of years, to dictate operational procedures. Is the tow going upstream or downstream? Is the river high or low? Are the barges loaded or empty? How large is the tow? Who is in the pilot house? These conditions vary with each boat and each company. Only competent management thinking of the safety of their men, equipment, and cargoes can make these decisions. The best Coast Guard officer with the highest seamanship qualifications could not come to these rivers and navigate a tow with any degree of safety. Yet, they would tell us how.

4. The bill calls for fees to be established for each inspection and certification.

In addition, the cost to the taxpayer for the administration of this bill will be astronomical. We believe the number of Coast Guard personnel on the western rivers will be tripled.

If the barge industry is saddled with these extra costs, they will have to be passed on in the form of higher rates. Because the movement by water is the cheapest form of transportation, barge rates are the base rates. Water-compelled rail rates will surely be increased to basic industries, along with other rates over much of the country. A pyramiding effect could be disastrous.

The best judges of our safety experience are the marine underwriters who back up their judgment with dollars. Our marine insurance rates are declining. We are building better equipment. We are operating safer with better personnel. This certainly does not indicate a dire need for legislation.

This bill is bad because it is not needed, and if enacted will have a far-reaching effect on the economy as a whole. We urge that you not permit this bill to become law.

Mr. WATKINS. Mr. Chairman, may I interrupt since I have to answer the quorum call? I would like to say that I accept the gentleman's statement.

Mr. GARMATZ. We have had permission to sit, so we will sit until 12 o'clock. I will remain here. Are there any questions?

Mr. CLARK. No questions.

Mrs. SULLIVAN. I would like to welcome my neighbor from across. the river. I appreciate your appearance and your statement. I would like to know whether your company was involved in any accidents in the last 3 years on the Mississippi.

Mr. FOUTS. It was. We ran over a submerged object north of St. Louis, Mrs. Sullivan. We never did find out what was in the bottom of the river. That was our problem.

Mrs. SULLIVAN. It was not your equipment that ran into trouble around Alton where some barges hauling grain had to be sunk?

Mr. Fours. You mean at Clarksville, Mrs. Sullivan?

Mrs. SULLIVAN. It was just above Alton, above the lock?

Mr. Fours. During the ice?

Mrs. SULLIVAN. There was one during ice.

Mr. FOUTS. The only one I know of, ma'am, was the submerged object that we never did find. We don't know what it was.

Mrs. SULLIVAN. How old is your equipment? It dates back to what?

Mr. FoUTS. Our equipment was built in 1957 when the company was formed.

Mrs. SULLIVAN. It is fairly new?

Mr. Fours. Yes, ma'am.

Mrs. SULLIVAN. That is all, Mr. Chairman.

Mr. GARMATZ. Mr. Zincke?

Mr. ZINCKE. No questions.

Mr. GARMATZ. Thank you very much, Mr. Fouts.

Mrs. SULLIVAN. Mr. Chairman, I will answer the quorum call and

be back.

Mr. GARMATZ. We have several more witnesses. Is Mr. Wattles here from Detroit, Mich.?

Mr. WATTLES. Yes, sir.

Mr. GARMATZ. We have Mr. Tracy and Mr. Underhill. Are they both here? The gentleman would like to get back to Michigan. Maybe we can hear him. How long is your statement, Mr. Wattles? Mr. WATTLES. About seven pages, 15 minutes possibly.

Mr. GARMATZ. Would you want to summarize the statement or would want to read the entire statement?

Mr. WATTLES. This statement to begin with is not mine. It was written by Mr. Gahagan. I am representing him for the association. He had to have his knee operated on last week and he could not come. So I am running interference for him.

Mr. GARMATZ. We want to quit at 12. I know there will be another vote at 12. It is possible that I can get to the gentleman from New York, too, and let you go back to Michigan before 12 o'clock. It may save you from coming back next week, at least the two gentlemen from New York.

STATEMENT OF E. D. WATTLES, NATIONAL ASSOCIATION OF RIVERS & HARBORS CONTRACTORS, AND DUNBAR & SULLIVAN DREDGING CO., DETROIT; ACCOMPANIED BY BARRY SULLIVAN

Mr. WATTLES. If you like, I will skip through a little faster so that we don't take too much time. In addition, Mr. Chairman, I would like Mr. Barry Sullivan, our Washington representative to sit with us. My name is Erbin D. Wattles. I am vice president of the National Association of River & Harbor Contractors and president of Dunbar & Sullivan Dredging Co., out of Detroit, Mich.

Due to the inability of our association president, Mr. Walter H. Gahagan, to be here, he has authorized me to read his prepared statement in opposition to H.R. 723 and identical bill H.R. 156, and in addition II.R. 7491 pertaining to inspection of certain towing vessels. Following is his statement:

STATEMENT OF WALTER H. GAHAGAN, PRESIDENT, NATIONAL ASSOCIATION OF RIVER & HARBOR CONTRACTORS

My name is Walter H. Gahagan. I am president of the National Association of Rivers & Harbor Contractors, and am here at the request of its board of directors. All directors are executives of major dredging companies.

The National Association of River & Harbor Contractors is a nationwide organization which includes the majority of the dredging contractors of the United States. They perform approximately 75 percent of the dredging work in this country. Our members have principal offices or branches in all the important ports along the Atlantic and Pacific coasts, the Great Lakes, and the Gulf of Mexico, and in many of the river ports. The total capital investment of our members is in excess of $300 million.

I have had more than 20 years' experience in the dredging business with Gahagan Dredging Corp., of which I am president and chairman of the board. Our members operate approximately 250 vessels which are involved in this proposed legislation. These boats are used to move pieces of floating plant in connection with dredging or construction work. On a hydraulic dredging job the dredged material is pumped ashore through a pipeline which is held on the water's surface by pontoons. Small tugs move this pipeline through a very limited area of 1 or 2 miles and move sections of it to shorten or lengthen the line. For almost all types of dredges, small tugs are in attendance throughout the contract area. Other similar work barges are also moved by these small tugs between the dredge and nearby mooring points. The investment of the association members in these vessels is extensive. The craft, mostly, are of a specialized design, suited for their specialized type of work. They are not used in the general or commercial towing business in the accepted sense of that word. As you realize, we are in the construction business. We are not basically towers. These smaller vessels which constitute the majority of the so-called tugboats operated by our members are generally manned by two or three men on each 8-hour watch. These boats seldom travel more than a few miles from where the dredge is working. The operation of these vessels around the dredging job requires men who have considerable familiarity with dredging work, which familiarity can be acquired only through experience.

Frankly, we believe these bills were not intended to include this type of craft, but the language is broad enough to do so. Since these vessels pull, push, and haul alongside, they perform towing as defined in the proposed bills. Since most are longer than 26 feet, they fall within the bills' definition of towing vessels. Those definitions, in our opinion, are too broad.

Existing inspection rules for tugboats were designed for application to commercial vessels making longer trips than are made by the type of so-called tugboats which we are discussing. Large numbers of our craft might not pass the rigid requirements of those regulations. That might very well require the replacement of many of them or the expenditure of considerable funds by each member to meet standards which were never intended for this type of craft.

Please do not infer that our vessels are not entirely safe by design, construction, and maintenance for their particular work. I wish only to stress that the inspection requirements are not designed for this type of craft and to express our fear that this legislation will force us to change these vessels, perhaps giving up some of their most desirable features, to make them comply with Coast Guard regulations not intended for them.

Mr. GARMATZ. What is your objection to 7491?

in our

Mr. WATTLES. The problem of licensing let us put it this way, union agreement, we have a clause whereby we will pay for our operators and engineers to get licenses. They have not used this. It amounts to as high as $2 a day that they will get extra.

This is an increase simply bypassing the test for the top license. I believe the reason is that in the licensing section of the Coast Guard they are asking questions pertaining more to steamboats to begin with, and I think it is antiquated. If it were updated, like you again have a truck driver, you ask him for a license, he has to have it, but you don't have to know every nook and cranny along the route.

You have road maps that you go by. Therefore we would object to the thing under the present setup because we have not been able to get our men to take the test right now. That is the trouble with these bills. We feel they are way too broad. If the Coast Guard would update themselves and be more modern in their examinationMr. GARMATZ. They would probably do that if the Congress would give them more money.

Mr. WATTLES. Well, I can't help them out on that. But I know they do ask such questions as the rhumb lines. I am a college graduate. Some one tried to explain to me that the rhumb line is for a

master. A man on the Great Lakes does not need a rhumb line. On the ocean this is a good idea.

This is the problem we face with the Coast Guard. We feel the design applications of our tugs, we know how we want these tugs to look and what they have to do, we feel they are specialized. They are basically the same as any steam tug but we have certain things we like.

One other thing so that we will save some time here. We do want to point out that we are inspected by the Government. Every contract we go on the Government inspects all our boats including the dredges, the scows, everything.

The Coast Guard is not even covering those things. So we are inspected by them plus our insurance people.

We

They

Now someone talks about insurance. Of course we are in the construction business which means we are in very shallow water. appreciate our boats are going to be on the bottom. They are. are backing up wheels in this and shafts all the time. There is no channel where they tell us we have to go to dump materials. Either that or we are opening up new channels. If we had to report every accident or casualty as the Coast Guard terms a casualty we will have one man busy all the time because our boats are banking wheels.

We simply lift them up by a dredge and put them to work. If a shaft is damaged we drydock them.

Mr. GARMATZ. You probably could not operate too well unless you did those things.

Mr. WATTLES. We could not operate at all. The other problem is too where they have the inspection they are in the cities. We are not in the cities. We are miles and miles away. The year is up and have to have an inspection. I suppose we would have to pay for an inspector to come from Detroit or some other place.

Or they have a change in rules and he has to come back a couple of times. It would be very costly to us. I wanted to get that over. It is because in our industry, the construction industry, we don't feel that we need the inspection as far as licensing goes; to be helpful we have asked the Coast Guard to come and inspect some of our machinery before it leaves on tows.

They do not come over and inspect it at all. I think basically the inspection system started, for boilers and the the other things kind of came in on the side. But boilers are or were a hazard and you need a license to handle a boiler because you want to be sure that engineer understands it.

Boilers will blow up. Diesels don't blow up. Once in a great while you have care for an engine that runs away. Boilers if they are not taken care of properly can be a real hazard. Of course the inspection personnel will have to be increased, I think far more than 50 men. I doubt that they will catch all of us unless they work more than 24 hours a day.

We deal with seven unions for our whole fleet. They tell us some manning, minimum manning, and then we add to it if we feel we need it.

Mr. GARMATZ. Would you say they are unreasonable in their demands?

Mr. WATTLES. The unions?

Mr. GARMATZ. Yes.

Mr. WATTLES. I don't think so. During negotiations times they are always unreasonable but generally when we settle down they are not. We have dealt with unions since 1905. I pity the fellow who is just. starting because it is an awful blow. But you get used to them and you finally get to be good friends.

We did find this, and this is something I wanted to point out, on the east coast there we had a steam tug. Down there they only required four men per shift, fireman, deck hand, captain, and engineer. We came to the lakes and for some reason we are now in confined waterswe are now forced to use five men. We had to put an AD on. That is on our papers by the Coast Guard.

As far as we are concerned that is straight featherbedding and we did not need it. We now run four because we went to diesel. We run diesels because they are more powerful for the same hull and cheaper to operate.

Also, we could not get men to man our steamboats.

Mr. GARMATZ. On the steamboats, the engines were running out of time?

Mr. WATTLES. No, you don't wear a steam engine out, we are running steam engines today.

I think it is more the cost and the ability to find men who can handle it. That is where the problem is. Our license personnel would be lost on the steamboats. The steamboat man does not know any more about handling a tug than flying to the moon.

They seldom learn. We have used them, we have tried them. We have never been able to get over to them the handling. These are a breed of cats that come off the river fronts. They know how to handle boats. That is why I disagreed with the 5 years. The problem will come up too that these men, where we get them from, won't be available.

Steamboat men as we talk about them, the bigger boat operators, like the lakers, don't make tug men. As far as we can find out our biggest hazard is from human error on accidents. Our equipment gets damaged, we have to be towed in but remember, where we are working is basically the reason for it.

We fix it back up. We find more human error, the man hits the dock, he did not use good judgment, that is the biggest cause of damage.

I can't say that we have gone down on what we call casualties, that term including everything. We have not had loss of life. By casualties, if you mean by backing into this object or that object, our boats are always backing into pontoons, things like that. Basically poor judgment, on that you can't license tugs.

That is a matter of experience and time. But it is built to take it. But we are backing ourselves anyhow, not the other fellow.

I think other than that that is basically about all I can add. Maybe you have some questions. I kind of dropped more of Mr. Gahagan's statement.

Mr. GARMATZ. If you would care to write another letter and add some more comment we shall be most happy to include it in the record.