DOCUMENTARY HISTORY OF THE FLORIDA CANAL 331

of survey, to make this study and this investigation. They were engaged in that
work for 18 months. They brought into cooperation with them experts from the
Commerce Department simply with reference to the economic and commercial
justification of the canal. That special board of survey of the Army engineers
went exhaustively into every question which is considered by engineers in pass-
ing upon the merits of river and harbor projects-the economic and commercial
data, the route, the plans and specifications. They went into every question that
determines the matter of recommendation with reference to river and harbor
projects. They were 18 months at that work.
 In the meantime, there were further developments. The act of 1934 was
passed authorizing loans and grants for public projects.
 The National Gulf-Atlantic Ship Canal Association, a corporation not organ-
ized for profit, and subsequently a public agency of the State of Florida, made
application to the Reconstruction Finance Corporation for a loan and grant with
which to build this canal. So much time was elapsing between reports and con-
clusions that the national association thought they would make application to
the Reconstruction Finance Corporation for a loan and grant. The application
was transferred by the Reconstruction Finance Corporation to the P. W. A., be-
coming the application of the Ship Canal Authority of the State of Florida,
especially created by the State legislature for that purpose. The P. W. A.
engineers made a thorough survey and examination, in accordance with the law,
to determine the possibility and prospect of this being a self-liquidating proposi-
tion as a toll canal. Under the application they had to consider the question of
the security for such a loan. The engineers of the P. W. A. made a thorough
examination of the whole project from beginning to end; they studied the ques-
tion for months and months, and they reported favorably on the application as
follows. I quote from their report of October 19, 1933, as it appears on page 43
of the hearings before the subcommittee of the Senate Committee on Commerce:
 "It is concluded that the project covered herein constitutes a public necessity
 and is of real social value. The project will afford much employment to many
 classes of skilled and unskilled labor; that the design is in accord with sound
 engineering practice; and that the project is economically sound. It is recom-
 mended that the loan with or without the grant be made."
 Subsequently, however, the Secretary of the Interior turned it down, after
 the board of review had reported that ships would probably pay a cash toll
 equivalent to only 45 percent of the savings realized, or about 8 cents per net
 registered ton, believing that it would not be self-liquidating within the P. W. A.
 requirements.
 Of course, the question primarily was as to the amount of revenue that would
 be derived from the tolls which might be imposed, and the rate of the tolls
 and the amount of tonnage were determining factors. It depends on whether
 there is a rate of 8 cents per net ton in the way of tolls, or the Panama toll of a
 dollar a ton. They figured on a toll of 8 cents per net ton of cargo. The Secre-
 tary finally decided that he did not consider this security sufficient for the loan
 applied for.
 Mr. CouzENs. Mr. President, will the Senator yield?
 Mr. FLE=HE&. I yield.
 Mr. CouzEps. Does the Senator know why they selected the figure of 8 cents
 per net ton?
 Mr. FrLETHEU. That is just an arbitrary figure they used. They could fix it
 at any figure up to the total savings, about 18 cents per ton. It was estimated
 by the board of review that only 45 percent of the benefits to the ship could be
 collected for tolls, the ship taking the other 55 percent as its net benefit from
 using the canal. That is purely an arbitrary adjustment. At any rate, on the
 basis.on which they figured, the P. W. A. were not satisfied that the canal
 would yield revenue sufficient to make it self-liquidating within their require-
 ments.
 The report of the engineers, however, is valuable as a collection of data and as
 a basis for further study of the project
 The report of the special board of survey of the Army engineers dealt with a
 canal which was to be a lock canal, with three locks. The report of the P. W. A.
 engineers dealt with a canal with two locks.
 There was a variation between the estimates of cost There was a difference
 in other respects, as to some specifications and unit costs, and there was a con-
 siderable spread between the cost estimates of the P. W. A. and the estimates of
 82710-36----22