DOCUMENTARY HISTORY OF THE FLORIDA CANAL


Mexico and thereby forever eliminate the uneconomic movement of commerce
of the Gulf tributary States as it exists today, which commerce must move
through the Gulf of Mexico to the southern end of the North Atlantic Ocean
and thence to its northern end to reach its markets of the North Atlantic.
 The special board which you appointed to study the Gulf-Atlantic ship canal
project has reported to you and recommended for your consideration the con-
struction of a 30-foot sea-level ship canal at a cost of $143,000,000 along the
St. Johns-Ocklawaha-Withlacoochie Rivers route in Florida and stated that it
was economically justified even up to a cost of $100,000,000. Further, the
board stated that upon the basis of a toll of 8 cents per net registered ton
(which toll represents not more than 40 percent of the savings to shipping)
that the canal would pay its maintenance and operating expenses and repay
its first cost within 80 years without interest.
 The Ship Canal Authority of the State of Florida is a legally constituted
body under the laws of Florida and has power to acquire, own, construct,
maintain, and operate a ship canal across the State of Florida, together with
power of condemnation and free right to State lands; right to regulate vessels
and pilots; to collect tolls; and the right to borrow money and issue its reve-
nue bonds therefore, secured further by the ship canal property and auxiliary
works. Also the right to transfer the canal to the United States when it has
repaid its obligations.
 We therefore propose-
 (1) That the Government, through the War Department and with the joint
 cooperation of the Public Works Administration, the Federal Emergency Relief
 Administration, and the Ship Canal Authority of the State of Florida, con-
 struct this sea-level ship canal at a cost of $143,000,000.
 (2) Upon completion of construction this authority will issue to the appro-
 priate department of the Government either $80,000,000 of 2 percent 99-year
 bonds or $60,000,000 of 3 percent 99-year bonds.
 (3) This authority will give t!:e Government such rights as it may desire
 in the maintenance, operation, and regulation of this ship canal until the bonds
 are retired. Then the authority will deed the canal to the United States.
 Based upon the report of your board, the earnings will retire either the
 $80,000,000 of 2-percent bonds or the $60,000,000 of 3-percent bonds within
 the 90-year period. In addition the commerce and people of this Nation will
 receive 60 percent of the economic savings (represented by that portion of
 the savings not assessed as a toll).
 We direct attention to the fact that the amount to be expended by the Gov-
 ernment in constructing this project above the amount for which the authority
 will issue its bonds is a justified expenditure by the Government both from
 the standpoint of broad national reasons and upon the basis of specific pro-
 visions in existing laws as follows:
 Specific provisions

 1. N. I. R. A., title II, project is entitled to a grant of 30 percent_ $42,900,000
 2. For providing a connection between the Atlantic inland water-
 way system and the Gulf inland waterway system, without
 additional cost to the United States.
 Upon these two systems the Government has expended $57,000,-
 000 but has no connection for passing commerce from one to
 the other. Under N. I. R. A., title II, this allowance can
 be made upon recommendation of the Chief of Engineers--- 18, 000,000
 3. The Relief Administrator of Florida advises that he could use-
 fully employ men in work relief on the construction of this
 project from relief funds to the amount of $5,000,000 annually
 for 5 years------------------- ---------------------- 25,000,000
 BmOAD NATIONAL REASONS

 1. An aid to the national defense in time of war.
 2. The fact that approximately $72,000,000 of the canal's cost will be spent
 outside of Florida and in the industrial centers of the United States with
 the heavy and specialized industries in constructing the equipment and mate-
 rials of construction-providing, as it will, employment for 69,000 men in
 these industries for the period of a year--seems ample justification for an
 allotment of this amount of relief funds to the project, either in lieu of or in