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there appears to be some question as to the advisability and justification for the project at this time, especially in the absence of the solution of all problems to the satisfaction of all concerned. I may, therefore, advise you that authorization of the work proposed in the report and accompanying papers should not, on the basis of the presentation, be considered to be in accord with the program of the President."
There is also the serious question as to the amount of benefits which would be derived in the event that the project was carried through. On April 10, 1946, Mr. J. C. Sommers, transportation expert, advised the House Committee on Rivers and Harbors as follows:
“Agricultural products presently moving in the offshore trades and produced in the Sacramento tributary area consist of canned goods, barley, rice, beans, and dried fruits.
“I have prepared rate studies and other information concerning the movement of these commodities which will be found in detail in my written report.
“In the limited time available, I want to direct attention to exhibit F, page (15) of my report. This exhibit is a summary of all the rate differences from studies in my report compared with the average rate savings claimed by Sacramento and used by the Army engineers to determine the annual freight saving benefits to commerce for a deep-water channel to Sacramento.
"The second column headed 'Sacramento claimed freight savings per ton over Stockton' and the fourth column headed 'Sacramento claimed freight savings per ton over San Francisco' are declared to be weighted average per ton savings, but again nowhere in the engineer's report are shown the individual rates and charges actually used to determine the so-called weighted averages. The third and fifth columns show the differences in the rates per ton Sacramento over Stockton and Sacramento over San Francisco, respectively, which we have developed on the individual agricultural products actually moving in deep draft vessels.
“It will be seen that the weighted average freight savings claimed by Sacramento are considerably in excess of the differences in rates we have developed. For example, on the first item, canned goods, Sacramento claims a per-ton saving over Stockton of $1.14 whereas exhibit A, with explanatory data under the heading 'Canned goods' in my report, develops a saving of only from $0.61 to $1.09 per ton. Barley, rice, dried beans, and dried fruits show a like variance. My written report shows how these differences were developed, together with all tariff authorities and the sources of other data used.
"In the limited time available to make this study, it was not practicable for us to secure the volume of offshore movement on each of these commodities and the points from which each lot would move to develop a weighted average, but it should be obvious from the differences developed in exhibit F, a weighted average per ton saving Sacramento over Stockton, would be substantially less than $1.14 per ton. Moreover, no allowance has been made for approximately 100,000 tons of agricultural products and other general cargo moving to and from Sacramento by river barge to or from shipside at San Francisco in the Atlantic intercoastal trade upon which Sacramento shippers already enjoy the same intercoastal rates as are now applied at Stockton, San Francisco, and other Pacific coast deep-water ports nor are the freight savings on this movement shown to have been deducted from the total benefits or savings claimed by Sacramento in justification for the proposed deep-water channel.
"Mr. Ohm, who has just testified, finds a negative cost ratio of approximately 0.75 based on the projected savings set up in the Army engineer's report and in my judgment this negative cost ratio would be further increased if the rates we have developed were used.
"In conclusion it is evident that the claimed rate advantage for a proposed Sacramento deep-water channel of $1.14 per ton over Stockton and $2.08 per ton over San Francisco is excessive and justifies a much closer detailed study of the alleged benefits to commerce before final approval of the project."
Mr. Chairman and members of the committee, in these days of critical scarcity of materials, high costs and staggering taxes only the most worthy and most necessary projects should receive the seal of your approval. The Sacramento Channel project is not in that category. It is a border-line project. In fact it is somewhat south of the border. It would be uneconomic, unfair, unnecessary, dangerous to the fertility of the land and burdensome to deep-water transportation for the following reasons:
1. Constructed under today's standards annual benefits will not equal annual costs.
2. It will duplicate existing harbor facilities adequately serving the area.
3. It will divert business from and depreciate the joint Federal and municipal port investment at Stockton still operating at a deficit.
4. It will endanger the fertility of the rich porous peat soil of the Sacramento-San Joaquin delta through salt intrusion.
5. It will burden the operation of deep-water ships and increase the cost of water transportation to the shippers of the great interior valleys of California.
6. It lacks Budget Bureau approval because of its low benefit ratio. The proposed outlay of $15,000,000 as estimated by the United States engineers, $25,000,000 as computed by the engineers of the city of Stockton, would be speculative, unadvisable, and unjustified in the opinion of the Bureau of the Budget. Our Nation is faced with heavy demands upon its Treasury. There are hospitals to be constructed, the disabled to be aided, dependents of both the living and the dead to be assisted, huge social-insurance obligations to be met, 15,000,000 service men and women to be fitted back into the economic structure of our country, terminal-leave pay to be financed, GI educations to be paid for, housing, agricultural and price subsidies to be met, bonds to be redeemed, interest to be paid and hungry mouths all over the world which cry for American food. At such a time projects of precarious worth should not be authorized. The survey of the Sacramento canal and basin project has been in the hands of the United States engineers for 13 years. The last local hearings were held 8 years ago. The costs were estimated in 1940. It is a gamble on the future. Such a project is not of sufficient merit or urgency to justify its construction at this time. I respectfully urge the deletion of the Sacramento Channel project from H. R. 6407 which is now before you for consideration,
WARREN H. ATHERTON,
Stockton Port District, Stockton Chamber of Commerce. Senator KNOWLAND. Mr. Chairman, Congressman Clarence F. Lea of California, the dean of the California delegation, would like to be heard.
Senator ROBERTSON. Congressman Lea is the very distinguished chairman of the Interstate and Foreign Commerce Committee of the House.
Senator OVERTON. The committee, is very glad to hear you, Mr. Lea.
STATEMENT OF HON. CLARENCE F. LEA, A REPRESENTATIVE IN
THE CONGRESS OF THE UNITED STATES FROM THE FIRST DISTRICT OF CALIFORNIA
Representative LEA. I appreciate the opportunity of appearing before the committee. I appear for the purpose of endorsing this project. I do that on the basis of what I regard as its economic importance.
The Sacramento Valley, in proportion to its size, is one of the great productive area of the United States. Sacramento City is the assembling and distributing point for all the products of that great area. So, I believe that the approval of the project by Congress will prove to be economically justified.
Senator ÖVERTON. Thank you, Congressman.
Colonel FERINGA. Before the proponents appear may I briefly answer the question of cost?
Senator OVERTON. Yes.
Colonel FERINGA. I will not repeat from the House hearings, but the same question as to our estimates was raised, and I went into the matter very carefully at the request of the chairman of the House committee on Rivers and Harbors. We submitted to the committee actual cost figures, dredging cost figures, on comparable jobs on the Gulf Coast, since large dredging jobs of this nature are few. We gave dredging cost figures as low as 6.65 cents per cubic yard for work done in December 1945. For about five other jobs the costs ranged from 8.25 cents, 6.65, to 9.1 cents per cubic yard.
That is found on page 87 of the House hearings.
I was also concerned by the statement of Mr. Ohm. He is a good engineer in my estimation. I have talked with him, and I have great respect for him. Therefore I teletyped our district engineer, asking him why the job on the Sacramento River referred to by Mr. Ohm, cost so much more than the estimated cost for this job. The district engineer's teletyped reply is as follows (reading):
Sacramento ship channel will involve some 60,000,000 yards material in very desirable heavy bank and with adjacent disposal areas, which support the low cost. Work cited by Mr. Ohm as being recently completed by Sacremento district was maintenance dredging of heavy sand from Sacramento River at cost 19.6 cents per yard. Yardage involved 1,600,000 at three locations near one spoil area. Material was pumped maximum distance of 7,800 feet and average distance of 4,000 feet against a lift of 30 feet. Job also involved use of two submerged lines, and was started in August 1944. Considering the improvement in dredging costs since VJ-day and undesirable features of job cited by Ow, it is opinion this office that jobs are not comparable.
I then asked the district engineer for additional data with reference to costs. I hesitate to read what is already in the record, but I think it should be repeated at this time [reading]:
Reference is made to the recent telephone request of Col. Peter A. Feringa, Director of Civil Works, for additional data concerning the physical conditions which will be encountered in the dredging of the Sacramento deep-water ship channel, and any other information which will support the estimated dredging unit cost of $0.097 contained in the report for this project.
Review of the preliminary plans for the channel has disclosed that a major portion of the dredging will involve the moving of about 350 cubic yards per lineal foot of completed channel through an average length of pipe line of 1,500 feet and against a maximum lift of 15 feet. Borings for the work indicate that hardpan will be encountered only at isolated locations, generally near the top of banks where it can readily be undercut, and that the hardpan strata will average about 4 feet in thickness. The remaining materials are clay, indy clay, silt, sand, peat, and a strata of pea gravel at one isolated point.
Three reputable hydraulic dredging contractors, now operating in the San Francisco Bay area, have been contacted concerning the probable cost of dredging the proposed channel under existing conditions. After consideration of the data advanced in paragraph 2, all of these firms stated that the contract cost per yard of material excavated from the channel should be less than 10 cents, spoil area and incidental costs being included in this figure.
The estimate contained in our report is based on 1940 costs. I have told the committee that the costs probably would be 20 percent higher, although the district engineer believes they would be the same.
Senator OVERTON. Who is going to speak for the proponents?
Mr. MANGHUM. My name is H. E. Manghum, Mr. Chairman. I am an attorney representing the city and county of Sacramento, Calif., and the Sacramento Chamber of Commerce. We have two other witnesses whom I would like to put on first, and then myself to give a brief concluding statement. So I will present at this time Mr. Arthur Dudley, secretary of the Sacramento Chamber of Commerce.
STATEMENT OF ARTHUR S. DUDLEY, SECRETARY-MANAGER OF
THE SACRAMENTO CHAMBER OF COMMERCE
Mr. DUDLEY. Mr. Chairman and gentleman of the committee, I am A. S. Dudley, secretary-manager of the Sacramento Chamber of Commerce, which position "I have occupied for 23 years. Incidentally, for 2 years I was manager of the Oregon State Chamber of Commerce, 2 years manager of the Stockton Chamber of Commerce. I was manager of the Stockton Chamber of Commerce at the time of the local bond issue, and came to Washington with officials of Stockton to assist in getting the first appropriation from the Federal Government for the Stockton channel. I was assistant manager of the Los Angeles Chamber of Commerce for 5 years. So I have covered the West for the last 30 years in organization work and know the situation on the coast fairly well.
I am here today, Mr. Chairman, officially authorized by the City Council of Sacramento, and also by resolution officially representing the county of Sacramento, and of course I am officially representing the Chamber of Commerce of Sacramento, which has some 1,600 members.
I would like to refer, in representing the city and county, to the resolutions which the city government of Sacramento adopted and which you will find on page 26 of the hearings before the Committee on Rivers and Harbors of the House, and also a somewhat similar resolution passed by the Sacramento County Board of Supervisors, which resolution is on page 24 of the same hearings.
Before the Rivers and Harbors Committee I presented, and asked that it be printed and filed, a resolution of the Sacramento Chamber of Commerce board of directors. Inadvertently that resolution was not printed, and I would like to have that resolution inserted in the record at this time and printed so that it may appear.
Senator OVERTON. It is so ordered.
SACRAMENTO CHAMBER OF COMMERCE, SACRAMENTO 14, CALIF.
SACRAMENTO SHIP CHANNEL RESOLUTION
Whereas the city of Sacramento is one of the largest and most important distribution centers from the standpoint of areas served as well as tonnage handled in the United States; and
Whereas it is the center of northern California's agriculture, food-processing, mining, and lumbering industries located approximately 100 miles inland from the Pacific Ocean at the west coast crossroads of rail, air, and highway transportation; and
Whereas sailing ships and oceangoing vessels plied the Sacramento River from Atlantic ports in the days prior to hydraulic mining which latter handicapped navigation compelling the Federal Government to assume financial expenditures exceeding $100,000 annually to maintain the 10-foot channel which has, in recent years, proved to be inadequate; and
Whereas recent growth and development of business and industry in this important district requires and now justifies the deeper channel recommended by the United States Army engineers, shortening the present water route by 15 miles; and
Whereas the engineers' recommendation finds the project economically sound and fully justified: Now, therefore, be it
Resolved, That the board of directors of the Sacramento Chamber of Commerce aprove the proposed 30-foot ship channel project as described in the report of and recommended by the Chief of Engineers; and be it further
Resolved, That Mr. A. S. Dudley, secretary-manager of the chamber of commerce, be authorized to personally appear before the House Committee on Rivers and' Harbors presenting this resolution and recommending that the Congress of the United States approve the report of the Chief of Engineers; and be it further
Resolved, That Mr. W. G. Stone, manager of the transportation and industrial department of the chamber of commerce appear before the House Committee on Rivers and Harbors and present such other supporting data as may be appropriate in furthering the approval of this project.
This is to certify that the foregoing is a true and correct copy of the resolution adopted by the board of directors of the Sacramento Chamber of Commerce at their regular meeting held in the city of Sacramento on the 5th day of April 1946.
A. S. DUDLEY, Secretary-Manager. Mr. DUDLEY. That resolution indicates the attitude of the business interests of Sacramento. In addition to the unanimous endorsement and approval of the city and county officials, the business interests of northern California have approved of it.
You have heard from the Congressman from the First District, Mr. Lea; the Congressman from the Second District, Mr. Clair Engle; the Congressman from our own district, the Third District, Mr. Leroy Johnson, all endorsing and approving the project. You have received yesterday or today, I think, a letter from the Senator from California, Mr. Sheridan Downey, also approving and endorsing it.
Senator KNOWLAND. That went into the record yesterday.
Mr. DUDLEY. The other Senator from California will have to speak for himself, as he is a member of this committee.
The Governor of the State of California likewise has endorsed the project, and you have that endorsement and report which was filed over in the other House.
I might say that approximately 3,000 shippers in the northern California trade area of Sacramento were personally contacted for a period of 3 months by seven men. Complete detailed data with regard to in and out tonnages as of 1940 were secured. These shippers all endorsed the project. The information and the details obtained were turned over to the Army engineers. Mr. W. G. Stone, manager of our industrial transportation department, who will appear following me, will give you some more details with reference to that particular situation.
The area to be served embraces about 114,000 square miles. There is approximately 1,000,000 population in this area.
Senator OVERTON. You are familiar with the estimate made by the Army engineers as to the prospective tonnage over this channel ?
Mr. DUDLEY. Yes, sir.
Senator OVERTON. Do you think it is a fair estimate, or do you think there will be more tonnage or less tonnage ?
Mr. Dudley. It is a conservative estimate. The estimate was made, I think, some 2 years ago. Since that time there has already developed another 100,000 tons, approximately. The Campbell Soup organization is now building and expending about $5,000,000 on a new plant at Sacramento to serve the entire West, as well as the Pacific coast. That tonnage was not included.
The Continental Can Co. is building a new building, a west coast plant, at Sacramento, and their tonnage was not included.
The United States depot of the Signal Corps are building and have just about completed an $8,000,000 structure at Sacramento. The Signal Corps depot at Sacramento will serve the entire Pacific area