FLORIDA EVERGLADES RECLAMATION
JULY 18-19, 1927
CHARLES CARROLL BROWN
C. E. DEPT., UNIV. OF FLA.
I Qk :- 1-
CHARLES CARROLL, BROWN
C. E. DEPT., UNIV. OF' FPA.
TO THE STATE OF FLORIDA:
In the endeavor to clarify and to lay before
her citizens and those interested in her welfare
questions that have arisen in connection with
that great territory within her borders known
as the Everglades the successful reclamation of
which by drainage means so much to her fu-
ture, this pamphlet is dedicated for distribu-
tion with the compliments of
S. DAVIES WARFIELD.
Baltimore, July 25, 1927.
The Conference on Florida Everglades Reclamation, held at
The Continental Building, Baltimore, July 18-19,1927,was called
in the following letter:
July 11, 1927.
A conference was held in New York between Mr. George E. Merrick,
of Coral Gables, Florida, and mysef on June 16th, Mr. Merrick desiring
to present his views in respect to the reclamation of the Florida Everglades
by drainage and tfe plans that had been thus far announced in'connection
therewith. As a result of this conference, it being apparent to both that
in the discussions that have taken place in the press, at meetings and
elsewhere that many misunderstndings had occurred, it was thought,
advisable by both that a conference be held at an early date of those
who represent the various communities and interests affected and who may
have given expression to views for or against the proposed reclamation
plans. It seemed desirable that a dear understanding be had of the various
questions involved in order that those attending such conference might
reach their conclusions relative to this important and far-reaching subject
after having all the facts.
Accordingly, the conference has been called at Baltimore, Maryland,
at The Continental Building, Baltimore and Calvert Streets, on Monday,
July 18th, at ten o'clock. The expectation is that this conference will
require perhaps two days.
You have been suggested as one of the participants in the said con-
ference. It is hoped that you will be present, as the outcome will be of
considerable moment to the State and to those localities and individuals
who are interested in the problems to be*discussed in their relation to the
reclamation of Everglades lands. Will you please advise by wire.
Very truly yours,
(Signed) S. DAVIES WARFIELD
The following were present:
Geo. F. Bensel1 Pres., Grtr. Palm Beach C. of C.
J. B. Briggs
F. E. Bryant
South Florida Sugar Co.
Jules M. Burguieres Real Estate
O. B. Brown
W. R. Bonsai
A. B. Chitty
B. G. Dahlberg
S. D. Eldredge
F. C. Elliott
F. P. Fleming
Robt. Foster, Jr.
Frank A. Furst
H. S. Harvey
Geo. B. Hills
Charles W. Hunter
Hon. L. W. Jennings
Don P. Johnston
W. C. Kyle
B. M. Latham
Hon. W. Lineberger
E. L. Mack
R. F. Maguire
Hon. J. W. Martin
Pres., Fla. State C. of C.
State Drainage Engineer
Chairman, Arundel Corp.
Pres., Inlet Commission
Pres., Chamber of Commere
Pres., Chamber of Commerce
Lake Mabel Harbor
Pres., Chamber of Commerce
Representing Chamber of Com.
West Palm Beach
West Palm Beach
Berlin, N.H. (also
Belle Glade, Fla.)
West Palm Beach
West Palm Beach
G. Z. Phillips
W. A. Phillips
R. R. Reed
H. O. Sebring
J. C. Sherman
Frank B. Shutts
H. S. Thomas
Geo. E. Tribble
H. P. Vannah
Ast. to Pres., S. A. L. Ry.
Construction Engr., S. A. L. Ry.
Wholesale Dry Goods
Chauncey L.Waddell Banker
Hon. A. H. Wagg State Senator
H. T. Wagner Banker
S. Davies Warfield Pres., Seaboard Air Line Ry.
Carl P. Weidling Capitalist
G. C. Westervelt Curtis Bright Company
D. M. Wood Lawyer
Belle Glade, Fla.
(also Belle Glade)
West Palm Beach
FLORIDA EVERGLADES RECLAMATION
AT THE CONTINENTAL UILDINO
Monday, July 18, 1927
Mr.S. DaviesWarfield called the meeting to order at Io. IOA.M.
MR. WARFIELD: Gentlemen, I suggest as chairman of this
conference Mr. George F. Bensel, of West Palm Beach. Mr.
Bensel is president of a large organization-the Greater Palm
Beach Chamber of Commerce-also of one of the large land com-
panies which will be affected by what is proposed in the Ever-
glades. Are there other nominations; if not, all in favor of electing
Mr. Bensel chairman of this conference will please say aye.
(Mr. Bensel was unanimously elected chairman.)
MR. WARFELD: Mr. Bensel, we will escort you to the chair.
(Mr. Bensel then took the chair as chairman of the meeting.)
MR. WARFImmD: I nominate Mr. Don P. Johnston, of Okee-
chobee, as secretary of the conference. As secretary he will not
have many duties to perform, since we have stenographers to
take the proceedings.
(Mr. Johnston was unanimously elected and acted as secre-
tary of the conference.)
MR. WARFILD: Gentlemen, this is an informal gathering,
notwithstanding the fact that we have the Governor of Florida
with us, and I am in hopes, owing to the necessities of the case,
that we will endeavor to confine what we have to say to the high
spots in connection with Everglades Reclamation.
I have been variously identified with this project, and it
seems desirable that I say a few words, not very many.
Before proceeding, and to save time, let me say that a light
lunch will be served in the large room at the end of this floor
-at one o'clock, then I would like you to be my guests at dinner,
at my country place, Manor Glen, twenty-two miles from the city,
leaving here at about five o'clock, you can get back early, it will
take about three-quarters of an hour to run out there. I hope
you will favor me by being my guests on this occasion. (Applause.)
MIL WAR mLD: Mr. Chairman and gentlemen: It is proper
at the outset to announce the reasons for this conference.
On June I6th, Mr. George E. Merrick, Coral Gables,
Floridasaw me in New York respecting the Everglades Reclama-
tion Act passed by the Florida Legislature, stating that he and
associates had employed counsel to defeat the purposes of the
Act by proving its unconstitutionality before the Florida Su-
preme Court. Mr. Merrick was under a misconception of the
purpose of those who had assisted in financing the Everglades
reclamation undertaking. He was misinformed relative to my
connection with the Everglades in the assistance given by me.
Our conference resulted in deciding that present-time Everglades
conditions could be fully understood only through a conference
of those in interest for and against, this meeting today repre-
sents that decision, the suggestion of a conference coming
primarily from Mr. Merrick. He telegraphs that he has been
unexpectedly and unavoidably detained in Florida for business
reasons,which I greatly regret. He offers co-operation in reaching
a satisfactory understanding.
This committee should know my reasons for any action
taken by me respecting the Florida Everglades as representing
the Seaboard Air Line Railway.
Seaboard Extensions and Everglades Reclamation
I have not believed nor do I now believe that the inhabitants
of the lower East and West Coasts of Florida bordering on the
Everglades, and particularly concerned at this juncture, are con-
tent to rely on existing conditions for the growth of their territory
industrially or agriculturally, nor content with limiting their
further activities to tourist business; if so, the railroad I represent
would not have extended its rails one foot below West Palm
Beach, nor to Fort Myers and Naples on the West Coast.
Without entering into details respecting what I have en-
deavored to accomplish in the interest of Florida, suffice it to
say that in the survey, traffic and otherwise, made of the territory
the Seaboard Railway was then considering occupying, the
prospective traffic revenue from that area of practically unoc-
cupied lands known as the Everglades was given full consider-
ation. The State's announced policy that Everglades reclamation
would be actively continued and money then expended thereon
not permitted to go to waste, played an important part in the
decision to extend Seaboard lines on both Florida lower coasts,
the Everglades lying between. I questioned public officials as
to the State's policy on this subject.
On this map you will see why they were the conditions under
which we were proceeding. There is the railroad across the
State. Here it extends now to Miami and Florida City. Here it
is extended to Naples on the West Coast. The Everglades lie
between those two extensions. We did not believe that it would
pay this railroad to go to the enormous expense which we did
in building through that territory unless the policy of the State,
which, as I say, went back a number of years, through all State
administrations, was to be followed.
No trunk line system of railroad could live on Florida
tourist business and what is collateral thereto, and unless this
great Everglades territory wastobeproperlyopened to agricultural
pursuits the Seaboard Air Line would not have extended its
tracks below its then termini on both lower coasts.
Chief Drainage Engineer Elliott, before the Seaboard exten-
sion from Coleman to West Palm Beach was constructed, dis-
cussed Everglades reclamation with me and had suggested that
the Seaboard should look into the desirability of running tribu-
tary lines into the Everglades lands.
Rights of Way on State Canal Banks
Having well-defined plans under which to proceed and before
the rails were laid on the West Palm Beach-Miami extension,
in August, 1925, I had a representative see Governor Martin
and others of the Internal Improvement Board at Tallahassee
in respect to the Everglades, what were their purposes and
notified these officials of our purpose to file with the Board our
application under the statutes for rights of way to the Seaboard
Air Line Railway on unused canal banks to reach Everglades
lands which in itself would be an encouragement to agricultural
development in the Glades.
All Florida knows the excessive amounts asked the Seaboard
Railway for rights of way between West Palm Beach and Miami
which should have been willingly donated for an enterprise of
telling, lasting effect op Florida's future.dI was not called upon
to repeat the same experience in the Everglades. The State of
Florida owns one-fourth of the total Everglades lands, what
better investment could the State make than give encouragement
even to the extent of donating part of its own acreage in addi-
tion to the rights of way which the Seaboard was entitled to
receive under the State statutes which only required that the
railroad file its application subject to the Internal Improvement
Board's approval, if a railroad would extend its rails into the
Everglades. There was no "bargain" made nor suggestion of
such, as has been stated respecting the three-year period to the
Seaboard Railway within which to use certain State canal banks
for railroad extension purposes. No financing of bonds was
suggested to me at that time. The statement I understand to
be made that I entered into some agreement with the Governor
of Florida under which the Seaboard was to get from the State
rights of way on canal banks which upon application it was
entitled to have, anyhow, in exchange for help in financing
Everglades bonds, is not true.
Neceities to Successul Financing
It is regrettable that the questions involved in so great a
state-wide and nation-wide undertaking should be permitted to
become the football of any political faction. This is a serious
business subject, far-reaching in result and altogether too great
to be dragged into politics by any man, set of men or any interest.
Mr. Merrick informed me it was stated that I had actually
drawn the bill that passed the Legislature in connection with
Everglades reclamation. I never saw the bill, knew nothing about
it until it was on passage and knew nothing of its provisions until
informed by letter from Miami of its taxing features and should
have opposed an ad valorem tax had I been consulted. This
feature is not sufficient to incite opposition provided the plans
in connection with the levying of the tax are stated and found
acceptable. So much for the Act.
In my address before the citizens of Miami on January 8,
1927, upon the opening of the Miami extension, I reiterated my
belief that one of the most important questions then before the
State was the reclamation of the Everglades by suitable drainage
plans, and told Governor Martin--and no one can deny the
benefits the State has received under his administration-that if
he desired me to introduce him to Messrs. Dillon, Read &
Company, bankers, in connection with Everglades bonds I should
do so; I have no personal financial interest in the outcome.
Through his associates in Jacksonville, Governor Martin
first took up the sale of Everglades bonds with Messrs. Eldredge
& Company, bankers, New York, without intimation to me
that he proposed to do so. I never met a member of that suc-
cessful firm until recently. It was after all this that the Governor
saw me in New York and I introduced him to members of the
firm of Dillon, Read & Company.
My purpose in asking Dillon, Read & Company to enter
this situation was because they had successfully sold large
amounts of bonds of the Seaboard Air Line Railway which had
been distributed to investors in a manner that few banking firms
had the distributing organization to accomplish. My experience
in financing securities taught me that if other Everglades financ-
ing was to follow, it was important that the first issue be
distributed to investors, not placed in blocks, or left on the
market undistributed to destroy the prices obtainable for ad-
ditional issues of the same security. Dillon, Read & Company
would not have taken up this proposition except upon my repre-
sentation of the desirability of the reclamation of this great
territory lying tributary to the Seaboard Railway, thus en-
hancing the value of the Seaboard bonds they had successfully
sold to investors by adding to Seaboard territory the products
to come from one of the richest areas of land in the world.
Taxee--Their Relation to Bond Interest and Maturities
Permit me to state that I have definite personal views in
respect to the terms of the financing of the money requisite for
Everglades drainage and reclamation. The Seaboard Railway
and affiliated companies are perhaps among the few very largest
taxpayers in the State and do not wish to see a financial plan
followed that would be irksome to the drainage district taxpayers
and particularly so to those of limited resources that own Ever-
glades lands. Therefore the question of the maturities of secu-
rities sold becomes an important consideration, not alone from
the standpoint of the tax rate per annum to take. care of the
interest on such securities but also the questions involved in
funding these securities as they mature. While short-time securi-
ties may be sold at a higher price than those of later maturities,
it is evident that the maturity dates must be sufficiently far in
the future to avoid a serious drain upon the resources of those
who would be required to pay the taxes to meet both the matur-
ities and annual interest. In addition to this, it is required that
provision be made for the interest and maturities of the bonds
now outstanding. I have favored a reasonably long maturity for
the present proposed bond issue to meet these important consid-
erations, even though the price obtained is less than could be
secured for shorter-term bonds.
Long Time Bonds Essential
The questions involved in the price secured for these securi-
ties which depend upon the length of time they are to run have
not been fully understood. Representing the interests I do I am
very greatly concerned in the maturity of the bonds to be sold.
We all know you can sell a one-year bond, a two-year bond, a
five-year bond, a six-year bond for more money than you can
a thirty-year bond or a forty-year or a fifty-year bond. How are
you to meet these one or two or three or four or five or six or
seven or eight-year bonds, particularly when you have to take
care of the maturities of the existing outstanding bonds. So in
youk consideration of the subject, I hope you will give attention
to this one point. The question of maturities to my mind is the
most important point in this connection that the State admin-
istration of Florida has to deal with. How are you to meet these
obligations unless you fix their maturities at a time when they
can be met. Furthermore, the question of whom you sell them
to is a very important consideration. I do not believe any man
in the railroad business has had greater experience in the ques-
tions involved in the distribution of securities than I have had.
In the distribution of securities when I first undertook to
finance the Seaboard Railway, and we had among the largest
and strongest financial institutions in the country to take our
bonds, unfortunately they were distributed by the bankers in
large blocks, and when we came to sell additional securities there
was no market upon which we could immediately depend in the
sale of future Seaboard securities.
I cannot believe that the people of Florida for a moment
would desire to see this matter of financing Everglades bonds
proceed in any other than under the most advantageous circum-
stances and to the best interests of the State. Personally I have
endeavored to carry out the statement I made to the Governor
publicly, that if he wished me to be of assistance in the sale of
these securities I would endeavor to do so. What was the first
consideration. To my mind it was to find bankers who could get
these bonds in the hands of permanent investors. Why, gentle-
men, with Florida, in the position she stands in today-it is getting
better-with great amounts of county and municipal bonds out-
standing and more to be sold, it was not an easy matter to
interest large banking houses with great distributing power to
buy Everglades bonds at all with ten, twelve or thirteen million
Everglades'bonds now outstanding with a value of fifteen mil-
lions of dollars property.
Distribution First Consideration
Make no mistake, the first thing to do is to find a house that
can distribute your securities, not necessarily the house that is
going to pay you the greatest amount of money for them. We
all know that the price of securities is regulated by the maturities.
Is it not unfair to intimate, because perhaps someone-I don't
know who-now comes along after all of this set-up has been
made, and says that somebody would have offered more for, the
bonds, that this should influence you. Let me say you can always
go out and find some house or some broker that will offer more for
some bonds than you may have sold them for, but what happens?
It is no easy job to distribute ten to twenty millions of bonds,
the proceeds of which will be used in the drainage of the Florida
My record is too well known in Florida to require me to
thus state my relations to the Everglades project, but I wish to
briefly bring you up to today. My loyalty to Florida has been
demonstrated by expenditures of great sums of money in building
railroads I do not believe other men would have built, believing
in my judgment and in my associates in and outside of Florida.
The future will decide as to this, I have no misgivings.
My purpose in calling this conference in Baltimore was to
meet on neutral ground. The Seaboard Air Line Railway is
concerned in seeing that its Florida investment shall be sustained
in avenues that are as important to the State and to its residents
as they are to the Railway. Ten to fifteen millions have already
been spent in Everglades reclamation. No man in or out of
Florida can wish to stop there. The purpose at least of the
Governor of Florida to finish this work with an expenditure that
will finish it cannot be opposed on any legitimate business
grounds. The methods or plans under which the Everglades are
to be reclaimed present fair grounds for debate, but in their
consideration opposition for political reasons may be expected
and would be ignored.
Two Angles of Approach
In the consideration of this subject it should be approached
from two angles:
(a) The effect of drainage in its relation to the agricultural
development of contiguous lands by reclamation;
(b) The necessity of adequate drainage canals or waterways
for the control of Lake Okeechobee and other waters or water-
sheds with the menace to life and property while uncontrolled;
further, the necessity of such canals and waterways in preserv-
ing the health of cities and communities dependent upon ade-
quate methods for quickly relieving the great volumes of water
precipitated upon large areas now without means for their
The result of the hurricane of 1926 with the great loss of
life in territory south of Lake Okeechobee which was unprotected
--and still is-should cause the forward and right-thinking men
of Florida to protect the people and the State against a repetition
of the calamity that then occurred. It is indeed a grave question
whether the State of Florida, without respect to drainage dis-
tricts or the taxation of any particular section of the State or
its people, if the National Government fails to do so, should not
appropriate the money to see that sufficient drainage canals and
waterways are constructed to avoid a repetition of what has
occurred not only at the period of the 1926 hurricane but at
former times, and protect the people against invasion of this
description as it would be the duty of the State to protect its
people against invasion by a foreign foe.
I visited Miami, Hialeah and contiguous territory immedi-
ately after the hurricane of 1926. The condition of the Miami
Canal backing up the drainage provisions at Hialeah might have
caused epidemic. There is always danger from uncontrolled
water in a low country and this phase of this subject should have
serious consideration without respect to land values by reclama-
Gentlemen, I cannot see that there are any two points of
discussion in regard to this matter. Suppose you do not reclaim,
and by reclamation add to the value of the contiguous lands by
draining them and enabling them to be cultivated; you have got a
problem to meet, and nobody knows more about it than I do. In
building the new railroad from Coleman on the Seaboard main line
through swamps and across the wilderness to West Palm Beach,
what was the result, men were standing up to their necks in
water, some died from it. We could not wait months until all
the water ran off after the heavy rains, so men were wading in
water in the endeavor to get the road through on time to open
somewhere near the time we promised that it would be opened.
Are you going to let such a situation, such conditions continue
to exist? Is it not part of somebody's duty to see that these
conditions are stopped? Do you suppose we would ever have
built to Miami if we thought you were going to stand still and
let that volume of water, as I saw it up there in your Miami
Canal, Mr. Shutts, backing up over everything, and not arrange
to let out this water somewhere, so that Miami-Hialeah-Opa-
Locka can live on something else besides tourists? It is unthink-
able to me that anybody should doubt the advisability of at
least getting rid of that great volume of water, it will cost a good
deal of money to do it. But if you are going to do it why not at
the same time reclaim the land?
Questions to be Decided by Conference
So I suggest to this conference that the first question that
should be put and decided is whether it is desirable that the
double purpose named-drainage and its effect on health; the
reclaiming of Everglades lands-both of which have become
the policy of every Governor and State Administration since
Governor Broward in 19o4 to the present administration-shall
be continued or shall not be continued, subject to such methods
and plans of financing and execution of the work as shall be
deemed expedient and efficient.
The reversal of a defined State Administration policy of so
long standing would be unthinkable; therefore, the real questions
before this conference are:
(1) The method of financing that is being presently fol-
lowed by the State Administration as to purchase price of the
security to be issued, its maturity and conditions relative
(2) The necessities of taxation to meet the proposed issues of
this security both as to interest and of meeting the maturities.
(3) The amount of such security to be sold from time to
time to meet necessities and approximate dates of the sales with
Anal total approximated.
(4) The general plan of drainage with total defined area
expected to be benefited with extent of such benedts and time
required for completion.
(5) The area defined in irstproposed money expenditure with
time of completion of firt unit and additional expenditures to
be made with time of completion of each unit.
(6) The requirements of property owners in connection
with the engineering plans adopted to make available their lands
for cultivation-the cost to the property owner per acre. To
what extent will diking and pumps be required.
(7) How definite are the engineers in their expectation and
estimates of results under the plans proposed.
(8) At what points will the local or resident engineering
organisation be stationed under the first unit of construction
(9) What are the requirements upon the State of Florida per
as under the provisions of the Act passed by the last Legislature,
the constitutionality of which is to be tested before the Supreme
Court of Florida.
(10) What relief will the proposed plan of canal widening
and deepening and the other plans proposed by the-ngineers
of the State and those especially appointed give in the avoidance
of the repetition of the calamities occasioned by the 1926 hurri-
cane in preventing loss of life and in caring for the needs of
cities and communities in relation to their drainage problems
without respect to the benefits to be derived by the actual
reclamation of Everglades land.
(11) The desirability ofoonstitutingacommitteecomposedot
representative of various cities or communities bordering on or
affected by Everglades drainage or reclamation with a small
Executive Committee thereof to confer with the State Internal
Improvement Board and regularly constituted authorities as
the work progresses.
It would seem that discussion of these eleven suggestions
will develop the proposals and purposes of those who are en-
deavoring to reach practical results in respect to Everglades
drainage and reclamation.
Before proceeding I will read certain correspondence which
has taken place in connection with this conference if you wish it.
It will take some time to read all this correspondence, it
will save time to briefly mention its purposes. It deals with the
various phases of the subject. I believe the questions I have
suggested cover what has been asked in numerous letters received,
or I have been asked in interviews or conferences in respect to
the subject. A number of gentlemen have not been able to reach
here today. I have a number of telegrams from Mr. Merrick.
He states he is having some financiers at Coral Gables and,
as I have stated, he is not able to be here today, which he says
he greatly regrets. He has stated, however, it is his purpose to do
everything in his power to see if some satisfactory conclusion
cannot be reached with his associates in regard to this matter.
Mr. Merrick originally stated he could attend a conference either
in New York, Baltimore or in Florida any time after the 15th,
so today the I8th was set to suit his wishes.
I have letters here from others, saying they regret not being
able to get here, and are in sympathy with the general proposition
although there are many things they do not understand in respect
to the subject.
Now, without taking too muchltime, Mr. Chairman, it
seemed to me desirable to havfaciss-table discussion of these
matters, free from rancor or feeling. I do not believe there is a
man in the room who has a desire further than to have questions
at issue settled and settled right. Many things have been said
better not to have been said, but it may be just as well, however,
for it brings to the surface the differences of opinion.
I have stated the situation as clearly as I know how, Mr.
Chairman, and will ask, with the consent of the gentlemen
present, if you will confine the discussion, as far as possible, to
answers to the questions proposed, to save time.
I do wish to ask this conference, however, at some stage of
these proceedings, whether it is desired to continue the policy of
carrying out the contract which was made when the Everglades
lands were taken over from the National Government by the
State, that they were to be drained, or whether that contract is to
be repudiated. With your permission, Mr. Chairman, I ask Mr.
Elliott, the man who has had more to do with the subject than
any or all of us, to give as concisely as he can the high spots
involved in the drainage or in. the reclamation of the Everglades.
I do not mean, Mr. Elliott, that at this meeting you can cover
the field in so large an undertaking, but to get started, then if
necessary we can appoint committees, if you please, to go ahead
with subjects that it is not possible to fully iron out today. If
you can give at least a bird's-eye view of what you have in mind
regarding the questions that affect you it might clarify the air,
because, while covering the ground, it is difficult to .arrive at
conclusions from such a report as that made by the three en-
gineers appointed by the State, which I have read two or three
times. For instance, Mr. Elliott, they say that in the lower reaches
it will be necessary for the landowner to dike and use pumps. Of
course, people who own property in the Everglades, and there are
men in this room who represent great interests, as you know, in
property there, would want to know, Mr. Elliott, just what that
means. If, Governor Martin, the plans of these engineers, involve
in addition to the expenditures named in their report that the
landowner will be compelled to spend other large sums of money
all over the Everglades to help out, the landowner will want to
know what he individually is expected to do. If Mr. Elliott will
touch on that subject we will all be obliged to him. (Applause.)
MR. EL uLr: Mr. Chairman and gentlemen: In response
to Mr. Warfield's request, and following the discussions set
out in the questions to be decided by the conference, some
eleven in all, I think perhaps from my standpoint it will be
well to begin with question four. That begins with the engineer-
ing features involved. After discussing some of the engineering
features, if the conference wishes information on one, two, or
three, I have also data on that subject. But, perhaps, we might
discuss first the engineering features, the reclamation of the land
itself and then touch upon the method of financing, taxation,
and so on.
Question 4 is: "The general plan of drainage with total
defined area expected to be benefited with extent of such benefits
and time required for completion."
Up to the present time there have been constructed or have
been opened, some of which have been only partly completed,
about four hundred and seventy odd miles of main canals. There
have been constructed fourteen locks and dams, twelve of which
are Of a permanent nature. There have been surveyed something
over a million odd acres of land in townships, sections, and more
or less subdivisions. Numerous surveys, drainage investigations
and reports have been made along engineering lines in the Ever-
glades, and along economic lines also. The total cost of all the
work to date, or to January I, 1927, I should say, was in round
figures $15,ooo,ooo. The estimated cost for completing the
reclamation of some 2,500,000 acres, according to the report of
the Engineering Board of Review, concurred in and supported
by investigations which have been made by the chief grading
engineers, call for a total expenditure for main work of about
$26,ooo,ooo additional to what has already been expended. A
general plan of drainage contemplates two principal things.
First, the lowering of the waters of Lake Okeechobee, and
bringing that lake under control'to prevent its overflow and
inundating territory comprising the Everglades generally on the
south. The control of the lake means two things; one, the build-
ing of a canal for regulating its water levels, and two, the
building of levees to confine those waters, and especially under
hurricane conditions, or storm conditions.
The other part of the drainage plan would be to provide
main drainage canals throughout the territory itself, main outlet
canals for carrying local rainfall from the lands to the sea.
Those are, in brief, the two principal things connected with
the drainage of the Everglades, and so far as the Everglade
drainage is concerned.
In addition to that, there is certain local work that must be
completed, to carry on where the Everglade work leaves off,
such as local work, farm district, and connecting canals, and
work which must be done by the workers in that locality at the
time and in the manner that they deem advisable.
"... with extent of such benefits and time required for com-
pletion." As to the extent of the benefits, perhaps I might give
some data that I have. The benefits already received might be
indicated in a general way by the improvement of the districts
along certain lines, and these benefits have come about not
through the completion of the work but through so much of the
work as has been carried out to date; not to the final comple-
tion of reclamation, because that has been by no means attained,
but the benefits which have accrued by the work thus far.
In 1905, average land sales price per acre was $1.25 for such
lands in the Everglades district. Now, there were prices as low
as $.25 an acre, but the standard price determined by the
trustee appointed at that time was at the rate of $1.25 per acre.
That, based on land sales basis value, was worth, 4,300,ooo
acres, approximately, in 1905, $5,391,ooo. Now, I have put it
here on a land value basis because that is all there was there at
the time, if we may call it land, covered with water, at any rate
there was nothing there but this, if we determined it land, so a
land value basis might cover what values .there were there at
that time, and the total value on the basis of land sales at that
time, was $5,391,ooo.
In 191o, the average price of land advanced to $2.oo per
acre. The population in 1905 is not given, but the population
in 19xo, according to the United States census, was 1x419
persons, a greater number of which were along the coast on
the south. There were no real residents in the Everglades at
that time, omitting a few Indians. There were forty-two miles
of improved roads in the district. There were forty-five miles
of railroad. On the basis of land values, then the district had
a land value of about $8,622,000.
In 1915, the land value reported as of 1915 was $5.45 per
acre. There were 6,816 persons in the Everglades. The estimated
assessed value of property, state and county taxes were placed
by the tax assessor of the counties at $9,69o,ooo. For the first
time an estimate of land under cultivation was made and there
was found an area under cultivation of 2o,ooo acres. Nearly all
of that was in the Everglades district proper. South of Cocoanut
Grove could not be considered as strictly Everglades land, as
we speak of it today. It does not include all of the land devoted
to citrus groves and lands of that character. The value of the
Everglades district on a land basis, according to the average
sale price of land in 1915, was $66,6oo,ooo. Up to that time
there was no bonded debt. The money had been raised through
sales and through taxes and there was no outstanding bonded
debt in 1915.
In 1920, the next five-year period, the average land sales
price of land was at the rate of $24.73 per acre. The population
of the district had increased to 23,500 persons. The assessed
value, according to the county tax assessor, was 9,424,oo00. The
estimated area under cultivation was 34,ooo acres. There were
found 72 miles of improved road within the district. There were
81 miles of railroad within the district. On the average price
per acre the value of land, the land value of the district had in-
creased to $1o6,3oo,ooo. The bonded debt of the district was
$5,000,000 in 1920.
In 1925, the boom year, the average price of land was at
the rate of $io8.66 per acre. The population, according to
the State census was 40,2oo persons. The assessed value of
the land in the district, according to the county tax assessor,
was $27,600,790. The acreage under cultivation was approx-
imately 50,00ooo. There were 34o miles of improved roads,
rock roads, in the Everglades district, starting with nothing in
1905. Three hundred and forty miles does not include the
short-end roads or connecting roads in various subdivisions, but
those roads commonly used in the district, not merely sub-
division roads. There were a great many more of those. There
were 18o miles of railroad. The estimated value of the district
on a land value basis alone was $467,000,00o. The bonded debt
of the district was $1o,25o,0oo.
Now, take it for 1927, or the end of 1926. The value of land
sold was at the rate of $81.51 per acre. That reflects the readjust-
ment from the previous boom year. The population of the dis-
trict taken from the 1925 census-we were careful in bringing it
up to date as nearly as it could be worked out-was 46,007
persons. The assessed value of the district, according to the tax
assessor of the county, was $52,404,000. The estimated area
prepared for cultivation, though perhaps all of it was not finally
cultivated or harvested, was estimated at 92,000 acres. Total
number of iinproved roads in the district, including non-connect-
ing roads and roads connecting subdivisions, 507 miles. One
hundred and ninety-two miles of railroad. The value on a land -:
basis only, according to the average price, $350,500,000. The
bonded debt was estimated at $Io,255,0oo.
I want to call attention to the ratio of increase in value on
a land basis only to the cost of the work or, as the work increased
in cost. The cost of the work as of January I, 1927, was about
$15,00oo,o0. 1he total value of the district was about $360-
000,000, that is a $355,00oo,oo increase over the $5,000,ooo in
the beginning. The ratio of the cost of reclamation work at the
Everglades drainage district was a ratio of one to three increase
in value. I leave it to Mr. Warfield if that isn't a pretty good-
or to anyone else if that isn't a pretty good increase in value
for the time with the moneytexpended on improvements and on
work, which is certainly responsible to a large extent for that
increase in value.
MR WARFELD: Mr. Elliott, if you will allow me to inter-
rupt you a moment, I expect these gentlemen would want to
know whether the original plans of Randolph have been sub-
MR. ELLOrr: How is that, Mr. Warfield?
MR. WARFILD: The original plans of Engineer Randolph
that were made back there, whether there have been substantial
changes in those plans through the suggestions made by the three
engineers making the recent report, and also I should think they
would want to know whether you approve the suggested changes
in that report; and, again, I should think they would want to
know whether you are going to adopt the unit plan, which I
understand you did adopt in expenditures in the Everglades, and
where your first unit would probably begin. I do not know
whether I have propounded too much to answer or not.
MR. ELuorr: The plans set forth under the Randolph report
have been followed in principle part. There have been some
deviations from that report. Those deviations are of a detailed
nature but not in principle. The deviations and alterations in
principle from the Randolph report were described in detail to
the Engineering Board of Review, which submitted its report
recently. Those changes and those deviations have been con-
curred in by the Engineering Board of Review. The principal
features of the Randolph report are supported by the report of
the Engineering Board of Review and are concurred in by the
Chief Engineer at Tallahassee. The final report of the Chief
Engineer at Tallahasee for 1925 and 1926 goes into some detail
as to these reclamation plans and has something to say also on
the subject of progressive drainage by units now in accord with
the recommendations made by the Engineering Board of Re-
view, and they are in accord in principle with the reports of the
Randolph Commission. As I said, there have been some changes
in details but those are natural and ought to be made if improve-
ments are to be carried out in any line of work.
This is from the Everglades Engineering Board of Review's
Report: The basic general features of the Isham Randolph
Report of 1913 are three in number; one, the control of Lake
M. WARFIEL: That is Lake Okeechobee?
MR. ELuolr: Yes, sir.
MR WAR FILD: I want to ask you this question: As I under-
stand it, the last engineers' report states that it would require
about a million and a quarter in respect to the completion of the
St. Lucie Canal, am I right in that? Is that an.additional cost
over and above what has already been expended?
MR. ELLIOTT: The cost as set down is the total cost for
MR. WARIELD: For completion from now on?
MR. ELLIOTT: The canal has not been completed to date.
Their estimate is for completion.
MR. WARFILD: For completion. Now, that is a million
and a quarter, as I understand it?
MR. ELLuOT: I think it is about three million in all.
MR. WARFIELD: Is it three million in all for St. Lucie alone?" "'
MR. ELLIOTT: Yes, for the control of the lake, three million
for the St. Lucie Canal and levee.
MR. WARFBLD: It is about a million and a quarter for the
St. Lucie Canal alone?
MR. EuLuor: Yes, sir.
MR. WARFIELD: Do you believe that when that is accom-
plished, that is to say, the million and a quarter, or whatever
it is, on the St. Lucie Canal, all the expenditures come to a
total of three millions including the levee at the south of the lake.
Is it your belief that that will control Lake Okeechobee and will
carry out what it is expected to carry out in the control of that
watershed there, if you please, and do you believe that when that
has been spent on the St. Lucie Canal and the levee to protect
Morehaven and that territory, you feel that will be the total, and
that there will not be anything required from time to time to
cause further expenditures?
MR. ELIorr: I certainly do.
MR. WARFELD: Gentlemen, I think that is a very im-
portant question. If three million dollars will control that water-
shed there, that lake, and protect that large area to the south
of the lake, and the lives of those people, I think that it is three
million dollars well expended, in addition to what has already
been expended, and that is the estimated total cost, if I am not
MR. EuIorr: For building the lake control, building the
St. Lucie Canal, and building the levee.
MR. SHmUTs: From this point, the three million dollars
will be necessary from this point?
MR. EuIorT: From now on.
MR. WARFmWD: And you believe that will accomplish the
MR. Eu Trr: I certainly do.
Tas CHummN: May the Chair ask what the capacity will
be over its present capacity with that enlarged area?
MR. EuOTrr: It will be from 25 to 50 per cent, depending
on whether it is low level or capacity.
"... the time required for completion," from a construction
standpoint and engineering standpoint, I think that all of the
work will be completed in four or fiveyears. That is from a con-
struction standpoint. But the time for completion, in my judg-
ment, is going to be determined from other circumstances than
just purely those of construction and engineering. I think that
is going to be determined by the rate at which the land can be
settled and cultivated. The construction work can certainly be
carried on as rapidly as man can develop it,. and as rapidly as it
is justified from the standpoint of settlement and colonization.
MR. FLuING: How soon can the control of Lake Okee-
chobee be affected by this three million?
MR. ELuoTr: The principal feature of it would be the
completion of the levee. As a matter of fact, with the exception
of a storm such as we had in 1926, or hurricane conditions, the
lake is already in satisfactory condition. The lake is in satis-
factory condition at this time, and would now be controlled
except under hurricane conditions.
MR. SHnrs: What are the proposed dimensions of the pro-
MRI. EuTorr: The crest of the levee would be at an eleva-
tion of 27 feet. That is io feet above high lake level. The levee will
be of what base widths are sufficient. That, perhaps, will vary
somewhat according to the material of which it will be con-
structed. The material of which it will be constructed will be
taken from the site, and be of varying quantity or varying
material. The height of the levee is the main thing. It will be at
an elevation of 27, which is io feet above the proposed high lake
level. That is higher than any water flowed under the extreme
of the hurricane condition of 1926, with the lake at a higher level
than 19 feet
MR. Smnrrs: What will be the length of the levee?
MR. ELUTrr: About 47/2 miles.
MR. STrrrs: What is the length of the canal?
MR. EuLITrr: A fraction less than 25 miles.
MR. FLMING: Where will the levee be located on the
MR. ELIOIor: It will be located from Hurricane Point,
which is about two-thirds of the way down, on the east shore of
the lake, and extend from there around the south shore, southerly
westerly and northwesterly past Moorehaven, where the high
land begins to the north of Moorehaven. That is where the ridge
begins now. The remainder of the lake is surrounded by a
good, substantial high level.
MR. WARmPL D: That has a rise there of 14 feet, has it not?
MR. ELUOTr: The levee will stand on ground at an eleva-
tion between 14 and 16 feet. That is about the margin of the
lake under ordinary water conditions.
Getting at the rate at which the work will be done, I believe
that we will give consideration to those areas which can be
brought into settlement and cultivation at an early date, the
areas, perhaps, that have some sort of priority in drainage over
others. Those areas are near centers of population, where con-
siderable work has already been done, and where considerable
development has been already done by farmers and private
individuals, and which appear to be ready now, or most nearly
so, for settlement and cultivation. Those areas, as a whole, can
be divided into small restricted areas, and the work provided for
each one of those restricted areas, so that the land within that
restricted area will be settled, and farmed, and the canal work
carried on later. Then as other areas will be required the work
will be extended into other territories and other territory added
progressively to that already reclaimed.
Now, the rate at which that is done, at which the work can
be done, I believe will depend largely on the rate at which the
land will come under settlement and cultivation. It is a proposi-
tion of colonization, it seems to me.
MR. WARmLD: Mr. Elliott, how long will it take for the
expenditure of this three million dollars, I mean to complete this
work? Of course, I mean just a rough estimate?
MR. ELuOT r: About eighteen months to two years will be
a fair estimate, a fair working schedule, and less than eighteen
months would suffice for completing it if necessary.
The lake levee, the condition there is of such nature that it
can be done more rapidly than the canal excavation. In the
canal you will have only one point of attack, or perhaps, two,
but on the lake you can put in as many plants as will be econom-
ically justified in carrying out the work, just as you would in
building a railroad, you might begin at more than one point.
MR. JOHNSTON: Does that three million dollars include a
MR. ELUOTr: It does not take that into consideration,
except maintenance and handling Lake Okeechobee later.
MR. WARFmL: As I understand it, that will be one of the
first things done, one of the first expenditures made from the
money that comes from the proposed issue of bonds?
MR. ELLorr: That work, no matter what area may be
selected, that work is absolutely essential for the protection of
the whole area, and, further, for any individual areas.
MR. WARFIED: What other areas would you take up in
the expenditures? I may be putting very foolish questions to you.
MR. EuUorr: No, sir.
MR. WARFtLD: What I think the gentlemen want to get
at is the progress of the work as I understand it.
MR. ELuoTr: Generally selected areas now nearest ready
for settlement and cultivation. For instance, there are certain
areas around Lake Okeechobee that are now under some degree
of settlement and cultivation. There are other areas, for instance,
west of Miami, where a good deal of work has already been done,
where a lot of development has already taken place, farming
operations that are under way, where there are means of ingress
and egress, roads and railroads, and those areas.are ones that
should be undertaken first.
Now, then, for instance, as an illustration, here in No. 7
indicated on the plan west of Miami, there is an area there of
io8,ooo acres, and by the way this is just illustrative, it is not
anything that has been selected, but this is just to illustrate
what can be done in the way of selecting restricted areas; an
area, we will say, of 1o8,ooo acres more or less will be taken west
of Miami tributary to the Miami Canal and to other works in
that neighborhood, the complete main works, that is the works
of the Everglades, and the figure for fully protecting that area
is put in the neighborhood of $2oo,ooo. That could be completed
within eighteen months to two years from the time of beginning
in so far as the main works are concerned. That does not mean
the area need wait until it is completed before any farming or
cultivation can be done. In fact, there is considerable farming
and settlement in that territory already, but it could progress
safely, it would make conditions safer than they are now and
would justify going along in a business way and with a feeling
of safety and security with the work begun and as the work
And so west of Fort Lauderdale there is a good area tapped
by the main drainage works and reached by roads and near a
railroad and along other canals. But these areas can be selected
according to the wishes of the owners of the property, the works
can be carried out, and these restricted areas will secure and
justify farming operations and the settlement and cultivation of
the land. And as these are settled and cultivated, at the same
time, the works can be extended to take in additional areas as the
SENATOR JENNINGS: What percentage of the entire Glades
would you say at the present time was in that condition, ready for
colonization, which could be easily tapped by drainage works
at the present time?
MR ELUorr: I should think that a million acres could be
very easily considered as being ready for developing in the
restricted areas. That is just a suggestion. It may be more or it
may be less. I am inclined to think that colonization may not
justify taking in quite as large an area at the beginning as some
perhaps may think. We can add to it without great cost, if
necessary, but if we take in too much there is going to be con-
siderable cosb for maintaining works already constructed, money
spent on those works protecting the lands and the property. You
can add to it certainly as fast as there is need for it, that is, you
can construct the canal just as fast as any justification from
a colonization standpoint exists.
Ma. WARmtDL: In regard to Miami, do I understand that
that would be one of the immediate or early things to do, to take
up that country just west of Miami?
MR ELuorr: I should think logically that is one of the
first areas to be taken care of.
MR. WARt w: Do I understand that Lake Okeechobee
and the area there, that area which is also contiguous to Okee-
chobee City and its environs, the territory that lies immediately
west of Miami, which certainly requires early attention--
MRI Eu.Trr: Yes, sir.
MR. WARIKDw: And then Fort Lauderdale, the area to the
west of Fort Lauderdale, that is another early work, as I under-
MR EUoTTr: Yes, sir.
MR. WARFILD: That the effort would be to make those as
simultaneous as could be done, that is the work there?
MRL ELUorr: Yes, sir.
MR. WARPIED: To take those areas for drainage, if you
please, and reclamation?
MR EuIorr: Yes, sir. In an illustrative way I am taking
about twelve areas just to illustrate how that could be carried
out. One or more of those areas are practically in part or every
part of the Everglades according to the work that has already
been done according to the population and according to develop-
ments already under way by landowners.
MR. HavaWY: I should like to ask two questions: If it
takes five or six years to complete the program-I did not quite
get the reasons that you gave-all of it might not then be
possible to cultivate. What will prohibit cultivation of the land
after the program has been completed?
MR. ELLorr: I do not know that anythingwquld prohibit
it, but I doubt if it would be feasible to colomze two million
acres of land and put it under any sort of settlement and cultiva-
tion within a period of five years.
MR. HARVEY: I mean it would be possible should any of
that land, should it be desired to cultivate it, any part of it could
be cultivated, isn't that so?
MR. ELLorr: No, sir, any part within one of those re-
stricted areas protected, but not any part out in the remainder
of the two million three hundred or five hundred thousand acres
that had not been protected.
MR. HARVEY: Well then, this five or six year program would
not comprehend all of Everglades area?
MR. ELLIOTr: It could be done from a construction stand-
point, but the rate of progress is going to be determined by the
need of land.
MR. HARVEY: The need of land?
MR. ELLIOrr: The need as determined by settlement and
MR. HARVEY: Before drainage began I understand there
are more than a half-million acres of land in the Everglades
drainage district, is that correct?
MR. ELUoTr: Yes.
M. HARVEY: Before any work was done, what portion of
that was cultivated?
MR. ELUTTr: I don't know of any of the Everglades land
proper that was under cultivation. Some in the district, some of
those lands that under the law are exempt from the acreage tax,
those high lands that are not Everglades lands proper, there was
some down there.
MR. HARVEY: But generally more than half a million acres
are not possible of cultivation?
MR. ELoTr: I should say so far as the Everglades were
concerned there was no such thing as cultivation in 1905.
MR. WARh uD: There are a good many gentlemen here in
the room from various other localities. Is there anyone here from
some locality that would like to ask Mr. Elliott in respect to his
locality if it is not included in the range of the area that he has
already discussed? I take it this is one of the most important
things we are doing here today, to give your people an idea of
what is going to be done with the money that is to be raised to
pursue this work, and it seems to me that Mr. Elliott has well
answered the questions in respect to the various areas he has
SmNATro JENMNCs: I would like to ask if there is any pro-
vision to take care of the flood waters of the Kissimee River
before they reach the drained land.
MIL EzorrT: The theory has been advanced that the
Kissimee River ought to be diverted out into the Atlantic Ocean
before it reaches Lake Okeechobee. The chief drainage engineer
had never thought such a plan as that feasible, and the Ever-
glades engineers of the Board of Review considered that question,
went into it and investigated it and declared it not to be feasible.
SENATOR JamNNs: I had in mind more particularly some-
thing in reference to diking or dredging the river.
MR. ELuOrr: We have not any at the present time.
MR. DALBERG: There has been issued a pamphlet entitled
"A Report of the Board of Review," and the work outlined
there is set out as costing about twenty to twenty-two million
dollars. Is it that work that is covered by that report that is
proposed to be dealt with in this bond issue, or what is that work?
If the work laid down in that report is to be done, then personally
I understand what is to be done. If it is not to be done, I would
like to know what part of the work outlined in that report is to
SM. ELUOrr: I think I can say in answer to that the
S purpose of that report is to lay down plans to be followed in
carrying out the reclamation of the Everglades. The estimates
in the report are on the cost to carry on that plan. The Board
engaged these engineers to work out plans, to review former plans
and to make recommendations for the cost of doing the work,
and to follow those plans as they have been following plans
similar to those in a general way before. I do not doubt but that
there would be some detail changes. The report does not enter
MR. DAHLBERG: I am not talking about details.
MR. ELUTrr: But the money in this bond issue will be
used for carrying out the works laid down in that report, and
that means something more than three-quarters of the extent of
those works, of the works set forth in the report.
MR. DAHLBERG: Does the land laid out in the area covered
by that report, your present thought is that can be done for
around twenty million dollars?
MR. ELuFrr: Around twenty-five million dollars.
MR. DAHLBERG: The thought is to go ahead and when the
present twenty million is exhausted, then what? This is the
point: If it takes twenty-five million dollars to do the work laid
out in that report, you are going to get the proceeds of the
twenty-five millions of dollars, then what part of that report is
not going to be done, the work contained there? Can that be
MR. EuoTrr: In a general way it can be, but not in detail.
It would be determined by how colonization and settlement
developed and advanced.
MR. DAHLBERG: Who is to determine that?
MR. ELUorr: I think that would be largely up to the land-
MR. DABLBERG: Well, I come here and I say, Mr. Elliott,
I want my land first. Somebody else says, I want my land first,
and when you get us all added up together it adds twenty-five
million, now, what happens?
MR. ELuOTr: I will ask you if you think with an expendi-
ture of twenty millions of dollars, if there is not going to be so
much land. ready for settlement and cultivation that from any
reasonable standpoint there will be land enough for all purposes
as of that time?
MR. DAHLBERG: True, but I am looking at it from a selfish
MR. WARFUL: Won't you tell these gentlemen, they may
not know just what you represent or whom you represent, they
may not know your great interest in this situation, won't you
please state your interest in this situation as briefly as you can.
MR. DAHLBmG: Well, directly or indirectly I own or con-
trol almost one hundred thousand acres of land in different parts.
MR. WARFuIL: In the Everglades?
MR. DABLBBRG: In the Everglades. As far as I am con-
cerned individually I have read that Review Board's report and
am thoroughly in accord with it. My own engineers say it is a
workable scheme. It may not be the best plan that could possibly
at sometime in the dim and distant future be evolved, but it
will work. It will give us available land for cultivation. It will
drain that part of the Everglades in a workable way, but I am
just asking these questions, as far as we are concerned we are
thoroughly satisfied with this program if it goes through, we are
not satisfied with it if it is going to kick around for five or ten
years The point I wanted to make, as I understand it, there are
some people here that have land not included or have land in the
area who may not be able to take care of it themselves. So, if I
have land here and Mr. Elliott drains a million acres of land there
I will agree with Mr. Elliott a million acres is plenty to bring
out, probably more than can be properly used for five years, but
here I am and there you are (indicating), this is plenty for the
people as a whole, but what about me here (indicating)? That
is what I would like to know.
MR. SmUrrT: What I would like to know is, if this twenty
million dollars is not going to complete the work where the rest
of the money is going to come from.
MR. DABLBERG: Is there a program of the progress of the
work laid out? If so, where is that program of the progress of the
work? If not, who is going to determine that program of progress?
In other words, is Canal B going to be dug this year or three
years from today? Is Canal 6-I don't know whether there is
any such canal or not, but assume it for the sake of the question-
is that going to be done now or three years or five years from
today? If I am on Canal 6 I would like to know. If I am on
Canal B I would like to know when it is going to be dug. Who
is going to do that? Is it the Internal Improvement Board? I
presume it is.
MR. WARFMELD: I think the questions you put are very
pertinent questions and should be brought out in these discus-
sions here. As I understand Mr. Elliott, he had better answer
for himself, there are certain places here such as he has men-
tioned, St. Lucie Canal taking care of the lake, which takes care
of a given portion around Okeechobee, and then the land west of
Fort Lauderdale, and then the land west of Miami of which he
has spoken, that sets out a large area, as I understand it, and
they are the main points of drainage attack in the Everglades,
in so far as its reclamation by drainage is concerned, as I
understand Mr. Elliott.
That covers a very great area. But it is, I think, infinitely
more important than as to whether they are going to take care
of you, if you don't mind, Mr. Dahlberg, whether or not these
plans which mean spending millions of dollars, will take the
water away from the Everglades situation to protect the cities
and communities bordering, thereon, infinitely more important
than if your individual holdings are specifically cared for. Why
should the people who live around the area be denied, first-
drainage? I look upon this as very much more important from
the drainage standpoint than making new money. I think these
questions are pertinent. I am very much in the same boat as
you are, representing large interests, perhaps larger than you
represent, if you please, but what I am concerned in is to get the
great areas of east and west coast territory drained, because both
the lower east and lower west coasts are concerned, and to see
that the people there are in habitable territory, which the State
contracted to give them when they took over the Everglades
lands. That is the key to the whole situation, and if it takes
$2o,ooo,ooo or $25,ooo,ooo to do that and at the same time
reclaim your land, which this will do, a double purpose is served.
If you don't mind, Mr. Elliott, I differ in one respect. You speak
of colonization here and there as the mainspring of the effort.
I do not agree with this view. The mainspring of the effort
should be to take care of the water-flooded territory by drainage
-save life, then the overflow of property, then drainage and
reclamation, with added value to lands. When I went west of
Miami after the 1926 hurricane it took an aeroplane to get
through, there wasn't a place for miles west of Hialeah where a
snow bird could alight, it is very much more important to clean
up this condition which extended all along the coastal area than
perhaps add immediate value to an individual land holding,
which will come in good time. Now, if I understand Mr. Elliott,
he says by the expenditure of this $25,ooo,ooo you will really
drain the Everglades?
MR. ELuurr: Yes, sir.
MR WARFELD: That takes care of that. Mr. Dahlberg, I am
financing the Seaboard Air Line Railway, we have a mortgage
that will permit three hundred million dollars of bonds to be
issued. Do you think I could look solely to the sale of these three
hundred million dollars of bonds waiting for that to take place
before going ahead as far and as fast as I can in the development
of the Seaboard System. I am financing the railroad as justifica-
tion is found for so doing. This is based on traffic earnings, both
actual and safely estimated, on which I can sell these bonds.
Now, as to Mr. Elliott, you cannot expect him to stand up
here and tell you whether he is going to take your land or my
land or somebody else's land and put it in a state of cultivation.
Let him first take care of the complete drainage of the area, and
in that complete drainage you are going to reclaim millions of
acres of land, and if it costs more money, look what you have got
to get it on: a revolutionized area-drained, with lands of greatly
increased value. You have a real asset upon which to raise more
money and at greatly reduced cost for the money. We finance
a railroad on earnings and value to date. We will have more
earnings next year. From those earnings we take care of interest
and maturities, then we go further. That is what you will do
here in the Everglades.
MR. Smrrrs: I gather that there is going to be some
plan under which certain sections are going to be through or
completed before others, as far as the time is concerned. You
want to know, Mr. Dahlberg, who is going to make that plan,
and what the progressive movement is, all the way through, so
that everybody will know when he is going to come into his own?
MR. DALBERG: Well, primarily I asked the question be-
cause I did not know what all the shooting is about in this
meeting. There are certain things as I understand, that should
be done. I don't know. The Everglades should be reclaimed. If
we all agree on that, that is that. If somebody does not want his
land reclaimed, if he wants to keep on having this danger, from
the floods, can that land be cut off and the rest of us get out of
Second, is it practicable to control Lake Okeechobee? If
everybody agrees on that, that is that.
If those things are to be done, how are we going to raise the
money? If that can be raised in the commercial, sensible orderly
way, that is that. The details of whether the diking is going to
be sixteen or eighteen, or whether this land is going to be re-
claimed before that particular land, it seems to me, are unim-
portant details. So far as I am concerned, I don't give one hoot
when my particular land is going to be drained under the Board's
plan. I will take care of my land, as far as my own little back-
yard is.concerned, if the main proposition is properly taken care
of. If the main arteries, main channels, main hazards are taken
out of the Everglades, and I understand that is what the general
program is, then I am perfectly satisfied, and I will paddle my
own canoe, and I suppose everybody else is in a position to
paddle his own.
SENATOR WAGG: I would like to ask a question of Mr.
Dahlberg. I happened to be with Senator Jennings at the hearing
upon the bill which brought about this conference. When Mr.
Elliott spoke he started with question four, and he has been
answered by Mr. Warfield and others and I would like to go
back to question four.
I think you are discussing details and not the basic proposi-
tion at the moment, and I do not believe the details are of the
slightest importance until you have settled first the basic proposi-
tions. I am going to be perfectly frank in my statements,
because I happen to have had this matter up before and studied
it very earnestly and very carefully at the time of the meeting
before our Committee in the Senate.
There are definitely men who do not want the Everglades
drained. A considerable part of the opposition to this plan
positively comes from a group who are opposed to the general
drainage of the Everglades, and the sooner we recognize that and
begin at the beginning, as Mr. Warfield has, the quicker this con-
ference or any other group or conference will accomplish some-
thing. Before that committee came representatives of one im-
portant area within the Everglades drainage district, by the
way the only group which had representatives in the hearings
which lasted until the wee hours in the morning. On both
occasions, the only area which had representatives in opposition
to the bill, and the main spokesman of that delegation, without
any exception, when pinned down by definite questions, ad-
mitted that they were opposed to general Everglades drainage,
and that they were disposed to abandon the Everglades project
as whole and confine themselves to the drainage of a limited
raa nm ediately adjacent to their cities because they said
definitely before the Committee that if the entire Everglades
were placed under drainage and cultivation, it would reduce the
market for lands and would work a hardship upon them; that
they needed agriculture and that they wanted to drain a few
hundred acres immediately adjacent to them and let them out
of the Everglades district and handle it as a little drainage
Now, gentlemen, agreat deal of the opposition to the whole
program is based on tRat proposition, and you might as well
recognize it in the beginning. Mr. Warfield has answered the
first question as to whether or not we should abandon this work
and the money which has been spent to purchase this land he
has answered it himself by saying that most certainly we should
not reverse a policy of every administration since I904, but a
group, and an important group of the opposition, take the
position that it should be abandoned. Now, I am personally
positively and unalterably opposed to any abandonment of the
Everglades project. I think that is the biggest thing in the country
today. Gentlemen, do not fool yourselves, we are not in good
shape, and it is going to take some big things like this reclamation
project to pull us out. It is going to take more than conversa-
tion, it isgoing totake more than conferences, itis going to take more
than opinion, it is going to take a real great amount of honest work
and this is the only big thing that I can see on the horizon that
can save the situation. Mr. Shutts suggests also the obligation
to the people, the pioneers who have gone into that area and
begun this work on the promise of the State, call it whatever you
please-it is not a legal obligation, I admit that, and understand
that, but nevertheless the moral obligation of the State is today
and has been ever since I have been'connected with the problem,
an obligation of the State authorities to the men who have gone
in there and invested their money to carry on and complete this
work. Why, the State's good name and reputation before the
world is at stake in this project.
And there is one other subject which has not been men-
tioned, and it is a matter in my opinion of the most vital im-
portance, and a very important reason why this work should not
be abandoned or held in delay. We are about to have taken up
in a few months the question of flood control in the United
States. It is true the original thought of the flood control
centered about the Mississippi Valley, bat, it will be impossible,
in my judgment, for Congress or any other law-making body
or group to ignore flood control in other areas, such as Florida.
In the flood in Florida, the loss of life was greater than in the
Mississippi Flood of a few months ago, and it is a question to my
mind if that can be ignored by Congress, and I feel if we go
ahead with a plan of flood control of Lake Okeechobee we can
secure Federal recognition of the problem and have it handled
along with the Federal program or plan of flood control.
A certain gentleman who represents 150o,ooo acres in the
immediate vicinity of one of our cities where the keenest opposi-
tion is coming from, bases it on the proposition that he wants
his 150,ooo acres put in cultivation and if you let him out of the
Everglades district he will put his own land in cultivation and
does not care what happens to the rest. And the entire testimony
before the Committee on this bill, the committee which had
under consideration this bill, or the substitute bill which was
offered by the Senator from the lower east coast district in sub-
stitution for this bill, provided that that area might be taken out
of the district on the action of a majority of a Board of seven
without reference to the bill or the I. I. Board or anybody else,
and there was little doubt but that the substitute bill was pro-
posed for the purpose of taking out of the Everglades drainage
district that vast area and ptting it into a local sub-drainage
district and abandoning the general scheme of Everglades drain-
age, and that is the first question for this or any other conference
to take into consideration, in my judgment. (Applause.)
MR. WARnLD: Gentlemen: We want no better evidence of
the necessity for this conference than what my friend Wagg has
just said. There is a group opposition, if you please, in Florida,
and it is on the lower east coast, contiguous to my friend Shutts'
MR. Smrrrs: You are not blaming me for it, are you?
MR. WARFI D: Not at all, but I tell you what I am
blaming you for, you might further use the influence of that
great journal you own and lay all the facts clearly before the
people of Florida.
MR. SHvrrs: The trouble is you do not read our paper
MR. WARFmD: I read it pretty nearly every day, it has
been doing fine work, we hope it will do more.
Referring to Senator Wagg's remarks, Mr. Merrick came up
to see me respecting the Everglades program as before stated and
told me that they had employed one of the best lawyers in Dade
County for the purpose of defeating the purposes of the bill by
declaring it unconstitutional. It seemed to me it was time to call
together those who were for and against Everglades drainage
and see what might be done to clarify the situation. Mr. Mer-
rick said he hoped to reach some understanding. He represented
a group of some twelve or fourteen people who have raised money
to employ the lawyer referred to and go before the Florida
Supreme Court to show the unconstitutionality of the Act to
which my friend Senator Wagg has alluded.
Now, this situation seemed to me to require an answer,
and very promptly. The way to answer is to tell the facts.
There have been lots said about the drainage.of the Everglades,
for and against, but I have been unable, Senator Wagg, to get in
concrete form the real objection. I have not yet heard a real
plausable cause of objection. The contract was made by the
State to drain it, as has been said here half a dozen times,
every Governor has recognized that contract. There is no better
drainage engineer than Elliott here, and he is interested in the
drainage work, I believe everybody believes in him.
I went over all this with Mr. Merrick, and asked him, did
he wish the thing stopped. Did he want to let the money go
which had been expended and go no further with drainage. He
said he did not. Suggesting that the defeat of the bill by showing
its unconstitutionality would not get his friends far, I asked
why not let us have a show-down, bring his lawyer and all his
friends to a conference and talk it over. He said he would do so.
He said he would go to New York, Baltimore or anywhere, and
have his lawyer, so that we could sit down and discuss the entire
situation. He unfortunately has been detained.
You say, do not go into details. We do not want detailed
discussion, but we do want to discuss the high spots. We have
discussed some of them. You cannot lie down at this juncture,
nor can you see the millennium down through the years to come.
Certainly Mr. Elliott has shown that they are going to work and
drain this great area of land' and the land contiguous to it will
get the benefit of this in increased value. If you put these bonds
out right and distribute the properly, you will have a reason-
ably easy problem. I would ke to ask Mr. Elliott, as represent-
ing large amounts of land in directly, if you please, what is the
landowner required to do about diking and pumping that is
referred to in the lower reaches. I have letters here asking what
is meant by this, what has to be done individually after the
money is spent and our taxes are levied and paid. To what
extent is diking and pumping necessary?
MR. ELLIOTT: The laws of Florida provide for drainage
districts in the Everglades, for building the local works or taking
care of those local areas. I would say that the area to be pro-
tected would provide all of those local works necessary to its
protection, but not the main works of drainage or the main
outlays which these areas must have provided for them. I would
say when these restricted areas are selected that those areas
created into special districts will provide districts consisting of
lateral canals, which will separate that area from otter areas.
MR. WARFIELD: Some areas will not require the diking, do
I understand that?
MR. ELLoTr: Under the present plans those limited dikes
for enclosing limited areas would come under the definition of
local works. Now, the outlays for that'restricted area would be
provided by the district, by the main district.
MR. WARIELD: But this diking would have to be done by
the landowners themselves?
MR. ELLIOrr: The diking would have to be done by the
landowners themselves unless it was a dike like around Okee-
MR. WARFIELD: What about Mr. Dahlberg's lands down
there, has he got to dike his lands after all this is done?
MR. ELUOTT: His particular area would provide those
dikes as part of the local works. Those dikes are, of course,
nothing like those around Lake Okeechobee, but are simply
separating his area from somebody else's area.
MR. WARFIELD: You do not regard that as a matter of
very excessive cost, do you?
MR. ELuorr: No, sir, the dike would come under part of
the drainage, itself, one of the ditches which would be provided
to separate the area from somebody who is not ready to come in
MR. SmHrrs: May I make a suggestion? In order to get
this before the meeting in a concrete form, I move the adoption
of the following resolution: I do not expect this to be voted on
until the session is about over, but I am going to put it before
That this conference approve the Everglades drainage district
bill of 1927 in its entirety. That it does not believe that Everglades
bonds sold at 55 per cent yield, average, is exorbitant, under the
circumstances; that it does not believe that the bonds themselves
when issued, as provided by the law, are a direct obligation of the
State of Florida; that it believes that this drainage program, as
originally planned and as carried on through the years, should
be finally completely consummated as soon as possible.
Now, speaking of the two or three points in the resolution.
I do not believe that the rate to be paid by the drainage district
for the money we propose to borrow is exorbitant. We people
of Florida who have been charging everybody who comes down
to us 8 per cent haven't any business to kick at 59 per cent,
and, because the bonds are not a direct obligation of the State,
I do not believe we can expect to get the money any cheaper. I
say they are not a direct obligation. Mr. Dann, in his speech at
St. Petersburg, claimed they were a direct obligation in effect.
I claim they are not a direct obligation either in effect or any
other way, but that it is a moral obligation of the State to pay
them, pay them with the Everglades lands loan if they cannot
pay them through the State's process of taxation, if it is necessary;
but carry out the moral promises of the State of Florida, which
has been selling lands for years past in the Everglades. The bill
provides, as I understand it, certain rules and regulations shall
be carried out, and one of the rules and regulations is that the
State shall pay its tax on the land owned by it in the Everglades
the same as any other owner, and if there isn't enough money
going into the drainage districts from the taxes on state-owned
land, that in that event, as I understand it, the Legislature, if
necessary-it has never been necessary-the Legislature may
appropriate and tax the entire State-collect taxes from over the
entire State with which to pay the Everglades bonds. I understand
that is no different from the law for the last four years, it has
always been that way and nobody has objected to it. The rules
and regulations provide further, if anybody lets the tax go by
default, the land be put up for sale and that the State may buy
that in for the taxes and continue to pay the taxes on it, and
if there isn't enough money coming out of the sale of the
land to pay them, that they may be levied, so that if that means
is adopted and nobody ever pays their taxes in the Everglades,
the State may finally pay for these bonds, and I think there is a
moral obligation to do so. But in view of the fact that the State
might, if it decided to do so, or some Legislature may refuse
to make the appropriation necessary to pay these taxes, so that
then it will all be lost, and that fact proves that it isn't a direct
obligation of the State because if the State wants to today, it
can get out from under after the bonds are issued. Those are
the questions I understand are being raised. First, that it is a
direct obligation of the State, and, therefore unconstitutional. I
do not believe it. I believe it is a moral obligation of the State
and I think the State can pay it if it wants to pay it, but it is
not bound to do so. I do not believe as long as there isn't the
direct taxation in the State the rate is too high and I do not
believe a great State like this has a right to offer its Everlglades
lands for sale anywhere in the country and after the property has
been bought and paid for under the promises to drain them
eventually, and say, "We have taken our loss and you can do
with it as you want." (Applause.) This was all a moral obligation
just as much prior to the passing of this Act as it is now and this
is the only available means we have to ever reclaim them, and
if anything ever happens to this bill we will not have drained
MR. WARELD: As I understand it, you want your resolu-
tion to lie over?
SENATOR WAGG: Mr. Chairman, I understand the motion is
put up for discussion sometime prior to adjournment.
MR. WARJLD: That is what I understand.
SENATOR WAGG: If that is correct, I would like to offer another
resolution on the same basis. This resolution to be given consid-
eration during the sessions of this conference and to be voted on
sometime prior to its adjournment at the pleasure of the Chair.
I would like to offer a resolution that this conference
recommend that the question of flood control of Lake Okeechobee
be presented at the coming session of the Congress of the United
States, due to the great loss of life and excessive damage to
property within this area by flood conditions during the period of
the last year, and believing that the proper control of this great
inland lake comes properly under the supervision and preroga-
tive of the Government of the United States. I certainly want
to offer the motion so that it will be a basis for discussion as a
resolution to be voted on sometime prior to adjournment.
MR. WARFELD: Mr. Chairman, it seems to me the first
question before this conference is the question I have already put
and which has not been acted on, and that is whether it is desir-
able-it is true as Mr. Wagg says in his answer-the first ques-
tion to be decided-and I offer this as a resolution to be acted
Resolved, that it is desirable that the double purpose,
namely: drainage and its effet on health; the reclamation of
Everglades land, both of which have become the policy of every
Governor and State Administration since Governor Broward in
1904 to the present administration, shall be continued.
That is the first question, whether we are going ahead with
it or not.
(Motion seconded by Mr. Dahlberg.)
THE CHAIRAN: Gentlemen, you have heard the motion,
properly seconded. Is there any discussion on the motion?
8SmNTOR WAGG: Mr. Chairman, I object to the putting of the
motion without discussion. I understand this was the only
objection raised to the bill before our Legislative Committee, not
to launch hearings during the recent session of the Legislature.
MR. DALBERG: Gentlemen, the people down where I come
from have definitely stated their position, and for that reason
I believe that you gentlemen here should by discussion commit
yourselves, as I am gladly willing to commit myself, to a support
of the general project of Everglades drainage, and that is a
very important matter, but, in my judgment, to pass this
motion without discussion would be serious error.
MR. DANN: As far as I can see, I am about the only man
in the room who has questioned the Governor's program. I
stated, in my address at St. Petersburg, that I did favor the
reclamation of the Everglades, and that I thought it was the
duty of the State to keep faith with the Government. I ques-
tioned the methods in this particular case.
MR. WARFIELD: Pardon me, this resolution does not state
the methods of drainage, it is to define the general policy, if you
do not mind.
MR. DANN: That is just what I am getting at, Mr. Warfield.
Since this question became a question of public policy in Florida,
I have received a great many hundreds of communications, many
from disgruntled people, many from soreheads, a great many
letters and communications from people who were seriously in-
terested in the Everglades matter, and who questioned whether
this was the proper way to go about it. But the great majority
of those people-with the exception-I do not think there were
many exceptions-except a small group from Miami, who
thought we ought to abandon the reclamation of the Everglades,
and, if I may be permitted, Mr. Warfield, I would like to second
that motion. (Applause.)
THE CAIRMAN: Gentlemen, you have heard the motion of
Mr. Warfield, seconded by Mr. Dann. Is there any further
(There was a call that they would like to have the motion
THE CHAIRMAN: Pay strict attention to the motion.
MR. WARIELD: This is the motion:
Resolved, that it is desirable that the double purpose,
namely: drainage and its effect on health; the reclaiming of
Everglades land, both of which have become the policy of every
Governor and State Administration since Governor Broward in
1904 to the present administration, shall be continued.
THE CHAIRMAN: Do you clearly understand the motion?
It is now open for discussion.
MR. KYLE: Mr. Chairman, I might state this. I think it
would be a crime and a disgrace to any citizen of the Everglades
district to say that the whole project should be abandoned, and
as representing Broward County I will state that we are unal-
terably opposed to any abandonment, and that we want this
drainage to go right straight ahead.
SENATOR WAGG: I realize I am taking a good deal of time
and I apologize for being on my feet so often, but this is of partic-
ular interest to me. It is a fact that the financing of the fight in the
Supreme Court against the bill is being carried on entirely by
the small group which has been mentioned, and that this posi-
tion, which is the only expressed position against the bill before
the Supreme Court, is being financed and carried on in its
entirety by a group who are opposed to general drainage. I
want that fact to be clear in your mind.
MR. WARFIEL: I think in justice to Mr. Merrick I should
say that Mr. Merrick not being able to be here, has asked for
a conference August Ist, at which conference he desires to have
those who are opposed to it present. Nothing has been done
about it, but, at least, I should say that there has been this
suggestion made for a conference in regard to the matter.
I would like to ask for the question.
GovERNOR MARTIN: Gentlemen, I feel at this time it would
not only be proper but wise to give this conference some informa-
tion relative to the question that Senator Wagg has brought up
for discussion: Can the Everglades be abandoned or should the
Everglades be abandoned? In 1850, by an Act of Congress, this
Everglades land was to go to this State so Florida could come
into possession of it. It was patented to the State of Florida,
about 1903, during the administration of Governor Jennings, and
in that patent the State of Florida assumed the responsibility of
draining these lands and opening them up for settlement and for
cultivation. Therefore, when the people of Florida accepted this
area from the Federal Government, in keeping with the patent
issued by the Federal Government to the people of the State,
they settled forever, in my opinion, the question of whether it
should be drained or not, unless in this day and time men dis-
regard their moral and written obligations, such as was done
recently in the World War, when Germany declared its written
obligations no more nor less than scraps of paper. Therefore, I
take the position that when the State of Florida accepted this
patent from the Government and assumed the responsibility of
draining it and opening it up for cultivation, that that question
was concluded. In 19o3 or 1904, the State of Florida endorsed
the candidacy of a particular man for Governor-who made the
drainage of the Everglades the entire issue of his campaign, and
in electing him on that platform, the people of Florida, by
solemn vote, individually endorsed the drainage of that area.
Aside from the fact that we have done it by a covenant with the
Government, and that the people have ratified it by an election
at the polls, and that the work started some twenty-two years
ago, it seems to me that settles forever in my mind or in the
mind of any one the question of whether it should be abandoned
' or not.
But there are other reasons why it should not be abandoned,
and just as strong moral reasons as possibly those that are
written and that have been endorsed by the people of the State-
we have sold land, and Senator Wagg says the people all over
the country were given the assurance that the State would leave
no stone unturned in an effort to drain this area. Had they the
slightest information or indication that the State would not
drain it, those lands would never have been purchased. They
have invested their money there, fifty some odd thousand people
now live in the district, and have gone on for twenty-two years.
The drainage engineer tells you he spent about $15,ooo,ooo in
beginning the reclamation work and bringing it up to this good
Aside from that, the people who have settled in the cities
adjacent to the Everglades were under the assurance that the
State would leave no stone unturned in draining them, so that
their communities might be developed. The railroad companies
have built in and adjacent to the Everglades, believing that it
was an obligation upon the State of Florida to drain this area.
If there had been any question about that matter, I doubt
seriously, sir, if you would have ever built your road into the
Everglades, if you thought it would be a waste of water.
Therefore, we are not only bound by covenants, and by the
endorsement of the people of the State at the polls, but by the
moral obligations, that we permitted the people of the nation
and a great many other countries to come in and invest their
The State of Florida owns today about one-fourth of the
area. When the work began the land was worth about twenty-
five cents an acre. Last year I believe that we sold land there,
and the average price of the land that was sold in that area was
$86 an acre. In 1925, it was $1o8 per acre. Isn't it a good
business proposition? If you can within twenty-two years, raise
the price of land from twenty-five cents an acre to around $ioo
an acre, is it not a good proposition for the State to continue?
It appears to me that it is. The whole Everglades, when it
started, was not worth over a million dollars, or a million and a
quarter dollars. Now, today, we have got over $9,ooo,ooo in
mortgages-the State of Florida has. Now, aside from the fact
of the covenant, aside from the fact that we have held these
inducements out to the people, it is a good business proposition.
So, you have got three things in favor of continuing the
draining of the Everglades. But, as Senator Wagg has just said,
and righteously so and properly so, the most of our trouble is
coming from an element in the State that does not want the
Everglades drained. That impression is becoming more prev-
alent each day, and it is a selfish idea, and one based upon
nothing in the world but selfish and pecuniary motives to those
who advance it.
Recently in an issue of the paper of Jefferson County, a
county away in the western part of the State, an article appeared
from the Secretary of the Chamber of Commerce, in which he
said that we have got enough good land in Jefferson County,
why drain land down in the other counties? That is the idea
prevalent in Dade County. Senator Wagg has stated the facts,
that many of those people do not want it drained in Dade
County. I hope that this conference will go on record as favoring
unalterably the drainage of the Everglades. Why should we
leave it about half-completed or a third-completed, and now
abandon it? That is poor business, and I want to see this
conference go on resolution as'favoring it. (Applause.)
MR. WARFPlD: Mr. Chairman, I will ask for a vote on the
(Question put and resolution unanimously carried.)
SENATOR JENNINGS: I have not heard, Mr Chairman, any
man in the State of Florida or anywhere else advance any argu-
ment against the moral obligation of the State of Florida to con-
clude and complete the drainage of the Everglades. I haven't
heard anyone argue that the Everglades ought not to be drained
on the proposition of our moral responsibility. They concede that.
The only arguments that have been advanced are based upon the
proposition of economic expediency. I submit, Mr. Chairman.
that that being the only argument proposed to the people of
Florida today in opposition to the drainage of the Everglades
ought not be considered when you have established the moral re-
sponsibility. But, Mr. Chairman, meeting that issue squarely,
meeting the question of economic need in the State, I submit that
the Everglades ought to be drained on the basis of that proposition
alone. I submit that the argument that the Everglades will be
in competition with Jefferson County, with Dade County or
any other county is falacious. I submit that the argument that
the country cannot consume the beans and potatoes that can
be raised in the Everglades is a falacious argument. I submit
that we all recognize that when sufficient area of the Everglades
is brought into production that we will have to develop a staple.
No one wants to continue the hazardous occupation of truck
farming except as a means to an end. When sufficient acreage is
brought into cultivation, so there will come in the great masses
of capital that Mr. Dahlberg speaks of, the sugar mills, the
celotex plants, and those other great enterprises that will come,
cultivation will improve and not be in competition with any
other part of Florida, but, instead, you will eliminate from that
competition the many sub-drainage districts now raising truck
because they are not the agencies and have not the facilities to
take care of a staple crop.
Now, Mr. Chairman, the moral responsibility is fixed, and
I have heard no one dispute that on the moral issue it ought to
be drained. It seems to me the second reason offered why it
should not, on the ground of expediency, should not be considered
when you have determined the moral responsibility. To my
mind only the economic proposition is the one that can be
squarely met, and the Everglades ought to be drained because of
the economic benefit to the State of Florida and to those com-
munities that will be involved.
GOVERNOR MARTI: Haven't you heard that a good many
of these people were opposed to the drainage of the Everglades
because it would come in competition with their localities?
SENATOR JENNINGS: That is the only argument I have heard
advanced to my mind that is of any consequence at all.
MR. WARIELD: Gentlemen, I think Mr. Shutts' resolu-
tion brings up a number of questions which ought to be dis-
cussed. I don't know whether we should begin to discuss them
prior to lunch or not. It may be we could do better after lunch.
I think some of the questions that have been brought out by
Mr. Dann are very pertinent questions. He represents an ele-
ment that wants to know more about the reasons for the various
steps to be taken. I see no reason for a man to object to those
questions being urged. I see no reason why we do not meet the
issue, if you please, by telling the various steps that were taken,
at least, as I understand were taken.
The drainage district or districts, whatever you choose to
call them, have used the proceeds of some ten to twelve millions
of dollars of bonds spent in the Everglades for one purpose or
another. Those bonds are outstanding. You have gotten to a
point, as I understand it, where a million or a million and a half
of those bonds had to be taken back, or at least they could not
be sold, as I understand it.
GOVERNOR MARTI: Two millions.
MR. WARFImL: Two millions. Those bonds were a drug on
the market and Everglades drainage was threatened because
there was no means at hand to sell securities to carry on this great
work. Now, what were you todoaboutit. AsI saidbefore, I havehad
considerable experience in selling bonds, I know what it means
to be confronted with what Mr. Morgan used to call undigested
securities on the market, and Everglades securities on the market
were very much undigested. As I understand it, the Governor
first discussed the subject with interests local to Florida, in
Jacksonville, to ascertain what was necessary to be done to sell
these bonds. The result was the Legislative Act. I understand
this Act does not impose a 'direct obligation on the State with
respect to these bonds, because it had no right to do so. It
would be unconstitutional if it did. Now, what does the Act do.
As I understand it, the State steps into the place of a landowner
in the Everglades who is unable to pay his taxes and may take
over the land concerned by paying the taxes thereon. Mr.
Fleming, you can correct me, the State will thus take the place
of this delinquent, if you please, but he would have two years
within which to come and get his property, if he pays the taxes.
Is that right?
GOERNOR MARTIN: Mr. Warfield, I can explain that to you.
Under a law which has been in force a long time the State buys
those lands in and pays the taxes and the State holds them for
two years and the State becomes the sole owner and the other
man is shut out.
MR. WARFIELD: But he is not shut out for two years.
GOVERNOR MARTIN: No, but after that the State gets the
fee simple title.
MR. WARFIELD: That is as I understand it, but the owner
can come in and pay his taxes and get back his land, that is,
within the two years.
GOVERNOR MARTIN: Yes, sir.
MR. WARIELD: A liberal proposition.
GOVERNOR MARTIN: And then of course you would have
to pay your interest.
MR. WARFIELD: That is the extent, the real extent, of the
GOVERNOR MARTIN: No.
MR. WARFIELD: What else does it do?
GOVERNOR MARTI: Well, it is a long-winded proposition.
MR. WARIELD: Do not let us make it long-winded. What
does the State have to do in the event I do not pay my taxes?
GOVERNOR MARTIN: In so far as the taxes are concerned
the State pays them. You can redeem the land with a penalty in
two years. If you don't do so the State becomes the sole owner
of the land in fee simple and can sell the land to anybody else.
MR. WARFL: If you have the taxes, you have what you
GOVERNOR MARTIN: Yes, sir.
MR. WARFIELD: What else has to be done?
GOVERNOR MARTIN: I will answer any question you want
to ask or anybody else wants to ask. There are two Boards in
the State of Florida. One is the Double I Board, the Internal
Improvement Board, which has been in existence about seventy-
five years. That Board holds title to all State lands except those
I .. ..I I. .
lands which were particularly deeded to the State of Florida for
school purposes alone. Then there is a State Board of Education
which holds those lands, every sixteenth section the Government
deeded to the State for school purposes. Then there is the
Drainage Board which has nothing in the world to do with the
State Board of Education and has nothing in the world to do
with the Internal Improvement Board, and all the Internal
Improvement Board has to do with the Drainage Board is to
pay the State taxes on the land that the State owns in the drain-
age area. The State has now around a million dollars in the
Double I Board, they are able to pay the State tax on the land,
and the Everglades Drainage Board, and the Internal Improve-
ment Board have nothing in the world to do with each other
except that the Double I Board is the Board that pays the State
drainage tax on the lands lying in the drainage area.
MR. WARFILD: Where has the State assumed any direct
obligation by reason of the processes you mention?
GOVERNOR MARTIN: Only this, that in order to invite or
in order to sell additional bonds in an area so heavily bonded we
found we had to give some other securities. We agreed to hold
in trust all of the State lands in that area except the school
MR. WARFIED: That is one other additional obligation.
GOVERNOR MARTIN: We agreed to hold in trust all of the
State lands in the drainage area, the proceeds from them, after
paying 25 per cent that the Constitution required to the State
school fund, and then we hold 75 per cent of the proceeds of the
sale of all State lands in that area alone for the purpose of paying
taxes. Then if there was any more left over we were to hold that
in trust until all these bonds were retired, and if these bonds
were not paid then these bond owners could go back on the
proceeds of the State lands in that area to collect the residue.
MR. WARWELD: But no further.
GOVERNOR MARTIN: No further: If they were paid the
residue left over of the 25 per cent which went into the school
fund, and that goes back into the general levy of the State of
Florida and the Legislature can use it whenever they please and
wherever they please.
MR. WARFmID: How about the ad valorem tax?
GOVERNOR MARTIN: Well, that wasn't for this purpose:
To sell bonds, drainage bonds are poor security. They cannot
be comparable with State bonds or municipal bonds. Therefore,
they are a poor class of security. No man in my estimation that
wants to invest his money would put it on that area that was
full of water in preference to putting it in a community which
was well settled and well regulated by a State well established
and well governed. We have so many bonds issued on the Ever-
glades already that the bond houses could not sell any more
bonds unless they could say to their purchasers, not only have
we a drainage tax by which we can collect enough money to pay
the interest and sinking fund, but we have an additional tax, an
ad valorem tax to back up the payment of the bonds. That gives
these bonds not only a drainage tax backing, but an ad valorem
tax backing. There was no necessity for the ad valorem tax.
It was simply a matter of helping to dispose of the bonds. If we
sell these people ten millions of bonds and they cannot dispose
of them, how can we finish financing the project. That meant
to give the public a commodity that was worth the money they
put in it, and a commodity which was properly secured. Now,
why the necessity of the ad valorem tax? We do not need it
except to help these people dispose of those bonds. The other
bond houses that had them had an experience with them,
there were two million laid in a bank in New York and they
could not dispose of them. If these people took ten million more
drainage bonds with two million already lying there for a year
and a half, how could they dispose of the ten million under those
conditions. We had to arrive at some solution of that problem.
Probably you would want to know how much the ad valorem
tax would be. I do not want to monopolize the situation. I
studied this thing for two and a half years.
MR. WARIELD: That was the next question I was going
to ask you.
GOVERNOR MARTIN: I studied this thing for two and a half
years religiously. We derive enough money today from the
drainage tax to pay the interest and credit the sinking fund on
ten million two hundred and fifty-five thousand dollars worth of
bonds that are outstanding. The present drainage tax is enough
to do that and leave us seven hundred and fifty thousand dollars
a year surplus. But because we could not sell any more bonds,
we had to use the surplus money derived from the drainage tax
to continue the work. Now, do you gentlemen understand that?
So we have sufficient money right now from the drainage tax to
more than pay the interest and the sinking fund on the ten
millions of dollars that it is contemplated to issue. So there is
really no necessity to use the ad valorem tax except to help these
people dispose of those bonds, to sell them.
MR. WARIELD: It is for window dressing, so to speak.
GOVERNOR MARTIN: That is all. It will not be needed, it was
not provided for with the purpose of taxing anybody, it was
to give them an argument to sell them. You buy a bond of a
municipality and it has an ad valorem tax. This bond has an
ad valorem tax and a drainage tax.
MR. WARFIELD: You have answered questions which it
seems to me are necessary to be answered and which are covered
in the questions first suggested. In the issue of ten millions of
dollars additional bonds, what will be the requirements of taxa-
tion in addition to what you are doing now?
GOVERNOR MARTIN: None necessary.
MR. WARFIED: For how long?
GOVERNOR MARTIN: Indefinitely, for this reason, that
under the present drainage law, we collect enough money
already from the drainage tax to credit the sinking fund and to
pay the interest on the ten million two hundred and fifty
thousands that are outstanding. After we do that we have a
residue of $750,000 left.
MR. WARFILD: How long will that take care of the interest
on the $io,ooo,ooo?
GOVERNOR MARTIN: This will leave about $25o,ooo a year
over after doing that.
MR. WARFIELD: What are the maturities of the outstand-
ing $xo,ooo,ooo worth of bonds.
GOVERNOR MARTIN: I think twenty years.
MR. WARFIELD: What is the first maturity?
MR. ELUOTT: They are maturing every six months.
MR. WARFIEL: How are you going to take care of those
GOVERNOR MARTIN: We have a sinking fund for that
MR. WARFIELD: As I understand it, your rate of tax and
your provisions for a sinking fund take care of not only the
interest but take care of the principal as the bonds mature.
GOVERNOR MARTIN: Under the present drainage law we
have enough money to take care of the present $1o,25o,ooo and
to take care of this $io,ooo,ooo with a surplus.
MR. WARFIELD: And will it take care of the interest on
those bonds plus the maturities as they come due on the $Io-
GOVERNOR MARTIN: It will take care of them and leave
about $250,000 per annum over. Right there for your informa-
tion, we have over 2,000,000 acres of land in the Everglades that
will be drained that are only now paying ten cents an acre
MR. WARFIEL: The difficulties met in taking care of these
bonds seem to be answered by what the Governor has said.
GOVERNOR MARTIN: There isn't any question of that.
MR. WARFIELD: If there are any other questions that any
members of the conference would like to ask in respect to these
bonds, their interest and maturities and taxes necessary to meet
them, I hope they will do so.
GOVERNOR MARTIN: I will be very happy to answer them.
MR. DANN: May I state my interpretation of this act and
ask the Governor to correct me, because these are the reasons
why I am opposed to the bill as enacted in the last Legislature.
As the Governor has stated, it was necessary to find additional
security to offer the bondholders in order to market these bonds
because they could not sell the bonds that were now out and
unsold. So to secure these additional bonds we have first the
drainage tax, which apparently should provide all the funds
necessary to meet the interest and sinking fund on the $io,ooo,ooo
now out and the $Io,ooo,ooo to be issued.
GOVERNOR MARTIm: That is true.
MR. DANN: Secondly, if that should fail, the Internal
Board may assess an ad valorem tax as an additional security
and a third bulwark for the protection of the bondholder, the
bill provides that funds of the Internal Improvement Board
derived from the sale of such lands shall be used to pay State
taxes or to buy in lands in case the ad valorem tax or drainage
GOVERNOR MARIN: No, it provides this, that the Internal
Improvement Board shall buy in all delinquent tax lands in the
area, and take title to that land.
MR. DANN: But they pay for them out of the funds on
hand in the Internal Improvement Department.
GOVERNOR MARTIN: Yes, when the land is sold they get
it back with interest.
MR. DANN: That is the third. The fourth is, if no such
funds are on hand in the Internal Improvement fund these funds
shall be paid from monies to be appropriated by the State for
that purpose, am I correct?
GOVERNOR MARTIN: The Legislature may or must appro-
priate money to pay the drainage tax and take up these lands if
the other funds fail.
MR. SHOmrs: But, Governor, that "must" does not belong
there, there is no way to make the Legislature do it.
GOVERNOR MARTI: Well, may appropriate.
MR. SHumrs: Yes, that is the case.
MR. DANN: That is a minor question. The bill reads, may be
appropriated for that purpose. That is the way the bill reads.
Now, Mr. Shutts, you have stated that the bonds are not a direct
obligation of the State?
MR. SmrrHT: In my judgment.
MR. DANN: Without answering the question immediately,
unless you care to, what is the difference between a moral
obligation of the State and a direct obligation of the State? Is
there such a thing as a direct obligation? Can the State be sued
without its own consent?
MR. SHmUrs: There can be no direct obligation of the
MR. DANN: It only has a moral obligation.
MR. Smrrrs: There is only a moral obligation so far as the
State itself as an entity is concerned, only a moral obligation.
MR. DANN: This is a moral obligation.
MR. SHmrrs: Which may be repudiated by any Legislature
refusing to appropriate from the fund any amount to make up
any such deficiency after the three bulwarks you describe have
MR. DANN: For what could a State be sued?
MR. SHTrrs: A state bond issued by a legislature which
pledges all the property of the State at the time of the execution
of the bond is a direct obligation which can be enforced. If the
Legislature refuses to make the appropriation necessary to meet
the bonds, I think they could levy on the property of the State.
MR. DANN: Can a State be sued without its consent?
MR. SHUrrs: Generally I think the idea is it cannot be,
but certainly a State which makes a direct and absolute promise
can be made to pay its debts.
MR. DANN: I agree with you thoroughly. I am taking the
position if the Legislature should see fit to refuse to pay or
appropriate money for this purpose that same legislature might
refuse to allow anybody to sue the State.
MR. SHrrrs: I should think so.
THE CHARMAN: For the purpose of giving you information
which may not seem official, I have here an excerpt from an
official report which will give you some idea as to the exact
income of the district for 1927. Mr. Elliott, who is here, and the
Governor will bear me out in this statement. It amounts in the
district to $1,695,404, in 1927, on the basis of the 1926 assess-
ment, the valuation ad valorem of $52,404, and on the amount
the Governor stated over the two million acres bore a nominal
ten mill tax.
GOVERNOR MARTIN: Ten cents.
THE CmAIRMN: Ten cents, the total area in the ten-cent
district is 2,206,000 acres out of the total of 4,113,700 acres. The
various zones, six in number, are, the maximum zone, 186,000 acres,
bearing a dollar and a half an acre, provided $279,oo00; zone
No. 2, 311,7oo acres at one dollar gave $311,7oo; zone No. 3,
350,000 acres at seventy-five cents gave $262,500; zone No. 4,
392,000 acres at sixty cents gave $235,200; zone No. 5, 668,000
acres at fifty cents gave $334,ooo; zone No. 5A, 206,000 at ten
cents gave $20,600; zone No. 6, 2,000,000 acres at ten cents
Now, then, there is another very important thing that has
not been given the prominence that I think it deserves, the ad
valorem tax as at present levied, one mill per dollar, provided
$524o4 as stated. Of that amount, the lands in the district
on which there is an acreage tax pay $30,629. The lands in the
districts, that do not bear an acreage tax pay $19,975; railroads,
telegraph and telephone companies in the districts pay $1,636,
and the personal property in the districts pay $163 per year.
GovERNR MARTIN: $163 personal tax for the whole area?
THE CHAIMAN: Yes, $163. That makes up your total of
$52,404 maintenance taxes of the year 1926.
GOVERNOR MARTIN: As I understand you, in the entire area
the total amount of taxes paid on personal property owned by
52,ooo people is what?
THE CHAIRMAN: $163.
GOVERNOR MARTIN: $163.
THE CHAIRMAN: Mr. Elliott, is that correct according to
MR. ELIOTT: Yes, sir.
THE HAIRMAN: These are from your official papers.
MR. ELuarr: The ad valorem tax of one mill is now being
THE CHAIRMAN: The ad valorem tax of one mill has been
in existence since 1921, and has met with no opposition in my
investigation of the matter and I have been studying the situation
for a great many years.
MR. WARFIELD: I just want to remind you that at one
o'clock we will have lunch and probably some will want to
wash up before lunch and before putting the motion to adjourn
for luncheon I will ask Mr. Phillips to read the list of gentlemen
who are here present, and where they are from so you may know
who are in the room. Do not forget at five o'clock we will
adjourn and I expect you to be my guests at dinner at my
residence outside of Baltimore, informally, just as you are.
MR. SHUrrs: Mr. Dann, just answering your question, the
State cannot be sued without its consent, but if they had state
bonds, as other states, but Florida has none, and fail to pay them,
we would be in the position of repudiating them. But my con-
tention is that this is not a State promise to pay made by the
Drainage Board, but the State may come to the rescue of the
Drainage Board and ought to do it and pay it out, but it is not
a direct obligation which may be enforced against the State
(A list of those present was thereupon read by Mr. Phillips,
after which at 12.55 a recess was taken until 1.45 P.M.)
After Recess (2 P.M.)
THE CHAIRMAN: Gentlemen, I think we have made prog-
ress, very material progress. There may be some things that
have arisen in the minds of those present which have grown out
of subjects which were discussed this morning. I will ask Mr.
Warfield if he has any particular matter in mind which was not
explained in the morning session and which should be further
discussed before taking up new matter.
MR. WARFIELD: I think there should be further discussion
with respect to the bonds that were sold or to be sold in con-
nection with this project. I doubt if everyone fully understands
the reasons for the bill that was passed, further than were rapidly
given by Governor Martin. Mr. Dann asked some questions which
seem to me ought to be answered. I tried to answer some of them
and Governor Martin has answered some of them. Some of the
gentlemen here possibly do not understand the conditions under
which it was necessary to do the things that the Act of the Legisla-
ture was supposed to do. I think we can go a long way in clarify-
ing this. My understanding is, that there was some relation
between the bankers and those who drew the bill. It seems to
have been insinuated that the bankers who proposed to take
the initial bonds should have nothing to do with the legislation
authorizing the conditions of their issue. I think it would be a
proper thing for a banker-and I hold no brief for bankers-to
know the conditions surrounding the securities he was to buy,
if you please. Personally I knew nothing of the bill until it was
passed. It goes without saying that no banking house would
have bought ten millions of bonds without knowing how these
bonds were to be cared for. As I understand it, the bankers
had something to do with the drafting of the bill. That bill does
not, as I understand it, place upon the State. as Mr. Shutts
has brought out, any direct obligation, because it could not do so.
The most that it does, Mr. Shutts, is to give the Legislature an
opportunity, if you please--
MR. Smrrs: If everything has failed.
MR. WARP iD: Yes, and after all of these various hurdles
have been jumped, that the Legislature can, ifitseesfit, appropriate
or take moneys out of an appropriation already made, for the
purpose of doing the things in default of their being done other-
wise, then the Legislature can if it wishes do the balance.
MR. 8Hmrrs: And a very remote possibility.
MR. WARncD: If the bankers expect to distribute these
bonds under the idea that the Legislature of Florida is going to
do something which is merely permissive and not obligatory, I
think it is well to know from the bankers who are here whether
they feel that the bonds are a direct obligation of the State.
Now, the question of the constitutionality of this Act will
be settled by the Court, and I understand the bankers will not
proceed until the Court determines that-Mr. Wood, you have
been in touch with the situation-determines whether the Act
is constitutional or not. That is the main issue, is it not?
MR. WOOD: Yes, sir.
MR. WARFID: It makes no difference whether you or
anybody else agrees with the facts of the Act, the question of the
constitutionality, as far as you are concerned-
MR. WOOD: The Supreme Court of Florida has the last guess.
MR. WARFm D: Yes. So that any difference of opinion as
to what the Act says, that does not disturb you at all.
MR. WOOD: It is up to the Court.
MR. WARFELD: It is up to the Court. So much for that.
So, it seems to me it comes down to the price that the bankers
are to pay for these bonds or have agreed to pay for these bonds.
Now, Governor Martin, will you kindly briefly clarify the
conditions surrounding the sale of these bonds.
GOVERNOR MARTIN: First, Mr. Warfield, I want to explain
about a railroad's right to a right of way over the State lands.
We have a law which says that any railroad company can get
200 feet of the State lands anywhere for railroad purposes, and
all they have to do is to file a plat where they propose to build
a railroad and how they propose to build it, with the Secretary
of the State and they get title to that 200 feet. The railroads
have been continuing to do that for a number of years, if I am not
mistaken, for some thirty-odd years that that law has been in
force in Florida. Under the administration of Governor Hardee
the East Coast Railroad filed a claim to 2oo feet or thereabouts
of land running along and adjacent to Lake Okeechobee, and
went down the East Coast Canal into Miami. They have also
taken at a great many other places, and so has the Atlantic
Coast Line-200 feet of State land for the purpose of building
About six months after I became Governor, which is two
and a half years ago, the people of Stuart, Florida, which is on
the east coast, were very desirous to have the Seaboard Railway,
which crosses Martin County at a place called Indiantown, build
into Stuart so that they might have two lines of railroad coming
into this particular locality. They petitioned the Board-and
everybody else-to try and inveigle Mr. Warfield and the Sea-
board Air Line to build into Stuart. About six months later or
two years ago, the Seaboard Air Line appeared before the Board,
and asked the Board permission to go down one bank of the
St. Lucie Canal into Stuart. They were given an easement-
they were not given a title-they were given an easement to
use one bank into Stuart. I am sure, I am satisfied, they could
have taken it any way under the State law which was in force,
but they were given some four or five years to complete that
railroad into Stuart and if it was not built up into Stuart, then
their easement would be null and void.
The Seaboard also wanted to build out into the Glades and
on the banks of several of the canals. This easement was given
to them for the purpose of building out into the Glades so that
when the Everglades would be drained they might encourage
people in the development of this great area.
You gentlemen know that the greatest trouble in developing
a community is the lack of railroads and the lack of dirt roads.
These people had believed it was the wisest thing to let them
build upon one bank of the canal and save the other bank of
the canal with the soil taken from the center of the canal for the
building of hard roads, and that the building of a railroad on one
bank and the hard road on the other would be of tremendous
value to this locality. So that the opportunity given to the
Seaboard, as with the other railroads, is the right to use one bank
of the canal for that purpose. That was practically two years
before anything ever came up about any bonds. I am mentioning
that in order to let you see that there was no occasion or that
there was no connection between Mr. Warfield's activity in
helping us market those bonds and the granting of the right of
way on the banks of some of those canals to his railroad.
Now, with respect to the Legislature. If any succeeding
Legislature desires to appropriate that money from any other
source to pay the interest on these bonds, I doubt seriously if
it could be stopped. It is a well-known fact that one Legislature
cannot be bound by another Legislature except in so far as a
contract is concerned. The Legislature a long time ago might
have levied a general tax on property to drain the Everglades if
they saw fit. In fact, the 1925 Legislature had before it a bill tax-
ing the whole State a quarter of a mill for the purpose of carry-
ing on the Everglades. The House passed it in 1925, and the
Senate killed it. So the Legislature can pass an Act at any
time that they want. I doubt seriously if one Legislature can
hinder the free use of thought and intelligence and mind of
subsequent Legislatures unless they be bound by some contract
they were violating.
Now, as to the price of the bonds. In the first work that was
done in the Everglades, Broward only had money from two
sources, from selling land and from five cents an acre drainage
tax. Well, everybody knows he could not dig a canal for any such
money as that. So it came on down to Catts' administration.
The first issue of bonds was sold and advertised everywhere.
Nobody was interested, nobody wanted Everglades bonds.
You could not get anybody to buy or make a bid on them.
They had a terrible time. Finally a man by the name of Rorick
bought three and one-half millions of dollars-three millions
of .dollars of Everglades bonds from the Board. He made a
contract to buy them and the Board issued 6 per cent bonds
and discounted them so that Rorick would get 64 per cent
on his money. Rorick went down to Miami and discussed with
the bankers down there, so he told me, and the bankers told
him he was crazy, that they would not touch them with a
io-foot pole and did not want them. Well, he bought three
and a half-million dollars and he took them. Then Rorick
bought the next issue in Catts' administration. Then came along
Hardee's administration and Rorick bought some bonds, but
before he would buy any more he made the Board enter into
an agreement with him that they would not sell any more
bonds unless they got his consent, because he said he had such
a hard time in selling them and he did not want the market
glutted, and if they were going to issue any more bonds without
notice he would not buy any more. Hardee advertised again
for buyers and nobody came. Finally some fellow did show up
and withdrew his bid after it was accepted. They sold them to
Rorick again. For the past two years the Board has tried, each
individual member, and your speaker has talked to bankers all
over Florida, and bond houses in an effort to get them interested
in Everglades bonds. We had about two million dollars of these
bonds lying in the National Park Bank in New York that were
authorized issued in 1925, that Rorick said he would try to
take, which laid there for two years and nobody would buy
them, and we couldn't get any money. Since 1917, ten years,
the Board has never been able to sell bonds to but one house,
that is, Spitzer, Rorick and Company. So when this conference
took place with the bond buyers in New York, after the area had
been bonded for $12,5oo,ooo and when I went in as Governor
it was valued at $15,ooo,ooo, and I got after the tax assessors
to put a correct valuation on the land. So it was raised to thirty-
odd million dollars. In conference with these people I had to
give them some other kind of surety besides the same thing
that Rorick had been handling for eight or ten years, because
they had sold about eleven and some odd millions of dollars and
they retired some of them. Nobody would handle them, nobody
would discuss them, nobody would talk aboat them. So when
the present bankers offered the best price we ever got for bonds
except possibly one issue, which was at the same price, believing
and being satisfied it was the best price ever paid for drainage
bonds in any market, we were glad to trade with them.
MR. WARIuLD: Gentlemen, that answers some of the
questions. Who in the room has a comparison of the price paid
for the proposed ten million dollars with the price paid before?
MR. ELuoTr: I have that here. Would you like to have
MR. WARFmM: Yes, please.
GOVERNOR MARTIN: May I say, while he is talking, gentle-
men, take into consideration, too, that the board did not have
any money in 1925, and the only money we could go ahead with
rather than abandoning it was the money derived from the
drainage tax and borrowing money, and we owe today Mr.
Furst, of Baltimore, Maryland, $14oo,ooo for work done in the
Everglades that he has taken the boafd's notes for rather than
abandon the work. That obligation had to be met, we could
not depend on the drainage tax, we could not get anybody else
to bid on them, and that is why we accepted the proposition,
because it was the best offer we ever had.
MR. ELuOTr: Briefly, the information as to Everglades
drainage bonds issued is as follows:
Authorized by Acts of the Legislature, 1915, $3,500,000.
Sold by resolution of the Board of Commissioners of Everglades
Drainage District, January 3, 1917; they were 6 per cent bonds
having an added maturity of twelve and one-half years; sold on
the basis of 60 per cent; average price, 94.8 on the dollar.
MR. WARFIELD: What was the price?
MR. ELuoTr: Sold on a 60 per cent basis, average price,
94.8; average maturity, twelve and one-half years; those bonds
were callable at 102; the amount outstanding June I, 1927,
none. They have all been retired, partly through maturing and
partly through proceeds of refunded bonds.
The Act of 1919, $2,500,ooo Everglades District Drainage
Bonds; interest rate, 6 per cent; average maturity, thirteen and
two-third years; sold on a 6.53 per cent basis; average price 95;
callable at 1o2; amount outstanding June I, 1927, $2,3Io,ooo.
Act of 1921, $1,750,000; sold by resolution of the board
November 6, 1921; 6 per cent rate of interest; average maturity,
sixteen years; sales basis, 63 per cent; average price, 95.
GOVERNOR MARTIN: Six and a half basis?
MR. ELLOTrr: Six and a half basis. Amount outstanding
June I, 1927, $1,750,000. None of those have been retired.
Authorized by Act of Legislature, 1923, $3,500,000; issued
by resolution of the board July 24, 1923, $2,2oo,000; 52 per
cent; average maturity, eighteen and one-half years; average
sales basis-sales basis, 5.95 per cent; average price 94.99. The
second part of the $3,500,000 issued, $1,300,000ooo; interest rate, 5 per
cent; average maturity, seventeen and three-quarter years; sales
basis, 5$ per cent; average price, 93.04. I might say that those
5 per cent bonds are there by reason of an exchange made during
Governor Martin's administration for 5Y per cent bonds that
were authorized during the previous administration. They had
not gone so far as to get to the point where they could not make
the exchange and the 5Y per cent bonds were called in, and
after they were exchanged an equal amount of 5 per cent bonds
on the same basis, 50 per cent; from 5.95 down to 50. Amount
outstanding June I, 1927, $2,663,ooo.
Refunding bonds, Act of 1925. Amount to be issued, not
limited but use limited to refunding other bonds outstanding
only. 1925, what is called Series A, $2,500,ooo; 5 per cent;
average maturity, nineteen and one-half years; sales rate basis,
50 per cent, and on the dollar based upon the maturities as
stated. 1925, Series B, $2,500oo,ooo; 5 per cent bonds; average
maturity, twenty and one-half years; same sales rate. 1925,
Series B, $3,95o,ooo; 5 per cent; twenty and one-half years;
same sales rate basis, the amount on the dollar depending on
the maturity as stated. Refunding bonds outstanding June I,
1927, $3,532,000. Total outstanding 6 per cent bonds, $4,060,000;
5Y2 per cent $1,663,ooo; 5 per cent bonds $4,832,000; total,
MR. WARFIELD: What I want to do is to bring out the
comparison of the sales of bonds heretofore and those now sold.
That is, the basis. How does it compare with other sales?
MR. ELLIOTT: You will note from the very beginning the
basis of sales has steadily improved. It has been gradual, but
it has improved. That indicates the credit of the district, to my
mind, is better than it was in the beginning.
MR. WARwFLD: What is the basis of the sales rate?
MR. EIuOTr: Five and five-eighths basis.
MR. WARFmED: How many bonds have you sold better
than that basis?
MR. ELuOIr: We have never sold better than that basis.
MR. WARFmLD: Do I understand this is the best basis you
have ever sold bonds?
MR. ELLOTrr: That is as good as the best. There was a
small amount of bonds sold on an equal basis as this, but that
was due to the change made in the administration, in substituting
50 bonds for 6 per cent bonds, but it had not gotten beyond the
reach of the board to exchange those.
GOVERNOR MARTIN: Had we not gotten where we could
not sell any more bonds on any basis?
MR. EuoTrr: We certainly had. You know you borrowed
$x,5oo,ooo to keep the work going.
GOVERNOR MARTIn: I know. Let me ask you this: Hasn't
the only bond house that ever wanted to buy any of these bonds
insisted on their extension?
MR. ELuTr: They did.
GOVERNOR MARTIN: Or they would not touch them any
more on any basis?
MR. ELuorr: They did.
MR. WARFIELD: I think, gentlemen, that brings out pretty
fully the conditions surrounding the sales of Everglades bonds
and the different maturities with the result that the basis now
proposed seems to be a fair one. I think it is up to the bankers
who are today represented here-Mr. Phillips, of Dillon, Read
& Company, is here now, and all of the bankers in this trans-
action-if there is anybody here who feels there should be
further discussion on the question of the sale of these bonds, it
seems to me it would be well to ask questions.
THE CHAIRMAN: Gentlemen, we have the Drainage District
and I think we have in the background, those of you who are
here, who represent a great proportion of the Everglades Dis-
trict. Gentlemen, after all, the difficulty is lack of understanding,
and if we will state here today what is in our minds and ask
questions that we are entitled to know, that are ambiguous at
this particular time, we can make progress. We have brought
out, up to the present time, certain information. The Chair is
going to suggeq that if anybody here has any question to ask
or desires any information on the subject that has been discussed
we will be very glad to have that matter brought out.
GOVERNOR MARTIN: Mr. Chairman, let me say the Internal
Improvement Board consists of five men. The Governor is not
the whole thing himself. It is the unanimous consent of the
whole board that has prevailed in the present situation.
MR. BRYANT: I would like to bring out one phase that has
not been brought out. The bankers here seem to be accused of
having mixed in the bill all sorts of things. Last October we
had a conference which we called Governor's Conference.
Prior to that conference there were meetings of small land-
owners all over the State. There were also meetings of the
State drainage districts which represent the large landowner and
the small landowner. They came together at that conference
and they were unanimous in wanting two things, first, an inde-
pendent engineering report by engineers of national repute;
secondly, a financial plan. That was got together and had the
approval of reputable bond houses. So they did not waste
their time in getting up something that would not meet with the
approval of the bond buyers. Those two things were done.
Incidentally at that meeting there were more landowners present,
more acreage represented than was ever present at one time in
the history of the State. The agreement was unanimous. The
Legislature met and the plan was approved by the Legislature.
As I say the whole thing was with the unanimous approval of
the landowner that the bond buyers should be consulted and a
proper plan drawn up.
MR. DANN: As I seem to be the only objector here, 1
would like to make this final statement explaining the reason
why I am going to vote against Frank Shutts' resolution. Ap
I understand it, the purpose of this conference is to explain
if possible, and remove possible objections that some Floridians
may have to the law as enacted by the recent session of the
Legislature and the sale of bonds as has been contracted for. The
statement was made this morning and has been made a number
of times before that because of the criticism of this sale, because
of the attacks on it by sundry individuals, that it might be that
the sale would not go through at all, and therefore the entire
reclamation project would be wrecked. If the financial scheme,
one that is under discussion now cannot stand up under a few
innocent questions asked by the senior Senator from Florida,
the statement rather that the bonds did not bring as much as
he thought they should, and if it cannot stand up under a few
questions from me, I ask, would Dillon, Read & Co. and Eldredge
& Company bid as much at public sale as they would at private
sale, and if not, why not; was it because they had evolved this
scheme themselves that they would not let anybody else into
the bidding? They are perfectly legitimate questions. They have
never been answered, and I say to you that any financial plan
involving public funds that cannot stand up under a few ques-
tions like that is not good enough for the people of Florida, and
I say further that any financial plan involving the expenditure
of public funds that won't stand up under the full spotlight of
publicity is not good enough for the people of Florida. Let us
turn the spotlight of publicity on this transaction. Mr. Warfield
has made the only intelligent explanation of the reason of this
sale that I have heard from the very beginning. He stated that
the bonds were sold to Dillon, Read & Company and Eldredge &
Company because these were two houses who could distribute
the bonds and keep them from being held in a lump and thereby
break down the prices of future bond issues. That is a perfectly
good reason. Most any intelligent man would admit it is a
sensible reason. But has anybody ever heard it before? There
has been nothing but silence and mystery connected with this
entire transaction. That is the reason the people of Florida have
been asking questions. They have been told nothing. They
have not been told about the prices that these bonds were sold
for, how much they were discounted. That may not mean a
great deal to you financiers who figure your purchases on yield,
but it means a lot to the people down in the country. We have
learned that a 5 per cent bond sells at o04, and that is all we
know about it, and we do not know what the yield is. But we
have never yet been told whether Dillon, Read & Company
and Eldredge & Company are supposed to pay eighty or ninety
or one hundred for these bonds. I know how much they will
pay for them.
MR. SUrrrs: How do you know?
__ __ I_
MR. DANN: Because I have seen the agreement.
MR. Smrrrs: Well, if you had sat down with a paper and
pencil, you could have calculated it yourself.
MR. DANN: Some of us may think these bonds should bring
more. It may be foolish for me to get up and say I have a man
who will buy them today for ninety-eight, I know you can always
get somebody to come up and say after the deal is made he
could get someone who would pay more, but why wasn't anybody
else given an opportunity to bid on these bonds issued under
GOVERNOR MARTI: I can answer that for you, because
frankly Dillon, Read & Company came very near backing out,
and Eldredge & Company were getting cold feet. We did not
want them to back out, because if they did back out we knew we
could not sell them to anybody else, and have them successfully
distributed. That is the reason. Now, about the price: That it
has not been given in dollars and cents is because these maturities
over a period of years will differ on each lot. You all know that.
A twenty-year bond will bring a little more than a twenty-one
year bond or a twenty-five year bond or a thirty-year bond.
You know that. And if you say to the public we are going to
sell so many for twenty years, twenty-one, twenty-two or twenty-
three way down to forty there will still be a maze of figures. It
would not be possible to make the whole ten million at one
time, and say the whole ten million brought so much, it was the
understanding of these gentlemen that we wanted to vary some
of these maturities if we could and if we said that we sold
five hundred thousand dollars of bonds to mature at twenty-five
years, and then we did not use but four hundred thousand dollars
worth, they would say, well, you said one thing and you did
another, and if we decided to make six hundred thousand due
in thirty years and seven hundred and fifty thousand due in
thirty-five, they would say, you said they would bring so much
and they did not bring but so much. And there is an agreement
with them that they might change some of th9se maturities and
when the maturities were absolutely final and irrevocably settled
on, why, then, we could give this to the public. If you string
out serial bonds over years, from twenty to forty years, they will
vary in price.
Now, in reference to the matter of obscurity, why, I spoke
_ ____ _i_ I __ L_
at Palm Beach and Miami and Okeechobee and Lauderdale
begging those people to get together with me and you gentlemen
to devise some concrete plan that we could submit to the Legisla-
ture. None ever came forth. You all remember that I spoke in
all those communities to thousands of people and then when
I came back from New York I stated in the press, it was posted
in the lead lines of every paper in Florida, that I had a proposi-
tion from the financiers in New York, and I submitted it to the
Legislature. That was all in the press. The bill took five or six
days or about a week before they finally passed it. When they
were sold, in less than ten hours the price was given to the public
through the Associated Press, and that is the only way you have
got to get it to the public. People wrote in there and it was
answered, sold 5 per cent bonds on a five and five-eighths basis.
It was published in the papers. Where there was any secrecy to
it, I don't know. It was given to the Associated Press and the
International News and the papers published it. That is all I
know about it.
MR. DANN: I want to get a frank statement concerning
this. For what were these bonds discounted under the agreement
with Dillon, Read & Company and Eldredge & Company,
signed May Inth?
GOVERNOR MARTIN: Whatever they figure out on a five
and five-eighths basis, anywhere from 93 to 91, depending on the
maturities which have not been definitely settled yet. If you
get a bond table you can get the figures on that.
MR. DANN: Mr. Chairman, I am not an obstructionist. I
am practically, more or less, a constructionist, and the only
objection that I have to this bill is to the bill itself and not to
the sale of the bonds, so much. I do not question at all but that
the price is as good a price as we could hope to obtain, although
that is still in my judgment, a matter to be proven. But I do
not think that the people of the State want to be involved in a
matter that will call for the expenditure of so indeterminate an
amount. We do not know, under the terms of this bill how much
the legislature may be called upon to appropriate for this work.
A great many of us are very.ignorant on matters pertaining to
conditions in Florida. I think that the entire people of Florida
would be very glad indeed to have a definite notice of just what
this is going to call for. I think that is a matter that should have
been discussed before the actual sale of those bonds.
GOVERNOR MARTIN: What would you do, Mr. Dann, with
the money that was received from the sale of those bonds?
MR. DANN: That would come back into the treasury.
GOVERNOR MARTI: Well, now, gentlemen, in that regard,
let me say this. This has been my experience, that you could not
get the Legislature of the State of Florida to put a million
dollars out on this thing. We have tried them out on that proposi-
tion and they wouldn't do it. I have sounded them out and I
know of nobody who is in favor of that.
MR. DANN: Well, I am afraid that I do not know any more
about that than you do, sir, but I have simply expressed the
consensus of opinion which I have gathered from going around
in the last four weeks, ever since I have gotten into this discus-
sion. Most people with whom I have spoken feel that it is a
moral responsibility of the State, this work of draining the
Everglades. It is the general consensus of opinion-among people
generally-that it is definitely the duty of the National Govern-
ment to take care of such a matter as the flood control and that
that duty should not fall upon the shoulders of those who may
own the land in the Everglades. That is, that it is a Government
responsibility and the responsibility is one that is definite as to
the matter of flood control. It is also up to the State to protect
the people. I do not think that it is up to the State to protect a
man against any rain that may fall in his own backyard, but I do
think that the State should pay its own expenses though no
more. But the point is that we do not know just what all this
is going to cost and that is why I am voicing my objection. I
may be wrong. I am apparently very wrong, but I am certainly
sincere in my own opinion. I think it is an attack upon the
Constitution that would open up the way to further legislation
to come later that would in all probability prove very disastrous
to the State of Florida.
THE CHAIRMAN: I think we ought to extend an opportunity
to be heard to some of these bond houses and get an expression
of opinion as to just how they feel. We want to know just how
some of the bankers feel about this. Now, I am going to call
upon a banker of Florida. I am going to ask Mr. Kyle if he
will not say something for us about this matter. He is very
well versed in it and I think we would all be very glad to hear
from you, Mr. Kyle.
MR. Knz: Thank you, sir. Mr. Chairman, I feel this way.
I think that Mr. Dann is sincere in everything that he has said.
I did not for one come up here with my mind made up on this
proposition one way or the other. On the contrary, I have come
here with an entirely open mind, and after hearing this discussion
as to the different bond sales and the prices that have been
obtained for them, I want to say, gentlemen, that I have gone
through a great deal as to this within the last six months. What
we want to do, as has been said at the very outset by Mr.Warfield
and the Governor and several other speakers-and I think the
most important thing that we can do is to get reputable bond
houses to handle your securities and thus bring credit upon your
State and your District. There is no doubt about that, for 'I
can tell you that our city, in the last year and a half, has suffered
more by having people handle its bonds that should not have
handled them than anything else. Then, when you create securi-
ties, you have to exercise the proper care in order to finance
them. Otherwise, it is like what has been done when a million
dollars worth of bonds have been bought and unloaded and thus
ruin the market. I can state to you very clearly that five and
five-eighths is a proper price. If I were representing this district,
or representing my city, I would say that I would not today pay
a cent more than that. I do not feel, gentlemen, that there is a
bond house in the United States that would offer more than that
price for the bonds under consideration. In the first place, you
have a district that is undeveloped, this is one point that all
of the gentlemen are agreed upon. The State of Florida has an
obligation to its citizens as well as has every other State to its
particular citizens all over the United States, and in order to
perform those duties it must resort to a sufficient amount of
taxation regardless of what it costs, and that was my reason
in asking that the State take proper care of its obligations. I
have interviewed the various leaders on the subject. I have
spoken to the Governor and to Mr. Elliott. Mr. Elliott is the
drainage engineer. We are all agreed that the State of Florida
is obligated to take care of the interests of its citizens in every
way, and regardless of what the terms of this bill may be in that
connection. I have been connected with this drainage affair for
the last twelve years, and I have made a close study of it. I
have studied it fairly and squarely. This is a serious affair for the
State of Florida. We must work for a solution of the problem.
What are we going to do? Do you suppose that we should stop
this drainage endeavor? If so, what is to happen then. Is there
to be called a special session of the Legislature? That will call
for another fight of another month or two. I will be frank
with you to say that I was not strong for this bill when it was
introduced because I felt it was a more drastic bill than we have had
heretofore. I can realize the difficulty, for we cannot sell a bond
under all circumstances. All of our counties and all of our
cities have voted to do just what has been done here, endeavored
to take care of the situation by having an ad valorem tax. In
fairness to the bond houses, to the Governor and to everyone,
I must say that the best endeavor and thought has been expended
in trying to find a solution of the difficulty. I have tried to do
what I could personally. What we want to get is the proper
handlers of these securities.
TEE CHAIRMAN: Mr. Elliott, does that cover your specific
MR. ELLIrr: I have no other question.
THE CHAIRMAN: Is there any other question on that par-
GOVERNOR MARTIN: Mr. Chairman, the State only pays
its drainage tax on the land in the area that will be benefited by
it, just like any individual does. In other words, we have
4,3oo,ooo acres of land, and the State owns about 84o,ooo acres.
Now, it would be unfair to make the owners of the land pay if
the State does not, owning the State's drained land, so the law
requires the State to pay their drainage tax on their land just
like the other people who own their individual land, andso all
the State is obligated to do is to pay their drainage tax on their
own land, which will be enhanced by the draining of it.
MR. HLfs: Mr. Chairman, there are two points that occur
to me that might be of interest to this gathering. I am not a
banker, but it has been my experience and almost my misfortune
to be involved in many millions of dollars in drainage bonds in
Florida, in the southeast. One of the things that should be con-
sidered, and has not been brought out here-we have all been
told of the difficulties in which the Everglades district found
itself at the time it entered into this new program of financing.
It was surrounded with difficulties of every nature. Its credit
was destroyed. Its assessed valuations were low. Objection of
every kind had been raised. It had recently come into the situa-
tion where if a financing program was to be worked out at all it
would be necessary for actual detailed consultation to be had
with investment banking houses or houses that were going to
lend money. When Mr. Warfield finances his railroad I take it
that he does not set up a bond issue on prescribed conditions and
then invite bids from investment banking houses all over the
country. When the Florida East Coast Railroad or the Atlantic
Coast Line Railroad, oranyother corporation gets ready to finance,
it does not do that. On the other hand, it selects its competent
banker and it goes to him and says to him: Here is what we
have, here is what we have got to do, how can we work it out in
fairness to both sides? Of course, they test out with others the
fairness of the price.
The sale of drainage district bonds, particularly the drainage
district which finds itself in the condition that the Everglades
District is in, is very different from the sale of ordinary municipal
bonds. When a banking house buys municipal bonds, it buys a
bond usually on io per cent of the assessed valuation and secured
by the real and personal property in the entire community. The
security is large. The margin of security is very great, and there
is a fair basis for competitive bidding set up, but when you have
a project on which it is proposed to issue securities practically
up to a unit of Ioo per cent of its assessed valuation, then cer-
tainly you must sit in with some investment banking house and
work out a deal with them.
Now, an investment banking house is in business, not for
its health, but for a profit. The making of an investigation in-
volved in a project of this kind in all fairness to them is no small
matter. I have not been definitely advised, no reason to do any-
thing, but I venture to say that the investment banking houses
that have committed themselves to the purchase of these bonds
have incurred expenses of many thousands of dollars. It would
not surprise me at all if they were out of pocket today twenty or
forty thousand dollars for investigations and studies and re-
searches that they have had to make. How in the world can we
expect any investment banking house to put up that amount of
cash and then agree to have competitive bids received from other
houses, and then perhaps lose the sale and perhaps the invest-
ment they have made in these investigations?
Now then, there is one other thing. I have heard here this
morning so many things said about what the State has done
for the State's interests in this thing. If you gentlemen will stop
and think, you will see that the State has not done much. The
Everglades were originally turned over to the State of Florida
and a Board of Trustees was organized or created by the Legisla-
ture to hold those lands in trust for the citizens of Florida. The
Board of Trustees have passed the ownership of the great
portion of this land into the hands of other individuals.
So the trustees of the Internal Improvement Fund were
trustees in fact for you, and for me, and stand as an owner of ap-
proximately 25 per cent of the Everglades land, the other 75 per
cent being in the hands of individuals and corporations.
Now, we spoke about the State spending $i5,ooo,ooo to
drain the Everglades. The State hasn't done anything of the
kind. The taxpayers down in the Everglades drainage district
have spent that $15,000ooo,ooo, three-quarters of it has come out
of the pockets of individual owners. I mention that, since a
misapprehension seems to have arisen because so few of us
understand that. Here is a contractor over in the next county
who has spent quite a large sum of money and he says, "Why
is it not time that the State comes over here and spends some
of that money draining my land?" Now, if we can correct that
misunderstanding, I think something very definite could be
gained by it. I call these two things to your attention.
MR. WARFBL: Gentlemen, I think you all agree with me
that the points Mr. Dann have made are very salutory. They
bring out the more or less opposing argument. He represents a
certain element in Florida and ably represents it. He has a right
to his opinion just the same as we have, and I do not know any
better way to get this whole subject understood, not only by
the people in this room, but by others who know of the proceed-
ings here today, than to air all sides of the questions at issue.
So I want Mr. Dann to feel that whatever I may say is in the
proper spirit of recognizing the fact that he is just as much
entitled to his opinion as I am to mine.
Perhaps I may have had more experience in the handling of
securities than Mr. Dann, but Mr. Dann has been successful in
his business and represents much in Florida. These questions
that are being discussed, are for the good of the whole proposition
and that is the reason I was anxious to see Mr. Dann come here
so that he would give us the benefit of his thought.
With the bankers in the room who agreed to purchase
$zo,ooo,ooo bonds it seems to me we ought to hear a word or
two from them. They can give the reasons for their position in
this matter and, Mr. Chairman, it would be well if Mr. Wagner,
of Eldredge & Company, who were first seen by Governor
Martin in respect to financing the Everglades, would say a few
words, if he will do so.
THE CHAIMAN: The Chair thoroughly agrees with Mr.
Warfield and would be glad to hear from Mr. Wagner.
MR. WARFJr: I think it ought to be said at this time
that only ten million dollars of bonds have been sold.
MR. WAGNER: Mr. Chairman, at the very. outset, I want
to state we have no excuses to offer and no apologies planned.
We were invited into this situation by Governor Martin. We
have known for a great many years of the Everglades. I remem-
ber as a boy I always thought of the Everglades, every time the
Everglades was mentioned, I could see nothing but snakes,
alligators and water.
MR. WARFInLD: Let me say, without interrupting, that Mr.
Wagner is a North Carolina "cracker."
Mx. WAGNER: Notwithstanding the fact I was born in
North Carolina, very close to Florida, I ought to know more
about Florida, but I did go down to look at the Everglades.
But I would say that, at that moment, the Florida Everglades
had nothing to sell. Now, if the Drainage District Board had
been in position to offer bonds for sale in the same manner as the
City of Jacksonville, the City of Baltimore, or any other city
offers bonds for sale, on a financial statement, everything thrown
on the table, with legal opinions, and the bonds laid on the table
on the day of the sale, they would have then been in a far
different position. They were not in that position and they are
not today. It is true that we have made a contract, and we
think we have worked out a very constructive piece of legislation.
We may be wrong. We did that at the solicitation of the State
officials and we feel proud of it, and as I said at the outset we
have nothing to hide and no excuses to make. The whole thing,
however, will depend upon what the Supreme Court says. All
of this work of ours may have gone for naught, we do not know,
the Supreme Court has, as Mr. Wood said this morning, the
last guess. If the Supreme Court upholds the constitutionality
of this law we have bought some bonds, if it upholds the law
in all its phases. If it does not, we have not bought any bonds.
If the Court does uphold this law and these bonds are sold and
distributed, as we hope to distribute them, together with Dillon,
Read & Company, I say frankly, it will not be easy, in view
of the difficulties we have had, but if we do dispose of them we
expect to create-at least we hope to create-a good market for
this class of bond. When we do that, the Drainage Board is then
in a position to say, "Gentlemen, here is what we have, five
million or three million dollars more bonds, on a certain date
we are going to sell those bonds. You can make your bid and
we want a check." As Mr. Warfield has mentioned to you several
times today, this proposition has not to this date been in the
position so that the Governor and his Board can say to Tom,
Dick and Harry, "I want you to make a bid on some bonds."
They have not got any bonds, and they are not going to have
them until the Supreme Court says exactly what they have.
We feel that this Act was a piece of constructive legislation and
we further feel that it was one of the greatest pieces of construc-
tive legislation that we have had anything to do with. There
has been a misunderstanding occasioned by the fact that every-
body has not understood what the bankers were trying to do.
It might be interesting to the gentlemen present to know that we
have handled over forty-five million dollars worth of Florida bonds
in the last twelve months. By virtue of which fact, we believe
in Florida, and can help Florida, we believe in the Everglades.
Otherwise, we would never have gone into it; I mention that in
passing to let those present know that we are not entirely new
in Florida. There has been some talk about these bonds being
a State obligation. I think we, the bankers, can nail that on the
head first by saying that not only do we know they are not a State
obligation but our attorneys have advised us that they would
not under any circumstances render us an opinion stating that
these bonds were either directly, or indirectly, distinctly State
obligations. Now, as to the attorneys' opinions that we expect
to have to sell these bonds, we had the knowledge before that
they are not direct obligations and are not indirect distinct
obligations of the State. I think it would be perfectly fair to say
that we would be foolish to attempt to sell our customers any-
thing representing them to be State obligations. These bonds
are the obligation of the Everglades District, authorized by the
1927 law, which also imposes certain tax obligations, and we
expect to pay for the bonds providing the Supreme Court
upholds the constitutionality of that law and in its decision
upholds its provisions as constructive, so that our attorneys
can go ahead and advise us.
The question of maturity has been discussed. You can
imagine the first thing we tried to decide when we went into this
situation was how are these bonds to be paid off. If we had not
concluded that they would be paid off and paid off easily without
working a hardship, we would have dropped the situation right
off. We have made exhaustive examination and found that the
equity tax, which the Governor terms the drainage tax, is at the
present time more than sufficient to take care of the outstanding
bonds and pay the interest on these bonds, provided we do not
expect to have these bonds mature at an early date. In other
words, if we had these bonds mature in one to ten years, or one
to twenty years, the annual requirements for principal and
interest would have been so great that it would have been
confiscatory. All right. What could we do? It certainly was not
our purpose to work out a bond issue, just for the joy of having
something to do, and making a confiscatory tax, which we know
the people in that district could not stand. We therefore took
the maturity of the outstanding bonds and tried to arrive at a
figure as well as we could to determine when those bonds could
be practically paid off, and we found that the last of those
bonds-if I am not correct on this, please correct me-I think
the last maturity is 1953?
MR. EuorrT: 1954 is the last one.
Mn. WAGNR: That the outstanding bonds would be paid
off in 1954. It was not our purpose to wait until 1954 to start
our first maturities. We said, let us try to strike a fair average
and make these bonds begin to mature when practically all the
outstanding bonds have been paid off, and thereby lighten the
load on the taxpayer. In other words, the taxpayer has no
maturity to pay for twenty years, all he has to pay is the interest.
From then on, of course, the question of definitely fixing the
maturity is adjustable, so much due one year, so much due
another year, but in any event we endeavored to put off the
load of paying these bonds until after the present bonds are
We thought we had that worked out finely, and when it
comes to the price of the bond, we never understood why there
was any question of the price. I was at Tallahassee on May i ith,
in connection with Governor Martin, and I believe on the
morning of the 12th, the State Treasurer came out in the news-
paper and stated the transaction in its entirety and stated the
price of the bond. I may be wrong, but I was under that impres-
sion, and it was copied in the New York papers. Now, if 1
borrow a thousand dollars from you and promise to pay you
back tomorrow at a certain rate of interest, I am going to pay
more money than if I had borrowed it for a year at the same rate
of interest. In other words, if I could postpone the payment of
it back, I could get it at the same rate of interest but the dollar's
price will be less. So that, instead of making these bonds mature
in one, two, three or four years, we tried to put it off as long as
we could for the benefit of the taxpayer, so that none of these
bonds would mature until after those present bonds have been
retired. I did rot come here prepared to talk on this subject,
but at Mr. Warfield's request, I thought I would tell at least
what the bankers have in mind, and I think I can answer any
question that anyone in the room wants to ask in regard to this
phase of the matter.
THE CHAhRMAN Mr. Dann, you may have a question you
would like to ask him?
MR. DANN: No, I would like to say this: That I do not
propose to take any Court action or encourage any Court action
or make any public utterances on this subject from now on. If
the Supreme Court declares the Act unconstitutional I may have
something to say on another angle, but I am all through at
THE CHAIMAN: Is there any other gentleman present who
would like to ask some question of Mr. Wagner? This is the time
to settle any question you may have in mind of the rate of interest
or maturity or any other subject connected with the bonds.
MR. WAGNER: Mr. Chairman, pardon me just a second.
(Referring to booklet.) At 50 per cent interest basis at ten and
one-half year averagematurity, the dollar's price ofa 5 percentbond
would have been just about ninety-five. Now, instead of matur-
ing these bonds from one to twenty years, it was our purpose
subject to the flexibility of determining with the engineers how
the outstanding bonds would mature, they would start to mature
in twenty years.
Tin CHAmmAN: As far as you know, with the average
maturity thirty years, your price would be 90.91?
MR WAGNE: That is right.
Tim CHAmuRAN: There seems to be no other question.
Ma. WARnLD: We have a representative here from Holly-
wood, Congressman Lineberger, is he present?
CONGRSSMAN LINMBEGER: Yes.
MR. WARMIL: Mr. Wagg will introduce a motion, I think
the gentlemen here, Mr. Congressman, might wish to hear from
you in connection with that resolution which suggests Federal
aid to control storm overflow. Mr. Wagg made a talk this
morning directing your attention to the Mississippi and the
river overflow, and what might be possible there, drawing a
parallel between that and our problem and he gave notice of
his intention to introduce a resolution in connection therewith
to lay over until tomorrow morning. If you will give your views
respecting this situation, we would be glad to hear from you,
whether there is any possibility of Federal help in connection
with the Everglades.
CONGRESSaAN LINBmmRGR: Mr. Chairman and gentle-
men, I am a very recent resident of Florida, an engineer by
profession and more recently a member of the House of Repre-
sentatives in Washington, for a period of six years, during which
time I served approximately four years on the Rivers and
Harbors Committee, which, as most if not all of you know is a
committee in Congress which has to do with navigable streams
and questions of navigability, and questions of flood control.
I am not familiar with the date upon which the Federal
Government assumed control of Lake Okeechobee, but it is a
well-known fact that the Federal Government, by its representa-
tives acting through the Chief of Engineers, maintains the water
levels in Lake Okeechobee. The question immediately before
this conference is one that is perhaps not directly connected
with navigation and with flood control, but it is intimately
correlated. The propositions of flood control, drainage and
navigation in the Everglades touch each other at so many
points and in so many ways that it would not be appropriate to
enter into any technical discussion of the matters here.
More recently my interest has been somewhat deepened in
this matter by virtue of the great catastrophe suffered in the
Mississippi Valley. I happened to be at the time and shortly
after the time this flood began in Tallahassee. And while there,
certain gentlemen of the Legislature and the Governor of Florida,
Governor Martin, conceived the very worthy idea of passing a
resolution expressing the sympathy of the State of Florida for
the flood sufferers of the Mississippi Valley, and were kind
enough to request me to go to Chicago and to read that resolu-
tion there. That committee was composed of four members of
the Senate and three members of the House. The resolution
was drafted in appropriate terms and was very favorably re-
ceived there. Mr. Hull, who was a colleague of mine on the
Rivers and Harbors Committee, was Secretary of the Resolutions
Committee, and Senator James Watson of Indiana was the
Chairman. There is no question but that the flood control
situation is a national problem, has assumed a new importance
since the catastrophe in the Mississippi River Valley, and there
is no question but that it will be a very prominent matter for
consideration before the incoming Congress. There is even some
talk of a special session for the consideration of it, and I broached
the matter in the light of what has taken place in Florida in the
previous year. I brought to the attention of my friends there
among the delegates, among whom were former colleagues of
mine in the House of Representatives from Florida, and advised
the Committee of the efforts on the part of the Governor of
Florida and the State of Florida to further solve the drainage
problem down there.
While I have no authority whatever to speak officially, and
I do not presume to do so, it would be very inappropriate and
improper under the circumstances, unofficially and purely as a
matter of personal opinion I believe that there is a very friendly
sympathetic feeling on the part of the members of Congress to
give due consideration and weight to the requirements of Florida
in connection with the flood control problem in Lake Okeechobee,
at the time when the general proposition and the general program
is under consideration. No figures have been given out by the
Chief of Engineers, and no report has been made, and I would
prefer not to discuss things that I have heard unofficially from
certain quarters. However, that problem of the Mississippi
River flood control, is going to be a very large problem and
will have to be spread over a period of years, it is fundamentally
impossible to meet the problem and solve it in less than ten
years. It will require a very large amount of money, running
into hundreds of millions of dollars. I have talked to the vari-
ous members of the Committee on Rivers and Harbors, most
of whom were in Florida last winter as the guests of certain
civic organizations in Southern Florida, many of whom actually
went to Okeechobee and viewed the situation there. I am quite
convinced that if there is a proper co-ordination and sympathetic
attitude on the part of the officials of the State of Florida, I have
no doubt that the correlated problem of drainage, essentially a
State matter, flood control and navigation, fundamentally
national matters, particularly since the Federal Government
now controls the water levels in Lake Okeechobee, and since they
have in the last Congress authorized an appropriation of around
five millions of dollars for the acquisition of the Florida East
Coast Canal, will be considered very seriously.
In passing I may say that a survey has been authorized with
a view to recommending a project to Congress for the navigation
of the Caloosahatchee River, and on the other hand there is
the angle of reclamation from the Federal Government's stand-
point. Doctor Elwood Mead, who is chief of the Bureau of
Reclamation, was in Florida last winter and Florida has been
selected as one of the southern States in which Federal farm
colonies are to be located and a site has actually been determined
upon in the Everglades and near the Florida Power Company's
power house near the Seaboard Air Line and Florida East Coast
Railroad, in the vicinity of Fort Lauderdale. Those authorities
have been in direct connection and contact with Mr. Elliott
here, who has offered them every assistance, and I merely wish
to say that I have never known in my public career a situation
to be more favorable at the present moment than is the situation
affecting the Government's end of the Florida reclamation
project as a whole, and, with the hearty co-operation which we
have already had and with the co-operation which I feel we will
continue to have, I am of the firm opinion that it is not too broad
a statement to say that we may reasonably expect co-operation
on the part of the Federal Government, which, in my opinion,
would probably ultimately reach the total figure of the Ever-
glades bond issue now before this meeting.
In conclusion I would say while not wishing to digress and
discuss any particular phase of the matter before the conference,
that coming from the West where I am a native son, California,
I have long been familiar with the problem of reclamation.
Reclamation with us, of course, means irrigation, developing a
water supply and placing it upon the land. Here your reclama-
tion as I see it is irrigation inverted. You take the water off
of the land and reclaim it, regulate it. You are all quite familiar
with the large amounts of money which have been spent prac-
tically, were initiated in the Roosevelt administration, for arid
land projects in the far West. The people of the South, as re-
ported by their votes in Congress, and I think of the country as
a whole, have been sympathetic to that program, and we of the
West are duly appreciative of it. And I believe that you will
find a very sympathetic and active response on the part of the
members of Congress from the far West. I might say that we
had Chairman Addison Smith of the House Reclamation Com-
mittee in Florida" last year at the time the Rivers and Harbors
Committees were there, and he went over this entire Everglades
proposition, and I know that he feels very sympathetic towards
the reclamation proposition down there. Mr. Dempsey, the
Chairman of the Rivers and Harbors Committee, was also there,
and General Jadwin, the Chief of Engineers, was there and
I certainly hope that this proposition to continue the work
in the Everglades will not fall through. As a kind of half-citizen
of California and of Florida, I feel that your position in Florida
is a very strategic one. I do not want to talk too long, but I
have become quite an enthusiastic Floridian. The peninsula of
Florida extending as it does as a salient out into the Gulf and
Carribean area, because of its geographical position, the fact that
it is on the world's trade routes, has so many miles of sea coast
in proportion to its area, plays a very important part in the
economic development of that great area down there, so full
of profitable products and raw materials. I have been informed,
I have not checked this up, that practically 50 per cent of the
world's developed and potential oil supply lies in the Gulf and
Carribean area. To those of you who have recently had in mind
the development of oil in Venezuela and Colombia, and who
live in New York, I might say that the Everglades lies about
equally distant from Colombia and the Panama Canal and New
York, and I am merely touching some of the high points of the
broader aspects of this situation. I am extremely sympathetic,
Mr. Warfield, with what you are trying to accomplish here, and
if in my humble way I may be of service to this Committee and
the citizens of Florida in promoting this great constructive
program, it is my desire to do so. (Applause.)
TIx CHAIRAN: Thank you very much, Congressman
Lineberger, for your splendid talk.
MR. Smrrrs: May I move the adoption of my resolution.
MR. WARmuF: The gentleman is out of order, Mr. Chair-
man. The resolution was to go over until tomorrow. He asked
that it go over until tomorrow. We have before us now the mat-
ter of Government assistance in reference to the Everglades.
THE CHAlRAN: The Chair rules it is out of order.
MR. WARFPD: As I understand, Mr. Wagg, you would
like your resolution to go over until tomorrow.
SENATOR WAGG: I would not attempt to add anything to the
very comprehensive statement the Congressman has just made
in regard to Government aid, it would be like attempting to
paint the rose or gild the lily. The Committee of seven appointed
by the Governor as director of the joint resolution passed by
the Legislature is a continuing commission and it is the intention
of that commission to be in Washington this fall to appear before
the Committees of the House and Senate relative to having
Florida included in this matter, in the matter of Federal aid
and flood control, our thought being briefly to have flood control
legislation of a general character, so that Florida and any other
flood area of the country may receive the benefits of Federal
aid where it is proper and right that they should receive such
consideration. Therefore, in my judgment, the work of any
group, particularly this very representative group, expressed by
resolution, their wish, and then later by individual work through-
out the State, would be a matter of very considerable importance
to this Commission and these gentlemen who represent the
State, in the matter of Federal assistance in flood control and
general reclamation work in Florida. That was my reason for
offering the resolution.
MR. WARFw D: Would Mr. Wagg permit that resolution
to come up now instead of deferring it?
SENATOR WAGG: Absolutely. I only thought that resolutions
were being deferred for final action until the morning conference,
and I thought this particular resolution was of such importance,
I frankly felt that many of us did not appreciate just what
strategic position we occupied in the matter of Federal aid to
the legislation that I feel is bound to come as the result of the
Mississippi incident. I have no objection to your acting on the
resolution at this time.
MR. WARFELD: Do you mind restating the resolution?
SENATOR WAGG: The Secretary has it. The Congressman
might wish to amend it.
The substance of the resolution, in view of the importance
of it, the effect of the resolution, should be drafted and sent
to the various authorities in Washington, Federal authorities.
It is possible that such a resolution should be given a great deal
of care in its final draft, and it would seem to me wise if Mr.
Lineberger and other gentlemen here particularly interested in
that project would shape it in its final form, and it is my sug-
gestion that we send this resolution to the various committees
having charge of this work in the House and Senate, and also
MR. WARFELD: Gentlemen, I suggest that the final form
of this resolution be drafted by a committee consisting of three
members, Senator Wagg, Congressman Lineberger and Governor
Martin, in its fipal form, in such form as the Congressman would
think suitable tb gain our ends.
GOVERNOR MArrT: Mr. Warfield, I wish you would leave
me off of that, I have a great deal to say on that.
MR. WARFIELD: Well, we will make it a committee of two
then, the Congressman and Mr. Wagg. The general purpose of
what Mr. Wagg wants done here we all know. The resolution
in terms will be stated in the record in such form as Mr. Wagg
and the Congressman will direct.
SENATOR WAGG: That is entirely proper. Mr. Lineberger, will
it be acceptable to you to put the resolution in final form and
CONGRESSMAN LINEERGER: The essence of the resolution is
stated in the authority.
THn CHAIRAN: Gentlemen, the motion has been properly
(The motion was thereupon put and unanimously carried.)
GOVERNOR MARTIN: I move to amend the motion by
putting Mr. Jennings on the Committee. (Mr. Jennings was
Tau CHAIMAN: Gentlemen, up to the present time we
have not gotten into the actual economic value of the Everglades.
It occurs to me this is a subject of immense interest, not only
in Florida, but all over the United States. Even in the drainage
district there is ignorance of the potentiality of the Everglades
soil when reclaimed. During the past several years many suc-
ceases have occurred in that area and many failures. We have
in this room men who have made successes. It would add ma-
terially to the information we are trying to obtain if some of
these gentlemen would give us something official as to the
Everglades soil itself. We have representatives 'of the Brown
Company here, Mr. Brown and Mr. Sherman. We are to adjourn
this meeting at four-thirty. It would be in order to have a
limited discussion of the Everglades proper, its present and future
economic value and the worthwhileness of the proposition. Mr.
Brown, we would be glad to hear from you with such information
as you can give regarding the development of the Everglades
district. Mr. O. B. Brown, of Brown Company. (Applause.)
Ma. BROWN: Gentlemen, I suppose it is advisable for me
to say first just how we fit in with this picture. Coming from
New England and having most of our interests in New England
and northern Canada and having as the basis of our business the
spruce tree in the forests, it seems strange that we should be
down in Florida interested in this Everglades proposition, but
it is not so strange as it may seem because the ramifications of
modern business very often carry one in the directions in which
you least expect.
Now, in the process of making pulp, which is our largest
product, we have a chemical mill which manufactures chlorine
gas and we use this gas in bleaching our pulp, and in making
the gas we make a waste product. We have done that for a
great many years. Originally we bought our bleach powder from
England and it had to be brought over in casks and there was
a great waste to it and it was finally discovered by an electrolytic
process we could manufacture the bleach powder. Some twenty
five years ago we put in these cells and we have ever since then
been using our own water power and getting that bleach liquor
for half what it costs us to bring it from England. Now, in the
first material we found we were wasting and throwing in the
river some caustic soda. We found a way of recovering that, but
that is history. Then we found there was hydrogen gas and this
gas was thrown off from the cells and goes off into the air. I
might say, in passing, a German passed through our mills one
day before the war and he said, "What do you do with the
hydrogen?" We said, "Let it go into the air." He said, "We
use it in our Zeppelins." We said, "We do not have any Zep-
pelins in this country," but now you can sell it. We take hydro-
gen gas and treat an oil like cottonseed oil or peanut oil and
harden them. You bake them slightly harder than they were
before and if you keep on to the point of saturation, you make
them still harder, our chemist worked out a plan by which we
made a wonderful substitute for that, and better, and we put
the process into operation and for a number of years it worked
very well because there was a large amount of this oil brought
over and the price was low, but when the war came on the oil
market was very much disturbed and later on there was a
tariff put on the kind of oil we were using and things conspired
to make it impossible to continue with this business. One of
our representatives, Mr. Sherman, who is here now, spent a
winter in Florida some years ago and while there he heard a
great deal about the Everglades. He heard that there was to be
a drainage program and the land was very rich and susceptible
of being worked on a large scale and he interested himself in that
property and came back with the proposition that we might
raise our product, which was peanuts, in the Everglades and
bring them by cheap freight rates to our mills in New Hampshire
and make the product we had been making before but which
we had to stop on account of conditions in the oil market. It
seemed absurd to us at first, but when we looked into it we
found he was right. We went to Florida, and I might say, in
passing, we had already been to Texas, I had been there myself
and found there was a possibility of getting peanuts in Texas,
but that did not prove commercially practicable. There were
many reasons, and one of them was that it was too far away.
But when we looked into Florida we became quite enthusiastic
over the property, but before acquiring any of the land there we
made experiments. We went to the lower Glades and the upper
Glades and we spent two years on that. We-hired a man and
his farm and he made a large number of experiments. I think
we had some eight crops of peanuts and wefound it was possible
to raise the peanuts. Some agriculturists said they would not
grow, we would not get oil. We shipped the peanuts to the mill
and had our chemists test them for the oil and we did everything
one could do in a research way to assure ourselves it could be
done. We also banked on the ultimate drainage of the Everglades
and we finally acquired these lands, which are situated about
twenty-five or thirty.miles from the coast up the canal, which
is about fifteen miles from Lake Okeechobee. Then we went to
work and built a little village there and cleared it up. I think
we have some thirteen hundred acres there under cultivation
now, and we have been some two years or so at it. As you know,
we had three very bad years of water, we were flooded out,
but the houses, fortunately, were built on stilts and they survived
the flood and also survived the hurricane, they were not blown
But we have finally worked out a very good system of
cultivation of this land. We have found out how to plow it and
how to harrow it and how to plant it, and there was no planting
machine for peanuts on a large scale, they had little things they
ran with a mule and that sort of business would not do for a
large process. I am just telling you this in passing to show you
the problems there may be in the Everglades. We have a machine
today that will plant two hundred and forty miles of peanuts
in nine hours with two men.
Now, I am not saying that in a boastful spirit, but I am
saying it to bring to your minds the possibilities of those Glades.
I have been going to Florida myself off and on three or four
times a year for three or four years and I have gotten very much
interested in the possibilities that are there and I am very
much of an optimist on what can be done along those lines.
Now, another thing is the research that is carried on at the
mill, we have one of the most valuable chemists here today,
Mr. Vannah. He has been down there about a year. He has
under him a pathologist, and two more chemists, and has many
men or assistants, and from time to time he is asked about
what we in our little family there call the mystery of the Ever-
Now, there is mystery in the soil of the Everglades, and I
suppose anybody who has scratched enough and tried to raise
anything knows that he is much mystified when he gets a result
one day and does not get it another, and he is apt to say that
this thing and that thing cannot be done.
Now, in our experience we are finding that it is simply a
matter of finding out what the proofs are that apply, and the
soil is very seldom to blame. It is the management and the
system that you are using, and I will say that within this last
year we have had some favorable weather, and the water level
has been kept under control, which it was not for several years,
and owing to that condition of things Mr. Vannah and his
staff have been able to raise some twenty-six different products
very successfully on a small scale, so that we can prove to
anybody who is interested and who is willing to come there that
any one of these products-several of them I should term staple
products-can be raised successfully in sour grass land as dis-
tinguished from custard apple and elderberry land, and I feel
that in the future there is a possibility for them to go ahead
on a varied set of products and hope to successfully carry the
production of those articles, or those vegetables or plants to a
Now, I want to add that in my opinion the drainage of the
Everglades as it is sketched out by this drainage board and by
this prospectus or plan that is now proposed is absolutely
essential. Until that is done a man has no business to be in
those Glades at all, because he cannot tell from one six months
to another whether whatever he puts in is going to be a total
failure or not. With that drainage it seems to me that the local
drainage areas that are in private ownerships can be readily
taken care of, that the water can either be pumped out from
ditches or can be pumped into ditches and the water level can
be held, and which will be more favorable for the crop which
the man is trying to raise.
A couple of years ago I went over to Holland and made a
tour around to check what had been done there for 400 years
to see what happened in a drainage country owing to my interest
in the Everglades, I found that there was a very great similarity
in the results that they had gotten there and the results that we
were then feeling we should get in Florida, the control of that
water level was the primary thing which was necessary to suc-
cessful agriculture, and I believe that this is absolutely possible
in the Everglades today when this drainage scheme is carried
out, and I cannot understand for a minute how there can be
any opposition from any quarter whatever or from anybody
who is interested in the welfare of Florida, when they have got
several million acres of land that is the most productive land in
the world, that is capable of raising calories sufficient to feed ten
million people if every acre of it was farmed in an intensive way.
I do not for a minute believe that under our system of civilization
we can attain perfection in a scheme of that kind, but if you
only get a small way along the possibilities of the potential
development of that area, you have got so much more equity
in the value of that land than these bonds or any bonds that
you are willing to put out on those Everglades, that there is no
possible comparison in the values. (Applause.)
MR. sum=G: Mr. Chairman, I would like to see at least
two things come out of this meeting. I am glad that this meeting
has resulted in something other than a discussion of what we
have been discussing in Florida.
I live in the hills and work in the Everglades. At least, I
have been for five years. Mr. Elliott knows some of our troubles
and some of our products. I have not been close to my work
for the last four months, and therefore, I have not gotten into this
Everglades discussion. I have been going back and forth from
South to North and North to South, and I came up here with
a free mind.
Now, the first thing I would like to see done, is for the Press
to change the sentiment that has been put out in Florida. I
picked up a paper one day and I saw where Governor Martin
had sold $2o,ooo,ooo worth of bonds, and that he had bargained
away the canal banks. I do not know whether you got that
impression or not, but I know our people got that impression,
that S. Davies Warfield was bargaining for something. We all
know here that that is not true. We all know that a newspaper
very rarely retracts I do not know whether Mr. Shutts' paper
does or not.
Ma. Srrmns: We did not say any such foolish twaddle.
Ma. SKamrG: There ought to be something come out of
this meeting to make the paper making any such statement
retract it. Governor Martin answered it good and strong. Mr.
Warfield is the best friend we have ever had. He did not bargain
for anything and did not have to, but the impression got out
that something happened. We do not want any such thing to
go unanswered and I am glad this has been effectively answered
The next thing that ought to come out of this meeting is
this: Sectionalism will kill Florida. Some of us who have been
down there since 1910, when you could not drive a Ford car
ten miles, know something about sectionalism. I can tell you
a story about a fellow up in another town who told a prospect
not to go to Sebring that it is a one-man town. The next year
another fellow came through on his way to Sebring, and he said,
Don't go down there. He said, Why? Well, he said, it is a one-
man town, but he sold out.
We do not want sectionalism in Florida.
Now, I do not want to see these men go back to Florida
and take up the discussion where they left off last Friday night
Why not have a committee formed and have some resolutions
prepared here that will go back, people have not much to do, and
will take up most anything. Here is Mr. Brown's speech, that
will enthuse anybody. You have enough brains and energy in
this meeting to go out and move the world. Mr. Dann wants to
drain the Everglades. It is just a question of how. There is not
anybody here that does not want to drain the Everglades; and
we are questioning whether there is a State obligation or not.
Let us make it a State obligation as far as we can. We cannot
make it a State obligation by law. We will admit that, Mr.
Dann, but the State of Florida has got to drain the Everglades
or we are going back to sectionalism again. Why can't we have
a committee that will bring out what has been done here and
go back and have something extra big come out of this meeting?
SBNATOR JENNINGS: Gentlemen, I rise to a point of informa-
tion. I see that this entire meeting is being taken down in short-
hand. It would be invaluable if that could be printed and we could
each have a copy. I wonder if that is intended?
MR. WARFbl : That will be done.
TRm CAmmN: Gentlemen, probably there were some
things that Mr. Brown was too modest to touch on that should be
brought out with regard to his particular proposition. He just
referred to i,3oo acres he has developed at his place. He has
not said what has been done in another by-product, potatoes.
You will pardon me-you are no longer on an experimental foot-
ing, Mr. Brown, would you care to give plans you have in mind,
the magnitude of them, and the faith you have in your proposi-
tion. I do not know whether you can tell this conference about
your plans provided we get drainage. And while on that subject,
I want to bring out that the Everglades can be successful in
broad farming rather than on a ten-acre basis. It is such con-
cerns as Brown & Company and the Celotex Company, Mr.
Dahlberg's concern, and the Pennsylvania Company, that will
create real value in the Everglades. Many people know nothing
at all about what the big people are doing. And as we have a
little time, Mr. Brown might give us more details, and Mr.
Dahlberg might give us something to show the faith that these
men have in the ultimate Everglades.
MR. BROWN: Well, I will say for your information as to the
why of the potatoes. I have had peanuts in the Everglades and
we are very much interested in that, because it ties in with our
business, because Florida is near enough from a freight-rate point
of view to make it possible to take peanuts to New Hampshire
and get the oil from them and the rest of the peanut with it. The
rest of the peanut goes into cattle food, and possibly can be used
for human food, and can be sold in that part of the country to
But peanuts cannot be raised in the Everglades until there
is drainage. It would be foolhardy to ever plant any amount of
land to peanuts in the early spring, not knowing whether or not
one was going to be flooded out in the summer or fall.
Now, while we are in the Everglades we are experimenting
with all kinds of plants, because other plants throw light on the
particular plants that we are most interested in. Mr. Vannah
could tell you that there are families of plants, and when you
are mystified as to why a particular plant does not come along
as you expect, you very often find by some plant of an allied
family a fact that reveals a great deal of the secret of the soil.
Now, in our experiments we discovered that potatoes were a prac-
tical product to raise. They yielded themselves to large opera-
tions. They could be handled by machinery. And there is almost
an unlimited market for them. The new potato in the winter
and spring is more in demand, and we started in this year to
make our place productive while we were going through the
experimental stage, and we have been so well satisfied with the
results that we are getting that we expect next fall and winter
to greatly increase our acreage.
I will say that we are counting on a dry season. We are told
by people from Tallahassee, who have watched the climate for
a great many years, that we are very likely to have a natural
condition that we can do business for at least one year, and there
is another reason we do not have to plant potatoes until we
know that the conditions are right.
I cannot tell you more about the different things because
they are in an experimental stage, and I can simply say that
these twenty-six different plants will grow in sour grass land as
distinguished from custard apple land.
THE CHARMAN: Thank you, Mr. Brown.
Mr. Warfield has a program that he wants to give us in a
little while. Is there an announcement that you wish to make at
this particular time?
MR. WARFIELD: Mr. Chairman, there are several resolu-
tions that are to be proposed at tomorrow's session, and as this
room has become quite hot, I suggest, it now being ten minutes
past four, that we adjourn. We figured on adjourning at half
past four, would it not be well to leave the'other matters until
tomorrow morning. There are several resolutions, one by Mr.
Shutts, and two or three that I would like to introduce in the
morning, if you do not mind. I desire to consult some of the
gentlemen present with respect to these resolutions this evening,
and if we want to continue today, we might do so under the
trees at my farm, where we will dine. Mr. Dahlberg, I under-
stand, desires to tell what he has done in the Everglades, and
what he wants to do, and perhaps you will allow me to suggest
that we adjourn now until 9 to 9.30 tomorrow morning.
MR. DAHLBERG: Mr. Chairman, may I make one more
remark. I would like to suggest this. We have gotten together
a representative gathering. We are going to pass probably some
very impressive resolutions. Is it convenient or is it desirable
to resolve this into some sort of a continuing committee so that
the work can be continued when we leave here?
MR. WARFIELD: That will be offered tomorrow morning, if
you do not mind.
MR. THORNTON: Mr. Chairman, I think we are looking
for something very important here, as was brought out by Mr.
Sebring. I believe we are all impressed with the fact that this
issue has been very seriously clouded in Florida. Through an
act of altruism Mr. Warfield has gone into it, and the good faith
of Governor Martin, and therefore, I believe that it would be in
perfect order that the Chair would appoint a committee of three,
as a resolutions committee, to consider such resolutions as may
come before this body, and to prepare such resolutions as they
see fit to come before this body as an outcome of the deliberations
of this meeting.
THm CARA AN: Is that in the shape of a motion?
MI. THoamNn : Put that in the shape of a motion.
Tar CnmIm: It is moved that a committee of three be
appointed to prepare such resolutions as may be deemed neces-
sary to present to this body for action in the morning.
(The motion was made, seconded and carried.)
Ta CARmmAN: The Chair will take the matter under ad-
visement and name the committee later in the evening.
M. WARMED: I move that we adjourn until 9.00 to
9.30 tomorrow morning. You will find a number of automobiles,
gentlemen, at the Calvert Street entrance to this building, which
will conduct the party to Manor Glen for dinner as my guests.
Ta CHAIMAN: The meeting is now adjourned until to-
morrow morning. There being no objection, we will stand
adjourned until tomorrow morning at 9.00 to 9.30 o'clock.
Tuesday, July 19, 1927
(The meeting was called to order by the Chairman at
THa CHAIRMAN: Gentlemen, this meeting will please come
In accordance with your request of last evening, the Chair-
man has appointed and will announce the Committee on
Senator Jennings of Okeechobee, Chairman, Mr. Latham of
St. Petersburg, Mr. Kyle of Fort Lauderdale, Mr. Burguieres
of West Palm Beach and Mr. Thornton of Tampa, form the
Committee of five on Resolutions.
Before we hear the report of that committee there is a
special committee consisting of Senator Wagg, Senator Jennings
and ex-Congressman Lineberger, who have a special resolution
which they wish to present.
SENATOR WAGG: Mr. Chairman, this is a resolution on
which action was taken respecting this subject for approval as
forming an expression of this Conference, by a committee com-
posed of myself, Congressman Lineberger and Senator Jennings.
WHEREAS, there has been called in the City of Baltimore,
Maryland, a conference of representative citizens and property
owners of the State of Florida to consider the problems of food
control navigation and Brerglades reclamation, and
WHEBRAS, the Federal Government has already assumed
control of Lake Okeechobee, the largest body of water entirely
within the boundaries of any one state in the Union for the
purpose of controlling water levels and navigation, and
WHEREAS, the recent hurricane which visited this area
resulted in a loss of life greater than in any similar recent
disaster in this country in addition to great property damage,
WHEREAS, such control of the water levels of Lake Okee-
chobee definitely commits the Federal Government to a par-
ticipation in the benefits and responsibilities involved in this
great enterprise, and
WHEREAS, the Federal Government has in other sections
of the United States made appropriation and contemplates
further consideration of those projects wherein flood control
and transportation are fundamentally involved, and
WHEREAS, the State of Florida has already expended ap-
proximately $15,00,000 in carrying on this work and has by
legislative action authorized an expenditure of approximately
THEREFORE, BE IT RESOLVED, that it is the sense of this
conference that the Federal Government through Congress and
other organized agencies, be and it is hereby repectfully peti-
tioned to consider Bood control and navigational phases of this
great project as a part of any'national blood control program
which may be submitted to and considered by the Congress, and
that this conference recommends the closest co-operation be-
tween Congress and the State of Florida in the carrying out of
this project in which the problems of Bood control and naviga-
tion are so intimately associated and codependent.
I move, Mr. Chairman, the adoption of this resolution,
and that a copy of it be sent to the chairmen of the various
committees in Congress and other agencies involved.
Tim CHAI AN: You have heard the resolution submitted
by Senator Wagg of the special committee.
(Motion then seconded.)
THE CHARMAN: Gentlemen, you have heard the motion
properly seconded. Now the matter is open for discussion.
SENATOR JENNIGS: It seems to me, Mr. Chairman, that that
ought to include sending a copy to each of our United States
Senators and Congressmen.
THE CHARMAN: Senator Jennings suggests, Senator Wagg,
that the motion should provide for the sending of a copy of
that resolution to the Senators and Representatives in Wash-
SENATOR WAGG: That was announced in my motion, that a
copy be sent to those individuals and agencies particularly
THE CHAmmA: Do you feel that that is taken care of,
SENATOR JENNINGS: Yes.
SENATOR WAGG: Congressman Lineberger will give you a list
of those to whom this should be sent in Washington, and that
will cover my motion.
TEB CHARmwAN: Thank you, Senator Wagg. Now, the
question. Are you ready for the question?
(The motion was put and unanimously carried.)
Copy of the above Resolution to be sent to the following:
Hon. Wesley L. Jones, Chairman, Commerce Committee,
U. S. Senate (Seattle, Wash.).
Hon. Lawrence C. Phipps, Chairman, Committee on Irriga-
tion and Reclamation, U. S. Senate (Denver, Colo.).
To the Chairman, Flood Control Committee, U. S. Senate.
Hon. James E. Watson, U. S. Senator (Rushville, Ind.).
Hon. Duncan U. Fletcher, U. S. Senator (Jacksonville, Fla.).
Hon. Park Trammell, U. S. Senator (Lakeland, Fla.).
Hon. S. Wallace Dempsey, Chairman, Rivers and Harbors
Committee, U.S. House of Representatives (Lockport, N.Y.).
Hon. Addison T. Smith, Chairman, Committee on Irrigation
and Reclamation, U. S. House of Representatives (Twin Falls,
Hon. Frank R. Reid, Chairman, Committee on Flood Con-
trol, U. S. House of Representatives (Aurora, Ill.).
Hon. Herbert J. Drane, M.C. (Lakeland, Fla.).
Hon. Wm. Joseph Sears, M.C. (Kissimmee, Fla.).
Hon. R. A. Green, M.C. (Starke, Fla.).
Hon. J. H. Smithwick, M.C. (Pensacola, Fla.).
Hon. Hamilton Fish, Jr., M.C. (Garrison, N.Y.).
Hon. Daniel A. Reed, M.C. (Dunkirk, N.Y.).
Hon. Dwight F. Davis, Secretary of War, Washington, D.C.
Maj. Gen. Edgar Jadwin, Chief of Engineers, War Depart-
ment, Washington, D.C.
Hon. Hubert Work, Secretary of the Interior, Washing-
Hon. Elwood Mead, Commissioner, Bureau of Reclamation,
Department of the Interior, Washington, D.C.
Hon. Herbert Hoover, Secretary of Commerce, Washing-
Hon. Andrew W. Mellon, Secretary of the Treasury, Wash-
Hon. W. L. Mellon, Pittsburgh, Pa.
Hon. William E. Hull, Peoria, Ill.
Tax CAmmI N: We will now hear from the Committee on
SNATmo JammNGS: Mr. Chairman, I have been designated by
the Committee on Resolutions as Chairman to present these
resolutions to the Conference.
RESOLVED, that the members of this conference be con-
stituted a permanent committee to be designated the Citizens
Evergladee Committee for the consideration of questions re-
specting the drainage and reclamation of the Florida Everglades
and to this end shall have power to add to its membership
others who are representative of the various sections of the
territory affected; that an Executive Committee of this Com-
mittee be appointed by the Chairman of not less than nine or
more than fifteen for the consideration and determination of
questions occurring between meetings of the full committee.
Mr. Chairman, I move the adoption of the resolution.
(The motion was seconded, the question was put and the
resolution carried unanimously.)
8QNATOR JNNINGS: Mr. Chairman, I have another resolution
RESOLVED, that the Governor of Florida, the members of
the Internal Improvement Board, the Board of Commissioners
of Everglades Drainage, and the Chief Drainage Engineer, be
formally advised of the action taken by this conference and the
appointment of this committee and its purpose and the desire
to co-operate with those officials in the great work undertaken
with the desire on the part of this committee to have those
officials recognize the purposes of this committee and its officers
and their desire to be furnished with such information as may
be compatible with the public interest.
This resolution speaks for itself, it is to advise the Com-
missioners of Everglades Drainage and those other Boards of
the organization of this committee with request that they co-
operate with us and furnish us information in order that this
committee may be advised.
I move the adoption of this resolution.
(The motion was duly seconded. The question was put and
the resolution was unanimously adopted.)
SENATOR JENNINGS: Mr. Chairman, I have another resolution
RESOLVED, that the officers of the Citizens Everglades
Committee be a Chairman, Vice-Chairman, Secretary and
Treasurer and an Executive Committee of not less than nine
nor more than fifteen.
Mr. Chairman, I move the adoption of the resolution.
(The motion was seconded. The question was put and the
resolution was unanimously adopted.)
MR. WARFmD: I move that the present officers of this
present conference be the permanent officers of the committee
you are now constituting or creating, namely, Mr. Bensel as
Chairman and Mr. Johnston as Secretary, and I move to fill the
office of Vice-Chairman and nominate Mr.-Kyle of Fort Lauder-
dale to fill that office.
MR FLEMING: I second the motion.
MR. WARFMLD: And I move that the Secretary cast the
ballot for the several officers as nominated.
(The Chairman thereupon put the motion, which was unan-
MR WARFILD: In respect to the motion I neglected to say
your resolution creates Mr. Johnston's office a double office, that
of Secretary and Treasurer, and therefore move that Mr.
Johnston be also made the Treasurer-Secretary and Treasurer.
M. FLEMING: I second the motion.
(The question was put and the motion was adopted.)
SENATOR JENNINGS: Mr. Chairman, I have another resolution:
RESOLVED, that the Executive Committee extend an in-
vitation to Meosrs. George E. Merrick, Glenn Curtiss and their
associates and colleagues to meet the Executive Committee in
conference in order to ascertain if an understanding can be
reached in matters respecting the Eerglades.
I move the adoption of this resolution.
(The motion was duly seconded and unanimously adopted.)
SEATm JammNG8: Mr. Chairman, I have another resolu-
tion to offer.
BE IT RESOLVED:
1. That this conference now approve in its entirety the
Everglades Drainage Law enacted by the Legislature of Florida
2. That in its judgment, the sale of bonds to be issued under
the provisions of this law, upon a I5 per cent basis, will, under
all the circumstances, be fair and reasonable;
3. That in its judgment such bonds when so issued and
sold will not be a direct obligation or an indirect obligation of
the State of Florida or in violation of the provisions of its con-
4. That in its judgment the Florida Everglades Reclamation
program as original planned, with such modifications as may
become necessary from time to time, should be carried out to an
ear& and complete consummation;
5. That this conference deplores any attempt to obstruct
in any way the plan of Everglades development now in progress
For your information, Mr. Chairman, this is the resolution
offered by Mr. Shutts yesterday morning, and comes as a
Committee Resolution having been presented to the Committee
by Mr. Shutts.
TaHCRARMAN:Youhaveheard themotion, properlyseconded.
Are you ready for the question? All in favor signify by saying
MR. HRMAN DANN: Mr. Chairman, I ask that my vote
be recorded in the negative.
SENATOR JKNNGS: Mr. Chairman, I have another reso-
RESOLVED: That this Everglades conference is deeply ap-
preciative of the efforts put forth by Mr. Warfeld in the matter
of the solution of the Everglades problem and that it is the
sense of this body that a vote of thanks be tendered him for
his seal and untiring efforts on behalf of the State of Florida; and
FURTHER RESOLVED, that the conference also express its
appreciation for the use of this conference room and for the
hospitality extended the members of this body on the occasion
of this meeting.
Mr. Chairman, I move the adoption of this resolution.
(Seconded by several members present.)
MR FLEMING: Mr. Chairman, I desire to add a word to
the usual form of seconding a motion.
Florida has had friends in the past, some of whom have given
of their money, some of whom have given their time, and some
of whom have given their work, but I cannot recall any man
who has given so generously of all three to our State as our dis-
tinguished host, Mr. Warfield.
I take a great deal of pleasure in seconding the motion and I
suggest that it be adopted by a rising vote. (Continued applause.)
THE CAIRMAN: All in favor of the motion signify by rising.
(The motion was carried by a unanimous rising vote.)
MR. WARFBLD: I thank you, gentlemen, for your kind
consideration. Whatever has been done by me has been a
SENATOR JENNINGS: Mr. Chairman, the Committee on Resolu-
tions asks to be discharged.
MR. FLEMIN: I move that the Committee on Resolutions
be now discharged with the thanks of this conference.
(Motion seconded and carried.)
M. WARFILD: Mr. E. L. Mack, of Lakeland, who has had to
leave suddenly, desires to record his vote in the affirmative on
the resolutions offered by the committee.
Mr. Chairman, as an executive committee is to be named
by the Chairman, as provided in the resolution adopted, I
suggest that a recess of ten minutes be taken at this time,
in order that the Chairman, who has the appointment of this
committee, may confer with the gentlemen in the room re-
specting the personnel of this committee. In that connection,
it might be well to consider leaving several vacancies on the
committee at the present time, so that they might be filled by
men who are not here today and may at present be opposed to
these proceedings but after conference may consent to serve on
Tai CHAIMAN: As the Chairman understands, it is a
minimum of nine and a maximum of fifteen.
MR. WARIm.D: Yes.
CO~GRESSMAN IJNB~RGER: Mr. Chairman, while we are
here and referring to the resolution, in regard to the resolution
just passed referring to Federal co-operation, I would like to
make the suggestion that all members present here who might
have friends in either the House or the Senate of the United
States Congress, either communicate with them personally or
by letter, furnishing them with a copy of this resolution and
soliciting their aid and assistance and serious consideration. I
have no doubt that practically every member here has various
friends in various sections of-the country who are members of
those two bodies, and it will all help very greatly when we come
to take the matter concretely before the House or the Senate
THx CHARMAN: Thank you very much for the suggestion,
and the Chairman will take note of the request made.
CoNGcrssMAN INUBRGER: We can have all of these reso-
lutions in printed form, which can be printed by the Secretary
and furnished to the members of the conference who may desire
to have copies thereof.
Ma. WARIvmD: All the proceedings of this conference are
being taken down by stenographers and will be printed, we can
furnish additional copies of resolutions where desired.
Tam CARmamN: There is a motion pending that we take a
recess for ten minutes. Is there any second to that motion?
Tai CHAIR N: All in favor say aye.
(The motion was carried and a recess was then taken.)
(Following a recess of ten minutes, the proceedings of the
Conference were resumed.)
THE CHAIRMAN: The meeting will please come to order,
gentlemen. Order, gentlemen, please. We are trying to facilitate
this meeting. Gentlemen, in accordance with your Resolution,
your Chairman, after conferring with some of the members of
the Conference, has to suggest the following Executive Com-
mittee of thirteen at this particular time, consisting of:
Mr. Burguieres, of West Palm Beach.
Mis Dann, of St. Petersburg.
Mr. Dahlberg, of Clewiston, Florida and Chicago.
Mr. Jennings, of Okeechobee.
Mr. Hills, of Jacksonville.
Mr. Latham, of St. Petersburg.
Mr. Sebring, of Sebring.
Mr. Sherman, of Belle Glade, Florida and Portland, Maine.
Mr. Shutts, of Miami.
Mr. Thornton, of Tampa.
Mr. Warfield, of "All Florida" and Baltimore.
Mr. Wagg, of Palm Beach.
Mr. Weidling, of Fort Lauderdale.
The Chairman suggests this Committee.
MR. WARFELD: How many are there?
THE CHARMAN: Thirteen, leaving two vacancies.
MR. HARVEY: I move the adoption of the suggestion of the
MR. WARFELD: Second the motion. I might call attention
to the fact-I do not know whether the resolution adopted
authorizes the officers to be ex-officio members of the Executive
Committee. If it does not do so, I should think it ought to, the
Chairman, Vice-Chairman and Secretary-Treasurer as ex-officio
members, not counting them within the thirteen members sug-
gested by the Chairman.
MR. HARVEY: I will change that motion. I move the
election of the Committee the Chairman has named by providing
that the Committee shall at present consist of thirteen of the