BRIDGE ACROSS ST. CLAIR RIVER AT OR NEAR PORT HURON, MICH. JUNE 14, 1930.-Referred to the House Calendar and ordered to be printed Mr. MAPES, from the Committee on Interstate and Foreign Commerce, submitted the following REPORT [To accompany H. R. 12643] The Committee on Interstate and Foreign Commerce, to whom was referred the bill (H. R. 12643) creating the Port Huron-Sarnia International Bridge Commission and authorizing said commission and its successors to construct, maintain, and operate a bridge across the St. Clair River at or near Port Huron, Mich., having considered and amended the same, report thereon with a recommendation that it pass. Amend the bill as follows: Page 1, lines 3 and 4, after the word "the" strike out the words "Port Huron-Sarnia International" and insert the words "Great Lakes" in lieu thereof. Page 5, line 13, after the word "ferries" strike out the words "and the bonds issued in connection therewith". Page 10, line 17, after the word "the" strike out the words "Port Huron-Sarnia International" and insert the words "Great Lakes" in lieu thereof. Page 12, line 6, after the word "determine" change the colon to a period and strike out the remainder of the line. Strike out all of line 7 down to and through line 17, inclusive. Page 12, line 24, after the word "sold," insert the following: "or in the event that the bridge herein authorized is not constructed within five years from the date of approval of this act,". Amend the title so as to read: Creating the Great Lakes Bridge Commission and authorizing said commission and its successors to construct, maintain, and operate a bridge across the St. Clair River at or near Port Huron, Mich. This bill is in a different form from the form usually used in granting franchises for international bridges. Its provisions have been very carefully prepared by the author of the bill in order to meet the conditions which have been found necessary, by the author, Mr. Cramton, to successfully finance the bridge and secure its construction. After careful consideration by the committee its passage is recommended with certain amendments which have been made by the committee. This bridge will be located between Port Huron, Mich., and Sarnia, Ontario, just south of the south end of Lake Huron, and will be on one of the main east and west international highways of travel and commerce, running from St. Paul and Minneapolis east through Michigan and Ontario, to Hamilton, Ontario, and Niagara Falls and New York City. The bridge will not be a part of the highway system of either the State of Michigan or the Province of Ontario. Neither the State nor the Province will construct a bridge at this point. Neither Port Huron nor Sarnia can finance a structure of this kind. It appears from the hearing that there will be no way to secure a highway bridge at this point unless it is financed and constructed by a private corporation with the usual rights of earning profits for stockholders, or by a commission under some kind of authority such as is provided in the bill. The bill creates a bridge commission with authority to issue bonds under the conditions specified in the bill, construct and operate the bridge until the bonds or other indebtedness issued or incurred for the construction of the bridge have been paid; and thereafter the bridge will be conveyed to the State of Michigan and to the Province of Ontario, provided they will accept it, and will be operated as a free highway bridge. The commission is to be composed of business men and the United States Army Engineers who are to act entirely from a spirit of public service and without compensation. Those selected as members of the commission are chosen by the author of the bill after consultation with them, and the committee was assured by the author of the bill that their business standing and their high character would insure the faithful discharge of their duties on the commission and their complete freedom from political influences. The bill provides that this commission is to be created in order to facilitate international commerce. It will be a Federal agency with limited powers specifically enumerated in the bill. It is not a corporation, but it will have several of the usual powers of a corporation. It will terminate and be dissolved within five years after the passage of the act, unless the bridge is constructed by that time. If the bridge is constructed, the commission will be dissolved as soon as the bridge is paid for and turned over to the public authorities authorized to receive it. No stock is to be issued; no one is to receive any profit. The members of the commission are to give bonds for the faithful performance of their duty, and all funds received from the sale of bonds are to be used for the construction of the bridge, and the bonds are to be retired from the tolls received. The method of financing the bridge is provided for by the terms. of the bill, and the bridge is to be constructed under the provisions of March 23, 1906, which gives to the Secretary of War the right to see that tolls are just and reasonable and to himself fix the tolls if he finds them not to be just and reasonable. The plans for construction will have to be approved by the Secretary of War and the Chief of Engineers. The bonds or other securities issued for financing the structure must be approved by the securities commission of the State of Michigan before they are sold. The bill authorizes the bridge commission to purchase and operate the existing ferries that are now used between Port Huron and Sarnia until the bridge is completed. Thereafter they may be sold or operated as the commission finds desirable. The purpose for authorizing the commission to purchase and operate the ferries is, first, to prevent what would amount to a practical confiscation of the ferries. When the bridge is completed and is in operation, the ferries will be practically put out of business; and while there is no obligation to prevent losses of that kind, when public improvements like bridges are constructed, yet the committee feels that there is no objection to the prevention of such losses if it can be done. But the principal purpose of authorizing the commission to purchase and operate the ferries is to enable the commission to finance the construction of the bridge. In order to raise the necessary funds to construct the bridge it is necessary to determine, with more or less certainty, the tolls that will be charged and the revenues that are to be expected. A careful check up has been made of the probable traffic to be expected, and by taking into consideration the probable traffic and the probable revenues to be received, the commission will be able to finance the structure. But, naturally, the ferry company is opposed to the construction of the bridge; they can reduce their tolls substantially at any time, and thereby prevent the financing of the bridge, because if the ferry company should materially reduce their charges it would be necessary for the bridge commission to reduce the charges for transiting the bridge. In order, therefore, to prevent anticipated cutting of ferry charges, and to secure the necessary funds to construct the bridge, as well as to prevent the practical confiscation of the property of the ferry company, the bill authorizes the commission to purchase and operate the ferries. The exact location of the bridge has not yet been determined. The river near where the ferries are now operated is quite wide. Just north of that location about a mile or a mile and a half, the river is narrower, and a bridge can be constructed at that point for perhaps a million dollars less than it can where the river is wider. Unless the commission owns and controls the ferries, they would be compelled to construct the bridge at the wide part of the river. Owning and operating the ferries the commission could construct a bridge at the narrow point and save considerable money. The savings would amount to more than enough to purchase the ferries. When the bridge is completed the commission would dispose of the ferries if they were no longer needed, or could continue to operate part of them if they were needed. The committee sees no particular objection to this authority being granted to the commission, since it seems to be important, if not necessary, in order to finance the bridge and successfully amortize its cost, and make it free. The bill also exempts the bridge and the income thereof from all Federal, State, and municipal taxes. Being a Federal commission, the State and municipality could not tax the bridge without authority of Congress. It would manifestly not be wise to exempt it from State and municipal taxes unless it were likewise exempted from Federal taxes. Since this is a public commission created for the single purpose of providing a facility for international commerce in connection with which no private profits are contemplated or allowed, the committee knows of no valid reason why they should not be exempted from taxes. If the bridge and the income therefrom is required to pay local and Federal taxes, a substantial part of the revenues would be required, and that much more time would be required to amortize the cost of construction, and its becoming free to the public would be thereby considerably postponed. It is the policy of the committee to encourage the building of free highway bridges wherever possible. Where that is not possible, it would seem to be a wise policy to permit the construction of bridges under plans of financing which would amortize their costs as soon as possible and make them free thereafter. In harmony with that policy the committee believes that it would be in the public interest to exempt the bridge and the income therefrom from all taxes, so that it can become a free bridge, the property of the public as soon as possible. On the whole the committee believes that it will be more in the public interest to authorize the construction of this bridge in the manner provided by the bill rather than to allow it to be built by a private corporation which would, of course, be entitled to receive promotion charges, and at least the usual profits to which private capital is entitled. As to precedents, some years ago Congress created a private corporation and authorized it to construct a bridge across the Hudson River in New York, granting the corporation authority to condemn property and to finance and construct a bridge. Within the last three or four years Congress authorized the city of Louisville, Ky., or a bridge commission appointed by the municipality, to construct and operate a highway bridge across the Ohio River at Louisville. Authority was granted to the commission to issue bonds and pay for the bridge from the tolls received and after costs of the bridge have been amortized, the bridge is to be free. In that case Congress granted the authority to a commission which we authorized the city to appoint to construct and operate the bridge. In this bill Congress itself creates and appoints the commission. The Louisville commission being a municipal agency is exempt from Federal taxes, and it has been exempted from State and local taxes by the State legislature. The State of Alabama created a bridge commission or a corporation and Congress granted authority to that public corporation to construct a number of toll bridges in Alabama, and provided that when the costs of the bridges were paid from the tolls, they should be operated as free bridges thereafter. That corporation, being a State agency, is exempted from Federal taxes, and by State law is exempted from State and local taxes. If it is a wise policy for Congress to encourage the construction of free bridges to facilitate the movement of interstate and international commerce, and to permit reasonable charges to be made for the use of such structures until the actual costs thereof have been amortized, and they can thereafter become free public bridges, the committee sees no reason why they should not be ex empted from taxes and thereby become free public bridges as soon as possible. Under the plan proposed by this bill a substantial and safe highway bridge can be constructed at Port Huron which will in a few years become a free public bridge. If the bridge can not be constructed in the manner provided by the bill, international commerce at Port Huron will be subjected indefinitely to unregulated tolls charged by the ferry companies, or to such tolls as may be charged by any private corporation that may be authorized to construct a bridge at that point. The committee believes that the plan proposed by the bill is in the public interest and recommends the passage of the bill. Section 10 of the bill contains the following provisions: No obligation created or liability incurred pursuant to this act shall be an obligation or liability of any member or members of the commission, but shall be chargeable solely to the funds herein provided, nor shall any indebtedness created pursuant to this act be an indebtedness of the United States. The bill has the approval of the State and War Departments, as will appear by the letters attached. Also letter from the Department of Agriculture on H. R. 11970, a similar bill. Hon. JAMES S. PARKER, DEPARTMENT OF STATE, Committee on Interstate and Foreign Commerce, Washington, June 3, 1980. House of Representatives. SIR: The department has received your letter of May 28, 1930, in which you request a report and comment on H. R. 12643, a bill to authorize the construction of a bridge across the St. Clair River at or near Port Huron, Mich. It appears that the purpose of H. R. 12643 is similar to the purpose of H. R. 11970, which was the subject of the department's letter to you of May 13, 1930. The two bills differ chiefly in the name of the commission which they would authorize to construct the bridge. The proposed legislation is unobjectionable in so far as the foreign relations of the United States are concerned. Very truly yours, WILBUR J. CARR, Acting Secretary of State. WAR DEPARTMENT, Respectfully returned to the chairman Committee on Interstate and Foreign Commerce, House of Representatives. So far as the interests committed to this department are concerned, I know of no objection to the favorable consideration of the accompanying bill (H. R. 12643, 71st Cong., 2d sess.), creating the Port Huron-Sarnia international bridge commission and authorizing said commission and its successors to construct a bridge across the St. Clair River at or near Port Huron, Mich. Hon. JAMES S. PARKER, F. TRUBEE DAVISON, DEPARTMENT OF AGRICULTURE, Chairman Committee on Interstate and Foreign Commerce, House of Representatives. DEAR MR. PARKER: Careful consideration has been given to the bill (H. R. 11970) transmitted with your letter of April 29 with request for a report thereon and such views relative thereto as the department might desire to communicate. This bill would create the Great Lakes Federal Bridge Commission, & body |