House Public Works Committee in behalf of the proposed project for Fernandina Harbor, Fla., which is the district I represent.

This project is the subject of House Document No. 662 of the Eightieth Congress, second session. The Chief of Army Engineers, on July 8, 1947, recommended the modification of the existing Federal project for Fernandina Harbor to provide a depth of 32 feet below mean low water throughout the harbor and. turning basin at an estimated cost to the United States of $242,000 for new work, and $5,000 annually for maintenance in addition to that now authorized.. The first figure has risen to approximately $290,000 due to increased costs, and the second figure has increased accordingly.

It is the consensus of feeling from my district that there exists substantial. need for the modification recommended by the Chief of Engineers The district engineer, for example, found that the present Fernandina Harbor is inadequate to accommodate prospective commerce and vessel traffic, and that in order to eliminate delays for the larger vessels a depth of 32 feet at mean low water is required.

Fernandina, Fla., the largest town in Fernandina Harbor's tributary area, is a city of approximately 5,000 population. But its commercial interests are far beyond those of the usual city of that size. In 1936 the Container Corp. of America erected a $6,000,000 plant in Fernandina for the making of kraft paper and boxes. Recently an extension to the plant doubled its capacity. In 1937 the Rayonier Corp. constructed a $6,000,000 plant at Fernandina for the making of rayon pulp. The two plants draw upon a stand of southern pine amounting to 10,000,000 acres within a radius of several hundred miles. The two plants: are responsible for employment resulting in an annual pay roll of about $2,000,000. The value of the products of these two mills is $12,640,000 annually.

Another large industry in Fernandina is the processing of menhaden fish in the extraction of oil and the production of fertilizer.

Fernandina Harbor has long enjoyed extensive commerce through its waters.. The annual commerce for the years 1932 to 1945, inclusive, varied from a minimum of 79,712 tons in 1933 to a maximum of 275,586 tons in 1940, the average being 180,710 tons. During 1940 the principal commodities were 60,123 tons of wood pulp (22 percent of the total harbor commerce), 34,162 tons of fuel oil (12 percent), 27,132 tons of chemicals (10 percent), 21,678 tons of phosphate rock (8 percent), and 21,301 tons of fish (8 percent). Except for chemicals, there was a general increase in commerce in 1945 over that of the previous 2 years. The phosphate business recently discontinued its shipping from Fernan-dina. Prior to that the cost-benefit ratio was set at 1.46. Even with this loss, the cost-benefit ratio is still in an appropriate amount for action, as I understand the supplemental report which is being made today.

In the past commerce has been delayed because of the necessity for larger vessels to wait for the high stages of the tide in order to enter Fernandina

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