DOCUMENTARY HISTORY OF THE FLORIDA CANAL 241

 (1) On the basis of the methods customarily used by the Board of
Engineers for Rivers and Harbors to determine the economic justi-
fication of a project, the Florida ship canal is justified by a wide
margin. These methods are analogous to those used in commercial
practice for work of a similar character.
 (2) Not only would the benefits to shipping exceed, by a wide
margin, maintenance and operating costs, and interest at the current
rates as required by the Board of Engineers, but in approximately 32
years they would, in addition, more than amortize the original cost
of the work plus interest during construction.
 (3) The return from tolls considered by the board of review is no
longer an issue as the route is being opened as a free canal as are the
other waterways of the United States.
 On work of the nature of the canal which includes but a small per-
centage of items subject to depreciation (less than 21/ percent), the
Board of Engineers requires that estimated annual benefits exceed
by a safe margin estimated maintenance and operating charges and
interest at current rates. These rates are now less than 3 percent.
 Senator FLETrE What is the Senate document giving that water
 report?
 Mr. BUCKMAN. No. 147. I have some copies here, if you want
 them.
 Senator FLuCHER. That is all I wanted.
 Mr. BUCKMAN. In the case of the Florida ship canal, the board
 of review's report of June 28, 1935, finds with the Army Special
 Board of Survey annual benefits of approximately $8,200,000 which,
 even on a 4-percent basis, allowing for amortization, the Board found
 would justify a cost up to $160,000,000, or $17,000,000 above the
 actual estimated cost. It will be recalled that the engineers of
 the Public Works Administration reported annual benefits above
 $10,500,000. The figure of the Special Board of Survey of the Army
 is therefore the more conservative.
 Following the method of the Board for Rivers and Harbors of the
 Corps of Engineers, we have, then, the following basis of justification
 for the Florida canal, using the benefits determined by the Army
 Special Board of Survey, and the cost estimate approved by the
 Chief of Engineers.
 Annual benefits -------------------------------------- $8, 200,000
 Cost, without interest during construction-------------,-------. 143,000,000
 Interest during construction, at 3 percent--------------------- 12,870,000
 Total first cost-------------.------------..-----. 155, 870,000
 Annual interest charges on $155870,000, at 3 percent------------ 4,676,000
 Annual maintenance and operation expense--------------------. 601,000
 Total annual cost----------------------- ------ -- 5,277,000
 Senator VANDENBERG. Excuse me. Where did you get your
 maintenance-cost figure from?
 Mr. BUCKMAN. They are developed in detail by the Board of
 Review in its annexes to its report, which we have here.
 Senator VANDENBERG. Why did General Pillsbury state it would
 be in excess of a million dollars?