(1) Industry of the area: The du Pont company has just completed a $50 million plant now employing 650 people, manufacturing ingredient (adiponitrile) used in the manufacture of nylon. (2) Carbide & Carbon Chemicals Co. has a plant under construction estimated to cost $75 million, to be in operation May 1, 1954, to manufacture plastics and antifreeze. (3) Gifford-Hill-American Co. of Dallas and California are constructing a plant at Victoria to manufacture high pressure concrete pipe. LOCAL CONTRIBUTIONS Victoria Navigation District has issued revenue bonds in the amount of $1,300,000 to construct the first 13 miles of the canal to the Carbide & Carbon Chemicals plant. Construction is expected to start not later than May 15, 1954. We want to request of this honorable committee and the Congress for an appropriation for the next fiscal year in an amount which at least matches the funds furnished by local interest; and that is $1,300,000. We hope eventually to complete this 35-mile channel connecting the Intracoastal Canal. We think it will be a great boon to the industry in that area, and to the welfare of all of the people. PLANNING FUNDS Mr Chairman, I would like to call this one additional fact to the attention of the committee. In the fiscal year 1951 the House included $50,000 for planning and the Senate also included $50,000 for planning, together with another $50,000 for construction. Moreover, in fiscal 1953, $40,000 in planning funds for this project was requested. Notwithstanding the fact that we put that money in the bill in the Senate, we lost it in conference; and, although the local interests have issued their revenue bonds and the Intracoastal Canal is there, we cannot tie into it. The Congress has never passed the bill to start the construction, and we are hoping that that is what the Senate will do this time. I would like now for my colleague to make a brief statement. Mr. Chairman, I know that you will give the matter your usual careful attention. Thank you. STATEMENT OF HON. PRICE DANIEL, A UNITED STATES SENATOR FROM THE STATE OF TEXAS GENERAL STATEMENT Senator CORDON. Senator Daniel. Senator DANIEL. Mr. Chairman and gentlemen of the committee, as Senator Johnson has pointed out, having been born in that area, the chairman of this committee is pretty well acquainted with and familiar with this particular project. We are going to depend upon Mr. Furman to give the details of this project, but I would like to point out that this is a short feeder line into the Intracoastal Canal, which connects up with the Intracoastal Canal. We have several very important industries there; several multimillion dollar industries have located at or near Victoria, with the understanding that this project, authorized in 1945, would be carried to completion. For many years, long before I came to the Senate, I have felt like this is one of the most important and worthwhile navigation projects along our Texas gulf coast, because it is a short project and will not cost a whole lot of money. It goes into an area that should be connected with our Intracoastal Canal, and will bring money into the Federal Government from taxes, if we continue to develop that area, and by having navigation into the area. We have many more plants as the facts presented by Mr. Furman will show. I believe that the committee will be very much interested in the point made by Senator Johnson that the local people have voted $1,400,000, and I just hope that the committee will see fit to recommend for that project, and Congress will authorize, at least enough money to match what the local interests are willing to spend on this particular project. Now, I would like for you to hear Mr. Thompson, who represents that district. STATEMENT OF HON. CLARK W. THOMPSON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS Mr. THOMPSON. Mr. Chairman and gentlemen of the committee. I have nothing to add Senator CORDON. May I interrupt you for just a moment. Do you have a prepared statement for the record? Senator DANIEL. No, Senator. Senator CORDON. Do you have a written statement, Mr. Thompson? Mr. THOMPSON. No, sir. I have nothing to add to the very able presentation of our two distinguished Senators. The statement by Mr. Furman will be very complete. It is written, and I have suggested to him that, in the interest of saving your time, he brief the brief, which he can do very ably. That will tell the complete story, and we will leave it in your good-and coming from Guadaloupe country-your sympathetic hands. Senator CORDON. Thank you, Congressman. Senator ELLENDER. Mr. Chairman, may I ask a question? Senator ELLENDER. General, I notice here you have a below ceiling sum of $40,000, a sum for planning on this project. How much money could be expended this year with the planning already made? General CHORPENING. I do not know that I understand your question, sir. Senator ELLENDER. Well, you have spent $200,000 here to date, as I understand upon this, and I presume that that is for planning. General CHORPENING. That is correct; yes, sir. Senator ELLENDER. Now, how far advanced are those plans, are they sufficiently advanced so that you could spend money on them, and if they are advanced, have they been advanced to a sufficient extent that additional money could be spent, and if so, how much money? General CHORPENING. We could expend at least $700,000 on construction this year, sir. Senator ELLENDER. $700,000? General CHORPENING. Yes, sir. Senator ELLENDER. What was the amount, Senator, that you say that the local groups are willing to spend, and have appropriated for that purpose? STATEMENT OF RICHARD FURMAN, SPECIAL REPRESENTATIVE, VICTORIA COUNTY NAVIGATION COMMISSION, VICTORIA, TEX. LOCAL PARTICIPATION Mr. FURMAN. We have issued $1,300,000 in bonds, Senator. Mr. FURMAN. Mr. Chairman Senator DANIEL. Mr. Chairman, let me introduce Mr. Richard Furman, special representative, Victoria County Navigation Commission; representing the Victoria County and the West Side Calhoun County Navigation Districts. Mr. FURMAN. Thank you very much. Mr. Chairman and gentlemen, may I enter my statement in the record? Senator CORDON. Your statement, Mr. Furman, without objection, will be made a part of the record at this time. (The statement referred to follows:) STATEMENT OF RICHARD FURMAN ON GULF INTRACOASTAL WATERWAYS CHANNEL TO VICTORIA, TEX. Texas history tells us that in 1840 the City Council of Victoria was granted congressional authority to clear out the Guadalupe River, including a raft a few miles below, and collect tolls. The following spring the steamer Swan navigated the Guadalupe up to Victoria. Because of the hazard of navigation and the lack of traffic at that time, the project was a failure as a transportation medium. In 1907, by authority of the Rivers and Harbors Act of March 2, 1907, the Federal Government dredged a channel in San Antonio Bay 5 feet deep by 40 feet wide, removed snags, log rafts, and shoals between the mouth of the Guadalupe River and Victoria, a total length of 68 miles. The construction was completed in 1909, but the maintenance of the project was abandoned in 1916 due to the lack of traffic and high maintenance costs. By the approval of the Rivers and Harbors Act of March 2, 1945, the existing project was modified to provide a channel 9 feet deep by 100 feet wide from a connection with the Intracoastal Canal approximately 138 miles west of Galveston, Tex., along the east shore of San Antonio, Guadalupe, and Mission Bays and the Guadalupe River to a point 3 miles above Victoria, Tex. About 4 years ago the proposed turning basin site was changed from its original site 3 miles above Victoria to a point about 6 miles below Victoria, saving the Federal Government 9 miles of dredging, the cost of construction and operation of two locks, and the cost of a diversion channel to the Guadalupe River, making the project a sea-level canal. Local interests were relieved of the expense of 9 miles of rights-of-way, the cost of two bridges, and the necessity of requesting authority from the State board of water engineers to divert water from the Guadalupe River to the canal for navigation purposes. It was felt that all available water should be saved for industry rather than for navigation. Early in 1947 two navigation districts, the West Side Calhoun County and the Victoria County Navigation Districts, through which the proposed canal will extend, were created; bonds were issued; and navigation commissions established to handle the affairs of the district. Since 1948 the Corps of Engineers have repeatedly requested construction funds for the project. The project report has been completed. 42592-54- -29 This is the sixth consecutive year I have appeared before you in behalf of the Guadalupe River Channel to Victoria, Tex., which was officially made an integral part of the Gulf Intracoastal Waterways by Public Law 527, 82d Congress, H. R. 6812, approved July 12, 1952. In 1948 when I presented our brief and first formal request for construction funds with which to start the project, I told you that big industry was anxious to come into the Victoria area because of our strategic location in the heart of the new industrial frontier. Our section of the Texas gulf coast has an unlimited supply of natural gas, an adequate supply of water for industry, an unlimited supply of sand and gravel, a very favorable labor situation, and a climate which permits year-round operation. In 1949 the Du Pont Co. purchased some 1,700 acres of land on the proposed canal extension about 8 miles below the city of Victoria. In 1951 they completed a $50 million plant, where they are now employing 650 people and are making adiponitrile, an ingredient of nylon salts. This adiponitrile is shipped to their plant at Orange, Tex., made into nylon salts and shipped east to their plants, there to be made into nylon. In May of 1952, Mr. L. J. Bowditch, vice president of the Carbide & Carbon Chemicals Co., appeared with me before the Senate subcommittee and testified that the final decision on the location of that plant site was based on a fact that our canal extension was an approved project, that the Defense Department wanted the plant built as was evidenced by priorities given them for materials, that their products, which would be plastics and antifreeze, would be beneficial to the war effort, and that they would put at least 140,000 tons of traffic on the canal each year. He testified that the first unit would employ at least 750 people. In October 1952, the Carbide & Carbon Chemicals Co., a subsidiary of the Union Carbide Co., started a $75 million plant on 1,500 acres of land which they purchased on our proposed canal extension about 25 miles below Victoria. They will start operating the first unit of their plant by May 1, 1954. They have already started hiring men and hope to have their full complement of 750 by May 1, 1954. In October 1952, the Gifford-Hill-American Co. of Dallas, Tex., and California, started construction on a plant at Victoria to manufacture high pressure concrete pipe of various sizes. Mr. Ray Foley, president of the company, stated that the site at Victoria was selected primarily because of the ample supply of sand and gravel, industrial water, and the possibility of water transportation. Mr. Foley stated that the plant, when completed, will employ approximately 200 men and that they expected to ship many thousands of tons by water transportation up and down the Texas coast and to other points available to water shipments. These three important industries mentioned above selected the Victoria area because they needed water transportation and were convinced that the canal project would be carried through to completion. These three plants have created new jobs for more than 1,600 people with a combined payroll of more than $10 million annually. The Federal taxes from these new payrolls will amount to more than $2 million annually, which, within 3 or 4 years, will pay for the Government's participation in this important intracoastal canal extension. In addition, the Federal taxes on the net income from the three industries will add a considerable amount each year to the coffers of the United States Treasury. Having full confidence in the merits of the project and believing that water transportation is of great importance to the industries located in our area, the navigation district has made plans to construct the first 13 miles of the canal up to the Carbide & Carbon Chemicals plant with local funds. Revenue bonds in the amount of $1,300,000 have been issued; the call for bids will be made on or about March 1, 1954, and construction is expected to start not later than May 15, 1954. We respectfully request the Congress to make an appropriation for the next fiscal year of an amount which at least matches the funds furnished by local interests. We make this request for these reasons: The Guadalupe River Channel to Victoria is not a new project, it is an integral part of and an important feeder channel to the Gulf Intracoastal Waterway, that great transportation link which has proved its value to the Nation in times of peace and war. The project is necessary and vital, not only to the economy of the area and our National Government, but also to the industries which have already located along its proposed route, and to those industries which need water transportation and which are anxious to settle in that area because of the abundance of available power, industrial water, natural gas, labor, climate, and other advantages. USE OF LOCAL FUNDS Senator CORDON. In order that we may have the record clear with respect to the testimony just given by General Chorpening on this Victoria project, can you at this time advise the committee as to what portion of the efforts will be met by the $1,300,000 to be financed by local interests? Mr. FURMAN. Yes, sir. May I show you that on a map? Senator CORDON. Yes, surely. Mr. FURMAN. This is the Intracoastal Canal, from New Orleans to Brownsville, and here is the authorized Guadalupe River project, which will take off from the main channel; and this point is about 138 miles west of Galveston. Now, the red line up to here [indicating on map] and then up to the carbide plant-it is about a mile and a half from here [indicating]. The carbide plant is on the channel which we propose and are going to build. We have issued $1,300,000 in revenue bonds. We will call for bids on or about March 1, and expect construction to start on the first 131⁄2 miles of the canal here, and there there will be a little jog, up to the carbide plant here. That is what the $1,300,000 is for. Senator CORDON. So that your local funds will construct a complete channel from the Intracoastal Canal, inland, to the point mentioned at the carbide plant. Mr. FURMAN. That is right; up to here; yes, sir. Senator CORDON. That is correct? Mr. FURMAN. That is correct. Senator CORDON. Then the Government evidently would pick it up at the interior end of the canal constructed by local interests and carry it on to the city of Victoria? Mr. FURMAN. That is right, sir. Senator CORDON. General, what percentage of it would that amount to? General CHORPENING. That would be about 40 percent of the total length of the canal. PROPOSED CANAL Mr. FURMAN. The proposed canal is 35 miles long, and the turning basin would be about half way between Victoria and the du Pont plant. Senator DANIEL. In cost, what proportion would the local interests bear? Mr. FURMAN. The $1,300,000 in bonds, to which I referred, represents about 18.1 percent of the total cost, but in the authorized project as a whole the local share is 41 percent. Senator CORDON. Go ahead. Mr. FURMAN. Gentlemen, let me express my appreciation first for the opportunity of appearing before you. This is the eighth time I have been up to see you and I appreciate the opportunity again. In 1840-let me go back just briefly-in 1840 the Texas Congress authorized the city of Victoria to clear the channel from the city of Victoria downstream. That was done in 1841, and the steamer Swan proceeded up to Victoria, making the Guadalupe River navigable. In 1907 the Federal Government expended some money down there and dredged a 4-foot channel across San Antonio Bay, and at that time |