Mr. GARVEY. This statement also gives the established freight rates from each of the producing districts, No. 1-11, inclusive, to a common point which has been selected as a basing point for the purpose of making a study of the tonnages moving from the various producing districts into the market areas established by the Coal Commission.

In order to ascertain the cost to my company, or any other companies, of towing coal out of the Big Sandy River, we asked some experienced rivermen in whom we have great confidence to investigate and make an estimate of the cost of towing coal out of the Big Sandy from both Pikeville and Williamson, to Catlettsburg, if and when the river is canalized as planned. These gentlemen are thoroughly familiar with the Big Sandy and in addition to their own investigation they made a thorough study of the United States district engineers' report.

Their estimate is that the towing cost would be 1.93 mills per tonmile and the cost from Pikeville to Catlettsburg is estimated at 22.23 cents per ton and from Williamson at 16.31 cents per ton. This is bare cost and does not include profit.

The conclusion reached by these people is that the district engineers' estimate of a towing cost of 4 mills per ton-mile is altogether too conservative and should be very substantially reduced under competent management.

It is believed by my company that the district engineers' estimate is entirely too conservative and should be very substantially reduced in working out the economic justification of the Big Sandy project.

I would like to submit for the record a detailed estimate of cost which is entitled "Analysis of Water Transportation Costs for the Movement of Coal From Points on the Levisa Fork and Tug Fork to the Mouth of Big Sandy River."

Also attached to this analysis is a statement from Capt. Thomas Vaughan, who has spent 40 years on the Big Sandy.

Mr. Hugh PETERSON of Georgia. Without objection the paper will be included in the record.

(The documents are as follows:)

ANALYSIS OF WATER TRANSPORTATION COSTS FOR THE MOVEMENT OF COAL FROM POINTS ON THE LEVISA FORK AND TUG FORK TO THE MOUTH OF BIG SANDY RIVER

In selecting equipment for movement of coal on the Big Sandy River, I would recommend using a .500-horsepower twin-screw, Diesel-powered towboat approximately 80 by 22 by 62 feet, having an approximate 4-foot draft. Such a boat can at the present time be built for $90,000. However, for the purpose of this study, I have used in my calculations, as shown in the attached cost study, $100,000.

As I understand the proposed locks on Big Sandy to be 80 by 500 feet, I would use four all-welded coal barges, 195 by 35 by 11 feet, having a capacity of approximately 2,300 tons each. Such barges could be built today for approximately $20,000 each. For the purpose of this study, I have indicated an investment of $240,000 for barges, which would allow you four barges en route, four at the originating point, and four at destination, which, I understand, is the usual method of operation in the coal trade.

For the purpose of this study, I figure that this tow, consisting of a 500-horsepower towboat and four jumbo coal barges, would make an average of 31⁄2 miles in both directions. This, again, is conservative as, in all probability, the tow would make 4 miles downstream and 5 to 6 miles upstream.

Taking Pikeville as a basing point and using 31⁄2 miles per hour, allowing 4 hours for picking up loads at originating point, and 4 hours for tying off loads at destination (this again is a very conservative estimate), this equipment should make the round trip in 74 hours.

In my study of costs I have used 340 days per year as a conservative operating schedule. In most marine operation of Diesel equipment, I believe 350 to 360 days per year actual operation is not considered excessive. Based on 340 days per year, a tow as above would make 110.27 trips and handle a tonnage based on 1,250 tons per barge of 55,135 tons.

You will note from the attached sheet that I figured the total cost of operation per year of $106,648.83, which comes out to 1.93 mills per ton-mile on this movement.

Using the 1.93 mills per ton-mile as a basis of your costs, you therefore could move coal from Pikeville to the mouth of Big Sandy for 22.33 cents per ton and from Williamson, W. Va., to the mouth of Big Sandy, for 16.31 cents per ton-mile.

Towboat, Diesel, 500-horsepower, twin-screw, 80 by 22 by 62, $100,000:

Depreciation, 15-year______

Insurance:

Protection and indemnity, 2 percent.

Hull, 2.375 percent---

Taxes__

Operating labor (10 men) (based on allowing 10 days off per

month for each employee)

Operating supplies_

Commissary

Maintenance.

Fuel____

Lube oil___

Miscellaneous_

Overhead____

Interest on investment, 3 percent_

Total (per day, $210.25) __

12 barges, 195 by 35 by 11, capacity 1,250 tons each-at $20,000

Taxes--

Maintenance_.

Operating supplies_

Miscellaneous_

Interest on investment, 3 percent_

Overhead__.

Total (per day, $103.41).

Total towboat and barges (per day, $313.66) –

TRANSCRIPT OF STATEMENT MADE BY CAPT. THOMAS VAUGHAN, CATLETTSBURG, KY.,

IN SUPPORT OF BIG SANDY RIVER CHANNEL IMPROVEMENT

Members of the Board of Engineers for Rivers and Harbors, Corps of Engi neers, as a matter of introduction, my name is Thomas Vaughan; home, Cattlettsburg, Ky.; vocation, licensed captain and master pilot; license applicable upon the navigable portion of Big Sandy River and between Ashland, Ky., and Huntington, W. Va., on the Ohio River.

I have had charge of and handled boats within the river area upon which my papers permitted for 48 years. During that period of time, I was in charge of boat operation upon the Big Sandy River when, during high-water periods, the only time such boat movement was possible. The operation of boats in pool water and on the proposed improved channel would not present the same navigation hazards, and would not present the same current resistance that we had to contend with under open-river navigation during high-water periods. The

creation of pool water and improved channel would make possible year-round continuous operation and dependable service.

During the years 1897 to 1945 I was employed in various capacities upon boats that were in operation on Big Sandy River. The boats were as follows: The Organd, Andy Hatcher, Mary L. Hatcher, Thealka, Sip Bays, Sandy Valley, Virgie Ratliff, Big Sandy, Maxie Yost, Fairplay, Alex Yost, B. F. Johnson, Buela Brown, John Hopkins, H. M. Stafford, Guyandotte, J. M. Grubbs, Crickett, Sea Lion, Lenaleota, Laynesville, Cando, and the Donca. These boats varied in size from 85 to 132 feet long, from 10 to 20 feet in width, and from 2 to 4 feet depth of hull.

Because of the actual experience I have had with boat ownership and operation upon the Ohio and Big Sandy Rivers, I feel I am competent to make a constructive statement as to what type of equipment would be best suited for operation upon the Big Sandy; what kind of operation could be maintained; what tonnage could be handled; and what the estimated cost of operation would be if and when the river is improved. Because of the practical knowledge gained with the actual operation of boats upon the Big Sandy, I am sure you will agree that my conclusion will be much nearer accuracy than any conclusions arrived at from an alongside observation survey of the Big Sandy during a low-water period, in its present unimproved state, and from any theoretical deductions made therefrom.

After reviewing the finding and recommendations made by the Huntington district office, and the statements made by various interests on the occasion of the September 10 hearing before your Board, I fully agree with all that has been presented by those supporting the proposal. If the Big Sandy Channel is improved so that barges and boats can be operated regularly all the year round, and having in mind the great commercial value of this proposed improvement to the citizens of the entire Big Sandy Valley, its approval and completion will afford them the full realization of their lifetime ambition. That is why I am appearing as a practical boat owner and operator before your Board today, giving full-hearted support to the recommendation made for the Big Sandy River improvement, a proposition which I have advocated for many years.

The proposed channel, with a minimum depth of 9 feet, width of 150 feet on the straightaways; up to 250 feet width on the bends; with lock chambers 500 feet long and 80 feet wide, is a practical proposition. I know that single locking tows up to the maximum that will pass through the proposed lock chambers can successfully and effectively be handled upon the Big Sandy and its two forks, the Levisa and Tug, if the proposed improvement is made.

With reference to the pools, most of them would be 14 to 27 miles long; this will provide pool lengths just as favorable, in fact, I might say more favorable, for operation than the pools provided on the Muskingum, Monongahela, upper Ohio, and other improved rivers. This statement is based upon the proposed construction of two locks between the mouth of the river to a point about 10 miles above the forks of Levisa and Tug; upon four locks to the proposed head of navigation for Levisa Fork, a distance of 126 miles; and upon four locks to the proposed head of navigation for Tug Fork, a distance of 92 miles; mileages apply (from the mouth of the river) to proposed head of navigation on each fork. Lock No. 1 would be at the mouth of Big Sandy, so there would be five locks between the mouth of the river and the head of navigation on each of the two forks, Levisa and Tug.

In order to determine a sound basis for boat operation, I have figured that not to exceed an hour will be required to pass through each lock, not to exceed 10hours will be consumed per round trip for this part of the boat operation; boats can be operated 24 hours per day; on a round-trip basis, boats pushing single locking tows should easily average at least 21⁄2 miles per hour land speed. By the use of this figure for operation, the average round trip daily movement per tow unit would be at least 55 miles per day. I have purposely made this calculation on a very conservative basis; actual operation will probably show that a round trip can be made in less time.

Use of this average daily movement, determination as to the number of round trips per year, should be calculated on the basis that there would be 300 actual running time days per year. This makes due allowance for lay-up time because of weather interference, maintenance, and repair.

The type of equipment and size of tow unit best suited for this proposed operation would be as follows: 1 towboat capable of delivering 600 push horsepower; 4 barges, 195 by 35 by 11 feet.