Mr. DONDERO. You think the Engineers are in error on their estimate as to the probable cost being too low, that is, as they have it?

Mr. THEOBALD. Yes, sir. I do not question their accuracy in determining the cost that they put forward on their present estimates for the extra 2 feet. They know their business about that and I do not, but I can see in their own reports that they did not view it as one whole project; just viewed it as how much traffic has to be found to pay for this extra 2 feet. And I can measure the rise in costs by the estimate for the extra 2 feet, because the same estimate was made in 1939, and the corresponding figures show that those costs have gone up 40 percent.

Mr. DONDERO. It is the claim of the railroads that to justify this project all of the traffic must be diverted from rail to water?

Mr. THEOBALD. From some other mode of transportation; yes, sir. Mr. DONDERO. It does not depend upon new traffic or new commerce? Mr. THEOBALD. No, sir. In a situation like this, I do not see how a waterway can develop new traffic. As a matter of fact, the natural traffic adapted to that waterway is gone. The St. Johns River fulfilled a vital public need for many, many years in the floating downstream of cypress logs to the big sawmills which principally were located at Palatka, Fla. Those were tremendous operations and it kept many, many people in work-provided them with income. The cypress is gone. Those logs are not going down the river any longer.

Mr. DONDERO. We have such a high regard for the Army engineers on these matters that whenever they come into question it forces members of this committee to ask questions, and that is the purpose of this.

Mr. THEOBALD. I am very reluctanut to take issue with the Army engineers on matters in which I do not know something about and have some chance of proving my assertions, and I think if you will review what I have said in this statement, that I have read, and the two that I have appended, that we have proven our figures.

Mr. DONDERO. We have had one diversion of traffic that was used as a justifiable item of credit against costs, that is the Tombigbee River project. You have heard of that river before.

Mr. THEOBALD. Traffic diverted from the Mississippi River?

Mr. DONDERO. A million dollars to the Tombigbee diverted traffic from the Mississippi.

Mr. THEOBALD. Some of us have questioned that.

Mr. DONDERO. We have a high regard for the Army engineers on their accuracy.

Mr. THEOBALD. Indeed, I have, too. And I have friends among them. On that subject that you mentioned of the Tombigbee versus the Mississippi, I want to mention something that I did not touch on. Judge Mansfield called attention to the parallel Intracoastal Waterway down the Atlantic coast which is 12 feet, and the other which is just across country from it. If you will dig deep enough in those traffic studies that form the basis for the Engineers' reports, you will find that the very same boxes of citrus fruit coming from the very same groves have been used to justify the 12-foot project up and down the coast as have been used to justify in part the 12-foot channel in the St. Johns River. That does not make sense to me. If the traffic is going to move one way or the other, the public is going to get the efit on whichever route it moves, but the public will not get the fit twice. It is not going up this way and that way, too.

Mr. DONDERO. Do you think there is the same element in this case as there was in the Tombigbee case?

Mr. THEOBALD. I think there is some difference there. I am not too familiar with that, but I understood that that element of diversion there had something to do with the fact that the current in the Mississippi was more difficult to navigate and that up-bound traffic could use the Tombigbee project to greater advantage than the Mississippi channel. That would not come in here, but I will say this: citrus fruit from Brevard County, Fla., which is right on the coast right here, certainly if transported by water, which we challenge, if it is going to move up this 12-foot channel, is not going to be brought over here to Sanford and move up this one. This is a canal, with dead or sluggish water, as you know. This is a river that has got curves and bends, and so on. It would be folly to move it over here and put it on the river channel when you have a ditch. along the coast that has nothing like the navigation hazards.

Another item mentioned to some extent in the reports, is canned citrus fruits and juices and canned vegetables, an industry which is growing a very great deal in Florida. The principal canning plants, roughly, for vegetables, are down here. There are some up here near the St. Johns River, but the greater number are down here. I know from bitter experience that the canned fruit from down in this part of Florida moves by truck to Tampa in normal times, by boat to eastern ports, not a barge, but a ship, or by boat across the Gulf and up the Mississippi. We did everything we could to get some of that traffic back. What was the answer? We had our own trucks. They are not common-carrier trucks, regulated, whose rates you can check on. We have our own trucks. We sent them to Tampa, which is the distributing point. We get our boxes and tin cans. We get our labels. We get our supplies of all sorts and haul them back. That gives us a two-way saving. We take our fruit to Tampa and bring the materials back. The railroads cannot compete with that, and no other form of transportation can compete with it. The St. Johns River cannot compete with it.

The CHAIRMAN. Are there any further questions? If not, we thank

you.

Colonel FERINGA. Those are all of the projects we have up for today, but we have some small projects listed for next week in which I do not think there will be local interest or opposition, in case you want to dispose of some other projects.

Mr. DONDERO. What do you say as to the question that I have raised on the element of diversion of traffic from another system of transportation to justify this one?

Colonel FERINGA. Let me divide your question into two parts.

If it means diversion of traffic from the Intracoastal Waterway to this waterway, I do not think we are guilty of it. I do not think, and I speak with all friendliness, that we ever use any element of prospective traffic twice, even in the case of the Tombigbee-Tennessee Rivers. We did not state that this traffic will move from the Mississippi and now go through the Tombigbee-Tennessee. We took the additional savings that inured to the Tombigbee route over the savings that we had already established and we took the difference of the two and made that our additional benefit. And in this case of Florida, I would have to look it up, but I am positive from the

safeguards that we set up in our figures, that we would not take the traffic twice.

Mr. DONDERO. In other words, you would not take the traffic from the 12-foot channel of the Intracoastal Canal that would normally go that way, and divert it to this new, proposed channel?

Colonel FERINGA. We would not use that in our justification. It is possible that some of that traffic would find its way, but we would not use that same traffic twice to justify two different waterways. We would not do that.

The railroad gentleman has made an able presentation and undoubtedly he is from Florida. I was district engineer at Jacksonville for a short time and assistant to the district engineer for a long while, to Colonel Dunn, now General Dunn, and I have driven from Palatka to Jacksonville during the height of the fruit season when there was one truck right after another that had taken its product from around this part of the country and was moving to Jacksonville, a fairly costly operation, and discharging it into steamboats at Jacksonville. This, I think, is about as rich a part of the country in orange producing as there is in Florida.

We hear of Indian River fruit. And the fruit up around Tampa and around Fort Myers, but there is a tremendous amount of it here. That fruit will find its way into the waterway and does right now on the St. Johns River line where they haul it up and down the waterway. Mr. DONDERO. If that does not move by truck, as you indicate, is there any way it can move by rail?

Colonel FERINGA. The rail costs are high, sir, and the railroad rates in Florida, I dislike to get into this subject, are higher than in any other State in the Union. That is why we show such tremendous savings.

I have indicated to this committee before in previous testimony the unit costs in mills per ton-mile in oil, because you can measure them that way much better, it is hard to do it any other way. It has been determined, I think, by the Interstate Commerce Commission, and I think the railroads would say these costs are conservative. I am just giving this as a comparison. A tank car cost is 8.3 mills per tonmile. By barge it would be 1.5 to 2.5 mills per ton-mile.

Mr. DONDERO. Did you use oil as the largest factor in commerce that might possibly move over this new channel, in determining the savings to justify the project?

Colonel FERINGA. I think that has been done, but I am using oil now because you can measure the cost of moving oil more readily than any other commodity.

The other question depends on how much is moved, but oil usually moves in full loads. The rail tank-car cost is 8.3 mills per ton-mile, and deep-draft tanker 1.25.

Early this afternoon I cited a case where Mr. Knappen said it would be reduced to 0.8 mill per ton-mile. Pipe line is 3 mills per ton-mile. That does not include the Big Inch which was lower than that, but then you have the large collecting cost coming in and the large distributing cost at the other end. And the barges which cost from 1.5 to 2.5 mills. Moving products by water is cheaper than by any other medium, except by deep-sea tankers.

I think if the committee will look at these pictures of the Ohio River and see the tremendous tonnage that is carried in one tow it then becomes self-evident.

Judge Mansfield asked me to have this picture available on the Ohio River. That is just one towboat and a group of barges. It becomes self-evident when you look at that.

The CHAIRMAN. How many carloads of freight would those barges handle there in one tow?

Colonel FERANGA. I think that particular tow, at your request I put that card on there, indicates the equivalent of six trainloads being moved by one towboat. I am not saying this would be possible on the St. Johns River. I am bringing that out as an indication of why the cost on water, for water transportation, is cheaper than by any other

means.

Mr. DONDERO. What do you say as to the claim that your estimate is low rather than high, based upon the figure of 1939 as compared with costs today?

Colonel FERINGA. We have two figures in here. We have the first project which has been authorized and which we did justify in the last river and harbor bill, and we did not change those costs because we felt that is an authorized project. The costs we present for this additional deepening are modern, up-to-date costs.

Mr. DONDERO. Base upon costs now?

Colonel FERINGA. I think his very able argument was that now that we present this added improvements we should also present the authorized project that we have not yet constructed, in other words present the whole thing all other again. I do not think that is what this committee wants. I think that after we have once justified a project upon the economy that existed at that time, then let that case rest. If the costs go up so go the benefits. We are only endeavoring to justify the additional work and that is based upon modern costs.

Mr. DONDERO. As I listened to the gentleman representing the railroads, there were just those two things: first, that the project was based upon a diversion of traffic; and, second, that the estimates made by the engineers were far too low when compared with present costs, and that those two things together did not justify the project. I think that is about the basis of the claim.

Mr. THEOBALD. That is correct.

Colonel FERINGA. You think that the estimate of the cost of the new work in the present case is too low?

Mr. THEOBALD. For the reason that I thought I explained that those who advocate this 12-foot channel have told the Corps of Engineers 10 feet would not do them any good, "We have to have 12. We cannot live on the river with less than 12 feet of water."

The oil operators, the men that barge their oil up to Sanford, said the same thing, every one of them. That means that the traffic that you are going to consider as justifying the extra 2 feet must also go back and justify the first 2 feet that you dig out to get to the extra 2 feet. You see, your savings back in 1939 have gone off in to thin air.

The very people in favor of the project tell you so. That traffic will "We cannot use 10 feet of water."

not move.

Mr. DONDERO. That was their argument before the engineers, of

course.

The CHAIRMAN. Before the Engineers, of course, but down in my district they convey millions and millions of tons of oil.

Mr. THEOBALD. How many feet on the Mississippi River, Judge, is it not 9 feet?

The CHAIRMAN. Nine feet.

Mr. THEOBALD. These Florida people come to Congress and say, have to have 12 feet to barge oil from Jacksonville to Sanford."

"We

Colonel FERINGA. I would like to point out for the sake of clarity that the Mississippi River is over here; that we talked about an Intracoastal Waterway which has been completed and is 12 feet deep from way up in Philadelphia, including the Chesapeake all the way down here [indicating] and has been authorized for 12 feet all the way down to Miami, Fla., and on this Gulf section, all around to Brownsville, Tex., that has been constructed to 12 feet.

Also, we have a project on the St. Johns River to Palatka that is 12 feet.

We are authorized then for Palatka south to dig a project 10 feet. We believe that will be a bottleneck because it will mean it will require transshipment. I think that is the core of our argument. I dislike to disagree.

Mr. THEOBALD. We covered that in our statement, too. The element of transshipment is there, and it is going to stay there, regardless of whether you have 10 feet of water or 12 feet. The division engineer reversed the district engineer on the citrus fruit on that very ground. The advocates of the project said, "We are going to put our oranges on refrigerated barges and move it from Sanford, Fla., to Jersey City," wherever the head is, Trenton, I believe it is.

The division engineer did not believe that. He said that the only citrus-fruit traffic that can be considered is that which, as in the past, would move down to Jacksonville and be transshipped to boats, not barges.

The petroleum that comes into Jacksonville is transshipped. Where is the traffic that is going to move through on this waterway from Sanford? Citrus fruit is not going to move on barges, with a movement of 5 or 6 miles an hour for day after day after day, even if they are refrigerated barges. Nobody has ever handled it that way or any other perishable product, meats, dairy products, anything of the kind. There just is not any traffic of any volume that would justify through movement. It has to be transshipped to Jacksonville.

Colonel FERINGA. The brief of the railroads was carefully considered by the Board for Rivers and Harbors, before it rendered a favorable recommendation.

SUPPLEMENTAL STATEMENT OF HON. JOE HENDRICKS, A REPRESENTATIVE IN THE CONGRESS FROM THE STATE OF FLORIDA

Mr. PETERSON of Georgia. I see that Congressman Hendricks is present. Do you desire to make a statement on the St. Johns River project?

Mr. HENDRICKS. Yes.

Mr. PETERSON of Georgia. You may make such remarks as you wish now, and extend your remarks in the record later.

Mr. HENDRICKS. Thank you.