mercial distribution is open to question, and for this reason no credit has been assigned to this item. 210. Indirect benefits.-Listed below are some of the indirect benefits which would accrue from the proposed waterway: (a) Indirect savings in the tributary area due to rate reductions on railroads (b) Adjustment of interterritorial freight rate situation. (c) Increased water supply for industries and the prevention of stream pollution. (d) Improvement of social and economic conditions in the tributary area. 211. A discussion of each of the indirect benefits listed above follows: (a) Indirect savings in the tributary area due to rate reductions on railroads. From statistics of the railways in the United States, published by the Interstate Commerce Commission, it was estimated that the railroads handle about 11 tons per capita in the Southeast. Applying this per capita tonnage to the population of the tributary area, a total of about 30,000,000 tons would appear to be a reasonable estimate of the amount of tonnage handled by the railroads throughout the tributary area. About 60 to 65 percent of the total revenue freight carried in the Southeast is composed of products of mines. Products of agriculture and products of forests each comprise about 71⁄2 percent of the tonnage, or about 15 percent of the total. It can be seen, therefore, that approximately 80 percent of the total revenue freight in the Southeast is comprised of products of mines, forests, and agriculture. Although 80 percent of the total rail freight is more or less adaptable to water transportation, based on an analysis of the Warrior River traffic, it may be assumed that 40 percent of the adaptable tonnage carried would be affected by a general reduction of rail rates due to water competition. A careful analysis of the tonnage moving throughout the territory affected by the Warrior River was made in the 308 report on that stream (H. Doc. 56, 73d Cong., 1st sess.). This analysis showed that the tonnage actually moving on the Warrior River during 1929 was about 43 percent of the total tonnage which could have moved by water or rail-water at a saving during that year. It can be seen, therefore, that about 10,000,000 of the 30,000,000 tons rail freight in the tributary area might be affected by the construction of the proposed waterway if the railroads continue to follow their policy of reducing rates on commodities adapted to water carriage. The average revenue per ton of freight originated, according to statistics published by the Interstate Commerce Commission, amounts to about $3.40. The average revenue per ton of all freight carried, however, amounts to a little less than $2 per ton. If it be assumed that only a 10-percent reduction of the average rail revenue would result from water competition (the actual reductions have been from 24 to 43 percent), a net reduction of about 20 cents per ton throughout the territory is indicated. It is realized that all rail tonnage in the territory would not be affected equally, as it is probable that greater reductions will be made on some commodities than on others. The total effect on the general level of water compelled rates throughout the territory, however, might easily amount to 20 cents per ton. Applying this saving to the 10,000,000 tons handled by the railroads in the territory on which possible reductions might be made, a total of $2,000,000 annually is indicated as the indirect savings to shippers which might result from the proposed improvement if rail rates are reduced in the tributary area as a result of the waterway. (b) Adjustment of interterritorial freight rate situation.-Although the volume of commerce which would move over the proposed waterway between the southern and official territories would be small in comparison to the total tonnage moving between these territories by other means of transportation, the creation of a new avenue of trade between these freight-rate territories which would not be subject to any existing rate reductions or differentials might contribute somewhat to the readjustment of the rate structure sought by the shippers in the southern territory. The readjustment of the interritorial freight-rate situation, if made, would result in a saving of millions of dollars annually to southern shippers. (c) Increased water supply for industries and the prevention of stream pollution. Although there are no industries along the banks of the Tombigbee River at the present time which require large volumes of water, and there have been no instances of stream pollution as yet, an increased water supply in the Tombigbee River, particularly in the upper reaches thereof, would make available an adequate industrial water supply which might induce new industries to locate in the territory, and would prevent the pollution of the stream as the cities along its banks increased in size and population. These are possible future benefits from the proposed waterway. (d) Improvement of social and economic conditions in the tributary area. An increase in the general prosperity of the tributary area would result in a greater per capita income, greater taxable values, and a greater per capita wealth. With more income and more funds from taxes available, the educational facilities could be improved, additional hospitals and libraries constructed, more paved roads provided, and other improvements and betterments made which would materially improve the economic conditions in the territory and do much to promote the human welfare of the area. These social and economic benefits cannot be evaluated in dollars and cents, but they are nonetheless tangible and real. 212. A summary of the annual benefits follows: Direct benefits: TABLE 44.-Summary of annual benefits Savings to public in transportation charges_ Enhancement of land values in the tributary area- Total____ The ratio of estimated annual carrying charges to estimated annual benefits is 1 to 1.16. DISCUSSION 213. The construction of a waterway shortening the waterway distance between the Gulf and the Tennessee River 630 miles, between the Gulf and Ohio River by over 200 miles, and between the Gulf and upper Mississippi River by over 100 miles, as well as providing a slackwater route to and from the Gulf avoiding difficult Mississippi River currents, and affording the public a direct saving in transportation charges of over $2,000,000 annually, would have a marked influence on the development of the region directly affected and its effect would extend to a lesser degree to the areas adjacent to the Ohio and upper Mississippi River systems. 214. For a territory so rich in natural resources, but which for decades has lagged behind the other sections of the country in population and industrial development, the estimates of prospective commerce are considered conservative from a long-range point of view. The unit savings shown in the traffic survey are considered to be low, as they represent only the spread between future water rates and the existing depressed rail rates which blanket the territory as a result of water competition in the Southeast. These savings would be much greater if compared to the so-called "normal" level of railroad rates. 215. The slack-water return route for upstream traffic on the Mississippi River has great possibilities and no doubt would be utilized much more extensively than can now be definitely shown. It is not expected that the route would be immediately utilized by all who could benefit thereby, as in many instances new or specialized equipment would be required, pilots would have to be trained, new business connections made, and the inertia to the change of established customs or operations overcome. 216. The plan of improvement proposed by the Board for a waterway connecting the Tennessee and Tombigbee Rivers would serve the needs of local interests as well as those of through traffic. The dimensions of the channels and locks are sufficient to permit the passage, theoretically, of 39,420,000 tons of commerce annually in the standard tow for which the waterway was designed, assuming 24 lockages per day of fully loaded tows. It is very improbable that the waterway would ever be required to handle any such volume of traffic, but assuming that the tows would be loaded to only 50 percent of their capacity and make only 12 lockages per day, the waterway could accommodate about 10,000,000 tons annually. As water for lockages would be obtained from the Tennessee River, there would be no problem of water supply. 217. The desire expressed by some of the proponents for a cut through the divide for the diversion of the floodwaters of the Tennessee River down the Tombigbee Valley for flood control on the lower Tennessee River and the Mississippi River below Cairo was investigated and the Board is of the opinion that, although schemes other than that presented in this report might be developed, no plan of diversion would be as economical as the storage of the floodwaters in impounding dams within the Tennessee River watershed. There would be no possibility of combining the plan for diversion with the plan for navigation or power development. The reservoirs in the Tombigbee Valley outlined in paragraph 196 would have to be kept empty at all times to be ready to receive floodwaters; therefore, some provision would have to be made for navigation during the low-water season, and there would be no possibility of the development of any prime power at the storage dams. Installations to develop the secondary power available for short periods of time would not be justified. 218. The benefits to be derived from development of power for commercial purposes at the navigation dams included in the proposed plan of improvement, discussed in paragraphs 176 to 188, appear to be questionable when the value of water diverted from Tennessee River power plants now built or building is taken into consideration. The Board is of the opinion, therefore, that power development, if any, in connection with the proposed waterway should be limited to that required for the operation of the locks. 219. Although the indirect and social benefits which would accrue from the construction of the waterway are difficult to evaluate, they would probably equal or exceed the direct benefits. It is estimated that, in addition to the indirect benefits listed in paragraph 193, the project would give employment to about 6,000 to 8,000 men for a period of 8 years, and thereafter to about 350 men on annual operation and maintenance. In addition, many men would be employed at the various terminals and by barge lines operating on the waterway. Industries locating along the waterway would further increase the amount of employment attributable to the improvement. 220. Although the benefits accruing from the proposed improvement would be national in scope and character, in view of the many advantages accruing to the areas directly benefited, the Board is of the opinion that a part of the cost of the project should be borne by local interests. The principal beneficiaries would be located in the States of Mississippi and Alabama. About 140 miles of the proposed improvement and all but 3 of the locks and dams would be located in Mississippi, and that State would benefit most from the actual construction, but a large percentage of the construction materials would be obtained from Alabama. The Board believes that it would be equitable and fair for the principal beneficiaries to bear the cost of various items outlined in paragraph 201 above amounting to $2,132,700, or about 3.1 percent of the total cost of the improvement. CONCLUSIONS 221. The Board is of the opinion that construction of a waterway to connect the Tennessee and Tombigbee Rivers substantially as outlined in this report is feasible from an engineering viewpoint, and that the benefits which would accrue to the general public by reason of its construction are of sufficient magnitude to warrant the undertaking of the project by the United States. RECOMMENDATIONS 222. The Board recommends: (a) That the United States undertake the construction of a waterway to connect the Tennessee and Tombigbee Rivers, by way of the East Fork of the Tombigbee River, Mackeys Creek, and Yellow Creek, so as to provide a channel of not less than 9 feet in depth and a minimum bottom width of 170 feet in river and canal sections and 115 feet in the divide cut, with locks 75 by 450 feet clear inside dimensions, substantially in accordance with the general plan presented in this report, at an estimated first cost to the United States of about $65,500,000 and an estimated annual cost of $477,000 for maintenance and operation. (b) That the prosecution of this project shall be subject to the conditions that local interests shall give assurances satisfactory to the Secretary of War that they will: (1) Assume the costs of all rights-of-way and flowage damages, except in the summit section. (2) Construct, maintain and operate all highway bridges, and construct and maintain all highway relocations or alterations necessary to the improvement. (3) Maintain and operate all railroad bridges and utility crossings. (4) Alter or reconstruct sewerage, drainage and water supply and distribution works made necessary by the improvement. (5) Guarantee the United States against all claims for damages incident to the improvement. (6) Provide adequate terminal and transfer facilities for operation of the waterway. F. B. WILBY, Colonel, Corps of Engineers, Senior Member. |