• TABLE OF CONTENTS
HIDE
 Front Cover
 Title Page
 Table of Contents
 Frontispiece
 Introduction
 Section I: Canal operation and...
 Section II: Business operation...
 Section III: Government
 Section IV: Administration
 Section V: Financial and statistical...
 Back Cover














Title: Annual report of the Governor of the Panama Canal for the fiscal year ended ..
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Permanent Link: http://ufdc.ufl.edu/UF00097365/00012
 Material Information
Title: Annual report of the Governor of the Panama Canal for the fiscal year ended ..
Alternate Title: Report of Governor of the Panama Canal
Physical Description: 36 v. : ill. ; 23 cm.
Language: English
Creator: Canal Zone -- Office of the Governor
Publisher: U.S. G.P.O.
Place of Publication: Washington
Washington
Publication Date: 1927
Frequency: annual
regular
 Subjects
Subject: Politics and government -- Periodicals -- Canal Zone   ( lcsh )
Genre: federal government publication   ( marcgt )
Spatial Coverage: Panama
 Notes
Dates or Sequential Designation: June 30, 1915-June 30, 1951.
Numbering Peculiarities: Report year ends June 30.
General Note: Some vols. issued in the congressional series as House document.
General Note: Reports for 1914/15-1915/16 each accompanied by portfolio of maps and diagrams.
 Record Information
Bibliographic ID: UF00097365
Volume ID: VID00012
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: oclc - 02454300
lccn - 15026761
oclc - 2454300
 Related Items
Preceded by: Annual report of the Isthmian Canal Commission for the year ending ...
Succeeded by: Annual reports of the Panama Canal Company and the Canal Zone Government for the fiscal year ended ...

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Table of Contents
    Front Cover
        Front Cover 1
        Front Cover 2
    Title Page
        Page i
        Page ii
    Table of Contents
        Page iii
        Page iv
        Page v
        Page vi
        Page vii
    Frontispiece
        Page viii
    Introduction
        Page 1
        Page 2
        Page 3
        Page 4
        Page 5
    Section I: Canal operation and trade via Panama
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
        Page 23
        Page 24
        Page 25
        Page 26
        Page 27
    Section II: Business operations
        Page 28
        Page 29
        Page 30
        Page 31
        Page 32
        Page 33
        Page 34
        Page 35
        Page 36
        Page 37
        Page 38
        Page 39
        Page 40
        Page 41
        Page 42
        Page 43
        Page 44
        Page 45
        Page 46
    Section III: Government
        Page 47
        Page 48
        Page 49
        Page 50
        Page 51
        Page 52
        Page 53
        Page 54
        Page 55
        Page 56
        Page 57
        Page 58
        Page 59
        Page 60
    Section IV: Administration
        Page 61
        Page 62
        Page 63
        Page 64
        Page 65
        Page 66
        Page 67
        Page 68
        Page 68a
        Page 68b
        Page 68c
        Page 68d
        Page 68e
        Page 68f
    Section V: Financial and statistical statements
        Page 69
        Page 70
        Page 71
        Page 72
        Page 73
        Page 74
        Page 75
        Page 76
        Page 77
        Page 78
        Page 79
        Page 80
        Page 81
        Page 82
        Page 83
        Page 84
        Page 85
        Page 86
        Page 87
        Page 88
        Page 89
        Page 90
        Page 91
        Page 92
        Page 93
        Page 94
        Page 95
        Page 96
        Page 97
        Page 98
        Page 99
        Page 100
        Page 101
        Page 102
        Page 103
        Page 104
        Page 105
        Page 106
        Page 107
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        Page 109
        Page 110
        Page 111
        Page 112
        Page 113
        Page 114
        Page 115
        Page 116
        Page 117
        Page 118
        Page 119
        Page 120
        Page 121
        Page 122
        Page 123
        Page 124
        Page 125
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        Page 135
        Page 136
        Page 137
        Page 138
        Page 139
        Page 140
        Page 141
        Page 142
    Back Cover
        Page 143
        Page 144
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............. ............. .............










UNIVERSITY
OF FLORIDA
LIBRARY








ANNUAL REPORT

OF THE


GOVERNOR OF


THE PANAMA CANAL

FOR THE

FISCAL YEAR
ENDED JUNE 30

1927


UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON
1927


_____










































































ADDITIONAL COPIES

OF THIS PUBLICATION M'AY BE PROCURED FROM

THE SUPERINTENDENT OF DOCUMENTS

U. S. GOVERNMENT PRINTING OFFICE

WASHINGTON, D. C.

AT

20 CENTS PER COPY


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TABLE OF CONTENTS

Page
Introduction-- ____--------------------------------------------- 1
Operation and maintenance of the canal----------------------------- 2
Business operations---------------------------------------------- 3
Administration-Government ___-------------------------------- 3
Net revenue of the canal and its auxiliaries ----------------------- 4
Services rendered by the canal to shipping ----------------------- 5

SECTION I.-CANAL OPERATION AND TRADE VIA PANAMA

Traffic in 1927 ------------------- --------------------------------- 6
Proportion of tanker traffic--- ---------------------------------- 7
Tanker cargoes ____-----_------------------------------------- 9
Nationality of vessels------------------------------------------ 9
Commercial traffic through the canal during the fiscal year 1927,
segregatefl by ags. ------------------------------------------ 10
Vessels entitled to free transit and launches of less than 20 tons net
measurement---------------------__-__-_______-__________- 11
Trade routes and cargo __-------__--------------------------------___________________ 11
Comparative cargo statistics for past four fiscal years by principal
trade routes through canal- -----------_----------------------12
Principal commodities- ---------------------------------------- 13
Commodity movement-
Atlantic to Pacific_----------------------------- ------------ 14
Pacific to Atlantic ----------------------------------------- 14
Classification of vessels ---------------------------------------- 15
Details of the trade ------------------------------------------- 15
Dual measurement system_ ---------------------------------------- 15
Hours of operation ------------------------------------------------ 17
Lockages and lock maintenance ------------------------------------- 17
Lockages ---------------------------------------------------- 17
Hours of operation ------------------------------------------- 17
Overhaul- ---------------------------------------------------- 18
Equipment_ -------------------------------------------------- 19
Power for canal operation- ----------_------------------------------ 19
Diesel-electric plant- ---------------------------------------------- 20
Water supply ----------------------------------------------------- 21
Dry season--------------------------------------------------- 21
Additional storage at Alhajuela ------------------------------------- 22
Sciinlog__ ----------------__----------------------------------------_____________________________________ 22
Maintenance of channel and improvement projects-------------------- 22
Improvement project No. 1------------------------------------ 23
Eqllipient --------------------_--___________________-------------------------___________ 24
Slides ------------------------------------------------------------ 24
Aids to navigation ----------- ------------------------------------ 25
Accidents -------------------------------------------------------- 26
Salvage operations------------------------------------------------ 27
Rules and regulations ----------------------------------------------__ __ 27


o 7/70







IV TABLE OF CONTENTS

SECTION II.-BUSINESS OPERATIONS
Page
Mechanical and marine work--------------------------------------- 2S
Marine work------------------------------------ ------------ 29
Other work ----------------___---_-___---_ 29
Dry docks---------------------------------------------------- 30
Plant-------------------------------------------------------- 30
Financial------------------------------------------------- 30
Coa------------------------------------------------------------ 31
Fuel oil, Diesel oil, gasoline, kerosene -------------------------------- 31
Ship chandlery and other supplies-storehouse operations -------------- 32
Native lumber operations------____________-------_______---____------_________________------------------__ 33
Harbor terminals ----------------------------------------------- 33
Commissary ----------------------------------------------------- 34
Sales--------------------------------------------------------- 34
Purchases---------------------------------------------------- 35
Manufacturing plants-- --------------------------------------- 36
Hotels and restaurants--- -----------------------------------------_ 36
Building construction---------------------------------------------- 37
Animal and motor transportation ---------------------------------- 38
Printing-------------------------------------------------------- 38
Panama Railroad ----------------------------------------------- 38
Telephones and electric printing machines---------------------------- 39
Land and buildings----------------------------------------------- 40
Panama Railroad Co. lands and leases--------------------------- 40
Agricultural lands in Canal Zone-------------------------------- 40
Alhajuela Basin ----------------------------------------------- 40
Plant introduction gardens and experimental station ---------------- -- 41
Quarters for employees ------------------------------------------- 42
Clubhouses----------------------------------------------------- 43
Farm industries ---------------------------------------------- 43
Operation with Panama Railroad company's funds -------------------- 44
Panama Railroad Steamship Line ----------------------------------- 45
Canal Zone for orders_--------------------------------------------- 45

SECTION III.-GOVERNMENT

Population ------------------------------------------------------ 47
Public health ----------------------------------------------------- 47
Malaria -------------------------------------------------- 47
Canal Zone ------------------------------------------------- 48
Panama City ------------------------------------------------ 48
Colon --------------------------------------------------- 49
Canal hospitals -------------------------------------------- 49
Quarantine and immigration services-------------------------------- 49
-Municipal engineering ------------------------------------------ 50
Water supply ------ ------------------- ------ 50
Sewers------------------------------------------------------- 51
Roads, streets, and sidewalks, Canal Zone_----------------------- 51
Garbage disposal---------------------------------------------- 51
Cities of Panama and Colon------------------------------------ 51
Army and Navy---------------------------------------------- 52
Miscellaneous_----------------------------------------------- 52
Laboratory ------------------------------------------------ 52





TABLE OF CONTENTS V

Page
Public order------------------------------------------------------ 52
Office of the district attorney_--------------------------------------- 54
District court ---------------------------------------------------- 54
Marshal--------------------------------------------------------- 54
Magistrates' courts- ---------------------------------------------- 54
Balboa------------------------------------------------------- 54
Cristobal.------------------------------------------------ 54
Fire protection --------------------------------------------------- 55
Public-school system ---------------------------------------------- 55
White schools- ----------------------------------------------- 55
Colored schools----------------------------------------------- 56-
Postal system---------------------------------------------------- 56
Customs -------------------------------------------------------- 58
Shipping commissioner-seamen ---------------------------------- -- 59
Prohibited aliens ------------------------------------------------ 59
Administration of estates------------------------------------------ 59
Licenses and taxes ---------------------------------------------- 60
Ini migration visas _------------------------------------------------ 60
Relations with Panama ------------------------------- ------------- 60

SECTION IV.-ADMINISTRATION

Changes in organization and personnel ------------------------------- 61
Force employed ------------------------------------------- 61
Wage adjustments:
Gold emplbiyee__---------------------------------------------- 63
Alien employees on silver roll ----------------------------------- 63
Complaints board --------------------------------------------- ---- 64
Recruiting and turnover of force ----------------------------------- 65
Gold employees_---------------------------------------------- 65
Silver employees ---------------------------------------------- 66
Public amusements and recreation---------------------------------- 66
Purchases and sales in the United States----------------------------- 67
Tacna-Arica Plebicite ---------------------------------- 68

SECTION V.-FINANCIAL AND STATISTICAL STATEMENTS

For list of tables see----------------------------------------------________ 69

LIST OF ILLUSTRATIONS

FrONTISP[ECE. Pedro Miguel Lock, Miraflores Lake, and section of Pacific sea-
level channel of The Panama Canal.
PLATE 1. Exterior of new Diesel-electric plant at M iraflores.
2. Direct-connected Diesel-electric generators in new plant, Mirailore.
3. Construction of manufacturing plants and storehouse for Commissary
Division at Mount Hope.
4. Pedro Miguel Lock. Cargo carrier on left being raised to level of
Gaillard Cit; passenger liner on right being lowered to level of
Mirnflores Lake.
5. New Cristobal. Type 1 cottages, of which 48 are being constructed

















APPENDIXES NOT PRINTED


REPORTS OF HEADS OF DEPARTMENTS AND DIVISIONS

Reports for the fiscal year 1927 have been made as follows and may be consulted
at the Washington office of The Panama Canal or at the office of the Governor,
Balboa Heights, Canal Zone:
Engineer of maintenance:
Assistant engineer of maintenance, report of.
Pacific locks, report of superintendent.
Atlantic locks, report of superintendent.
Electrical division, report of electrical engineer.
Municipal engineering division, report of municipal engineer.
Dredging division, report of superintendent.
Office engineer, report of.
MAeteur'logy and hydrography; surveys; report of chief of surveys.
Gatun dam and backfills, report of general foreman.
Marine division, report of superintendent.
IIechalnii.al division, report of superintendent.
Supply department, report of chief quartermaster.
Executive department:
Division of civil affairs, report of chief of division.
Police and fire division, report of chief of division.
Division of schools, report of superintendent of schools.
Bureau of clubs and playgrounds, report of general secretary.
District attorney, report of.
Accounting department, report of the auditor.
Land agent, The Panama Canal and Panama Railroad Co., report of.
Purchasing department, report of the general purchasing officer and chief of
Washington office.
VI












































Digitized by the Internet Archive
in 2010 with funding from
University of Florida, George A. Smathers Libraries with support from Lyrasis and the Sloan Foundation


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ANNUAL REPORT


OF THE

GOVERNOR OF THE PANAMA CANAL


BALBOA HEIGHTS, CANAL ZONE,
August 27, 1927.
The SECRETARY OF WAR,
Washiington, D. C.
SIR: I have the honor to submit the report of the Governor of
The Panama Canal for the fiscal year ended June 30, 1927.
Respectfully,
M. L. WALKER, GovernOr.

INTRODUCTION

The traffic through The Panama Canal in the year ending June
30, 1927, was greater than in any preceding fiscal or calendar year.
Our main interest has been in the proper handling of this procession
of vessels, not only in their transit through the canal but in the
prompt and adequate supply of their needs of fuel, stores, and repairs
at the terminals. Along with this we have carried on the deepening
of the Pacific sea-level section, the maintenance of other parts of the
channel, and the overhaul of the machinery of the locks at Gatun,
as well as the current maintenance of all other equipment. We
have been engaged also on the erection of additional buildings for
the furtherance of canal operations, the supplying of vessels, and the
replacement of worn-out quarters for employees. Municipal im-
provements have been made in step with an increasing population
of employees and their families, and the growth of the terminal cities
in Panama, for which we furnish water, sewer, and street work.
The principal elements in the administration of The Panama
Canal are:
First, operation and maintenance of the canal proper in which are
included work in passing vessels through the waterway and main-
taining the channel, locks, aids to navigation, etc.;
Second, business activities required for shipping and the canal
forces; for example, storehouses and retail establishments for purvey-
ing foodstuffs and supplies, oil, and coaling plants, dry docks and






REPORT OF GOVERNOR OF THE PANAMA CANAL


shops for repair and manufacturing, including railway work; opera-
tion of the Panama Railroad on the Isthmus, piers and wharves for
the handling of cargo and passengers, operation of the Panama
Railroad Steamship Line plying between New York and the Isthmus
via Haiti, with branch communications to ports of Colombia and
Ecuador; operation of quarters for the canal force and their families,
and the conducting of other business enterprises which in the usual
community are under private management; and
Third, governmental or municipal administration for the Canal
Zone, including public schools, medical and hospital service and
sanitation, postal system, police and fire protection, customs service,
quarantine and immigration, and some provision for recreation in a
population which includes approximately 8,000 civilian Americans,
9,000 in military and naval stations, and 20,000 West Indians and
natives.
Under the provisions of the Panama Canal act responsibility for
the administration of The Panama Canal is centered in the Governor.
In the present organization the Governor has distributed the work
among nine major departments and divisions, the heads of which
are responsible to him.

OPERATION AND MAINTENANCE OF THE CANAL

The essential business at the canal from the point of view of the
world at large is the maintenance of the passage for vessels between
the oceans. The fiscal year 1927 was another in which no delays to
traffic occurred. Vessels were handled both in transit and at the
terminals with the promptness which operators have learned to expect
and demand. During the year a total of 6,072 seagoing vessels passed
through the canal, an average of 16.6 per day. Of these vessels,
1,962, or approximately one-third, made use of the terminal ports in
discharging or loading passengers or cargo.
In the handling of traffic in restricted channels and in transit
through the locks various accidents occurred. In the past year a
total of 60 accidents took place, as compared with 83 in the previous
year. The most serious of these accidents resulted in damages esti-
mated at $45,000. The cases in which damages were $1,000 or more
numbered 15.
The United States Battle Fleet totaling 71 vessels, the major unit
of the United States Fleet, conducted maneuvers in the canal waters
in March. Fifty-seven of the 71 vessels passed through the canal
from Balboa to Cristobal for maneuvers in Atlantic waters contiguous
to the Isthmus. The greater part of these returned to the Pacific
in June. The transit of the fleet were handled, as on previous visits,
without mishap and without important delay to commercial vessels'





REPORT OF GOVERNOR OF THE PANAMA CANAL


although this additional traffic involved considerable amount of
overtime work for employees engaged in transit operations.
The deepening of the Pacific sea-level section, the removal of ma-
terial brought into the canal by small slides in June, and the general
maintenance of channel were carried on through the year without
interference with traffic.

BUSINESS OPERATIONS

From the beginning of canal construction and continuing with
increasing importance after the canal was opened to operation, the
organization has engaged in certain business enterprises necessary
for the carrying on of the work and for the convenience of shipping.
The employees must be housed and provided with the necessities
and comforts of life and must have means for transportation to
and from the United States on leaves of absence to be spent in the
temperate zone. Shipping requires repair facilities, bunkering sta-
tions, chandlery, and other essential supplies, and for purposes of
transshipment must have wharves and piers. These activities are
carried on by either The Panama Canal or the Panama Railroad
Co., the latter being in all essentials a department of the canal
organization.
Years of experience have demonstrated the value of all of these
services. Combined under the one organization they assure to
shipping adequate facilities at reasonable prices under a management
which is devoted primarily to the efficient handling of vessels. From
the administrative point of view, they make much easier the main-
tenance of an adequate and contented force which can be depended
on for the effective operation of the canal. With regard to the ele-
ment of national defense, they place under the direct control of the
Government certain plants and stores of supplies essential to the use
of the canal terminals as naval bases and to the husbanding of re-
sources in case of possible siege. It is notable that in the face of the
general opposition to the Government's engaging in business activi-
ties, the wisdom of this arrangement at the canal is recognized prac-
tically universally.

ADMINISTRATION-GOVERNMENT

The administration of such functions of government as public
health; quarantine; immigration service; customs; post offices; schools;
police and fire protection; construction and maintenance of roads,
streets, water supply, and sewers; hydrographic and meteorological
observations; steamboat inspection; aids to navigation, etc., are all
embraced in the single organization of The Panama Canal under the
direct control of the Governor. Here again the concentration under






REPORT OF GOVERNOR OF THE PANAMA CANAL


one control has simplified the operations of the canal and coordi-
nated all of these activities to the main function of prompt and reli-
able handling of vessels. It has also resulted in economies of
administration, since under this control it is possible to place under
one organization or even one individual, duties which in a less central-
ized administration would be the function of two or more adminis-
trative units.

NET REVENUE OF THE CANAL AND ITS AUXILIARIES

For the fiscal year 1927 the net income from tolls and other mis-
cellaneous receipts grouped under the head of "Transit revenue"
was $15,611,093.80, as compared with $15,151,668.06 in 1926,
$13,465,924.72 in 1925. and $16,307,948.50 in 1924.
The net profits on auxiliary business operations conducted directly
by The Panama Canal, of which the most important are the mechani-
cal shops, material storehouses, and fuel-oil plants, totaled $876,536.80,
as compared with $841,310.29 in 1926, $765,916.85 in 1925, and
$901,624.12 in 1924; while those conducted by the Panama Railroad
Co., exclusive of the Panama Railroad Steamship Line but includ-
ing commissaries, docks, coaling plants, and cattle industry, showed
a profit of $1,644,189.37, as compared with $1,347,887.33 in 1926,
$1,525,910.13 in 1925, and $1,044,887.04 in 1924. The total net
revenue of the year from all sources, exclusive of the Panama Rail-
road Steamship Line, was $18,131,819.97, as compared with $17,-
340,865.68 in 1926, $15,757,751.70 for 1925, and $18,254,459.66 in
1924.
In tabulated form the financial results of the operation of the canal
and its auxiliaries on the Isthmus were:

1927 1926

Net transit revenue --- --------------------------------------- $15,611,093.80 $15,151,668.06
Net revenue on Panama Canal business operations_---------------------- 876,536.80 841,310.29
Total net revenue, Panama Canal ---.----------.-----.. .---------- 16,487,630.60 15,992,978.35
Net revenue on Panama Railroad business operations-------------------- 1,644,189.37 1. .47, ;S7. 33
Combined net revenue----------------- .----------- .. -------- 18,131,819.97 17,340,865.68






REPORT OF GOVERNOR OF THE PANAMA CANAL 0


SERVICES RENDERED BY THE CANAL TO SHIPPING


In terms of service to shipping, the main items accomplished

during the past fiscal year, as compared with 1926, were:


1927 1926


Transits of the canal by ships paying tolls.------------------------
Free transits-------------- ----------------------------------
Calls at canal ports by ships not transiting canal ----------------------..
Cargo handled at ports (tons) ------------ ------ -----------
Coal sales and issues (tons)........................... ..................
Coal-number of ships served othhr than vessels operateil by The Panama
Canal------------------------------ -------------------
Fuel oil pumped (barrels)-------------------------------------
Fuel oil-number of ships served other than vessels operated by The
Panama Cnal ..................-------------------------------- ------------
Ships repaired, other than Pnn.rna (.'anl equipnment...................
Ships dry-docked, other than Panama Canal equipment.................
Provisions sold to ships (commissary sales)......------------------------
Chandlery sold to ships (storehouse sales)---------- ..---------------


5, 475
597
1. Or0 I
1, 1 .0, 807
372,461
907
16, 350,399
2,874
911
120
$1,308,520.02
$134,106.36


5,197
552
963
1,0>9,244
347,619
902
12, 562, 146
2,064
836
109
$1,174,478.46
$109, 590. 58





SECTION I
CANAL OPERATION AND TRADE VIA PANAMA
TRAFFIC IN 1927
The number of commercial transits, the net tonnage of vessels,
Panama Canal measurement, and the volume of cargo passing
through the canal for the year ended June 30, 1927, exceeded those
in any preceding fiscal or calendar year. The receipts for tolls
aggregated $24,228,830.11, and were $62,133.43, or about one day's
collections (the average per day for the fiscal year was $66,380.36),
less than the record figure of $24,290,963.54 collected during the
fiscal year 1924.
The number of commercial ships transiting the canal averaged 15
per day as compared with 14.2 in 1926. Including transits of naval
and other public vessels of the United States, public vessels of the
Republics of Panama and Colombia, but omitting small nonseagoing
launches, the daily average number of ships transiting the canal was
16.6 during 1927 as compared with 16 during the preceding fiscal year.
With the exception of traffic from the west coast of South America,
commerce over all the major trade routes served by the canal in-
creased as compared with the preceding year. Nitrate shipments
from the west coast of South America declined more than 700,000
tons as compared with the fiscal year 1926, which reduced by about
one-sixth the volume of outgoing cargo and also affected the purchas-
ing of American and European products. Nitrate and coal were the
only important commodities passing through the canal in which
shipments declined appreciably as compared with the preceding year.
Mineral oil shipments were fairly uniform throughout the year.
They made up slightly more than one-fourth of the total cargo passing
through the cniail, and likewise were the source of more than one-
fourth of the total revenue received in tolls. Slightly over four-fifths
of the mineral-oil shipments originated in the California area.
Traffic figures for each fiscal year since the canal was opened to
navigation are shown in the table below:

Number Panama
Fiscal year ending June 30- of Canal net Tolls Tons of cargo
transits tonnage
19151 --------------------------------------1,075 3,792,572 4, '.7f. 550. 19 4,888,454
1916 ----------------------------------------- 758 2,396,162 2., 41s.089.62 3,094,114
1917 ------------------- --------------------- 5, 798, 557 ., 1.2, 463. 05 7,058,563
1918 --------------------------------------- 2, 6,574,073 6,438,853.15 7,582,031
1919 ---------------- ---------------------- 2,024 6,124,990 6,172,828.59 6,916,621
1920 -------------- ------------------------- 2,478 8,546,044 8,513,933.15 9, 37., 499
1921 --------------------------------------- 2,892 11,415,876 11. 276. 889.91 11, .9., 214
1922 ---------------------------------------2,736 11,417,459 11, l'.7, 832. 41 10,884,910
1923 ........ ---------------------------------------3,967 18,605,786 17,508,414.85 19,567,875
1924 ---------------------------------------5,230 26,148,878 24,290,963.54 26,914, 710
1925 ---------------------------------------4,673 22,855,151 21,400,523.51 23, 95s, G
1926 --------------------------------------- 5,197 24, 774, 591 22, 931,055.98 26,037,448
1927-----------......------ ------------- --------5,475 2h. 22.". 815 24,228,830.11 27,748,215
Total ---------.---.-------------------- 40,377 174,677,954 166, :W3, 22S. 06 185,655,490
1 Canal opened to traffic Aug. 15, 1914.
2 Canal closed to traffic approximately 7 months of fiscal year by slides.
6






REPORT OF GOVERNOR OF THE PANAMA CANAL /1


Commercial traffic was fairly uniform through the year. By
months, the number of transit ranged between 428 in November
and 496 in March, the daily averages between 14.26 in November
and 16.03 in February, a difference of 1.77, or 12.4 per cent of the
average for the lowest month. Monthly transits and tolls, with
daily averages, were as follows:


Month


Total for month


Transits


1926
July----- --------------------------------------. 456
August------.--.-------------------..-------------- 464
Septem ber.. ............... .... .... .................... 446
October........................ ...... ................. 445
November..... ---------------------------------------- 428
December.------ --------.. -------.------.. ------------- 458
1927
January -------------------------------------------- 443
February---- ------------------------------------- 449
March-.------------------------------------------ 496
April ----------------..---------------------------- 464
M ay ........................... ......................... 471
June ......................... . ........ ................ 455
Total.--------------....----.....-...............----..---------..-------- 5,475


Tolls


$1,980, 719. 67
2,055,041.91
2,01. 626.42
1, 99,213.93
1, lJ. 00 1. 11
1, 996, 036.72

1,984,760.71
1,994,860. 82
2, 217,913.20
2,065,206.92
2,066,070. 73
1,970,377.97
24,228,830. 11


Daily averages


Transits


14.71
14.96
14.86
14.36
14.26
14.77

14.29
16.03
16.00
15.46
15.19
15.16
15.00


Tolls


$63. 1'4 18
66, 2"'1.67
67,320.88
64,168.19
62,966.70
6,4 3s-. 28

64,024. 54
71,245.03
71, 54.5 59
t', m40. 23
66,647.44
65,679.26
66, 380. 36


Comparison by months with traffic in the preceding fiscal year is
shown as follows:


Month


July------------
August.........
Se ptem er ....
October........
November.....
December.---.-
January........
Febri'iry. . ...
March -------
April...........
May ---------
June..---------
Total-.--


Number of
vessels


1925-26

418
372
388
410
424
462
479
423
506
425
470
419


Panama Canal net
tonnage


1926-271 1925-26


456
464
446
445
428
458
443
449
496
464
471
455


1,951,295
1, 77,627
1,831,039
1,955,485
2,028,034
2.257. 409
2,300. 1!7
1,991, 127
2. 39w. 694
2. 04. 247
2,243,103
1, 9E0, 344


1926-27


2, 154, 821
2,230,905
2,186,804
2.124.519
2,032. 4%
2, 135, 002
2,121,631
2, 201.3214
2,-113, 199
2,224,500
2, 24A. a92
2,152, 926


Tons of cargo


1925-26 1926-27

1,960,654 2.185, 527
1,912,217 2.321. 69,
1,891,988 2,239.5-147
2,009,171 2,3741,711
2,023,398 2.272,4-410
2.35S, 170 2,310, 270
2,346.643 2.241.765
2,139.207 2.2.30,107
2, 607, 04t; 2,5.33,.525'
2,237,567 42,42. bi7
2,416,701 2.379,713
2,134,686 2, 22i.097


5, 197 5, 475 24, 774, 591 20, 227, Al 5 26, 037, 448 27, 748, 2 I 5 22, 931, 055. 98


PROPORTION OF TANKER TRAFFIC

During the fiscal year 1927 tanker traffic, both actually and rela-
tively, was greater than for any preceding fiscal year excepting] 1924.
Tank ships comprised 24.2 per cent of the total commercial transits,
made up 29.1 per cent of the total Panama Canal net tonnage, were
the source of 27.5 per cent. of the total tolls collected, and carried
26.1 per cent of the total cargo passing through the canal during the
year.
The increase in net tonnage and tolls in the past fiscal year as
compared with the fiscal year 1926 was due primarily to increase in


Tolls


1925-26

$1,800,239.84
1,657,893.90
1,692,723.11
1,826,314.64
1,870,087. 68
2.111.896.53
2,103,36'; 2Y
1, 35,226 47-
2,.206,212.20
1,917,457 1
2, 056, 965. 55
1,852,670.66


1926-27


$1, 980,719.67
2,055,041.91
2,019, 626. 42
1, 9', 213.93
1,889,001.11
1,996,036.72
1,984,760.71
1, 99-4, 60. 82
2,217,913. 20
2, 065, 206. 92
2,066.070.73
1,970,377.97
24, 228, 830. 11


i I-


I_.__)_. _~. __. 1





REPORT OF GOVERNOR OF THE PANAMA CANAL


mineral-oil shipments. Tanker tonnage for 1927 was 1,280,872 tons,
Panama Canal measurement, more than in the previous year, while
net tonnage of general cargo vessels increased 172,352 tons. For
the total gain of 1,453,224 tons, approximately 6 per cent of the pre-
vious year's net tonnage, tankers were responsible for 88 per cent.
In tolls there was an increase of $1,032,638.97 from tankers, com-
pared with the increase of $265,135.16 in tolls from general cargo
carriers; and tankers were responsible for 80 per cent of the increase.
The apparent discrepancy between 88 per cent for net tonnage and
80 per cent for tolls is due to the fact that a great part of the tanker
trnnsits are in ballast, while vessels built for general cargo are usually
laden in both directions.
Omitting transits of public vessels of the United States and other
ships exempt from the payment of tolls, the number of ocean vessels
transiting the canal daily averaged 15 throughout the year. Of this
number tank ships averaged 3.6 transits daily, the balance being made
up of general cargo carriers, passenger ships, warships of foreign
nations, etc.
In the tables below the commercial traffic has been segregated to
show the proportion of tanker transits, tonnage, and tolls as com-
pared with corresponding figures embracing all other classes of traffic:
PROPORTION OF TANKERS TO TOTAL TRAFFIC

Total commercial transits Average daily transits

Tankers General Total Tankers General Total

July ----------------------------- ------ 114 342 456 3.68 11.03 14.71
August ------------ ------------------- 121 343 464 3.90 11.06 14.96
September------------------------------ 119 327 446 3.96 10.90 14.86
October -------------------------------- 105 340 445 3.39 10.97 14.36
November- ------------------------------ 90 338 428 3.00 11.26 14.26
December ------------------------------- 103 355 458 3.32 11.45 14.77
January -------------------------------- 103 340 443 3.32 10.97 14.29
February------------------------------- 104 345 449 3.71 12.32 16.03
March-- ------------------------------ 118 378 496 3.81 12.19 16.00
April..--------------------------------- 123 341 464 4.10 11.36 15.46
May---------------------------------------- 115 356 471 3.71 11.48 15.19
June------------------------------------- 109 346 455 3.63 11.53 15.16
Fiscal year-
1927 -------------- ----------------- 1,324 4,151 5,475 3.60 11.40 15.00
1926 -------------------------------- 1,090 4,107 5,197 3.00 11.20 14.20
1925 -------------- ------------------ 1,079 3,594 4,673 2.90 9.80 12.80
1924 ------------------------------. 1,704 3,526 5,230 4.60 9.60 14.20
1923----------------------------------- 913 3,054 3,967 2.50 8.30 10.80

PROPORTION OF TANKER TONNAGE TO TOTAL TONNAGE

Panama Canal net tonnage Percentage of total net tonnage

Tankers General Total Tankers General Total

Fiscal year-
1927--------------------- ... 7,624, 112 18, 603, 703 26. 227, 815 29. 1 70.9 100.0
1926. _----- ---- (., .i2 240 18,431,351 24, 774, 5. 1 25.5 74.5 100.0
1925------.--------------- ., 4'4, ',22 16,430,529 22, 855,151 28. 1 71.9 100.0
1924.------.-------------- 10,212,047 15, 936. 831 26, 14k, 878 39.1 60.9 100.0
1923..--------------------- 5,374,384 13,231, 402 18,605,786 28.9 71.1 100.0





REPORT OF GOVERNOR OF THE PANAMA CANAL


PROPORTION OF TOLLS FROM TANK SH111P TO TOTAL TOLLS FROM ALL VESSELS

T- .lI. paid by shipping using canal I'Prcriiuce of total tolls

T General Total Tankers General Total

Fiscal year-
1927-----------. ----. $6, 6i', 016.90 $17, "ri. 023.21 $24,228,830.11 27.5 72.5 100.0
1926----.------------- 5, t24, 167. 93 17, .i4. -, 05 22., :i.1. 055.98 24.4 75.6 100.0
1925-------------.--- 5,728,302. 26 15,7-'2. 221 25 21. Fi1, '.... 51 26. 8 73. 2 100.0
1924.---------.-------- 9,071. 833.65 15. 2'., 17.89 1. u.*l. 54 37.3 62.7 100.0
1923----------------- 4,769,324. 63 1.' 7 .. 1,74. 94 17, .ON. IT'I 57 27.2 72.8 100.0


TANKER CARGOES

Mineral oils carried through the canal in tank ships aggregated
7,250,579 tons for the fiscal year as compared with 6,073,779 tons
during 1926. Of the total, 137,288 tons passed through the canal
from the Atlantic to the Pacific, and 7,113,291 tons from the Pacific
to the Atlantic. Shipments of both Californian and Peruvian oils
increased as compared with the preceding year, and of the past
year's total, 5,565,477 tons were from the port of Los Angeles.
The above figures for tanker cargoes do not comprise all mineral-
oil shipments passing through the canal, as considerable quantities
of refined oils in cases are carried through the canal in general cargo
vessels.
NATIONALITY OF VESSELS

Twenty-five flags were represented in the commercial traffic
passing through the canal during the fiscal year. Tonnage under
the United States flag was more than twice as great as that under the
flag of any other nation. Combined, tonnage under the British
and American flags comprised approximately four-fifths of the whole,
with the flag of the next highest nation contributing less than 4
per cent of the whole.
With respect to cargo tonnage routed through the canal, vessels
of United States registry carried approximately 55 per cent of the
total; British vessels, 23 per cent; Norwegian and Japanese vessels,
33,' per cent each; German vessels, 3%2 per cent; Swedish vessels,
2%2 per cent; and Dutch and French vessels approximately 2 per
cent each. Combined, the vessels of these eight countries carried
95. 4 per cent, of all cargo that passed through the canal during the
past fiscal year.
As compared with the fiscal year 1926, cargo carried under the
American flag was greater by more than 1,500,000 tons. Cargo
under the British flag, its nearest competitor, declined soime 300,000
tons. The increase in tanker cargoes, largely carried under the
American flag, accounts for the greater plart of the increased cargo
carried by vessels of American registry. The following tabulation





1U REPORT OF GOVERNOR OF THE PANAMAL CANAL


shows the cargo tonnage carried under the flags of the leading mari-

time nations contributing to canal traffic during the past four years:

Tons of cargo carried


1924 1925 1926 1927


United States-------------------------- -------. 16,654.435 13, 61)n, 2(0 13,710,956 15. 242. 156
British.---------------------------------- 6,051,842 5, J17, ) 6,750,843 6. 43fi, 785
Norwegian--------------------------------- 539,101 942.708 1,051, 27 1. (,02.453
Japanese----------------------------------- 935,425 94rt, 916 667,982 1,036.785
German--------------------------------- -------. ----- 737. 103 830, 512 885,007 973,741
Swedish------------------------------------ 220,517 282,447 636, 266 rC.2. 173
Dutch -----------------------------_----------_ 573,929 619,017 r.,.2. 741 :; 700
French----------------------------------------- 407,249 481,526 39A, 393 530.026
i.rmi:ijiinrL, combined----- -------------------- 875,109 958,452 1,380,984 1, '2,3'.16

Total ------------------------------- 26,994,710 23,958.836 26.037,448 27, 748,215


With a cargo tonnage through the canal exceeding that of any pre-

ceding fiscal year, it will be noted that tonnage under the United

States flag was less than in 1924, while in most instances tonnage

carried under other flags has increased materially. Mineral-oil ship-

ments, referred to above as bearing particularly on cargo tonnage

carried in American vessels, although showing an increase over 1926,

were more than 2,000,000 tons below 1924 shipments, and account

for the decline in cargo tonnage carried by vessels of United States

registry as compared with three years ago. The volume of general

and miscellaneous cargoes carried in American bottoms has been

gradually increasing from year to year.

Complete statistics for all flags contributing to the 1927 traffic

through the canal appear in the table below:

Commercial traffic through The Panama Canal, fiscal year 1927, by nationality of
vessels


Nationality


Argentinan ------
Belgian..--------
British.....------.
Chilean ------ -
Colombian.-. ---
Costa Rican -----
Danish ---------
Danzig.. ---..--.
Dutch.--..--..---
Ecuadorian..-----
Finnish...........
French. ........-
German.---....-
Greek-.--...-.---
Honduran_-------
Italian.. ----------
Japanese----------
Yugoslav.- -.-
Mexican...--.:.:
Norwegian __ I
Panaman.........
Peruvian --..--...
Spaiii -h ..........
Sw edish-..-.-....
United States-----

Total. 1927.-
Toidl. 1926.
Tutal, 1925-.


Num-
ber of
trans-
its

1
16
1,351
27
52
2
46
29
105
6
2
116
212
1
1
74
165
14
1
265
105
63
30
106
2,685


5, 475
5, 197
4, 673


United
States
equivalent
net tonnage


71, 224
5,392,401
85, 830
18, 185
138
153, 048
155,863
433, 648
1, 187
3, 730
424, 017
571,957
3, 208
341
293, 190
701,983
45, 703
1, 569
691,481
54,115
ty, 785
90, 252
285, 747
10,987,994


20, 565, 596
19, 452, 828
18, 127, 153


Panama
Canal, net
tonnage


79, 214
6,942, 555
114,427
21, 500
138
198,432
192,947
575, 065
1, 210
3, 722
535, 719
779, 812
4,047
425
344,491
818,310
57, 340
2,159
907, 675
85, 374
143, 157
110,544
394,907
13, 914, 645


26. 227. 815
24, 774, 591
22, _1 151


Registered,
gross
tonnage


-----------
105, 474
8, 797, 856
178,013
30, 049
246
236, 832
250,971
699, 091
1,916
4, 058
683, 186
939,830
5, 269
623
4.7. 846
1, 11.:1, 725
72, 045
2, 876
1,115,468
109,427
205, 555
152,949
794, 272
17,678, 240


33, 555, 817
31, 672, 618
29,148,358


Registered,
net
tonnage


68, 235
5,431, 833
96,051
18, 163
144
152,607
143, 139
424,823
1, 201
3, 623
4 1 I1, .i61
.,:2, siM4
3, 322
348
2R2.32.5
6<. 14
45. 45.3
1, 892
685, 140
71,478
114,987
93, 118
343,306
10,958, 406


20, 618, 253
19. 548, 881
1x, 188, 061


Tolls


$1,200.00
75,245.31
6,452,527. 30
106, 899.60
22, 592. 25
103. 50
187, 640.36
166,959. 26
542, 023. 19
1,322.46
3,644.55
518,419.78
707, 510. 22
4,010.00
306.00
363, 168. 32
862,699.61
53, 847. 88
1, 961. 25
808,621. 74
66,844. 25
123,125. 70
107,904. 65
329, 804. 98
12, 720,447.95


24,228,830.11
22,931, 055. 98
21,400, 523. 51


Tons of
cargo


82,558
6,436, 785
86,960
20,917
------------
261, 543
159,362
571, 700
1,638
3,100
530,026
973, 741
6,124
------------
308, 050
1,036, 786
76, 649
2, 145
1,052, 453
87. 776
J107,997
47. 576
6-2, 173
15, 242, 156


27, 748,215
26,037,448
23,958, 836


''


i~----~I--





REPORT OF GOVERNOR OF THE PANAMA CANAL


VESSELS ENTITLED TO FREE TRANSIT AND LAUNCHES OF LESS THAN
20 TONS NET MlEASUREMENT
Naval and other public vessels of the United States, Panama,
and Colombia, and vessels transiting the canal solely for repair at
the Balboa shops, are exempt from the payment of tolls, and such
vessels are not included in the transit statistics in the preceding
sections. They accounted for the following additional transits in the
fiscal year 1927: Public vessels of the United States, 563; public
vessels of Panama, 11; public vessels of Colombia, 2; vessels transit-
ing the canal solely for repairs, 21; or a total of 597. These vessels
carried. a total of 228,740 tons of cargo.
If charges at commercial rates-had been made against the 563
public vessels of the United States that transited the canal without
payment of tolls, the revenue from tolls would have been increased
by approximately $1,275,995.25 during the year.
Launches of less than 20 tons net measurement are also excluded
from the traffic statistics, although they are not exempt from the pay-
ment of tolls. The number of these transiting the canal during the
year was 193, and tolls aggregating $1,235.18 were collected for their
passage.
TRADE ROUTES AND CARGO
An analysis of cargo movements through the canal during the past
year indicates strikingly the preponderance of the traffic between the
two coasts of North America.
In the Atlantic-to-Pacific traffic approximately three-fourths of all
the cargo tonnage moving through the canal originated on the east
coast of North America and almost, one-half was destined to the west
coast of North America. The proportion of North American inter-
coastal traffic moving in the other direction was no less striking, as
more than 70 per cent of all Pacific-to-Atlantic cargo originated on
the west coast of North America and slightly more than 68 per cent
was destined to the east coast of North America.
With the exception of cargo to and from the west coast of South
America, the volume of tonnage moving between the principal trade
areas served by the canal was as great or greater than for the pre-
ceding year. Cargo en route to the west coast of South America
decreased approximately 160,000 tons as compared with the fiscal
year 1926, while tonnage from the west coast of South America pass-
ing through the canal was less by 470,000 tons. General shipments
increased approximately 230,000 tons, but nitrates decreased over
700,000 tons.
Tonnage originating on the east coast of North America was greater
by 600,000 tons, while cargo routed to the east coast of North America
was greater by approximately the same amount.
64950-27- 2




12 REPORT OF GOVERNOR OF THE PANAMA CANAL

Tonnage destined to the west coast of North America was greater
by 210,000 tons, while tonnage originating on the west coast of North
America was greater by 1,570,000 tons.
Tonnage destined to Asia was greater by approximately 400,000
tons, while cargo from Asia was greater by 110,000 tons; outbound
cargo to Australasia was greater by 105,000 tons, while tonnage from
Australasia passing through the canal was less by approximately
50,000 tons.
In the United States intercoastal trade the cargo movement was
approximately 500,000 tons greater than in 1926, but was nearly
3,000,000 less than in 1924. Cargoes moving between the east coast
of the United States and the west coast of South America declined
approximately 300,000 tons as compared with the preceding year,
while tonnage moving between Europe and the west coast of South
America was less by 100,000 tons.
Tonnage moving between the east coast of the United States and
the Orient showed an increase in both directions. Cargo moving
between the Atlantic terminus of the canal and the western coast of
the United States totaled nearly half a million tons, being more than
double that for the preceding year.
In the tabulation below the volume of cargo tonnage moving over
11 of the principal trade routes through the canal is shown for the
past four years. Combined, approximately 92 per cent of the total
cargo routed through the canal during the past year passed over
these routes.

Cargo shipments through The Panama Canal during the past four fiscal years,
segregated by principal trade routes

Tons of cargo
Trade routes
1924 1925 1926 1927

United States intercoastal:
Atlantic to Pacific--------------- ------- 2,719,240 2.213.603 2,435,748 2,638, 786
Pacific to Atlantic---------------------- 10,808, 138 7, "'_, 656 7,633,856 7,921,719


Total----------------------------
East coast United States-west coast South
America:
Atlantic to Pacific-------------------------
Pacific to Atlantic-------------------------
Total----------------------------
E- ur]'pr'-t t. coast Canada:
Atlantic to Pacific-------------------------
Pacific to Atlantic..... .....-------------------------
Total ------------------------------
Fiurorpe-.t-st coast United States:
.\l:miic( to Pacific.-----.-- ------- -----
1'nrific to Atlantic---------------------
Total..--.---..--------------------


13, 527, 378 9,496, 259 10,069, 604 10, 560, 505

373, 34 377,864 423,730 412,835
2,3 2'1 2,661,756 2,816, 346 2,518, 611
2, 702, 629 3, 039,620 3, 240,076 2,931,446

242,279 361,792 377.446 559,138
1,211,535 1,409,277 1,0*l1, 663 1,901,702
1,453,814 1,771,069 2,059,109 2, 4-10. 4 II

427.992 334.761 321. 540 199,105
1, .'J1, 230 1, 1571;. 556 1, 31,662 1,821,255
1,659, 222 1,492, 317 1,656, 202 2,020,360






REPORT OF GOVERNOR OF THE PANAMA CANAL


Cargo shipments through. The Panama Canal during the past four fisc.al years,
scgregatcd by principal trade routes-Ciaiitiniiiied


TriadI routes



East coast tlnilil St;it's-IF'nr East:
Atlantic to Prciltit ........... .. ......
Pacific to Atlantic...--..--------------... ...

Total..-------------------------.- -...-.

i'uroa i:-e t st coast South America:
.1: litn ic to Pac' ifi c. .... ...... .
Pacific to Atlantic------------------------

Total---------------------------------

AP ll toI I'..c ............. ......
PTotal.......inti ........... ......... ...

T otal .-- -- -- -. ..-.-.-.. .. .-- .- -

I' ln-tl States-west coast Canada:
Atlantic to Pacific---.---------.------.------
Pucitir to Atlantic --------------.-----------

Total--.. -..--.---.----------.----------

United States-Australasia:
Atlantic to '.i ifii ..........................
Pacific to Atlantic--..........------------.....----..---..-

Total ---------------------. -------

4Cristobal-west coast United States:
Atlantic to Pacific--.......---............----
Pacifice to Atlantic.-------------------------.

Total..--.--------------------------....


-I n I- of carro


1924


1, ..n 27r.
-"i1. 11i1 I

1,798,278

i;27. 356
1,378,501

2,005,857

509,477
;illt. ;7k)

813,847

1.;t. 364
356,223

486,587

587,481
47,777
635, 258

29,061
53, 924

"2. 9P.'


1925



1,234, 008
266, 269

1,500,877

771, .388
1, 708, 626
2, 1-:. 014

518.406
420,356
938,762

178,110
!.111. 023

679, 733

rr3.619
*". 195

691, 814 i

23, S77
.9., 372

:'. JO


East coast Canada-west coast United States:
Pacific to .\tlirnltic .......................... 111,392 132, 623

Total.--..----------------------------. 111,392 132,623

Miscellaneous routes and sailings:
Atlantic to Pacific----------------------- 709, 227 71 .. 369
Pacific to Atlantic_ ----------------- ------ 1, 018, 236 ;:.r. 130

Total ................ ................ 1. 727463 1. 37.4

Total traffic all routes
Atlanlic It f Pacitr*. ................... ...... 7. .Ii, l' 7 1. 3' 7
Pae:ti to . . . . . . . . . .. I .

Total.--.--------------------------------- 26. I-'17 '1- (1! I


1,421,214
(1'(. 834

1, ;'. ,048

7S3,007
1.' I2,733

2. 059, 109

543., 25
55f,.871

1, 100. ,96

19. 175
t51. 969
851.144

727,106
33, 087
71ll. ;'i.1


26, 251
Jiir 129

226, 381

271, 618

61.618


1, ".7. 151
4TG. 313

1,983,464

623,030
1, .l .. 573

1,.919, 03

539. 792
i1.*., 425

1. i:i:l. 217

*-1.7.895
t.>,959

926,854


. 758

'. 919

40,484
-1Vr... 811

497, 295

354, 859
:I4 789


;;4.755 5 9..50
1 ., 583 I 1. '3', 903
1 651 331 ?.. 200. 83


2tl' ci:.448


27, ..177

27o. 7.:-.


PRINCIPAL CONM MODITIES

Precise statistics are not kept of all commoditie- pI)ing through

the canal because it is not required that complete manifests of cargo
carried by vessels be submitted at the canal. In lieu thereof the

master of each vessel is required to file a briefly iteriized statement,

listing the principal items of cargo carried, and showing their port

of origin and destination. These itemized statements are the basis

of such commodity statistics as are compiled, anrd, except for conrlnodi-

ties commonly shipped in bulk, such as mineral oils carried in tank
ships, wheat, barley, lumber, nitrate, etc., actual shipments are likely

to be in excess of the aggregate tonnage reported during the year and





14 REPORT OF GOVERNOR OF THE PANAMA CANAL

shown in the annual summary, because there is a natural tendency
to list small miscellaneous shipments under the head of "General
cargo," and not infrequently no other classification is made of entire
cargoes carried by vessels. Subject to errors arising from this
source, the tonnage of the principal commodities shipped through
the canal during the past four years has been as follows:

Commodity movement
ATLANTIC TO PACIFIC

Fiscal year ended June 30-
Commodity
1927 1926 1925 1924

Manufactures of iron and steel-------------------------1, 971, 964 1, 525,280 1,416, 135 1, 691,712
Mineral oils----------------------....-.- -- ... 649,379 721,817 948,451 1,079,137
Cotton------------------------------------- 361, 241 226,092 141. 604 100,925
Sugar----------------------------------------........ 282,912 1'1. 997 91.461 32,952
Cement-------------------- ---------- ----------- 222,817 2,1,328 3.9,831 303,724
Sulphur----------------------------------------- 211,625 188,889 165, 925 146,712
Tin (metal)------------------------- 194,111 202,773 145,188 191,733
Railroad materials---- ---------------------... 189, 858 150,993 138,740 192,537
Phosphates----------------------------------------.. 183, 521 162, 254 67, 206 25,473
Machinery ------------------------------------- 172,150 134,411 133,024 181,112
Paper- --------_ ----_...- __.---- --- -------_ _---_ 150,722 101,493 101,827 90,885
Ammonia--------------------- ------_-------- 134,977 108,104 88,199 78,813
Automobiles (exclusive of accessories) ------------------ 127,882 125, 820 124,972 110,351
Coal ------------------------------------------- 96,772 222,288 159,231 191,488
Textiles----------------------------------------- 91,967 78,770 94,132 90,207
Coke-------------------------------------------- 89,750 93,344 96,.114 90,447
Tobacco-- --------------------------------------- 81,457 65,174 68,472 71,550
Iron (metal)------------------------------------- 60,216 47,490 51,867 94,746
Asphalt----------------- ------------- -------- ------- 60,586 43,458 34,978 34,639
Coffee------------------------------------------ 54,018 39,356 3?,345 48,714
Glass and glassware------------------------------- 53,119 44,363 24.826 25,389
Auto accessories----------------------------------- 53,064 46,132 39,462 9,773
Agricultural implements---------------------------- 52,438 38, 976 40, 223 40, 529


PACIFIC TO ATLANTIC

Mineral oils '--------------------------------- 7, 143,165 5,930,716 5,989,622 9,721,446
Lumber------------ -----------.------------- 3, 139,113 3,200,311 2,255,421 1,824,438
Wheat --------------------_ _------------------- 1, 477,376 1,187,384 1,078,844 1,352,388
Iron ore-------------------------------------- 1,403,737 1,334,408 1,045,383 888,198
Nitrate---------------------------------------- 1,174,384 1,878,050 2,155,814 1,744,580
Canned fruit------------------------------------- 403,270 356,609 2'55. 688 229,691
Sugar-.------------------------- -- ------ 427,035 31 .032 .100.465 2s6,.782
Copper (metal)----------------------------------- 357,456 .jl3, 045 211,168 270,688
Barley ----------------------------------------------- 344,341 313,535 236,115 266,859
Food products in cold storage 2-------- --------------- 245, 520 221, 068 202,781 142,830
Canned fish --- ---- -------- -------- 209,491 16. 701 165,071 151,201
Dried fruit------------------------------ -------- 200,433 1,5. 0229 135, 832 103,469
Wool---- ------------------ ---------------- 129,906 146,092 91,586 84,696
Coffee-------- -------------------------------- 113,313 104,739 81,881 102,451
Cotton ------------------------------------------ 107,311 65,850 75,358 r54.253
Fresh fruit---------------------- ------------------ 97,969 63,495 45,376 25, 0.3
Flour---------------------------------------------- 90,988 64,391 82,402 36,943
Lead (metal)------------------------------ -------- SI.077 79,734 76,343 29,916
Copra ---------------------...............---------------------- 1. 685 76,223 90,125 51,115
Beans------------------------------------------ ..... 73,569 54,565 lu101, 1 60,030
Oats------------- ------- ------------------ ----- 73,515 41,084 37, x75 24,946
Rice-------------------------------------------........71,870 20,664 49,315 74,470
Copper (ore)----------------------.---------------- 62,436 79,104 100.289 85,947
(' innlI vegetables------------- -------------------. 60,982 28,908 27.391 16,177
Skins and hides----------------------------------- 58,976 48,479 46,875 51,595
Tin (ore)---------------------------------------- 57,092 51,325 27,955 24,677
Borax -..------------------------------------------- 56,091 51,951 50,428 46,791

1 Includes crude, refined, and lubricating oils. 2 Does not include fruit.

In the Atlantic-to-Pacific cargo movement, reported shipments of
crude and refined mineral oils, cement, tin, coal, and coke were lower
than the preceding yeair, while the other shipments listed above were





REPORT OF GOVERNOR OF THE PANAMA CANAL


higher. The more important increases were in shipments of manu-
factures of iron and steel, cotton, sugar, sulphur, railroad materials,
and paper.
In the Pacific-to-Atlantic cargo movement all of the 27 commodities
listed above, except lumber and nitrate, show an increase in tonnage
as compared with the fiscal year 1926. Mineral oils, lumber, wheat,
iron ore, and nitrate accounted for 14,300,000 tons out of a total of a
little over 19,000,000 tons of cargo passing through the canal in this
direction. The more important, increases were mineral oils 1,212,000
tons; wheat, 290,000 tons; iron ore, 69,000 tons. Lumber decreased
61,000 tons and nitrate 703,000 tons.
CLASSIFICATION OF VESSELS
Of the 5,475 commercial vessels transition the canal during the
fiscal year, 4,668 were steamers, 654 were motor ships, 80 were motor
schooners, and the remaining 73 were sailing ships, barges, etc. For
the past four years the proportion of each class hns been as follows:

1924 1925 1926 1927

Per cent Per cent Per cent Per cent
Stearner ...................................... ...............-- 94.4 92.0 89.2 85.3
Moior ship .............. ................... ............ 3.9 6.0 8.5 11.9
Motor schooners_---------------------------------------------- 1.0 1.1 1.2 1.5
M isce ljneous ................... ... .. .. .......... ....... .7 .9 1.1 1. 3
Total-------------------------------------------------- 00 I1 00. 100.0 100.0

As indicated above, the number of motor ships transiting the canal
has been increasing from year to year. The actual number of transits
for the past several years has been as follows: Fiscal year 1922, 77
transits; 1923, 121; 1924, 203; 1925, 282; 1926, 443; 1927, 654.
Of the 4,668 steamers transiting the canal duringg the past fiscal
year, 3,303 burned oil, 1,323 burned coal, and 42 were reported as
fitted for either fuel. For the past four fiscal years the proportion of
each class has been as follows:

1924 1925 1926 1927
Pr cent Per cent Per cent Per cent
Oil-burning............... ........ ....... ........... 69.1 69.4 66.2 70.8
Coal-hurning.. ....................... .. 30.1 30. 1 33.2 28.3
Eilber ud or coal ........................................ .. .8 .5 .6 .9
100.0 100.0 100 0 100.0

DETAILS OF THE TRADE
Further particulars of the traffic are presented in Section V of this
report, in Tables Nos. 67, 68, and 69.
DUAL MEASUREMENT SYSTEM
Under the present law, tolls on commercial vessels using the canal
are levied at $1.20 per net ton on laden ships and $0.72 on vessels
in ballast on the basis of tonnage determined by the Panama Canal





REPORT OF GOVERNOR OF THE PANAMA CANAL


rules of measurement, with the proviso that the amount collectible
shall not exceed $1.25 per net ton or be less than $0.75 per net ton,
as determined under the rules for registry in the United Stat~es.
This requires that tonnage be determined and tolls reckoned on two,
bases, and as the United States rules of measurement are considered
somewhat arbitrary and are subject to changes the dual system
results in confusion and annoyance. Occasionally on small vessels,
such as tugs, the United States rules indicate a negative net tonnage
and such vessels make the transit without payment of tolls.
The canal administration has advocated consistently the adoption
of the Panama Canal rules only as the basis of tolls and in recent
years has suggested that if they be adopted the rates of tolls should
be set at $1 per net ton for laden ships and $0.60 for ships in ballast,
which would return approximately the same revenue as is collectible
now. This plan has met opposition from operators of United States
general cargo vessels for the reason that it would result in a slight
increase in the charges against this type of vessel. However, for
the past fiscal year the adoption of the canal plan would have increased
the total tolls less than four-tenths of 1 per cent, as the additional
collections would have been $93,409.79 as compared with the actual
collection of $24,228,830.11. For all United States vessels together
it would have meant a decrease of $118,825.35. The following table
shows the distribution of this increase among the vessels of the
different nations using the canal during the year:


Nationality


Argentine .-----------------------------
Belgian----. ---......----- --------------
British...-- --.---- ......-..............
Chilean ---------------._ _--... ..-.-.--
Colombian..........-.. ..-.-..-..-.....-
Costa Rican ---------.--------------------
Danish---..---_.-. .. .--- ...---.-.-.---.-
D a n z ig --- - - --.. .- -.-.-.. -. ._ .-- -
Dutch -----.---------.----......------..
E cuadorian.------- --- .- .- ---_ .-- _------
Finnish. --.. ---- -- .-- ...-..._ ..-_-- .
French -- ---- ------ ---------_ ------- .--
German ----------------------------------
G reek ... -_--------- -.-- ...-- --_ ....-_
Honduran --------------. _-----------_---_
Italian -------. ------ _.-... ---...---___ ..-
Japanese-----------------------_---------.
Mexican --------------------.__--------_
N orwegian ---------- ----- -- ..----- .----.
Panaman -----. --------_-_-__-----
Peruvian -------.------_.-_---_--.------
Spanish. .-- -- ----- ---__ -__ -.-- ___--- -
Swedish ---------- -.._...._-......
United States------------_......--.......--
Yugoslav.--------------- ------ ----__ ----
Total----.....--..-..- ... ...- ......-
Total difference-Increase of---------


Total act-
Sually collected
under present
dual system




$1,200.00
75, 245. 31
6,452, 527. 30
106, 899. 60
22, 592. 25
103. 50
187, 640. 36
166,959. 26
542, 023. 19
1, 322.46
3,644. 55
518, 419. 78
707, 510. 22
4,010.00
306. 00
363, 168. 32
862, 699. 61
1,961. 25
808, 621. 74
66, 844. 25
123, 125. 70
107, 904. 65
329,804.98
12, 720, 447. 95
53, 847. 88
24,228. 830. 11


Tolls that
would have
been col-
lected under
proposed rate
of $1 per ton
laden and 60
cents ballast,
Panama Ca-
nal measure-
ment

$1,200.00
66, 601. 20
6, 567, 300. 70
114,207.00
21,476.00
82. 80
188, 193. 60
151,673.80
574, 264. 80
1,094.40
2,988.80
523,059. 40
769, 824.80
4, 047.00
255. 00
342, 722. 60
812, 316. 80
2, 159.00
833, 642. 60
84, 727. 20
143, 568. 40
105, 688. 00
356,985. 00
12,601, 622. 60
52,538.40
24, 322, 239. 90


Increase







$114, 773. 40
7, 307.40

553. 24
32, 241. 61

4, 639. 62
62,314. 58
37. 00


197. 75
25, 020.86
17,882.95
20, 442. 70
27, 180. 02


312,591.13
93,409. 79


Decrease






$8, 644. 11

1, 116.25
20. 70
--------------
15, 285. 46
228. 06
655.75


51. 00
20, 445.72
50, 382.81
--------------
--------------
--------------
2,216.65
--------------
118, 825. 35
1, 309. 48
219,181. 34
--------------


1 Naval vessel on which tolls were assessed on displacement tonnage.




REPORT OF GOVERNOR OF THE PANAMA CANAL


HOURS OF OPERATION

The system of dispatching vessels through the canal on a time
schedule was continued through the year. With reference to the
provision that vessels loaded with gasoline or naphtha are not per-
mitted to move about in canal waters during darkness or to transit
the canal on such schedule as may cause them to encounter other
vessels in Gaillard Cut, the practice. was adopted of using place No. 3
on the northbound schedule (Pacific to Atlantic) for such vessels, as
well as Nos. 1 and 2. This was brought about. by the increase in
traffic of tankers.
There was no further agitation during the year for placing the
canal under 24-hour operation. Under present operating conditions,
for vessels at the Pacific entrance awaiting transit, the ship on No. 1
schedule is dispatched through the canal so as to reach theMiraflores
Locks at 7 a. m. Subsequent dispatches are made at approximately
30-minute intervals until all awaiting traffic is disposed of, except
that no vessel is permitted to begin the northbound transit unless
she can be dispatched so as to reach Miraflores Locks by 3.30 p. m.
For vessels awaiting transit at the Atlantic entrance, the first two
ships are dispatched so as to reach the Atlantic Locks at 7.15 a. m.
and 7.25 a. m., respectively. Subsequent dispatches, averaging
approximately two per hour, are made by schedule until all awaiting
traffic is disposed of, except that no vessel is permitted to begin
southbound transit unless she can be dispatched so as to reach Gatun
Locks by 2.20 p. m.
The schedules outlined above for dispatching vessels through the
canal require the Atlantic Locks to be operated from 7 a. m. to 11
p. m. daily and the Pacific Locks from 6.50 a. m. to 10.50 p. m. daily.
Lengthening the hours of transit necessarily would prolong the hours
of lock operation, which would mean added difficulties and increased
costs of operation not only at the locks, but for other divisions of the
canal as well. Increase of traffic may eventually make an extension
of operating hours advisable but under present conditions it is not
warranted.
LOCKAGES AND LOCK MAINTENANCE
Lockages.-The average number of lockages per day was 14.98 at
Gatun, 15.84 at Pedro Miguel, and 15.59 at Miraflores. The total
number of lockages at all locks was 16,941, as compared with 15,970
during the fiscal year 1926, and 14,480 for the fiscal year 1925.
Hours of operation.-At the Gatun Locks, except during the period
of overhaul when one lock chamber was out of service and 24-hour
operation was in effect, two shifts were on duty from 7 a. m. to 3 p. m.
and one shift from 3 to 11 p. m. At Miraflores the hours of operation
were from 6.50 a. m. to 10.30 p. m. and at Pedro Miguel from 7.30





18 REPORT OF GOVERNOR OF THE PANAMA CANAL

a. m. to 9 p. m., with overlapping shifts to make possible double
lockages between 9.20 a. m. and 5.20 p. m. at Miraflores and 9.30
a. m. to 5.30 p. m. at Pedro Miguel.
On December 29, 1926, 28 commercial ships were locked through at
Gatun, which constituted a record day for commercial traffic at
Gatun Locks.
At the Gatun Locks, March traffic of 661 ships with a total of 524
lockages constituted a month's record. This record traffic was
handled with only one chamber in operation except for the first three
days of the month.
The total delay to vessels, after entering the locks at Gatun, due
to minor troubles of operation, was but four hours and 24 minutes.
In no case was the delay to any lockage more than 15 minutes, and
of the 32 delays that occurred during the year the average delay was
eight minutes.
Lockages during the year are summarized in the following table:

Gatun Pedro Miguel NMirafor-us Total

Lock- Vessels Lock Vessels Lock- Vessels Lock- Vessels
ages ages ages ages

1926
July -__- ------------------ 440 514 463 533 455 530 1,358 1,577
August_---------------------- ----- 457 523 491 575 478 556 1,426 1,654
September --------.---------------- 439 505 468 581 461 561 1,368 1,647
October------------------------------ 441 528 472 557 465 557 1,378 1,642
November.------------------------- 418 514 438 521 434 521 1,290 1,556
December.---------- ---------- -----441 566 482 592 475 588 1,398 1,746
1927
January-------------------------- 451 554 471 580 468 570 1,390 1,704
February--------------------------- 444 551 468 559 461 576 1,373 1,686
March ----------------------------- 524 661 542 638 535 648 1,601 1,947
April-------------- --------------- 469 582 488 606 478 606 1,435 1,794
May ------..------------.------------ 460 546 495 600 484 603 1,439 1,749
June-------- --------------------- 483 597 505 626 497 625 1,485 1,848
Fiscal year-
1927 ----------.---------------- 5,467 6,641 5,783 6,968 5,691 6,941 16,941 20,550
1926-.--------------------------- 5,213 6,386 5,398 6,434 5,359 6, 403 15,970 19,223
1925 -------------------------- 4,644 5,485 4,977 5,703 4,859 5,689 14,480 16,877
1924 --- ---------------- ------5,260 6,205 5.572 6,297 5,520 6,277 16,352 18,779
1923 ---------------------------- 4,011 4,638 4,267 5,017 4,273 4,960 12,551 14,615


Overhaul.-During the period of January 17 to April 3 each lock
at Gatun was unwatered for the triennial overhaul. The west
chamber was out of service from January 17 to March 1 and the
east chamber from March 4 to April 2. The west chamber was
out of service 43 days and the east chamber 29 days. As no work
was done on Sundays and holidays, the overhaul was accomplished
in 36 and 25 working days, respectively. The work was performed
with the intention of inaugurating a four-year period of overhaul
rather than the three-year, as has been the practice in the past.
In addition to various ordinary replacements, 40 new cylindrical
valves and bodies were installed. Twenty of these were purchased





REPORT OF GOVERNOR OF THE PANAMA CANAL


in the United States and 20 were manufactured on the Isthmus by
the mechanical division. A total of 600,540 pounds of bitumastic
enamel and 2,525 gallons of solution were used in painting miter
gates, rising stem valves, bulkheads, screens, fixed irons in culverts,
and other miscellaneous places. Of the enaniel, 346,940 pounds
were used on exterior surfaces of gates and 111,500 pounds in the
water chambers of the gates.
Equipment.-The installation of the automatic emergency brakes
for the towing locomotives, which had been designed and tested out,
was completed for all locomotives at all locks.
A fender chain composed of detachable links alternating with solid
links was installed at the locks at NMiraflores for trial. If this chain
is successful it is planned to adopt it as standard material for the
locks to replace the all-solid link chains of wrought iron.
Investigation was made of the loads bearing on the idle rollers
under the outer faces of the bull wheels of the miter gate-moving
machines. The findings dictated the adoption of an idler of greater
capacity, and accordingly a design of a double roller to replace each
single roller was made. Two of these. were ordered for each set of
locks and if they prove successful a general replacement of all weak
rollers will be made.
Design for new arrow signals for the ends of the center approach
walls was made and six were manufactured of aluminum. Two
semaphore signals were installed at the sea end of Gatun Locks for
the purpose of giving additional information to ships approaching.
Samples of a lighter cylindrical lens with iron shields for vault
lights in the ceilings of tunnels and machine rooms were purchased
for test; the original installations were of heavy cylindrical lenses
set in the pavement without shields, and these gradually crush into
powder, requiring many renewals.

POWER FOR CANAL OPERATION
Electric power for the operation of the canal throughout the year
was derived primarily from the hydroelectric plant at Gatun. The
old Afiraflores steam plant and the new MNiraflores Diesel electric
plant were maintained on a stand-by basis but were not required
to carry load for the purpose of conserving the water in Gatun Lake.
However, load was handled by the steam station 24 times and by
the Diesel electric plant 22 times'on account of peak load conditions
and other operating requirements.
The combined generator output of the three plants averaged
5,066,243 kilowatt-hours per month, as compared with 5,031,756
kilowatt-hours per month last year. An average of 4,386,746 kilo-
watt-hours per month was distributed from substations, as com-
pared with a corresponding figure of 4,231,127 kilowatt-hours per





REPORT OF GOVERNOR OF THE PANAMA CANAL


month for the preceding year. These figures indicate a loss in
transmission and distribution of 13.41 per cent, as compared with
similar loss of 15.91 per cent during 1926.
The old Miraflores power plant was maintained on a stand-by
basis during the first half of the fiscal year, the fires having been
drawn at midnight December 31, at which time the new Diesel
electric plant was advanced to such state of completion as to be
capable of handling this service.
At the generating plants there were no interruptions to service
during the year. Two failures of major equipment occurred; one
being a 1,500 KVA transformer at Gatun substation, and the other
a 2,667 KVA transformer at Cristobal substation. Both transform-
ers have been repaired and are now back in service. On the 44,000-
volt transmission line there were nine interruptions during the year.
Temporary installation was made at Gamboa of outdoor substa-
tion equipment of 3,000 KVA capacity to accommodate gravel
handling operations up the Chagres River. This equipment will
be removed and installed permanently at Summit for supplying
current for dredging operations in the vicinity of Gaillard Cut,
probably about November, 1927.
DIESEL-ELECTRIC PLANT
The construction work on the Diesel-electric generating plant at
Miraflores was continued, and in a practical way the plant was
completed at the close of the fiscal year. The erection of equipment
started with the arrival of the contractor's erecting engineer in
August. Two of the units were erected and available for service
by the end of the calendar year and the old steam plant was com-
pletely shut down the last day of December. The switchboard
erection for the new plant progressed to such a state of completion
that it was possible to bring it into service the last week in January.
The third engine unit was ready for service the latter part of
February.
The erection of this station is the largest single construction job
which has been performed on the Canal Zone since the completion
of the construction of the canal and its appurtenances. The new
plant is in replacement of a former steam plant which it adjoins in
location, and has been installed for the sake of increased capacity
and economy in operation. During such times as the water supply in
Gatun Lake is adequate and except as occasional peak loads place
demands on the auxiliary station at Miraflores, the electricity of the
canal is generated entirely in the hydroelectric station at Gatun,
placing the auxiliary plant in stand-by service. Under such condi-
tions it has been possible to operate this auxiliary station in complete





REPORT OF GOVERNOR OF THE PANAMA CANAL 21

readiness for immediate service, but with zero generator output on a
fuel consumption of approximately 5 barrels for a month.
The installation consists of three units, each composed of a Diesel
engine of 3,750 brake horsepower, direct-connected to a 25-cycle,
2,200-volt generator of 2,500 kilowatt capacity at 80 per cent power
factor, with necessary auxiliaries. Each of the three engines with
its generator and auxiliaries forms a complete unit with a length of
60 feet. and a weight of 815,000 pounds. The engines are all of the
2-cycle, air-injection type, with six cylinders, each cylinder having a
bore of 29 inches, a stroke of 44 inches, and operating at a speed
of 125 revolutions per minute. This station is said to be the largest
of its kind in the Western Hemiisphere. The plant is housed in a
concrete building, 78 by 141 feet in plan and 58.5 feet in height from
floor of basement to bottom chord of roof truss.

WATER SUPPLY

Coimpaiirtive data showing the inflow of water in Gatun Lake
from all sources, utilization, and losses for the fiscal years 1926 and
1927 are shown in the following table:

Per cent of total, Billion cubic feet,
fiscal year fiscal year

1926 1927 1926 1927

Run-off .ho\ hijiuel.. .......... ............ ............. 35.0 35.9 55. 01 82. 18
V' -i from in Iil m i ai .i w lli iju11 l i............. ....... .......... 41.7 44.3 C65. 46 101.57
Direct rainfall on lake surface------------------------------- 23.3 19.8 36.66 45.47
Total---- --------------.------------------------ 100.0 100.0 157. 13 229.22
F iii r.laioinr from lake surface- --------.. --------------------- 13.3 8.7 20.97 20.02
(; IaIIi I. ik. lockages-.... ----------------------- 19.8 17. 0 31. 14 38. 96
Hydroolectric power--.......----------------------------------------- 26.4 19.9 41.52 1 45.64
S1.,11n waste-------------------------------------------- 39.5 50.1 62. 07 114.86
Leakage and municipal water------.....------------------------- 1.0 0.6 1.53 1 1.39
Increase or decrease in storage -.------------------------------------- 3.7 -0.10 +8.35
Total---------....--..................................--------------------------------------- 100.0 100.0 157. 13 229. 22

Dry ..-(a.on.-From a wvater-supply standpoint the 1927 dry season
began about January 11 and ended April 25, a total of 105 days,
during which time Gatun Lake fell from elevation 87.15 to 84.08
feet, representing a loss in storage of 14 billion culjic. feet. No effort
was made to save water at the Gatun hydroelectric generating plant,
and only a slight saving was made in lock age water, as the indications
at the beginning of the dry season were that there was no danger of
a prolonged dry season such as that of 1926. Since the new Diveel
plunt at Miraflores was completed and it was necessary to break in
the varrious units, some power was generated there but not. with the
purpose of saving water.





REPORT OF GOVERNOR OF THE PANAMA CANAL


ADDITIONAL STORAGE AT ALHAJUELA
From the early days of the canal the need for additional storage of
water has been recognized in order that a reserve might be available
in the event of a long dry season. During approximately eight
months of the year much excess water enters the lake and has to be
spilled into the sea. During the remaining four months the inflow
is wholly inadequate to meet the demands for water which must be
provided for the lockage of ships, the generation of electric power,
and for municipal purposes, in addition to the heavy losses resulting
from evaporation. The maximum height to which Gatun Lake may
be filled is 87 feet plus. The minimum lake elevation permitting safe
navigation through Gaillard Cut is 80 feet plus. This gives a margin
of 7 feet of storage available for drawing upon during the dry season.
With the continued increase in traffic, the time is approaching when
this margin will not suffice to provide safe transit through the cut
for heavy draft vessels toward the end of a dry season both extremely
dry and unusually prolonged.
By the erection of a dam at Alhajuela a second basin can be created
where surplus water can be stored in the rainy season to be drawn
upon during the dry season to maintain the level of Gatun Lake.
Recent topographical surveys show that it is feasible to build a dam
about 170 feet in height, which will create a reservoir covering about
22 square miles, and provide additional storage of about 22 billion
cubic feet. In addition, the reservoir would be a means of control
of the Chagres River during floods in the rainy season, which are a
possible menace to navigation.
It will probably require about five years to complete this project
from the time appropriations become available, and it is highly desir-
able to proceed with the construction at an early date. The necessity
for additional storage is but a matter of time in any event, and early
construction will simplify present operating problems and minimize
the possibilities of serious accidents or delays to shipping.
SEISMOLOGY
Twenty-two seismic disturbances were recorded at Balboa Heights
during the fiscal year ending June 30. Of these, about 64 per cent
were of local origin, 22 per cent of distant origin, and 14 per cent
were so slight that no estimate of the distance of the epicenter could
be made. No damage was reported from any of these tremors. In
the preceding fiscal year the number recorded was 36.
MAINTENANCE OF CHANNEL AND IMPROVEMENT PROJECTS
During the year a total of 4,618,850 cubic yards of material was
dredged from the canal prism, 270,150 cubic yards from the Balboa
terminals, and 455,000 from the Atlantic terminals. In addition,





REPORT OF GOVERNOR OF THE PANAMA CANAL


208,140 cubic yards of run-of-bank gravel were dredged from the
Chagres River, which involved the handling of 85,600 cubic yards of
silt.
The following statement shows in greater detail all material removed
from the canal prism and auxiliary projects during the fiscal year:

Cubic yards

Earth Rock Total

From the canal prism:
Atlantic entrance--------------------------------------- 801,900 0 801, 900
Oatun Lake-.----- ---------------------------------------- 268,300 57,850 326, 150
Gaillard Cut-- -------------------....--..----------------.. 372, 750 1,525, 150 1,897,900
Pacific entrance- I
Maintenance--------------.------.. -------------------- 707,500 63, 300 770, 800
Improvement project No. 1 ------.----------------------- 244,950 577,150 822, 100


Total, canal prism ....-- .....--.. .- ..------- -------------


2,395, 400 2, 223,450 4, 618, 850


Auxiliary:
Balboa inner harbor-
Maintenance..------.---------------------------------- 99,200 0 99, 200
Improvement project No. 1 _---------------------------- 170,950 0 170,950
Cristobal harbor.-------------------------------------- 455,500 0 455,500
'Total, harbors---------. ----------------------------- 72.,.0 0 725, 650
Sand and gravel service.-------.--.---.-.-----.------------------- 293, 740 0 293,740
Grand total.-------------------- ------------------ 3, 414, 790 2,223, 450 5,638, 240

Improvement project No. 1.-The work of deepening the Pacific
entrance channel from Miraflores Locks to the sea buoys from 45
feet to a ruling depth of 50 feet, mean sea-level datum, known as
improvement project No. 1, was continued throughout the year at
times when equipment was not needed on other work. A suction
dredge removed 1,039,300 cubic yards of material from the channel
and Balboa inner harbor, dredging where possible to 50 feet mean
sea level, leaving all hard material to be removed later by dipper
dredges. An additional 823,750 cubic yards of material were removed
by dipper dredges during the year. Two drill boats were employed
11 months each on this work, breaking up 407,407 cubic yards of
rock and using 388,828 pounds of dynamite. At the close of the
fiscal year the excavation on this project totaled 1,650,950 cubic.
yards.
A suction dredge working in Cristobal Harbor removed 455,500
cubic yards of material, all of which was pumped on Telfer's Island
through pipe lines averaging 4,100 feet in length.
At the close of the fiscal year there remained to be removed from
the canal prism, including siltage, slide material, and improvement.
project No. 1, 3,117,800 cubic. yards of earth and 2,761,250 cubic
yards of rock. In the Cristobal and Balboa Harbors, including
improvement. project No. 1, there remained to be removed 907,400
cubic yards of earth and 706,600 cubic yards of rock.




REPORT OF GOVERNOR OF THE PANAMA CANAL


Eq uipiment.-The following floating equipment was employed or
held in reserve during the fiscal year: Three 15-yard dipper dredges,
in service eight months each; two 20-inch pipe-line suction dredges
operated 11 months each; two drill boats employed continuously
throughout the year; a hydraulic grader operated four months in
filling low areas in Lirio Lagoon and vicinity; a relay pump barge
employed six months in connection with suction-dredge operations;
two 250-ton floating cranes were operated alternate months except
when the demands of the service necessitated commissioning both
cranes; five large tugs and one small tug were operated continuously
except when laid up for repairs; a second small tug was held in reserve.
Other equipment included a ladder dredge, a crane boat, 11 launches,
and an air compressor.
SLIDES

There was no interference with shipping on account of slides, though
a number of breaks occurred during the year, with the result that
considerable material entered the channel, causing shoaling and par-
tial obstruction. The more important movements were as follows:
On July 2, 1926, a settlement, occurred in a portion of the high
bank at the north end of E:Rst Culebra slide, and some 16,900 cubic
yards of material entered the prism. On October 6, 1926, a second
slide, with an average drop of 40 feet along the back rim, occurred at
this point, the toe of the slide reaching the canal axis, causing general
shoaling which extended to the west bank. This new slide covered all
the area involved in the old slide, and an additional area of approxi-
mately 8 acres. A general movement continued until the morning
of October 8, 1926, after which only slight movements along the
water edge were observed until December 27, 1926, when another
general movement occurred, resulting in some material entering the
canal prism and causing shoaling to the center line,. No further move-
ment was observed until June 1, 1927, when another settlement oc-
curred and approximately 90,000 cubic yards of material entered the
basin which had been dredged at the foot of the slide.
At West Cilebra slide, a slow general movement and settlement
continued intermittently throughout the year. On June 17 and 20,
1927, movements occurred in this slide and some 35,000 cubic yards
of material entered the canal. This movement was accompanied by
a settlement under Hodges Hill. During the year the dredges re-
moved 117,400 cubic yards of material from in front of West Culebra
slide and a total of 1,258,100 cubic yards from the foot of East Culebra.
slide, making a grand total of 29,015,860 cubic yards of material
removed from these two slides to date.
On July 29, 1926, a general settlement of the high bank occurred
at West Lirio slide, causing material to push into the canal about 40




REPORT OF GOVERNOR OF THE PANAMA CANAL


feet beyond the west prison line. This slide continued its movement
toward the canal during the first part of August, necessitating the
removal of 81,050 cubic. yards of material at that time. Again on
October 15, 1926, the lower portions of this slide settled and moved
toward the canal, pushing some innmteriail beyond the prism line. An
additional 17,000 cubic yards of InmteriiLl were dredged from in front
of this slide in October, making a total of 98,050 cubic yards removed
during the year, and bringing the total excavation to date from this
area to 1,843,820 cubic yards.
Cucaracha slide became active on the night of June 19, 1927, and
the entire area, extending to the previous back break showed move-
ment, with new cracks developing and several drops and breaks occur-
ring. The movement continued until June 27, during which time
approximately 105,000 cubic yards of material had entered the basin
and 10,000 cubic yards the canal prism. On the morning of June
30, the area just north of Purple Rock broke and approximately
10,000 culbie yards additional entered the basin. Dredges removed
62,900 cubic yards in June, bringing the total excavation at Cu-
caracha slide to 9,197,752 cubic yards at the close of the fiscal year.
At East Lirio slide, a movement occurred on October 13, 1926,
carrying material into the canal prism for a distance of 50 feet west
of the east prism line. A second break occurred in November, with
material pushing into the canal prism for a distance of 60 feet. Dur-
ing the year 27,050 cubic yards of material were removed from in
front of this slide, bringing the total excavation up to 396,212 cubic
yards to June 30, 1927.
Several additional small movements and breaks occurred, but the
amount of material involved was relatively small. The total yard-
age removed from Gaillard Cut during the fiscal year was 1,897,900,
of which 1,525,150cubhic yards were rock.

AIDS TO NAVIGATION

The maintenance of lights, buoys, and beacons established in the
canal and adjacent waters was continued. On September 24, 1926,
the luminosity of Bona Island Light, latitude 80 34' 30" north,
longitude 790 35' 30" west, was increased from 570 to 1,500
candlepowler and a sun valve was installed. With a view to effecting
a saving in gas consumption, and in labur expense through less fre-
quent recharging, sun valves were installed also on a number of gas
buoys and at gas range lights.
The gas and whistling buoy located 8.6 miles north of the break-
water entrance to Cristobal Harbor was permanently discontinued
June 24, 1927.
The arrangement heretofore existing between The Panama Canal
and the Bureau of Lighthouses whereby the lighthouse tender U. S. S.





REPORT OF GOVERNOR OF THE PANAMA CANAL


Favorite made periodic visits to and maintained the lights located at
Roncador, Quita Sueno, and Serrana in the Caribbean Sea, has been
discontinued. On April 1, 1927, at the instance of the Bureau of
Lighthouses, the care of these lights was transferred to the ninth
lighthouse district.
A buoy-tender, Coco Solo No. 2, built by the mechanical division of
The Panama Canal, was turned over to the lighthouse subdivision
during the early part of the fiscal year. This vessel is 64 feet 9 inches
overall, has a beam of 15 feet 6 inches, and a depth of 6 feet 7 inches,
with a loaded displacement of 90 tons. It is equipped with a 110-
horsepower Diesel engine, auxiliary air compressor, two gasoline-
engine generator sets for lighting, and has a one-half ton boom at the
forward end for handling buoys and cargo.
ACCIDENTS
Investigations were conducted and reports submitted by the board
of local inspectors on 60 accidents to vessels in transit through the
canal or using its terminal ports. In the majority of these accidents
the damages were relatively slight; there were 15 which caused
damages estimated at $1,000 or more. A classification of all accidents
shows the following: Collision between ships, 4; grounded in canal, 1;
struck bank of canal, 15; struck lock wall, 11; other accidents in
locks, 5; incidental to assistance by tugs, 9; docking accidents, 7;
miscellaneous, 8. The following is a brief description of the more
serious accidents:
On July 1 the steamship Chilore struck west bank of canal, denting
several plates and bending several frames in the forepeak tank, caus-
ing small leaks; accident caused by failure of steering gear; estimated
damage, $7,000, exclusive of dry-docking.
On July 9 the steamship Ontariolite, after passing another steamer
in Gaillard Cut, took a sheer and struck west bank of canal, denting
plates for a length of 30 to 35 feet, and suffering other damage; acci-
dent probably caused by vessel being overloaded; ship considerably
damaged, but no estimate made as to cost of repairs.
On September 6 the motor ship Buenos Aires struck east bank of
canal while endeavoring to tie up at Empire moorings; estimated
damage, $2,700.
On September 26, 1926, the tanker Tuxpanoil took a sheer and
struck bank of canal; cause unknown; estimated damage, $20,000.
On November 18, 1926, the steamer La Placentia, while leaving
moorings, struck dock and tug G. W. Getty; caused by mistakes of
engine-room personnel in executing orders from bridge; damage
estimated at $7,550.
On December 20,1926, the steamer Montrolite, after passing another
steamer, took a sheer and struck bank of canal, probably due to her
overloaded condition; damage estimated at $20,000.




REPORT OF GOVERNOR R OF THE PANAMA CANAL 27

On January 22, 1927, the steamer Trontolite took a sheer and
collided with a Panama Canal barge and dipper dredge; the accident,
was caused by failure of telemotor gear; estimated damage, $60,00.
On March 25, 1927, the U. S. S. Stoddert, without a pilot abroad,
collided with the oil crib at Balboa, with resulting damage of $3,350.
On April 26, 1927, the steamer Felix Tau.ssig touched west bank of
canal, causing damage estimated at $2,000, exclusive of dry-dock
charges; accident attributed to heavy draft of vessel with consequent
difficulty in steering.
On May 26, 1927, the tanker John D. Archtbold, in getting under
way from the merchant anchorage basin in Cristobal Harbor, collided
with the port side of the steamer Siuneiarkco, causing estimated
damages of $30,000 to the latter vessel and $15,000 to former.
On June 23, 1927, the steamer Hororoalta. in leaving the east chamber
of Pedro Miguel Lock took a sheer and struck wooden fender of
center lock wall; cost of repairs estimated at $3,000.

SALVAGE OPERATIONS

As mentioned in the report for 1926, owing to the establishment of
commercial salvage companies in the Caribbean area, The Panama
Canal no longer undertakes salvage operations in other than Canal
Zone waters except where lives are endangered or great emergency
exists. In line with this curtailed policy, the only services of this
nature furnished during the year were as follows:
The.tug Tarern illya was dispatched to the aid of the steamer Steel
Inventor, aground about 3 miles west of the south end of Old Provi-
dence Island, Caribbean Sea, and assisted her from March 28 to 31.
The tug Gor'jona assisted in the salvaging of the steamer Jacob
Luckennbacli, ashore off the west, coast of Costa Rica, from May 8
to 16.
In addition to the above, offshore tug service was furnished on
February 17, when the tug Gorgona was dispatched to the Pearl
Islands, Gulf of Panama, to tow in the sailing ship Tutalfnla.
The expenditures charged to salvage operations for the year ex-
ceeded the revenues by $44,534.23.

RULES AND R EG NATIONS

The rules and regulations effective January 1, 1926, issued under
Executive order of September 25, 1925, were supplemented during
the year by the issuance of three supplements referring to routing of
radio messages from ships approaching the canal, lights on pipe lines
from suction dredges in navigable waters, and rat guards for ships at
docks.
li4950-27-- 3









SECTION II


BUSINESS OPERATIONS
A detailed statement of the expenses (including depreciation),
revenues, and profit or loss on the various subsidiary business opera-
tions conducted by The Panama Canal will be found in Table No. 26,
Section V, of this report. The total net profit on these opera t1ions was
$876,536.80, as compared with $841,310.29 in the preceding year, and
$765,916.85 in 1925.
The business operations of the Panama Railroad Co. on the Isth-
mus yielded an additional net revenue of $1,644,187.37. In 1926 this
revenue was $1,347,887.33 and in 1925 it was $1,525,910.13. Details
of operation pertaining to the major business units of both The Panama
Canal and Panama Railroad are discussed briefly in the following
paragraphs:
MECHANICAL AND MARINE WORK
The volume of shop and marine work handled during the fiscal year
was less than for either 1925 or 1926. Owing to variations in the
volume of work, the number of employees carried fluctuated consid-
erably during the year, although so far as expedient the repairs to
canal and Panama Railroad equipment, the manufacture of spares
for the locks, and work of a similar character was so distributed
throughout the year as to provide employment for the mechanical
force during the periods when the outside commercial repair work
declined appreciably.
The value and class of work done, and the source of the same, for
1927, as compared with the two preceding years, are shown in the
following tables:
AMOUNT OF WORK DONE

Class 1927 1926 1925

Marine---------------------------------------- $1,619,815.30 $2, 123, 956.45 $2,245,522.56
Railroad.----- -.--. ---------------------------------- 612,276.46 9'* 478. 27 526,149.75
Sundries.------------. ----------------------.-----. 476,821.34 382,422.45 531,758. 96
Stock materials---. -..---...-..----.... .... .....-. 358,814.90 383,866.90 316, 787. 36
Total--------------------------------------------- 3,067,728.00 3,519,724.07 3,620,218.63

ORIGIN OF WORK DONE

Individuals and companies ----------- .......-------------- $764,619.46 $1,001,586.00 $1, 229, 868.37
The Panama Canal-------------------.... ---- -------- 1,324,896.56 1,47.3.071.54 1,481,476.19
The Panama Railroad Co-------------------------...........................--- 671,940.06 7.l1,251.52 516,156.08
Other departments of United States Government....------... 306,271. 92 313,815. 01 392, 719. 99
Total---------------------------------------- 3, 067, 728. 00 3, 519, 724. 07 3, 620, 218. 63

1 Includes Panama Railroad Steamship Line.
28





REPORT OF GOVERNOR OF THE PANAMA CANAL


Manni't work.-During the year two tugboats, named the ChlIgrre.
and the Trnidl;dd, for rivers t ributary to Gatun Lake, were laid down
for the dredging division and the marine division, respectively.
These are Diesel-electric tugboats, 125 feet in length with chart-
house control. The tugs are being built by the mechanical division,
the machinery being purchased under contract in the United States.
At the close of the fiscal year, the hulls were ready for launching, the
deck house struicturies were erected in the shops, and the major part
of the machinery had been delivered on the Isthmus.
An extensive overhauling wis given a whaling fleet, consisting of
a mother ship and five tenders, broIult up from Peru for repairs.
Docking and annual overhaul were given a number of small light-
draft tank ships, constituting the fleet of one of the oil companies
operating on the shores of Lake Maracaiho. The fleet of the West
India Oil Co., operating out of Talara, Peru, also was docked and
overhauled.
The various subminariines stationed at the Coco Solo Submarine
Base were docked and overhauled. The United States cruiser Omaha
was docked for repairs, and a number of miscellaneous jobs covering
repairs to vessels of the special service squadron stationed in local
waters were executed. The work of remodeling the ends and renew-
ing the loading sides of the dredging division dump scows was pr;ic-
tic;lly completed. Extensive repairs were made to dredges and tug-
boats in use by the canal. Several small boats were built, and the
usual run of marine repairs were made on colllnerci'il vessels.
An order was received for the building of 12 barges to be used in
the construction of port works at Buenaventura from parts fabricated
in the United States and knocked down for shipment to Balboa. At
the close of the fiscal year the construction of three of the hulls \as
co nsiderably advanced.
Other irork,.-A large volume and variety of spare parts were made
for use in the overhaul of the locks, and considerable shop work was
performed upon parts removed and replaced during the overhaul.
Two of the towing locomotives for the locks ordered in 1924 were
delivered during the year; one remains uncompleted at tile end of
the fiscal year. During the year, a second locomotive of the Panama
Railroad was converted from saturated to superheated steam. Tilhe
converted locomotives have proved so successful in service that a
decision was reached that as fast as the locomotive boilers need
rebuilding, conversion will he made to superlheated steam.
The program of converting all main line passenger equipment to
61-foot steel underframe, all mahogany equipment, was completed.
The only passenger equipment not so converted consists of four small
antiquated wooden coaches, approximately 45 years old, in use on





REPORT OF GOVERNOR OF THE PANAMA CANAL


the Fort Randolph branch; this equipment will be replaced as fast as
funds are available.
Dry docks.-A total of 146 vessels were dry-docked during the
year, 77 at Balboa and 69 at Cristobal. A classification of these
vessels follows:

Balboa Cristobnl Total

Panama Canal equipment ----.-.---------..----------------------------- 29 4 33
United States Navy vessels-...---------------------------------------12 7 19
United States Army vessels------------..------------------------------- 1 7 8
Panama Railroad vessels------------------------------------------------- 2 5 7
Commercial line vessels --------------------. ------------------------- 33 46 79
77 69 146

A notable docking of a commercial vessel was that of the oil
tanker John D. Archbold. This is reported to be the largest tank
ship afloat, and is one of the two largest vessels ever docked at Balboa
shops. She was docked for repairs to rudder and steering gear dam-
aged in a collision in Cristobal Harbor. The average tonnage of
conunercial vessels docked at Balboa was 2,590, and at Cristobal 408.
The days in which there were no vessels in dry dock numbered 2
at Balboa and 36 at Cristobal. These figures would have been con-
siderably higher had not Government craft been left in dry dock at
times as a matter of convenience. With the growth of shipping,
the Balboa dock may be expected shortly to be required continuously
for use. This suggests the necessity of enlarged dry-dock facilities
at Cristobal. A survey indicates that a dock there of 475 feet in
length, with appropriate depth and width, could accommodate 75
per cent of the vessels which pass through the canal.
. Plant.-Installation of the 5,000-cubic-foot air compressor at the
Balboa plant was completed during the year. The new roundhouse
and sand house at Cristobal was almost completed at the end of the
fiscal year, with indication that the funds allotted would allow the
purchase of the new machinery and still be considerably inside the
estimate. The extension to the pattern storage building was prac-
tically completed at the end of the year, and removal of the pattern
shop to the lower floor of the extension had been effected.
Fiiancial.-The mechanical division earned net profits of $49,-
126.21 during the year, after providing funds for repairs and replace-
ments totaling $125,000, in which are included $39,899.30 for reroof-
ing buildings at Balboa shops and $80,000 reserve for the construc-
tion of a new boiler shop at Cristobal and toward the cost of enlarging
the Cristobal dry dock. Local reserves as of June 30, 1927, for
replitcemnent of machinery and dry dock, repairs to buildings and
equipment, and gratuity for employees' leave, totaled $786,048.49,
as comiipared with $670,051.75 for the same items at the end of the
precl(.ing year.





REPORT OF GOVERNOR OF THE P.\ANAM.1 ('ANAL


COAL

Sales of coal on the Isthmus totaled 372,641 tons during the fiscal
year as compared with 347,619 tons for the preceding year. Of the
1927 sales, commercial vessels purchased 365,367 tons, and the bal-
ance. of 7,274 tons was sold to the United States Army, The Panama
Canal, the Panama Railroad, and individuals and companies on the
Isthmus.
Owing to the coal miners' strike in Great Britain last year, the cost
of spot coal in the United States gradually increased from $4.30 per
ton in July to $10.25 per ton in November, and then gradually
declined to the present cost of $4.25 per ton. To meet this increased
cost, the sale price of coal at the Isthmus was increased from $8.50
to $12.50 per ton effective November 1, reduced to $10 per ton
effective December 6, and further reduced to $9 per ton effective
March 1, 1927.
The total receipts from sales, including charges for extra handling,
etc., amounted to $3,566,237.74 for the fiscal year, as compared with
83,081,238.60 for 1926; while net profits from coal operations totaled
$562,280.32 as compared with $507,663.47 for the preceding year.
The sum of $216,000 was set aside as a reserve for the repair and
replacement of Panama Railroad colliers and barges.
On January 1, 1927, a new contract was made with the Ore Steam-
ship Corporation, covering the transportation of coal from Norfolk
to the Isthmus, to run for five years, at the rate of 95 cents per ton,
subject to fluctuations in the trimming rate at Norfolk and penalties
from delay to their steaniers in transit.
During the fiscal year 35 cargoes of commercial coal and one cargo
of Navy coal were received on the Isthmus. Practically all deliveries
were made through the Cristobal plant and only a skeleton operating
force was maintained at the Balboa plant to meet emergency demands
and make deliveries to local equipment or steaiiiers not tranmitinl;
the canal.
FUEL OIL, DIESEL OIL, GASOLINE, KEIRO SENE

During the year the Standard Oil Co. of New York crucCe'l two
fuel-oil tanks with a capacity of 80,000 barrels each and one Diesel
oil tank of 85,000 barrels' capacity at Balboa. At the close of the
year the storage capacity for fuel oil and Diesel oil \was 1,li;,540
barrels at Balboa and 1,114,500 barrels at Mount Hope, makinii a
total of 2,281,040 barrels.
All deliveries to and from the tanks, for private companies as well
as for The Panama Canal and the United States Navy, continued
to be handled through the pipe lines and pumping plants of The
Panama Canal.





REPORT OF GOVERNOR OF THE PANAMA CANAL


Fuel oil.-The volume of fuel oil handled, including receipts,
issues, and miscellaneous transfers, is shown by the following
tabulation:

Balboa Mount Total
Hope

Barrels Barrels Barrels
Received by The Panama Canal----------------------------------- 274,177 68,785 i 42.962
Used by The Panama Canal..----------------------------------248,365 90,683 339,048
Puii; -d.l for individuals and companies----------------------- 7,499,878. 8,044,352 15,544,230
I- I i. The Panama Canal------------------- ------.. -- 6,086 6,102 12,188
I.-*-,:I .neni transfers--------------------------------------------- 44.630 67,341 111,971



The number of ships handled in connection with receipts and issues
totfiled 2,874, of which 166 were Panama Canal craft.
D;ifcel oil.-Sales of Diesel oil to vessels by The Panama Canal
totaled 2,792 barrels, and sales made by the various private conm-
panies aggregated 561,189 barrels.
Ga-uoline.-During the fiscal year, 1,889,107 gallons of gasoline
were received for bulk storage; of this, 694,142 gallons were stored
in tanks at Mount Hope and 1,194,965 gallons were stored in tanks
at Balboa. The total storage space available for bulk gasoline on
the Canal Zone is 2,086,000 gallons, 616,000 of which is owned by
The Panama Canal.
Kerosene.-Kerosene shipments received in bulk aggregated 568,045
gallons during the year; of this amount, 240,928 gallons were stored
at Mount Hope and 327,117 gallons at Balboa.
The handling of mineral-oil products resulted in net profits of
$299,572.17, after deduction of operating expenses and fixed capital
charges.

SHIP CHANDLERY AND OTHER SUPPLIES-STOREHOUSE OPERATIONS

The storehouses continued to be operated under the same policy
as prevailed during the preceding year. The operating force was
held at a minimum and consistent efforts were made to keep the
amount of stock on hand as low as deemed prudent to meet probable
ined-. A small substore was opened at New Cristohal to facilitate
the economical handling of building materials for the new houses
under contritction there. Stock on hand at the close of the year
was valued at $3,945,380.27, a dec-rease of $199,487.28 as compared
with the stock at the end of the preceding year.
The general storehouse at Balboa and the branch storehouses at
Parnia- and Cristobal handled a total of 132,582 requisitions and
foremenu's orders during the year. The value of all issues for the
year was iS,520,414.46. Material and supplies sold to steamships,
employee;, and others aggrclegated $1,217,441.78, and involved 55,120


32





REPORT OF GOVERNOR OF THE PANAMA1. CANAL 33

separate sales. Business with shipping comprised sales to 3,420
vessels of material and supplies, including fuel oil, having a total
value of $134,106.36, compared with sales of $109,590.58 to 2,818
vessels in the preceding year.
A total of 4,353 tons of scrap were sold, of which 423 tons were
disposed of in the local iiarket.

NATIVE LUMBER OPERATIONS

Native lumber operations were continued for the purpose of
procuring lumber from native hardwood logs to be used instead of
high-priced northern hardwoods. A total of 251,689 board feet of
logs were purchased, of which 250,934 feet cost $35 and 755 feet cost
$20 per thousand board feet in the log. Purchase was also made of
1,947 native hardwood railroad ties at $1.50 each.

HARBOR TERMINALS

During the fiscal year a total of 2,729 vessels utilized the faciliges
at the terminUal ports in loading, discharging, and interchanging
cargoes, as compared with 2,456 vessels for the preceding year. A
comparison of cargo tonnage handled, gross and net revenue from
terminal activities, etc., for the past three years is given in the tabula-
tion below:

1927 1926 1925

Tonns of cargo stevedored------..----------------.--------- 305, 506 372, 760 .327. 237
Revenue per ton stevedored---------------------- ------ $0.3888 $0.3570 fij.. 4
Cost per ton stevedored---------------------- ------------ $0. 2248 $0.2543 $0. 2345
Tons of cargo hrindlcil and transferred.------------------ 1, 1.4, i17 1,089,244 994, 245
Revenue per ton handled------------------------------- 0. 9'80 $0.9708 $0.9630
Cost per ton handled-------------.------------------- $0.7894 $0.7412 $0.6812
Gross 'Jperating revenue ------------------------- $1, 423. 37. 77 $1.381,375.58 $1,233,984.74
Gross operating expense.-----.---.---.---.------------- $1, I17, 80'J. 90 1, 066,376.07 P$J13, 242 01
Net revenue--------------..------------------------ 75, 547.87 $314,991.51 s320. 742 76
Per cent of expense to gross revenue-------------------- ..80.64 77.20 74. 01

The distribution of business between the Cristobal and Balboa
terminals is indicated below:

Cristobal Balboa

Number of vessels disci.irging or taking cargo-.----.--------------------------- 1,858 871
Tons of cargo received------------....----------------------------------- .................... 601.264 64,705
Tons of cargo ip:ii ll.. ....................................... .. .. ..... 47.186 16, 517
Tons of cargo stevedored by Panama Railroad------------.-------------------- I 2I. 15.6 36,400

In addition to the above business, agency duties were undertaken
for various commercial steamship lines which do not maintain their
own agencies on the Isthmus, and this service was furnished 353
ships transiting the canal, at the nominal agency fee of $25 per ship.
Near the close of the year work was begun on the erection of a
50-ton stiff-leg derrick at the outer end of Pier 8, Cristobal, for
handling heavy lifts.




REPORT OF GOVERNOR OF THE PANAMA CANAL


COMMISSARIES
The operations of the commissary division were continued along
the same lines as in previous years. Very few complaints were
received from patrons, and in general it is considered that the quality
of the merchandise, prices, and service furnished were satisfactory
to all concerned. During the last quarter of the year retail prices
were reduced on practically every staple item of foodstuffs as well as
on many leading staple items of dry goods.
SALES
Every effort was made to restrict sales in the commissaries to those
entitled to buy in these stores. During the year the Chamber of
Commerce in Panama published charges in the United States against
the commissaries, many of the statements being widely at variance
with the facts, with a view to influencing the Federal authorities in
Washington to curtail the sale of merchandise offered and thereby
fcde employees to buy more goods from the merchants in Panama.
This question has been fully explained to all interested parties from
time to time and will not be dwelt upon here further than to state
that the continued operation of the commissaries along present lines
is essential to the successful operation of the canal.
Total sales to steamships amounted to $1,308,520.02. This in-
cludes sales to United States naval vessels totaling $486,204.67, of
which approximately 35 per cent was purchases by the Battle Fleet
in March, May, and June. An outstanding example of the service
furnished to shipping is that in the case of the U. S. S. Henderson
which arrived in port shortly before midnight on March 4. On the
ship's arrival it was discovered that a radiogram ordering a consid-
erable quantity of supplies had not been delivered. In the expec-
tation that supplies might be needed, a force of commissary employees
had been assembled prior to the ship's arrival, and it was possible
to get out the supplies needed, approximately 14 tons, and make
complete delivery by 4 o'clock the next morning, within four hours of
receipt of order.
The largest single sale in many years, $16,971.63, was made to the
U. S. S. Argonne on January 21, 1927.
A new reinforced concrete commiissry building at La Boca was
completed during the year and opened for business on May 31. This
new store was urgently needed to replace a very dilipidlted old store
remaining from construction days. The reconstructed Balboa com-
missary was opened shortly after the beginning of the fiscal year
and provides greatly improved facilities for catering to the trade
properly. Construction was commenced on a new manufacturing
plant, warehouse, checking-iii shed, and office building at Mount
Hope, on a site adioining the present cold-storage plant. Upon the
completion of the new buildings, the offices and all the important





REPORT OF GOVERNOR OF THE PANAMA CANAL 60


storage and manufacturing units will be housed at Mount Hope,

which is expected to result in greater economy and efficiency of
operation.
Gross receipts from the sale of commissary supplies were approxi-

mately $400,000 in excess of 1926 sales and net profits, after deduct-

ing $41,631.42 for the value of old canning machinery written off,
amounted to $320,754.03. The distribution of sales, as compared
with the two preceding years, was as follows:


United States Government, Army and N.ivy .......v. -
The Panama Canal ---------------------- ----------
Steamships. .... ..............
Panani Iidlnlia.l Steanirihiip Line......................
Individuals and (ormpanies...--...............--...........
Employees-------.--------- ---------------------


1. .i21, 933. 1t
6l7, 522.98
794,689.06
264,685.11
697,673.98
5, 751, 234. 99


Gross sales.......-.- ............. ..... ..... ......... 0. 127,739.2
Less discounts, credits, etc......-....................... 399, 1i5. 13
Revenue from sales.------..-..-------------------- 9, 128, 580. 10


Supplies for ~exp nse and r-qiuipnimnt'
Retail conr'iIIissarii-s inil wjaretih use .................
General-..------...................................
Plants------------------------------------
Total ------------- --------------------


Loss by onudemiination. pilferage, shrinking, clerical
errors, etc.----------------------------------


47, 017.90
1, 089. 78
20. 571.66


207, 196. 15


Grand total------.----------.---------- ------9, 404,455. 59


1926


$1, 370,929.81
685,894. 65
766.989.50
Ij2,360 29
660. 436.75
5,477, 106. 19


1925


$1, 062. 589. 02
;-4., 594. 24
GIM. 656. 09
*-'. 774.64
731,675.58
4, Itr 983. 00


9,T3.(]7 9 i2.22.5


9,.1n3.C. 19 1 Q 8. i02, 272.57
4121. 77e. 19 3'8. 170 92

8, 731, 841. 00 7,944, 101. 65


42, 527. 73
1,231.70
15, 827, 28
W., .'6 71


195, 113. 84


43, 070.90
1,499.93
20,165.80
61.736 63


128, 232. 60


8,986, 541. 55 8,137,070.88


PURCHASES

Purchases during the year aggregated $7,356,407.48, an increase
of $788,461.30 over the preceding year. The following tabulation
shows the value of the various items purchased as compared with
the two preceding years:


1926


1925


1rc t s .......... ....................................
lH arlw rr ...............................................
D ry goods..............................................
Shoes...
Shoes .... ..... .......................................
Cold storage..--------------------- ---------
Tobani.* ,........... ...........................
Cattle and hogs.......---------------------- I
Milk and cream.-------- .------.-.-.-----
ll .tt .r ...................... .. ....................
Raw material............................................
Baw material ----------------------------------------|
T o s br...................................................
Dressed beef departinrw ...............................


$1,672,887.79
W5i. 982. 22
1, 171,818.42
:l32. 489.83
1,470. 016.76
.l"s',654.36
445, 852. 08
1?4. 293.55
011. 689.74
:32:. 082.08
3L'. 821. 11
.14,585.22
2**4, 234.33


Tolt l.......................... ... ............. 17. 1.. 407. 48


$1,428,138.67 $1,351,059.33
6l :. 123.67 :,11.I436.39
1, 0.35.508.32 1, 134.196. 45
I'111.873.72 24:. 272.02
1, I N. 313. 07 1, 250, 231. J4
1.?S.528.94 i 412,567.67
.I0. 711 25 -17.1. 229.49
10 1. 1 49.55 iS. 027. 88
1 ."7. ,' -.J. 74 4 .
217. .72. 44 I .2". 11'. 72
I:. 142 81 ".111, -7,5 tjA
1 L (1)
6, ------------- 946.--18 6,334, 714.38
6,',1177 946.18 1 6,334,714.38


PLACE OF PURCHASE
Unitedl States.....--.--.-.-.-.-...-..................... ... '1.1.*.< .1 31 1.V.7S .Y1 .1, 7f.;.2 16- *5
Europe and I irinnt .... .............. .................. 1. 0.. i '7 3 l.'., 1 7'1 :'.. 1i02. 6
Central and Souiih America ..------.....--------- ---.. 7. .. 11. ill 231. 2;.; (1 146. .,. 10
Cattll inriustry ........................................ 10 1-50. 12 i .*i. 971. 70 1 .1. '.13. 75
Panam a 'anal ......................................... 112,612.75 90.993.77 11i NI.. .77
Local.................................... ............... 183,692.43 216'. 057. 69 1 .3r.c. 441. 12
l utal..................... ......... ... .. .. 7,356,407.48 6,567.946.18 6,334,714.38

IIncluded under hardware.


I i i




REPORT OF GOVERNOR OF THE PANAMA CANAL


MANUFACTURING PLANTS
The output of the manufacturing plants had a total value of
$1,795,127.10. The principal products of the major plants, and their
value, are summarized as follows:
Bakery.-The output of the leading items manufactured included
3,917,247 loaves of bread, 1,739,419 rolls, 27,311 pounds of cake,
2,486 dozen doughnuts, 5,205 pies, and 106,087 pounds of soda crakers,
having a combined value of $291,733.53.
Coffee-roastling plant.-Among the products handled were 207,007
pounds of coffee, 18,756 pounds of corn meal, 62,454 pounds of pea-
nuts, and 1,648 pounds of almonds, having a combined value of
399,936.63.
Ice cream and milk-bottling plant.-The principal output consisted of
32,917 gallons of ice cream manufactu tired, 398,110 quarts of milk and
14,608 quarts of cream bottled, 165,679 Eskimo pies manufactured,
having a combined value of $164,396.89.
Ice plant.f.-Ice manufactured totaled 39,610 tons, valued at
$342,727.72.
Launidry.-The number of pieces handled totaled 4,741,010 and
receipts aggregated $193,805.49.
Sausage factory and pickling dtpariia nt.-The aggregate output of
the various products manufactured totaled 933,849 pounds, valued at
$155,568.96.
Industrial laboratory.-Many new items were added to the list of
products manufactured and the output was valued at $217,130.34.
Abattoir.-Included among the animals slaughtered were 8,044
head of cattle and 167 hogs, and 95 turtles, the combined output
being valued at $329,827.54.
HOTELS AND RESTAURANTS
The restaurants and silver messes continued to be operated under
contr:et throughout the fiscal year and service at fair prices was
rendered to all employees.
The Hotel Tivoli at Ancon and the Hotel Washington at Colon were
operated by the supply department throughout the year. These
hotels are essential adjuncts to the canal in affording accommoda-
tions to visiting Government officials, persons having business to
transnact with the canal, tourists, and others. An advertising folder
for the hotels was printed during the year and copies were distributed
to hotels and steamship agencies in all parts of the world. During the
tourist season the capacity of these hotels is frequently taxed to the
ml i t..
The Hotel Tivoli made a net profit of $19,155.90 during the year
after deduction of capital charges of $7,581.13 and of operating ex-





REPORT OF GOVERNOR OF THE PANA.MA CANAL


penses. At the Hotel Washington the re-venue exceeded the expenses
by $1,815.55, but capital charges of $20,506.21 made a deficit of
$18,690.66 for the year.
BUILDING CONSTRUCTION
A considerable amount of construction of new buildings w as carried
on during the year and the organization for this work had to be ex-
panded on account, of several projects. These consisted principally
of building 48 new cottages at New Cristobnl, a new concrete ward at
Corozal Hospital for the Inaiine, a new roundhouse at Cristobal,
which was 90 per cent complleted at the end of the year, and the be-
ginning of work on a new warehouse, manufacturing plant, and build-
ing for offices of the general manager of the comnimissary division,
which is being constructed adjacent. to the present cold-storage plant
and abattoir at Mount Hope. The last-nnmed project will involve
the expenditure of approximately $1,125,000, which will cole from
Panama Railroad funds. The first concrete for foundations in the
erection of this composite plant was poured on March 28, 1927; at
the end of the fiscal year construction had advanced to 15 per cent
of completion.
Work was begun on the construction of an administer i tion building
in Cristobal, near the Terminal Building, estimated to cost $500,000.
The main building will be of three stories, 160 feet long, with wings of
two stories, adapted to the addition of a third story when required;
one wing will be 280 feet in length, the other 124 feet. The Admlin-
istration Building will provide space for the post office, police station,
magistrate's court, district court, paymaster, collector, di-trict
quartermaster, Panaina Railroad steamship ticket agent, land agent,
and district dentist. To secure an iadeq uate site for the building, the
two-story concrete building occupied by the agency of the Royal
Netlierlands Steamship Co. was moved intact across a street and
removal was begun of several wooden buildings, including the three-
story structure formerly used as a restaurant and bachelor quarters.
The concrete commissary store at La Boca was completed, and was
opened for business on May 31. Work on the Diesel-electric plant
at Miraflores was pract icaIlly finished at the end of the year.
With the advance of years, main tenance work on the canal build-
ings, especially the older ones of wooden construction, involves more
labor and expenditure. Several il lmpori tatnt maintenance projects
which have been authorized during the prev-ious fiscal year were con-
tinued and completed. The Iargest of these items was the repilce-
ment of all deteriorated shingle roofs with standard galva nized-iron
roofing. Another large item was in the painting of quarters for both
gold and silver employees.




REPORT OF GOVERNOR OF THE PANAMA CANAL


ANIMAL AND MOTOR TRANSPORTATION

Animal and motor transportation for all departments and divisions
was supplied by the transportation division, this centralization of
activities permitting the reducing of both employees and equipment
to the minimum necessary to meet transportation demiiand(s.
Thirty cars and trucks were purchased and six pieces of equipment
were retired during the year. The equipment on hand at the end of
the fiscal year consisted of 269 cars and trucks, 10 trailers, 22 motor
cycles, 6 mowing machines and rakes, and 10 mules.
The division is required to operate on a self-sustaining basis.
Revenues exceeded expenses for the fiscal year by $10,940.24.

PRINTING

The canal printing plant carries in stock and manufactures such
necessary stationery, forms, etc., as are required on the Isthmus in
connection with canal and railroad operations. In addition, The
Panama Canal Record (an official bulletin published weekly for the
disseminnation of statistics and other information of interest to the
shipping world), the coupon books used by employees in making pur-
chases at the canal commissaries, and various pamphlets, circulars,
tariffs., folders, etc., are printed at this plant. It is the established
policy to keep the volume of printing work at the minimum compatible
with the needs of the canal.
The volume of work handled during the past year was about the
same as during the preceding year, though the output was valued at
$159,911.39 as compared with $174,769.92 for 1926, the decrease of
$14,858.53 being attributable to several factors, chief among which
were the privilege of making purchases of paper on the Government
Printing Office contract and the reduced cost of operations following
the installation of new improved machines.
The plant operates on a self-sustaining basis, and at the end of the
year operations showed an excess of revenue over expenses and fixed
capital chiargLe of $794.26.

PA NA.MA RAILROAD

The gross revenues from the operations of the railroad proper
amounted to $1,638,753.66; the gross operating expensCes were
$1,306,843.29, leaving a net revenni'. of $321,910.37 for the fiscal year.
This was an increase of $201,099.15 in net revenue over the previous
year's operations. Tonnage tnraisported during the fiscal year,
inclii'liiiig coal, totaled 298,033 tons as compared with 288S,342 tons
for the preciltiniig year.





REPORT OF GOVERNOR OF THE PANA1MA CANAL


The following table shows statistics covering various phia-se- of
operation during the pist three years:

1927 1926 1925

Average niles operated, Colon-Panama.----.------.------. 47.61 i 47.61 47. 61
G ross rating revenue .............................. $1,638.753.661 1. *'.4, i74. 30 1.508.501.61
O'perntingt\ 'l uses ...................... ....... ... $1 30..). W13 29 1. 41. 2 4.08 $1. 3'. 433. 41
Net operating revin.ue............. .. .... ....... .. 1. 910.37 .U. 811.22 t 1-'. 068. 2
Per rent of vr ipecsl in rt \ .ri-i ............ ..... ... 711 75 91.64 87. 93
U ross revenue per mille of road--..-----.....--------------.. $34. 420.37 $32, 851. 80 .il. 684. 5
Operating -penses per mile of road.---.------------- ', 448.92 $30, 104.24 8 U' -80. 39
Net reven u per mile of road-------------------------- i. 971. 45 $2. 747. 56 5. 824. 17
Nunriilier of passengers c ar ilvd:
Firt- l:. ..................... ... . .-----. -- 184,430 170 11 1(i3. 688
Second-class--.----.---.--------... ... .. ... 311.343 1 i.B52 ; 291.'57
Tconda l ....................... . .. . . . ... .^311. 343 .,)1. 6512 291. 579

Pasoei ger rTle m ___enl e__
First cl:s................................ $249,061.03 2 I'. 471. 44 0 13. f'7 38
n -clss................... ................... .. 189,206.66 194,564. 59 17'. :.'.i 11
Total.-------------------------------------------- l3. 2;7 h9 4 4:1 :!3' 03 D3'. 44
Re\ enute per passenger trnin-mi!e....................... $5.15 $5.18 i $4.76
Revenue per freight train-mile..................... .... $11.28 $11.98 $12.08
Total revenue tiazi-n-iliSee........................... $179.2. 00 $179,932.00 $178,524.00
Railro r rcveni..- per ti :in-miilc ....................... $9 14 $8.69 $8.45
RHilroadl operating expense's per revenue i ir-nmile.... $7.29 $7.96 $7.43
Net r:ilroi:il revenue per reeinue train-mile............ $1.85 $0. 73 $1.02
Freilt. npassenfger, and slci locomotive mileige...... 294,994 2..156 297,433
Work-Ir:an mileage----------------------- -- ----------- 1,992 1,992 1,992
Passenger-train mileage-------------------------------- 103, 135 104, 563 1i:.. 259
Freighi-train mileage--..-------------------------------- 76, 123 75,369 7.. 265


Toward the close of the fiscal year, the old main line track of 70-
pound rail, lying between Colon and Mount Hope stations was re-
placed with 90-pound steel. The weed killer was operated five
times during the last wet season, about 100 miles of track being
treated each time. The cost of operation amounted to approximately
$13 per mile, and through its use it has been possible to dispense
with the services of two laborers on each section gang.
Little change was made in the trackage in use by the Panama
Railroad, The Panama Canal, and the United States Army during
the year, and the total trackage in use at the close of the year was
157.70 miles.

TELEPHONES AND ELECTRIC PRINTING MACHINES

The change from manual to automatic operation of the telephone
system was made at midnight on January 23, 1926, as noted in the
annual report for 1926, and the new system has been operating
satisfactorily since that dat.e. The expense of maintaining the
automatic systern is approximately the same as for maintaining g the
old manual system, but there has been a marked decrease in the
expense of operation due to reduction in the number of exchange
operators.
The gross revenue from the operation of telephones, electric
clocks, and electric typewriting machines was $222,281.48 for the
fiscal year; operating expenses were $197,959.86, leaving a net revenue
of $24,321.62.




REPORT OF GOVERNOR OF THE PANAMA CANAL


During the fiscal year 889 telephones were installed and 970 were
removed, resulting in a net reduction of 81 telephones for the year.
Excluding 223 telephones in the Hotel Tivoli and the Hotel Wash-
inmjton, there were 2,665 telephones in service at the end of the
fiscal year.
Electric printing machiines.-Fou rteen electric printing machines
were in service at the close of the year, 10 of which were being used
by The Panama Canal, and two each by the United States Army
and the Republic of Panama.
LANDS AND BUILDINGS
Panama Railroad lands in the cities of Panama and Colon and
public lands in the Canal Zone are administered by a joint land
office.
Panama Railroad Cooipaniy lands and lca.ses.-At the close of the
fiscal year, 1,306 leases and 18 licenses granted by the Panama
Railroad Co. covering the use of its property in Panama and Colon
were in effect. The income derived from these leases and licenses
during the year was $189,566.05, representing an increase in revenue
of $10,262.55 over the preceding year.
Three tracts of Panama Railroad land in the city of Panama not
required for business purposes, comprising a total of 8,189.2 square
meters, were sold during the fiscal year. The aggregate price was
$220,208. Building No. 1000 in Colon was sold for $156,690 without
the land on which it is situated.
At'r icultuiral lands in the Canal Zone.-A total of 2,019 licenses,
covering 6,801.5 hectares of agricultural lands in the Canal Zone,
were in effect on June 30, 1927. The rental from these lands for the
year aiggregated $34,742.09, of which $1,357.50 was outstanding at
the close of the fiscal year. The average holding under these
licenses was 3.36 hectares (8.3 acres) per licensee. Great difficulty
was experienced in the collection of rentals, due to the poor production
of the farms resulting from the prolonged dry season of 1926.
Alhajuela Basin.-Of the three claims for land and improvements
remaining unpaid at the close of the previous fiscal year, two were
settled for a total of $1,760.82, and a partial payment of $522.50
was made on the other, leaving a balance of $200 due the only
remaining claimant.
The gross revenue realized from all real estate operations handled
by the joint land office amounted to $220,950.64, not including
$220,208 derived from sales of property. These figures do not
include the rental on the oil tank sites at Mount Hope and Balboa,
nor the sites held under license in the Canal Zone by individuals
and companies on which office buildings and residences are main-
trJind. Neither do they include rentals for quarters occupied by
employees of The Panama Canal and Panama Railroad.





REPORT OF GOVERNOR OF THE PANAMA CANAL


PLANT INTRODUCTION GARDENS AND EXPERIMENTAL STATION

The plant introduction gardens and experimental station were
established in June, 1923, and the work to date has involved primarily
the securing and planting of a lnrge number and variety of useful
and ornamental plants from all parts of the world with a view to
determining their value for general propagation on the Isthmius.
The work is yet in its infancy and sufficient time has not elapsed to
demonstrate the merits or demierits of the many plants introduced.
The following brief comment covers some of the more important
plantings:
Buaanans.-The most serious problem of the banana industry
encountered on the Isthmus is the control of wilt disease, and one
of the possible means of obviating the losses from this malady lies
in the adoption of resistant varieties. Several varieties in different
parts of the world are known to possess more or less resistance to
the disease and studies are now in progress to determine their
possibilities locally as commercial bananas as well as to observe the
degree of resistance which they may offer. ,Three such varieties
now under observation are the Catrendisk, the Congo, and a variety
believed to be the Philippine Bungulan.
Abaca.-The abaca or Manila hemp plant is well known as the
source of the best cordage fiber of commerce, as it withstands salt
water better than any of its competitors. Up to the present time
the Philippine Islands have enjoyed a monopoly of this market.
Several attempts have been made to introduce this species in the
American tropics. Introductions of plants and of seeds on the
Isthmus have been made through the Department of Agriculture,
but, unfortunately, two of the important introductions arrived at
the close of the rainy seasons in 1923 and 1925 and, consequently,
made a poor start, but with the abundant rains of the present season
they are now giving promise of success. Suckers are also being
transplanted to other parts of the Isthmus less subject to drought.
Chaulmoogra-oil trees.-There are several species of trees which
yield oils rich in chaulnioogric or hydnocarpic acids. It is these
oils or their esters which have proved so effective in recent years in
the control of leprosy. Of these species there are represented at the
experimental gardens the following: Tarak-togenos k urzii, Hydno-
carpui. anthelminthtica, H. wightiana, Oncoba echinata, and 0. spilnosa
(oil content not yet, known).
A planting of about 800 trees of the species Taraktogenos. kurzii
was made in June, 1924, at Flat Rock, on the south bank of the
Chagres River. There are about 700 trees now growing in this
plantation on a little less than 10 acres of land and most of them have
made a very satisfactory growth. Measurements of a large number





REPORT OF GOVERNOR OF THE PANAMA CANAL


of these trees in July, 1927, showed an average height of over 7 feet
8 inches. Only a few specimens of the remaining varieties have been
planted.
?lubber.-Trees of the Hevea birazililsis are under observation at
Summit and elsewhere.
Avocado.-Many young seedlings of this remarkable fruit tree
have been budded to the best varieties available on the Isthmus so
as to continue their dissemination. It is of great importance to
introduce the best varieties, and by a proper selection to extend the
season so that the local market can be supplied through a considerable
part of the year with fruit of first quality, free from fibers, and of
good texture and flavor.
MaJigo.-Several of the introduced varieties of mangoes are now
bearing fruit, but it is yet too early to make any confident recom-
mendation as to the varieties best adapted to the Canal Zone and
Panama.
Man gosteen .-The mangosteen is regarded by many as the best of
all tropical fruits. The young trees that have been introduced
through the Department of Agriculture have made an excellent
growth.
Java grass (Polytrias przrmorsa).-This grass is proving effective
in crowding out the taller-growing and coarser Guinea grass (Panicum
mnacinuin). It also gives promise of being of value on golf links and
upon airplane landing fields as well as on lawns. The demand for
roots and cuttings is great and it is being distributed continuously
through the rainy season.
Accessions for the year included 72 species. Several thousands
of fruit-bearing or ornamental trees and shrubs have been placed in
various parts of the Canal Zone and in Panama, and exchanges have
been maintained with foreign countries.
QUARTERS FOR EMPLOYEES

Gold einployees.-In the Balboa and Cristobal districts the demand
for gold quarters was greater than the supply during most of the
year, there being on the average about 30 applicants on the waiting
list at each of these places. In the Pedro Miguel and Gatun dis-
tricts it was possible ordinarily to supply quarters to applicants within
about 30 days from date of application.
The construction of 48 new cottages at New Cristobal was author-
ized during the year. Thirty-four of these were completed, and the
remaining were near completion at the close of the year.
The replacement of deteriorated shingle roofs on gold quarters
with standard galvanized-iron roofing was completed during the year
and all the metal roofs on permanent buildings were painted. Avail-





REPORT OF GOVERNOR OF THE PANAMA CANAL


able funds did not permit the painting of all exterior woodwork that
needed painting. The established rental rates were collected for all
gold quarters occupied. The revenue received was sufficient for
necessary maintenance of the buildings, which included some painting
for preservation, but there was not sufficient revenue to provide any
interest on the capital invested. A charge of 2 per cent of the capital
value, however, was made as part of the operating expenses to
provide a reserve for replacement.
Silver employees.-There is a shortage of quarters for silver em-
ployees in all districts. During the year a one-story silver bachelor
quarters building was removed from the site of the new Administra-
tion Building at Cristobal and reerected at Camp Bierd. Another
three-story 48-room gold bachelor quarters building is being removed
from this site and will be ricrv acted at Camp Bierd for use as silver
quarters.
The operation of silver quarters was continued without change of
regulations or policy. The -cost of maintaining and operating silver
quarters exceeded the rents collected by $95,000. The maintenance
costs during the year were comparatively heavy on account of neces-
sary exterior painting of the permanent type buildings and heavy
expenses for replacement, of worn-out shingle roofs with standard
galvanized-iron roofing. The roof replacement work was completed
during the year.
CLUBHOUSES

To the maintenance of clubs and playgrounds for American and
West Indian employees and their families, The Panama Canal con-
tributed $120,000. The additional expenses defrayed from current
revenue were $472,711.99, and the income from moving pictures,
soda fountains, candy and cigar counters, swimming pools, tennis
courts, and other activities promoted was $469,640.09. The accu-
mulated surplus of clubhouse funds on June 30, 1927, was $105,316.69.
Additional detail of income and operating expenses may be obtained
from Table 42, Section V, of this report. Report of activities is in
Section IV.
FARM INDUSTRIES

Plantations.-All plantations were operated under contract during
the fiscal year, with the exception of the citrus fruit farm at Juan
Mina comprising some 50 or 60 acres. The gross revenue received
during the year amounted to $5,25S.69, while operating expenses
totaled $7,774.13, resulting in a loss of $2,615.44.
Dairy farrnm.-The gross revenue accruing from the sale of cattle,
milk, cream, and other products totaled $69,920.82 for the fiscal
64950-27- 4




REPORT OF GOVERNOR OF THE P.AN.AMA CANAL


year; operating expen -es amounted to 869,603.36, leaving a net profit
of $317.46 as comrpa red with a loss of $3,654.61 for the previous year.
The total imilk production for the year amounted to 78,017 gallons,
of which 71,930 gllons were di-sposed of through the commissaries.
The general health of the dairy cattle throughout the year was
excellent.
Cattle.-At the beginning of the fiscal year, owing to the rapid
advance in the cost of cattle in Colombia, heretofore the principal
buying market, and the revolution in Nicaragua, it did not appear
possible to purchase sufficient lean cattle to restock the pastures with
the usual reserve of four or five thousand head. Consequently, con-
tracts were nmade for the purchase of frozen beef, taking delivery over
a period of six months, this providing for a surplus in refrigeration
instead of on pastures.
This procedure necessarily curtailed the killing programii and
reduced the operating profits with the results that net losses for the
year amounted to $16,254.85.
In December a contract was made for the purchase of 3,000 head
of Venezuelan lean cattle with a subsequent contract in May for
4,000 more, and the indications are that this market will prove
satisfactory.
On July 1, 1926, 5,952 head of cattle were in the pastures. Dur-
ing the fiscal year, 8,084 head were purchased and 116 calves were
born; 7,733 head were slaughtered, 278 died, 129 were transferred to
the dairy, 104 were sold to outsiders, leaving 5,908 head on hand in
the pastures at the close of the fiscal year.
During the year a total of 19,289 acres of pasture were recleared or
burnt at an average cost of $2.87 per acre. This reclearing resulted
in considerable improvement in the stand of grass on the pastures.

OPERATIONS WITH PANAMA RAILROAD CO.'S FUNDS

Miany of the bu-ine,- activities on the Isthmus connected with the
canal are conducted with funds of the Panama Railroad Co. In-
cluded in these are the wharves and piers at the harbor terminals,
the collmnii-.iary sys4teum, cnaling plants, and various minor activities
as well as the Panama Railroad itself. In this report only the major
features of these openitioins are noted, in their relation to the canal
adminiiist ration as a whole. Details are given in the annual report
of the Panama Railroad Co., which is published separately.
The operations of the railroad proper, harbor terminals, coaling
plants, stables, and baggage trainsfr were continued throughout the
fiscal yeiar under the direction of the superintendent of the railroad;
the telephone syv-tem under the electrical engineer of The Panama





REPORT OF GOVERNOR OF THE PANAMA CANAL


Canal; renting of lands and buildings under the land agent; and the
conmmi ssaries, Hotel Washington, plantations, dairy farm, and cattle
industry under the chief quartermaster of The PaLHnama Canal.

PANAMA RAILROAD STEAMSHIP LINE

Tlihe gross operating revenue of the steamship line for the fiscal
year ending June 30, 1927, amounted to $2,026, 875.91, and the total
operating expenses to $2,075,843.68, resulting in a net deficit from
operation of $48,967.77. This operating deficit compared with that
of the fiscal yetr ended June 30, 1926, of $285,349.26 shows a decrease
in deficit of $230,381.49.
Tlhe stea mship line carried all freight and passengers for account of
The Panama Canal and other departments of the Government of the
United States at material reductions from tariff rates, which amounted
to the important sum of $484,028.93. Had regular rates been
charged by the steamship line for such freight and passenger service
rendered to The Panama Canal and other branches of the Govern-
ment, its operating deficit of $48,967.77 would have been reversed,
and a profit of $435,061.16 shown.
For the year ended June 30, 1927, the tonnage carried amounted
to 205,196 tons as against 258,448 tons for the previous year, a
decrease of 53,252 tons.

CANAL ZONE FOR ORDERS

The system of shipping cargo to the Canal Zone subject to the
orders of the consignor or consignee after arrival was established
Iarch 17, 1925. Under this svstemn merchandise may be shipped to
Canal Zone terminal ports to be there held for orders, the Pananla
Railroad Co. acting as warehouseman. Such cargo or integral parts
thereof may be withdrawn and delivered locally or forwarded as the
consignor or consIignee may desire, except that goods for use in the
Canal Zone or the Republic of Panama by others than those entitled
to the free entry privilege are released only upon the presentation
of satisfactory evidence of the payment of the proper duty to the
Republic of Panama.
This system is proving of great convenience to all concerned and
the volume of Ibusiness is increasing. During the fiscal year 1927 the
number of receipts issued was 602; number of withdrawals, 3,641
tons received, 8,200; tons withdrawn, 6,125; packages received,
76,316; packages withdrawn, 77,885. The following is detail of the
operations by months at Cristobal and Balboa.






REPORT OF GOVERNOR OF THE PANAMA CANAL

(il'-TOBAL


Mhnth b



Jul-------------------------------------
Jul:.........1s................................
September .............................
October .--....----- .......................-
N ovem bi--r................................
December-------------------------------
J.nDecember--........---........--........--
Febru.iry.................................
.NIarctU....................................
Aprd.................... ........ ..
May ...--.................................
June........................ .......

Total.................................


Number Number
of rrri I.t1 of with-
-1.1-iid drawals


26 179
26 178
32 145
21 167
26 185
38 168
35 189
43 245
57 329
34 261
39 226
62 227

J9 I 2.4 49


Tons Tons Pac. age
with- r ,9Iz I
received w lr-,.ed at -
eceived drawn '' drawn


187 232 4,394 5,194
281 211 5,693 4,442
141 138 2,520 2,717
389 184 5,497 4,538
225 288 7,890 4,762
212 252 3, 506 5,605
202 179 3,813 3,609
476 291 6,062 5,228
365 434 5,962 7,217
1,038 349 4,744 5,779
304 704 4, 754 7, 286
2,137 1,137 4,783 5,585
5,9 O.I -; .J3J 59 5Y,.l 6, 962


BALBOA


July---------------...---------.--.----- 9 40
An ust ................................ .. 15 69
Septr mbCer................................ 6 64
October-------------------------------................................. 5 92
November-------------------------------. 11 63
December.------------------------------- 18 89
January-------------------------------- 20 82
Fbrn.arv----------------- ...---------------.... 15 103
March...------------..---------------------. 13 168
April--------------------------------- 16 100
May.-----------------------------------.............................. 19 103
June........... ----------------------------------- 16 169

Total----------..-------------------...... 10 1. 1-


50
308
98
38
14
306
773
63
139
112
171
171

2, 24 3


653
1,147
1,108
364
998
1, 303
1,901
1,401
1,879
1,248
2,085
2,611


576
700
1,039
962
1,135
1,140
1,574
1,058
2,317
1,263
1,048
3,111


1, 7.- I In, 15, 923













SECTION III


GOVERNMENT

The civil government of the Canal Zone is conducted as prescribed
by the Panama, Ctunal act of August. 24, 1912, and other acts and
Executive orders applicable to the Canal Zone. In some cases it
has been found practicable to assign governmental functions to
departments organized prilimarily for the operation and maintenance
of the canal, which has resulted in both economy and closer co-
operation.
Data on the cost and revenues of various branches of the govern-
mental service are contained in Section V, devoted to financial and
statistical statements.
POPULATION

A census of the civil population of the Canal Zone was taken by
the police force during the month of June, 1927, a summary of which
s given below:

Americans All others
Grand
Total Total Chil- Total Em- Total Em- Chil- total
men es women pe dren men P- wolomen ploy- dren
Sw e; ploy-dreees ees

Balboa district------- 1,810 1, t'ly 1. 5 y9 I T3!7 1 Q94 3, -49'. 2, 113 2. 5`12 3 4, s.I)0 11, 453
Criiutltnl distridt..... 543 U.' 61() 22 JIl 3, 1.'3 2, 5 1,90 l b 4,075 11,042
Prisoners............ ....... ..... ...... ...... ... U. ....... 3 I 1 9
Total fiscal year
1927.......... 2,375 2,111 2,501 349 2, 5 f.. 7f.1 4, 166 4. 14 11.1. 93S 17,624
'I'otal lical year
1'.-'2o......... 31i 2.0-'. 7 2, 66i-l 353 3, 010 o 6,l0J 4..;75 4, 17.3 4t. 8,-O '4 27. 692

I Indindes 72 civilian employees of the Army and Navy in 1927 and 91 in 1926.

In addition to .the civilian population listed above, the military
and naval forces in the Canal Zone in June, 1927, i nlllhered 8,971,
making a total population of 30,600.

PL'UILIC HEALTH

11alaria.-The total number of malaria cases reported from tile
Canal Zone and terminal cities during the year, .olp11)ared with the
six previous years, follows on next. pago.





48 REPORT OF GOVERNOR OF THE PANAMA CANAL

1927 1926 1925 1924 1923 1922 1921

Erimpi ee----- 155 1312 180 208 216 176 325
MilitarY aind naval personnel. -------------- 739 854 762 894 870 828 810
N nem-y-.--------- 420 445 494 521 657 243 459
Total._.-------__ . -------------. ------- 1,314 11,611 1,436 1,623 1,743 1. 247 1,594

1 "riinuin the cases from Brij.i .iini where a o.in* 4.f men was eng.iae 1 in construction work for the
Army and housed in a .Impn.riry (.ilip outside ilie A.mnritle areas, the number of employees reported
with malaria was but I- 1 n'l lite riinl number of cases 1,487. Over half of the men eniplit e-1 it Bruja
Point developed malaria within nionih-, and this furnished a very good example of \%whivt nuld. occur
ihrn'11111-.ii all the villages and -.rtleripnter in the Canal Zone should our sanitary measures be relaxed.

There were no deaths among employees from malaria during the
year. The last death of an employee from malaria occurred in 1924.
Cinaln 7Zon.-The population of the Canal Zone (civil and military)
on July 1, 1926, was 36,988, and this figure has been used as a base for
vital statistics. From this population 284 death-s occurred during
the year, 253 of which were from disease, gix ing a rate of 6.84 for
disonest alone, as compared with 6.87 for 1926 and 7.17 for 1925.
There were 611 live births reported during the year, and 26 still-
births. Including stillbirths, this is equivalent to an annual birth
rate of 17.22 per 1,000 population. The infant mortality rate, bused
on the number of live births reported for the year, was 44.78 for white
children and 136.59 for colored children, with a general average of
106.38. Of the total births reported, 4 per cent were stillbirths. Of
the total deaths reported 29 per cent occurred among children under
five ye ;rs of age.
The maternal mortality rate (from conditions due to the puerperal
state) was 14.3 per thousand births, stillbirths included.
Pai a mu City.-The estimated population of the city of Panama for
the year was 59,635. From this population, 1,246 deaths occurred
during the year, of which 1,208 were from disea-oe, giving a rate of
20.26 for di-ea;tc alone, as compared with 18.33 for the preceding
yea r.
The principal causes of death, compared with the past few years,
were as follows:

1927 1926 1 1925 1924 1923

Pneumonia (broncho and lobar). --.---------....... ......-..- 209 154 187 276 128
TuI. r iluli., (various organs).---- -------------............... 199 201 201 193 218
Diarrhea and enteritis ----------------------------------- 149 S 90 121 144


There were 2,192 live births reported du ring the year and 112 still-
births. Including stillbirths-, this is equivalent to an annual birth
rate of 38.64 per 1,000 population. The infant mortality rate, based
on the number of live births, reported, wn:s 136.24. Of the total






REPORT OF GOVERNOR OF THE PANAMA CANAL


number of 'deaths reported, 38 per cent occurred among children
under five years of age. The maternal mortality rate (from condi-
tions due to the puerperal state) was 6.94 per thousand births, still-
births included.
Colon.-The estimated population of the city for the year was
31,285. From this population, 441 deaths occurred during the year,
of which 427 were from disease, giving a rate of 13.65 for disease, as
compared with 12.50 for 1926.
The principal causes of death, as compared with the past few
years, were as follows:


1927 1926 1925 1924 1923

Tuberculosis (various organs) .................................. 76 71 87 57 79
Pnei mnionia (broncho a i lobari............ ................. 50 36 54 42 40
Diarrhea and enteritis ------------------------------------ 17 26 27 33 26


There were 723 live births reported during the year and 52 still-
births. Including stillbirths, this is equivalent to an annual birth
rate of 24.77 per 1,000 population. The infant mortality rate, based
on the number of live births, was 118.95. Of the total births reported,
7 per cent were stillbirths. Of the total deaths, 26 per cent occurred
among children under 5 years of age. The maternal mortality rate
(from conditions due to the puerperal state) was 20.65 per thousand
births, stillbirths included.
Canal hiospInJal..-Patients treated in Panama Canal hospitals, fiscal
year 1927:


Nuihbet in
hospital
July 1, 1926


Ancon .. ....
Colon........
Corozal:
Insane- --
I'ripplpes..
Chronic...
Pnlo SNco Lep.e


... . .. .. .. . 13
............. 11
. . . . .. ..
. .. .. .. . . . .3
r Cnlon. .... N


34
3151
25
.A 1
'12


Admitted


--e




79 151
1 14
(I 10
I'
.1 :.-. :, W


ToIul................ ..111. fhs
I


Died


S I





01
0,


l(I'l 272


Rem ai ning
Discharged Tr;insferreud June 10.
1927





1. 4161. 3. 213: 21! P7 IS4 1,,7
72s 1. 112 1UJ 17, 27 :- 9
fC 47 2 11 121 380
ii r. 2. 11 3 23
I 1 4 .1 j32
I II 7 97
2t,3-'_>. _. 4.432 1 2I". 271 3 1 75.S


I Eloped.


QUARANTINE AND IMMIGRATION SERVICES


As in former years, an effective quarantine was maintained with
very slight delay to shipping. No quarantinable disease was intro-


--


..





50 REPORT OF GOVERNOR OF THE PANAMA CANAL

duced into the Canal Zone. Only one ship of the total of 7,185
entering the canal ports suffered any detention and that was for
one day. During the preceding year, of 6,483 ships entering, four
were detained an aggregate of three days.
The quarantine embargo prohibiting the introduction of certain
animals and articles that are liable to be carriers of foot-and-mouth
disease remained in force against all of the countries of South America
except Colombia, Venezuela, British Guiana, and Dutch Guiana
throughout the year. Under date of May 2, 1927, that part of the
Republic of Mexico situated south and east of the Tehuantepec
National Railroad, which crosses the Isthmus of Tehuantepec, was
included in the areas under this quarantine.
The physicians employed as quarantine officers act also as immigra-
tion officers. In this function they are concerned principally with
the exclusion of members of races whose entry into Panama is pro-
hibited and the exclusion of undesirables or of persons liable to
become a public charge.
The activities of the quarantine division during the fiscal year 1927
are summl arized as follows:

Cristobal Balboa Total

Xe4sc-kl itii.' tedl and passed_.--------------.-- ----------------- -----4,091 744 4,835
'esss lis gr.inm n l radii r.itill. ..... .... ....................... ........... 172 88 260
Vessels passed on it ti.i . .I n ..I ............................ .20 2, 069 2,089
Vessels detained in quarantine (1 ship, 1 day)-----------------. -----. ----- 1 0 1
Total vessels received- .---------------------------.------------ 4,284 2, 901 7,185
up .1 ri -nt i. . . . . . . . . . . . . . . . . . 3,852 1,312 5, 164
\estels fiiI .i ................... ................... ................. 93 40 133
Crew in'l t i-d and passed -----..---------------- ------------------------ 240,507 35,187 275,694
Crew 1.i- .l I .-. radio. _...--------............---.. --........-.----. 50, 466 24,530 74,996
Crew passed on certificates of masters-------------------------------- 3, 658 95, 434 99,092
Crew detair'''l i ii .11i. ii I i I .1 v ................... . .......... 116 0 116
Passengers Arl -I*I Il l i. .I I.... .. .... .. ... .. ... .............. 88, 185 13, 405 101, 590
Pcia-ne.*ri passed by radio------------------------...------------------....................... 364 0 364
Passengers i1i- -rIl -n certificates of masters ---------.. -----------_-- ----- 12,452 21,739 34, 191
P.-ra n-rrc' th-[ ainepd in quarantine (1 ship, 1 day).-------. ---------------- 64 0 64


Total persons received--..----... __.__.......-......................


395,812 190,295 586,107


Pi*- 'n; deported illi.r il .li..n il I'S_. _ ---------------------- -- --......- 784 343 1, 127
Pei ii' detained ni i lint jirliji'j ii ri I iws and later allowed to enter or
to resume 1ilien jir in :' 1.1 hv.ii it0 1.: transshipped here.--------------. 209 1,259 1,468


MUNICIPAL ENGINEERING
Water .supply.-On January 1, 1927, the water system on the west
side of the canal, supplying Camp Gaillard and Las Cascadas, was
turned over to the United States Army to operate. The municipal
division, however, continued to operate the Cucaracha pumping
station. The water line running from Gatun Dam to Toro Point,
which supplies Fort Sherman with \vai tir, also was transferred to the
United States Army. Filtered water for the fort is still supplied
from the Agua Clara filtration plant.






REPORT OF GOVERNOR OF THE PANAMA CANAL


The improvement of the Cristobal-Colon and the Gatun-Fort
Davis water systems was completed during the year. This resulted
in the abandonment of Brazos Brook and Agua Clara Reservoirs.
The new system secures raw water from Gatun Lake.
A filtration system was constructed at Gamboa, adjoining the
pumping station, to filter the water from the Chagres River supplied
to the various canal activities at Gamboa. It will be operated by
the force already required at the pumping station.
The amount of water consumed during 1927, as compared with the
two preceding years, is shown in the following table:

1927 1926 1925

Gallons Gallons Gallons
Canal I"ne.......................... ................... 3,087,507,913 3,000.372.000 3,140,009,765
Ci of '.n: ..................................... 211,019.000 1, 4. 000 1,117,982,000
City of Colon --------. .....--------------------------* *- JIU 37.. 4.'9. 000 586,325.000
Saitr to ships ...--------------- ------------- ------- 4 27,227 144, I1., 672 132,912,685
Tut.il........................................------ -- ., J ,390 4,t 3, 5J; 672 4, U7,259, 450

Seirers.--Other than the usual maintenance work performed
during the year, the extension of the storm sewer from intersection
of Second and Bolivar Streets, Colon, to the sea was completed;
additional storm sewers were constructed at the Balboa railroad sta-
tion to prevent, flooding in time of heavy rains; and an extension to
the sea wall at Fort DeLesseps was constructed to eliminate sanitary
nuisance complained of by the Ariiy.
Roras, stfreets, and s? required the replirinL' of 8,405 squ-are yLrd.s of various c'liisses of
roads and streets, and the chipping and asphalting of 74,618 linear feet
of (rac(-ks in concrete roads. In addition, a considerable number of
din-eiroims curves were eliniinatedi or widened. The progriamni of con-
striutini! sidewalks parnilleling the principal streets and avenues was
continued. A pllrking place was constructed adjacent to the locks
at. Pedro Miguel to take care of automobiles transporting tourists
landing there after a trip through the Cut, and for traffic using the
Army ferry.
Garblye i s7posaI.--The incinerator at Motuint Hope was operated
until February 7, 1927, when it was shut down. At the. close of the
fiscal year garbage in both the northern and stoutliern districts \was
being dclumpied on waste land and buried.
Cities rf Panliimna and Goloni.-Tlie lecesswry maintenance and new
construction work in connection with the water and sewer systems
and the streets of Panama and Colon were carried out. Revenues
received from the sale of water in the two cities is applied to meet





REPORT OF GOVERNOR OF THE PANAMA CANAL


bills arising out of the maintenance of the water and sewer systems
and streets, and if there is a deficit it is billed against the Republic
of Panaimi. In Colon, municipal improvements were made on
vacant, lots owned by the Panaima Railroad Co. on the east side of
Broadway between Tenth and Thirteenth Streets, which makes them
available for lease. The cost of this work was paid by the company.
Army and XSry.-Various jobs, such as the building and repair of
concrete roads, seaplane runways, alteration and extension of water
systems, repairing of docks, air and water lines, etc., were performed
for the Army and Navy during the year.
3fisc'Ilan1iou. .-Some of the more important miscellaneous work
handled included the installation of additional oil lines between the
oil-handlingi plant at Balboa and Docks 6 and 7; the construction of
road and the installation of oil and water lines for the new Miraflores
Diesel electric plant; and the construction of fences around the Gatun,
Pedro Miguel, and Miraflores Locks; and construction of roads and
sidewalk andl installation of water and sewer lines for the new ware-
house and manufacturing plant of the commissary division at Mount
Hope.
Laboratory.-The testing laboratory at Miraflores carried on a wide
variety of work, in which were included inspection of the holds of
general cargcaro carriers, in case of cargo damaged by water and fire,
and of tankers, prior to the beginning of work on them, and tests and
analyses of samples of concrete, asphalt, asphalt wearing surface,
mixedil paints, paint materials, fuel oil, lubricating oil, gasoline, kero-
sene, turpentine, cement, sand, gravel, tar, coal, coke, soap, lime,
ores, steel, gas, electrolyte, water, alcohol, and many others, the total
number of samples analyzed being 2,022. Work was performed for
a number of individuals and companies in Central and South America.

PUBLIC ORDER
During the year 3,045 persons were arrested, of whom 188 were
females. Of these, 2,177 were convicted, 299 dismissed, 17 were
under trial at the end of the year, and 652 were disposed of otherwise
on proIper authority.
The more common am-;ses of arrest were violations of the vehicle
and traffic regulations, 934 cases; violation of immigration regula-
tions, 375; disorderly conduct, 341; intoxication, 181; petit larceny,
134; loitering, 120; assault, 86; fighting 81; violation of the national
prohibition act, 71. The persoIns arrested included representatives
of 79 countries and territories and 166 different trades and professions.
There were two hoiniiiides during the year, one each of voluntary
and involuntary viiianslaughter. There were four suicides, two of
whom were white Aii erica;n employees of the canal. Deaths investi-





REPORT OF GOVERNOR OF THE PANAMA CANAL


gat ed by the coroner during the year numbered 63; accidental t I nwn-
ir1,n was found as the cause of death in 20 instances.
The average total number of prisoners in the coniiiiiio jails at the
close of each month was 66. Those prisoners were emiiployed in
clearing trails, on road repairs, anid on janitor and miiscellaneous
work at police and fire station". The labor performed by them was
valued at $22,335.31
Fifty-seven convicts were committed to the Canal Zone peniten-
tiary during the year, with sentences aggregating 1563.; years; 38
convicts were discharged, 6 were pardoned, and 4 were released under
parole. Labor performed by convicts during the year, valued at
standard rates of pay, amounted to $26,571.55; they were employed
principally on road improvements, and in the cultivation of fruits,
vegetables, etc., at the penitentiary farm. At the close of the year
87 convicts remained in custody, as compared with 68 at the close of
the previous year.
Four arrests were imiade under the narcotic drugs import and export
act, three of which resulted in convictions. One arrest was made for
violation of the white slave traffic act, and resulted in acquittal.
Forty-three person; were deported from the Canal Zone during the
year; of the-se, 34 were convicts who had completed terms of imupris-
onnment and 9 were persons who had been convicted of misdemeanors
or who were deemed iluldesirable persons to be permitted to remain on
the Canal Zone.
Traffic accidents on the Canal Zone numbered 303, resulting in
injuries to 65 occupants of cars and vehicles and 26 pedestrians, among
whom three deaths occurred. A classification of these accident-s
shows that practically all were avoidable, 254 being due to careless or
reckless opera tion of vehicles, 22 to careless pedestrians, and 9 to
intoxicated drivers. In only three instances was the accident caused
by defects in the mnecluinismi of the cars.
In addition to the routine police work in the Canal Zone villages,
a continuous plttrol of the harbors of Balboa and Cristobal was
maintained throughout the year, principally for the enforcemrentA of
navigation regulations and for the prevention of smuggling and irregu-
lar traffic. Police laiiunches were maintained also for the patrol of the
Chaigres River and Gatun Lake, and details of police officers were
continued throughout the year at all canal locks and at the spillway
at (G atun. Monthly patrols of the interior sections of the Canal Zone
were continued to determine if any unauthorized clearings or cultitva-
tions were being made, or any unauthorized new buildings were heing
const ructed. \lotor-cycle patrols for special emergency service and
for the enforcement of the vehicle trtimic regulations were maintained
at various points.





REPORT OF GOVERNOR OF THE PANAMA CANAL


OFFICE OF DISTRICT ATTORNEY

The district attorney and his assistant prosecuted 204 criminal
cases before the districtt court, with 168 convictions, 20 acquittals,
and 16 cases dismissed. There were 17 criminal cases pending at the
close of the fiscal year. Of the criminal cases prosecuted, 38 were for
violations of the national prohibition act, 29 for endeavoring to make
revolt at sea, 26 for burglary, 17 for conspiracy, and 14 for assault.
The district at turnvy represented The Panama Canal or the United
States Government in 11 civil crises, two of which were still pending
at the close of the year.
DISTRICT COURT
Sessions of the district court were held at Ancon and Cristobal, and
the following business was trainscted during the fiscal year:
Cases pendin- July 1, 1926-civil, 28; probate, 84; criminal, 27.
Cases filed during the year-civil, 93; probate, 208; criminal, 138.
Cases settled during the year-civil, 83; probate, 215; criminal, 152.
Cases pending June 30, 1927-civil, 38; probate, 77; criminal, 13.
Of the civil cai>es disposed of, 50 were decided and 33 dismissed; of
the criniminal cases disposed of, 4 resulted in acquittal, 128 in convic-
tion, and 20 were dinimis-ed.
Marriage licenses i.-sued numbered 599, deeds recorded numbered 9,
and collections from fines, fees, licenses, etc., totaled $4,497.92.

MARS PHAL
During the year 641 writs were served by the office of the Canal
Zone marshal. Fees collected amounted to $243.45; fees paid to
witnesssce-, jurors, interpreters, etc., amounted to $61; and trust
funnd- handled during the year ;i'.rgregated $64,645.66.

MAGISTRATES' COU'HTS
In the iii;ngiitriate's court at Balboa, 7 cases were pending at the
beginning of the year, 1,507 uses were docketed, and a like number
disputed of, leaving 7 c;aseS pcinwliIn- at the close of the year. Of the
criminal cases settled, 1,149 resulted in conviction, 50 in acquittal,
173 were dlismi.ed, and 68 held to the district court. During the
year petitions were muade to the district judge for the commitment to
Coriozual Hospital of 71 persons for observation.
In the magistrate's court at Cri0-tobal, 6 cases were pending at the
beginning of the fiscal year, 1,191 cases were docketed, 1,187 cases
were disposed of, leaving 10 cases pending at the close of the year.
Of the criminal cases settled, 054 re-;ulted in convictions, 32 in acquit-
tals, 88 were (lisii-;se(l and 76 lh1'w1 to the district court.
Fines and other collectionV totaled $11,211.75 at Balboa and
$9,342 at Cristobal.





REPORT OF GOVERNOR OF THE PAN..\MA CANAL


FIRE PROTECTION

During the year 107 fires, 5 emergency calls, and 3 false alarms were
reported. Of the fires, 72 occurred in property of The Pannma,
Canal, 12 in Panama Railroad property, 9 in United States Army
property, 2 in property of the United States Navy, and 12 in private
property.
The total loss from all fires amounted to $15,919.03 during the
year, distributed as follows: Panama Canal, $1,292.78; Panama
Railroad Co., $767; United States Army, $5,070; United States
Navy, $2; private property, $8,787.25. The total value of the
property involved was $4,356,849.98.
Periodical inspections of all Government buildings, docks, yards,
etc., were conducted, and fire extinguishers and other equipment were
maintained in good condition throughout the year. Thirty-five
extinguishers and 2,000 feet of hose, the latter mostly for replace-
ment, were added to the equipment.
In addition to the paid firemen, who numbered 43 at the close of
the year, an average of 18.7 volunteer fire companies was maintained
at the several villages, the personnel of which numbered 187 on
June 30.
PUBLIC-SCHOOL SYSTEM

The school organization in the Canal Zone is coii parable with a
city school system in the United States, with a superintendent and his
assistants in charge and a principal at each su-hool; the towns of the
Canal Zone, although more scattered, being comparable with the
sections of a city where schools are located. .All elementary schools
are graded and the high schools, which are at Balboa and Cristobal,
offer the usual courses. Pupil transfers to and from the States are
frequent, and graduates of the high schools may enter various institu-
tions of higher learning in the States. Consideration is being given
to the establish ment, of two-year junior college courses, in extension
of the courses offered in the Balboa high school.
White schioo.ls.-It has been the policy to provide for American
children educational facilities of the same character as can be found
in the best public schools in the United States. Only American
teachers, with normal school or college training, are employed. At
the close of the year 87 teacher.; were employed in the white schools.
During the year there were 10 replacements, 7 of teachers who
married, 3 of those who resigned for other cause-.
During the past fiscal year the average daily attendance was
2,429.9 as compared with 2,051.5 for the preceding year. Six elemen-
tary and two high schools were maintained. At the close of the school
year 71 pupils graduated from the two high schools as compared
with 53 for the previous year. Dr. R. G. Reynioltd, provost of




REPORT OF GOVERNOR OF THE PANAMA CANAL


Teachers College, Columbia University, visited the Isthmus at the
close of the school year and delivered the address at the comience-
ment exercises.
Plans were perfected during the year for a reorganization of the
seventh and eighth grades in the Balboa and Cristobal schools along
the lines of the junior-high-school plan of organization used by some
of the leading schools in the United States. Specimens of records
and reports also were secured from a number of representative
schools and after careful study of these forms a system of records
and reports was devised to embody the feaiture- deemed desirable for
the Canal Zone schools.
Colored schools.-The average daily attendance for the year was
2,016.9 as compared with an average of 1,976.5 for the preceding year.
A much larger growth would have been indi icate if facilities had been
available for all the pupils who sought admission. This situation
will be alleviated somewhat at the beginlllinrg of the new fiscal year
when appropriations will become available permitting the employ-
imient of 13 additional teachers and admitting some 650 pupils from
the waiting list. The construction of eight new classrooms at Silver
City, Cristobal, and six additional rooms at Gatun was under way at
the close of the fiscal year.
Manual training was introduced in the school at La Boca during the
past yea r, and will be begun in the schools at Silver City and Gatun
in the fiscal year 1927-28.
Operation of the colored schools on a 12-month basis was approved
to begin with the fiscal year 1927-28, which will tend to relieve the
congestion and advance the standard of work in these schools.
A corps of 47 teachers was maintained throughout the year. In the
colored schools the curriculum does not extend beyond the graimma;r-
school grades, and only West Indian teachers are employed.
POSTAL SYVTF.M
Twelve post offices were in operation at the end of the year, all of
which, except Gamboa, were authorized to t rinsact money-order
business. No new post offices were opened during the year. The
post office at Fort Sherman was clIsdc on May 31 and postal service
for that post is now furnished by the post office at Cristobal.
The total receipts of the postal service were $181,589.04, as com-
pared with $178,324.02 for the year preceding. The total disburse-
Ilents were $181,812.29, leaving a deficit of $223.25 for the year.
This showing of practically a self-sustaining lia-is is in the face of the
fact that it is estimated that 60 per cent of all mail handled locally is
dispatched under official frank from which the bureau of posts
derives no revenue but for which it must bear the burden of trans-
portation and other handling charges.





REPORT OF GOVERNOR OF THE PANAMA CANAL


The sale of United States postage stamps and postal cards sur-
charged "Canal Zone" was continued throughout. the year, but
stamped envelopes are manufactured by the Panama Canal press.
It is proposed to discontinue the iise of such surcharged postage
stamps as soon as funds are available for obtaining the required
dies for the printing of a distinctive series of Canal Zone postage
stamps and other stamped paper. As the additional revenues which
would be derived from the sale of an entirely new issue of stamps
would, in all probability, nearly defray the expense involved, it is
hoped that funds for this purpose may be made available at an early
date.
Deposit money orders issued without the payment of fee, in lieu of
postal savings certificates, had a total value of $713,685. The total
amount of June 30, 1927, including deposit money orders, old postal
savings accounts, and unpaid fee-paid money orders in favor of the
remimitter, was $471,743.10, as compared with 4166(,0')96.65 on June 30,
1926. The system operates satisfactorily and at a minimum expense.
Interest is paid on such deposit money orders at the rate of 3 per cent
per annum. Since the inauguration of the system on August. 21,1916,
the interest received from the banks in excess of that paid to deposi-
tors aggregate, $158,63S.9.S.
During the year the decision was reached to discontinue the C. 0.
D. system between the United States and the Canal Zone, effective
July 1, 1927, This system, which was established in 1914, has been
abused by cheap mail-order concerns. It was estimated that the
cost to the Canzal Zone postal service of operating the system during
the last year was about $0,000, which was di-proportionate to the
benefits derived fri nm it by local patrons.
There were 147,979 immoney orders issued during the year, amounting
Sto $2,754,567.03, on which fees amounting to $13,399.63 were col-
Slected. During the year 40,486 money orders, amounting to $1,175,-
445.23, were p;iid.
In the registry division of the post offices 278,315 letters and
parcels were handled, of which 44,288 were official mail under frank
and accepted for registration without fee.
During the fiscal year a total of 2,793 dispatches of mail were
made to different foreign exchange post offices by the post office at
Cristobal and 1,668 dispatches by the post office at Balboa. Incom-
ing dispatches from foreign post offices numbered 3,018 at Cristobal
and 1,075 at Balboa.
The routing of mail to and from the United States via Key West
continued to show gratifying results and advances the mail consider-
ably when close connection is made at Havana.





* REPORT OF GOVERNOR OF THE PANAMA CANAL


United States and foreign transit mail destined to the west coast
of Central and South America, as well as mail exchanged between
Cuba, Jamnaica, and other insular governments with Colombia,
Costa Rica, Venezuela, etc., continued to be handled under the
supervision of the director of posts. Mail from European countries
routed via the Isthmus for transshlipment is handled by the director
of posts in behalf of the United States Post Office Department.,
whereas direct, agreements are in effect between the director of posts
and the postal administrations of Peru, Costa, Rica, Australia, and
New Zealand for the handling of their mniiils routed via the Isthmus.
Eventually, it is believed that the postal administrations of all
Central and South Anierican countries will find it more satisfactory
and more economical to discontinue their local postal agencies and
have their mails handled through the Canal Zone postal service.
CUSTOMS
Vessels entering and clearing Canal Zone terminal ports numbered
12,497 and 12,506, respectively, an increase of about 7 per cent as
compared with the previous fiscal year.
All merchandise discharged at Cristobal and Balboa, destined to
local consignees not connected with The Panama Canil, the Panama
Railroad, or the United States Army or Navy, remains in the custody
of the Canal Zone customs until submission of the necessary papers
from Panaman officials showing that duty has been paid. Permits
for 9,318 releases were authorized during the year. Free-entry
requests numbering 3,708 were approved for employees of The
Panama Canal, the Panama Railroad Co., and members of the
United States Army and Navy who have the privilege of importing
articles for their personal use without payment of duty.
Customs duty was paid to the Republic of Panama to the amount
of $109,728.74 on 35,402 mail parcels for noneniployees and on duti-
able articles for employees imported through the Canal Zone post
officee.
No arrests were made for violations of the customs regulations.
but numerous attempts to smuggle mercy lIandi-e of various classes,
in small quantities, were frustrated, and such merchandise was con-
fiscated and delivered to the proper authorities of the Republic of
Panama.
Three arrests were made by police and customs officers during the
year for alleged violations of the narcotic drug act. Convictions were
secured in each rase and the offenders sentenced to hard labor in the
Canal Zone penitenl tiary.
To facilitate the discharge of passengers from vessels arriving after
the usual working hours, special customs service was furnished to
678 vessels, of which 483 were at Cristobal and 195 at Balboa. Fees
totaling $5,535 were collected for this extra service.





REPORT OF GOVERNOR OF THE PANAMA CANAL


SHIPPING COMMISSIONER-SEAM EN

The shipping commissioner and his deputies have the same powers
with respect to American seamen as shipping commissioners in the
United States and American consuls in foreign ports. During the
fiscal year 3,518 seamen shipped on American vessels and 3,251 were
discharged at Canal Zone ports. There were 154 American seamen
lodged and subsisted at the expense of the United States Govern-
ment. Sick or destitute seamen returned to the United States at
the expense of the appropriation for the relief of destitute American
seamen numbered 183, and 129 were signed on vessels as seamen or
workaways and returned to the United States without expense to the
government.
The wnges earned by seamen discharged at Canal Zone ports ag-
gregated $.S7,557.82; the total approved for deduction on account of
ad vances, allotments, fines, slop-chest account, etc., was $19,622.53,
and the balance of $67,935.29 was either paid to seamen under the
supervision of the deputy shipping commissioners or received on de-
posit for their account. The wages and effects of 11 American sea-
men who died in Canal Zone hospitals, or who died at sea and were
brought to the Canal Zone for interment, were handled by the ship-
ping commissioner during the year.

PROHIBITED ALIENS

Chinese passengers arriving at Canal Zone ports during the fiscal
year numbered 737, in addition to 42 on hand July 1, 1926, making
a total of 779 in transit to the Republic of Pnnanma and other coun-
tries. Of this number, 542 were nidmiit ted to the Republic of Panama
by authority of that Government, and the others, with the exception
of four awaiting transportation at the end of the year, either pro-
ceeded on their journey or were ret turned to the port of embark ifion.
Chinese cre ws were checked on arrival and again upon the vessel's
departure, in order to see that no illegal landings were made, and
crews of 602 vessels were so checked during the year.

ADMINISTRATION OF I.STATES

During the year the estates of 82 deceased or insane employees of
The Panama Canal and the Panamin Railroad Co. were settled and
there were 29 estates in course of adm;liniitration on June 30, 1927.
The cash assets involved in the settlement of the 82 estates were
$16,898.59.
64950-27-- 5





REPORT OF GOVERNOR OF THE PANAMA CANAL


LICENSES AND TAXES

Licenses issued for motor vehicles, bicycles, and animal-drawn ve-
hicles, and permits for the peddling of foodstuffs, the vending of mer-
chandise, etc., numbered 7,508 for the year. License fees, taxes,
etc., aggregated $34,731.79 for the year. Automobiles accounted for
4,978 of the licenses and $30,030.79 of the fees.

IMM.11IGRATION VISAS

During the year ended June 30, 1927, a total of 100 visas were
issued to alien residents of the Canal Zone going to the United States.
Of these, 43 were quota, 33 nonquota, 18 nonimmigrant, and 6 were
transit-certificate visas. Two applications for visas were refused on
account of the applicants being diseased. The fees collected for the
visas amounted to $906.

RELATIONS WITH PANAMA

There was direct correspondence between the government of the
Canal Zone and the Republic of Panaima on the issuance of compli-
ment try transportat ion over the Panama Railroad, traffic regulations,
street cleaning, garbage collection, andl on various other questions
principally of local interest.
The negotiations for a general revision of the existing agreements
between the United States and the Republic of Panama, which have
been pending for several years, were continued but had not been
concluded at the end of the fisc.l1 year.













SECTION IV


ADMINISTRATION

CHANGES IN ORGANIZATION AND PERSONNEL

The section of meteorology and hydrography was merged with the
section of surveys, effective November 1, 1926. These two sections
were performing allied work and it was found that they could be
advantageously combined. The new section comes under the assist-
ant engineer of maintenance, as did both of the old sections. This
brings all work relating to seismology, hydrography, ineteorology,
and surveying under one administrative unit.
Capt. William McEntee, United States Navy, was appointed
superintendent of the mechanical division June 13, 1927, vice Capt.
Ross P. Schlabach, United States Navy, who had occupied the posi-
tion since June 13, 1924.
Col. George I. Ekwurzel, Medical Corps, United States Army,
was appointed superintendent of Ancon Hospital Muay 15, 1927, vice
Col. Will L. Pyles, Medical Corps, United States Army, who had
occupied the position since May 28, 1923.
E. E. Weise was appointed assistant to the chief of the Wash-
ington office, The Panama Canal, effective May 1, 1927, vice Ray L.
Smith, whose death occurred April 20,1927. Mr. Smith's ser vice with
The Panama Canal dated from December 15, 1904, and his loss is
felt keenly.
FORCE EMPLOYED

The force employed by The Panama Canal and the Panama Rail-
road Co. on the Isthmus increased from 12,819 in June, 1926, to
13,403 in June, 1927, or 4.55 per cent. The distribution of the per-
sonnel on the third Wednesday in June of both years is shown in
the following tahulation, from which it may be seen that the increase
is considerably greater in the silver or alien employees than in the
gold or American employees, the percentages of increase being 5.3
and 2, respectively. The Americans comprise the supervisory, tech-
nical, higher clerical, and highly skilled mechanical force.






REPORT OF GOVERNOlR OF THE PANAMA CANAL


As of June 16, 1926 As of June 15, 1927

Gold Silver Total Gold Silver Total

0 inli l .11.in III ii t *n iii.I*
pIll.r ..... 37 35 72 37 40 77
Electrical---..--. ------. --.------.------------ --.. 148 1 153 301 142 180 322
Municipal engineering---------------------------- 79 580 659 78 803 881
Lock operation..------------- .... .............. 210 624 834 211 606 817
... ..................... 174 879 1,053 182 898 1,080
M 11 i ir.il ...................................... 40 738 1,146 442 792 1,236
Marine ------------------------------------------ 18 535 720 196 596 792
1.r il ir n,. ... ... . .... ....... .. .. ... 14 118 132 14 35 49
Qii..rii-ri L ...... ........................... 181 1,519 1,700 187 1,716 1,903
*iUhl-I1.T 1 .. ......... .............. .......... 8 100 1087 97 104
Conmnissar----------.---------------------------198 977 1,175 203 1,056 1,259
Cattcl industry. ----------------------------------- 7 326 333 7 127 134
.it..l W .]-hir utnrII ................................ 8 88 96 8 95 103
Trn in..rr inii.... ........ ................. 49 200 249 46 1 208 254
AVL. muInI i iiI i -i.rl ni niri ............................... 198 8 206 200 8 208
Health department----------------------------------- 227 801 1,028 240 784 1,024
E\ i.II |,rii . r It.. ............- ---------------. 502 285 787 490 279 769
Panama ; lin Z r Il
-111.i111 i l .nt. ..11 . ...... ..................... .... .. 47 217 264 48 234 282
Tr. 11 ri 11 ...............................5 ... 112 177 64 113 177
T.I n it n .iil forw ir.li., .' nt......... ......... 85 1,419 1,504 86 1,588 1,674
Silii i n .............. ...... ................. 49 1 226 275 48 210 258
Total--.-----------.--------------------2,879 9,940 12,819 2,936 10,467 13,403


The larger number of employees on the rolls of some of the divisions
at the end of the fiscal year as compared with June, 1926, was due to
increlsed(l construction work in some divisions and to increased busi-
ness in others. Explanations of the larger inr asve; are given below:
Elect, ledl d;,,rision.-Increacs in work due to new construction;
this is temporary.
IMluricipal engini' ring.-Increase due to new construction, and is
temporary.
Drfdql'inpg (L;r:4S11jn .-Increase due to construction of the Rio Granlde
spillway and to operating the GrIimo:a gravel plant on a two-shift
basis to meet increiiv-ed demand for gravel due to new construction.
.Vfrcl nical dr;';;vio.-InIcrerate due to coniiI ruction of two tugs for
The Panama Canal and a number of bargies for Buenaventuira,
Colombia.
.11mr ine l;i'iion.-Increase due to ilncrei-sed traffic through the
canal necei'itating more pilots and more seamen to handle lines on
ships transiting the canal.
(Ouarf~t' /i r.-Incrpeaie is largely in the constructing quarter-
iat(er''s livi -ion and is due to increiia-ed corit ruction work.
C n1 ///;.ssr l/-/ 17;iri' ;on.-Increlase is due to increac ed business and to
improvements at La Boca and Balboa coninis i ries.
Panama Paiolriad, supfr'ni l(n1(nd.-Incrense due to increased help
nece.-ary in laying new steel from Mount Hope to Colon.
RTfc; 1in in1117 fJorlairding agent.-Greater number of vessels and
larger volume of cargo handled as compared with preceding years.






REPORT OF GOVERNOR OF THE PANA3A C('.\.ANA


WAGE ADJI'STMENTS
Gold employees.-The policy of compensating Amierican employees
at. 25 per cent above rates paid by the Government for similar em-
ployment in the continental .United States, as authorized by the
Panama Canal act, was continued in so far as appropriations would
permit. As in past years, owing to insufficient appropriations, a
number of employees in various divisions of the civil government had
to be denied the full 25 per cent over rates paid employees engaged
in corresponding work in the United States.
Reflecting the stability of wages in the United States throughout
the year, revisions in basic salaries and wages on the Isthmus were
slight., and such changes in compensation as were authorized con-
sisted largely of individual rather than group adjustments.
The wage board, composed of the assistant engineer of na intenance
and a representative selected by the organized employees, held 22
meetings during the year. The salary board, composed of the heads
of the nine major departments and divisions of The Panama Canal
and Panama Railroad, held meetings in December and June.
The respective spheres of the two boards have not been definitely
established as yet., though in a general sense salary and wage ^ched-
dule derived by the application of the 25 per cent differential over
rates authorized for similar work in the United States are referred
to the wage board, and adjustments not so determined and in which
local coordination must be given special consideration are referred to
the salary board. Both boards function merely in an advisory
capacity to the Governor, who is charged with the fixing of all rates
of pay. In some classes of employment the wage board submits
recommendations as to the general scale of rates to be established,
while the salary board, which functions primarily as a coordinating
agency, recommends rates for individual positions in accordance
with the general scale for the class of employment, in which the
individual employee under consideration is engaged.
Alien employees on thke silver roll.-There were no changes in the
basic wage schedules previously authorized for alien employees other
than a few adjustments involving small groups. The basic rate for
unskilled labor remained at 20 cents an hour, and the maximum
authorized rate for alien employees at 40 cents an hour, or s8i per
month. The average rates in effect as of November 1, 192l', when
the last, general survey was made, as compared with the th ree preced-
ing years, were as follows:
Average earnings

Employees employees
Prr month Par hour
Nov. 1. 1923 ------------------------------- 0. 2312
Nov. 1, 192........................................................................ 54. 7 .2312
Nou 1, 1925--.- --...................-............ .......... .-......... .. .3
Nov. 1, 1926............................................... .................... 111 .2395





64 REPORT OF GOVERNOR 01' THE PANAMA CANAL

As may be seen by the above, dirmin the past four years average
earnings of the alien employees have remained almost stationary.
During this ;aimle period the index of living costs, taking prices of
staple co'l olldities as old in the ca11al.conunissaries as a base, shows
a decline from 14t0.6 as of October 1, 1'12::, to 143.34 as of January
1, 19i27; and a further sharp redluctimon to 136.95 as of July 1, 1927,
which Intter, however, may be partly s;iso;Il.
At thr close of the fi-'ll year, tliererore, the worker's real wage,
measured in the a mount of goods pIur)li-.lble, was mo re favorable
than it haid been at any time for nrlmie years. A -etiond factor, how-
ever, which need-; be given n-iiidleration so Ir-nir as wages are fixed
with relation to commodity price-, is that the number of dependents
per worker has been iln rIsing steadily from ye':! to year. During
COnstrltfiicti dlivs ml'ii laboilei:- were. imported in gre;nt niniubers,
i he proportiii of imale work rs domiciled in the Canal Zone was
a;iIproximul;icly 60 per cenit of the total alien population. This ratio
I.i been dcw!iiiijw; from year to yea;r until at present it is 35 per cent.
In vi' w of the 1-Ir2I' increase in the number of women and children,
after the termination of construction work and the settinHg aside of
p1r(Ii:i1'1L0t t'wll sites to nmc.uimmodate alien employees and their
fl.iijllij:, it is obvious that, though w. c-,' as compared with commis-
sary INi. es are -li-ihtly niore favorable than in the past, this has been
oflet. by the greater number of dependents who must be housed,
clolt hed, and fed from the avceragL ciiiepl yee's earnings.
There have Ibeen rcpeint'd efl 'It on the part of tilieii employees
dliiriitI the past fe\\ years toward .-eciiumii'. the removal of the present
Z.." limit;ati"ll on tleir rates of pay. Conidrlrable study has been
gievin to the question of these rates, and further con.;idera titon may
indliu: (t that sr'me increases should be granted. The canal adminis-
tralion has Ion' 'u recogniiz.d its obliu.r;atii! to maintain a schedule of
rnI and comfort, and has at all in'c ci(ndcIvored to maintain a scale of
w:_rse that woNmild provide a -sl;adard of living as high or higher than
that which prevailed among these employers during construction
d:i\ -, ind equal if not superior to standards for this class of employ-
nient in ;idj;rcniit Latin-Amieican count ri(e; and the islands' of the
Wert Indiie.
COM1I'LAINTs BOARD

All Iemployees, whether members of a labor ornanniization or not,
have a right to submit proper complaints ronm1ccrning working condi-
tion'- to thi Goerunor, r'iiuestiingi investing action by the complaints
1oard. The .'roe of cases iref'nrred to the board includes discharges
for nrisec; uieniority, where it is or may become a factor in making
discmirgrs' on iircount of reduction of force; ratings given to em-





REPORT OF GOVERNOR OF THE PANAMA CANAL


ployees for workmanship and conduct; or other complaints of unfair
or discriminative treatment concerning which the Governor desires
an investigation by competent and representative persons, for the
benefit of their recommendations.
This board relieves the Governor of much of the routine work con-
nected with the handling of complaints, but does not deprive any
employee of the right of appeal t.o the Governor. It is composed of
the assistant engineer of maintenance, the head of the department or
division in which the complaint originated, and two representatives
of the eiiimployees, nominated by the central body of the employees'
associations and approved by the Governor. The work of the board
is a valuable auxiliary in promoting a sense of fairness and content-
ment among the working force, since the employee is assured of a
hearing of any real or fancied complaint by a board on which his
fellow workers have equal representation and on which the canal
administration is represented by a disinterested official. The func-
tions of the board are wholly advisory and its findings are not effec-
tive until approved by the Governor.
As indicative of the generally satisfactory conditions of employ-
ment that. existed throughout the year, it may be stated that but
three complaints were handled by the board during the fiscal year.

RECRUITING AND TURNOVER OF FORCE

Gold employees.-The number of persons tendered employment
through the Washington office of The Panama Canal during the year
was 495, of whom 261 accepted and were appointed; the percentage
of acceptance and appointments was 52.7. In the previous year
the tenders numbered 401, appointments 167, giving a percentage of
acceptance of 41.6, and in the fiscal year 1925 the corresponding
figures were 512 and 234, percentage 45.7. Including the 261 em-
ployed in the United States in the past, year and 318 eImploymlents
on the Isthmus, the total additions to the gold roll were 579. Sepa-
rations numbered 506, of which 14 were due to retirement. Based
on a force of 2,879 gold employees at the beginning of the year, this
gives a turnover rate of 17.6 per cent per year from all causes, as
compared with 17.5 per cent in the previous year.
When the services of an employee are no longer required in one
department efforts are made to place him in a vacancy in another
department in preference to bringing a new employee from the
States. This policy has proved profitable to the canal in that not
only are the effort and expense incurred in recruiting and testing
new and unknown employees eliminated but also the experience and
knowledge gained by the employee in one department are often of
value to him in his new work. The canal also retains the services




REPORT OF GOVERNOR OF THE PANAMA CANAL


of a worker accustomed to tropical living conditions. Of the 318
additions to the gold roll on the Isthmuis during the. past year 130
were reemploymients.
Two thousand seven hundred and ten 'perons (2,473 from New
York, 135 fronm New Orleains, and 102 from Pacific coast. ports),
including new appointees, those retur'nin1g1 from leave of absence,
and members of employees' families, were provided transportation
from the. United States to the Isthmus. In response to inquiries
and applications for employment and in the issuance of appoint-
ments and in gathering waLge data, the Wa1shington office sent out
9,010 letters, 1,209 telegrams, and 12,711 circulars.
Sibler enfploy(c.s.-No figures are available concerning the number
of separations and employment among the alien personnel compris-
ing the silver roll, but no difficulty was experienced in maintaining
an adequate force, and the percentage of turnover was fairly low for
this class of labor.
PUBLIC AMU-:ME.1NTS AND RECREATION

Ten clubhouses were operated continuously throughout the year,
of which five were for white and five for colored employees of the canal.
These clubhouses were open daily from 7 a. m. to 11 p. m., and pro-
vided central meeting places in each of the larger settlements, where
employees and their fainilies could find wholesome entertainment
and recreation.
Reading rooms are maintained where current numbers of the lead-
ing United States newspapers, magazines, and periodicals are
available. Branch libraries containing suitable selections of books
are open for one or more hours in the evening. Moving pictures are
exhibited daily in the larger clubhouses, and several times weekly at
the smaller clubhouses; weekly prngralns are shown at the leper
colony, the in-lane asylum, and the penitentiary, where film service
is furnished without charge. Plays, concerts, vaudeville, and other
entertainment by local talent or by professional entertainers passing
across the Isthmus on their way to and from other counties are
given as opportunity offers. Bowling, billiards, pool, chess, and
checkers provided recreation for blrge numbers of people, and card
pnirt-ic* were popular at all clubhouses.
Ice creami, soft drinks, and light lunches may be obtained at all
clubhouses, and tobacco, candy, toilet articles, iag linese, souvenirs,
etc., are on sale at all clubhoiiuses where the demand warrants it.
At the playground-;, gan'es and kindergarten work were provided
for children from 3 to 6 years old. The playgrounds \\ere also used
by the school children outside of school hours and during the summer
vacation, and baseball, soccer ball, basket hall, volley ball, and





REPORT 01' (OVEtINOIR OF THE PANAMA C.\NAL


indoor-blaseball leagues were organized. Regular gymnasium classes
were held for high-school students as well as mixed classes for adults
during the evening. The swiimming pools at Balboa and Pedro
Miguel were used freely during the year, and swiinning, diving, life
saving, atnd physical development, exercises were taught, and swim-
minig meets for school children and adults; were arrfinged from time
to timune.
At the colored club houses, literary clubs, talks on education,
health, and other subjects helpful to children as well as adults form
an important part in the community welfare work. Industrial
schools meet one or more nights weekly, where shorthand, type-
writing, and grade subjects are taught; and classes are conducted in
cooking, baking, and sewing for girls.
Most of the present clubhouses are old, and extensive repairs are
necessary to keep them in good condition. The. twentieth anni-
versary of the use of one of the buildings, that, at Pedro Miguel, was
celebrated on June 7; the clubhouse was opened originally on June
7, 1907, in Gorgona, and on the abandonment of Gorgona had been
transferred to Pedro Miguel. New clubhouses are needed at Balboa
and Ancon, and inexpensive playsheds and facilities for swimming
should be provided at some of the colored settlements where none
exist, at present.
Some of the clubhouse activities are carried on at a profit; others
are not self-sustai'inig and the deficit must be met from appropria-
ions. The justification for such approlrint ion is that the playground
activities, swimming pools, tennis courts, etc., are such as are pro-
vided at public expense by many cities in the United States and that
these Iativities add iiiaterially to the morale of the organization and
to the physical and moral health of the comm unity.
Clubhouse finances for the fiscal year are taken up in the section
on business activities.

PURCHASES AND SALES IN THE UNITED) STATES

The principal purchases of supplies were made by the Washington
office of The Panama Canal as in previous years. Branch offices iIn
charge of assistant. purchasing agents were continued at New York,
New Orleans, and San Franci and andn Francisco, 1d the personnel at these offices
acted also as receiving and forwarding agents for materials forwarded
to the Isthmus from their respective ports.
The principal medical and hospital supplies were purchased tlhroulvhi
the medical section, New York general intermediate depot, L'nited
States Army, Brooklyn, as in the past.
The number of orders placed for supplies during the fiscal year
was 7,693 as compared with 6,674 for the preceding fiscal year, and
exceeds the number during any fiscal year since 1904, except 1915,




REPORT OF GOVERNOR OF THE PANAM.A CANAL


1916, 1917, and 1920. The force handling this work was not in-
creased and considerable overtime was required. The total value
of orders placed during the past year was $5,676,069.5,' as compared
with $4,236,313.10 for the fisral year 1926. The grand tutal for
the purchase of supplies and rnterials by orders placed in the United
States by and under the direction of the Washington office since
1904 is $194,267,S62.35. Fifty-four contracts were prepared during
the fiscal year 1j27, amounting to $3,020,357.07; among the more
important were the following: For Diesel engine.; and accessories
for two electric tugs, amoiinting to $163,013.36; for electrical ma-
chinery and auxiliary equipment for two electric tugs, amounting
to $109,150; for Diesel electric hydraulic dredge and equipment,
amoiuntingr to $1,042,600.
The sale of surplus canal material by the purchasing depa:rtmtent
in Washington (during the fiscal year amounted to $60,031.52, as
compared with $76,357.94 during the preceding fiscal year.
In representing The Panama Canal in the United States, the
Washington office handled extensive correspondence and mavitained
representation on various Government boards and coordinating
committees, in addition to contacts with other governmental de-
partments with reference to canal affairs.

TACNA-ARICA PLEBI,-CITE
Activities on this plebi-;ite having been in abeyance during the
year, except for the work of the boundary connisieon, there was no
important participa tion in its work by employees of the canal on
leave, as in the previous year. One of the two employees absent
at the beginning of the year on work of the boundary commission
returned to canal duty, Ieav ing one still on detached service at the
end of the year.






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SECTION V


FINANCIAL AND STATISTICAL STATEMENTS

Various financial statements with reference to The Panama Canal
and three tables relative to the traffic through the canal are presented
on the following pages. The financial statements are abstracted
from the annual report of the accounting department and the traffic
tables were compiled by the bureau of statistics.
The following is a list of all of the tables contained in the annual
report of the accounting department and of the three traffic tables.
Tables Nos. 23, 35, 40,41, and Nos. 45 to 66, inclusive, in the account-
ing department report are not published because they are concerned
with details of operation which have no general interest.. For pur-
poses of reference, however, the numbers given these tables are
preserved below and all of them are listed. Following this list is a
series of notes of explanation of the financial tables. These notes
explain both the published and unpublished tables. Following the
notes are the tables, with the exception of those the omission of
which is noted above.
The complete list of tables is as follows:
Tnable
No.
1. General balance sheet.
2. Summary of revenues and expenses.
3. Balances in appropriation and fund accounting.
4. Appropriations by Congress.
5. Cash receipts and disbursenmits- for account of the Uliitcld States.
6. Payments made by the payma,;ter.
7. Receipts and disbursements by the collector.
8. Collections repaid to appropria.tiorn- and to individuals and companies.
9. Collector's special deposit account.
10. Audited pay rolls.
11. Accounts receivable registered.
12. Comparative statement of accounts receivable outstanding June 30, 1927.
13. Comparative statement of accounts payable.
14. Statement of defense capital expenditures to June 30, 1927.
15. Details of canal fixed property.
16. Detail of canal transit equipment.
17. Business property, equipment, etc., by divisions.
18. Buiisiness fixed property.
19. Canal business equipment.
20. Status of public works in Panama and Colon.




REPORT OF GOVERNOR OF THE PANAMA CANAL


Table
No.
21. Canal transit material and supplies on hand.
22. iereipt,. issues, and transfers of stores.
2';. Comparative statement of store balances.'
24. Statement of canal earnings, expenses, and net expenses.
23. Canal transit revenues.
-'I. Business expenses, revenues, and net revenues.
27. Comparison of expenses and revenues and surplus by years to date.
2.s. Payroll deductions from gold employees, for rent, etc.
29. Reserves for replacement.
30. Reserves for repairs.
31. Reserves for gratuity.
32. Cost of production and distribution of electric current.
33. Cost of production and distribution of water.
34. Dredging operations (channel maintenance).
35. Mu11'ony orders issued and paid by Canal Zone and Canal Zone orders paid by
other administrations, fiscal years 1907 to 1927, inclusive.'
36. Monthly money order business of Canal Zone postal service.
37. Postal service-audited rnveniti.u. fiscal years 1907 to 1927, inclusive.
3s. Postal revenues., fiscal year 1927.
39. Postal savings and deposit money-order transactions, fiscal year 1927.
40. Income, bureau of clubs and playgroundii--, fiscal year 1927.1
41. Expenses, bureau of clubs and pTliygroiimld;. fiscal year 1927.1
42. Income and expenses, bureau of clubs and playgrounds, fiscal year 1927.
43. Balance sh6:.-it, bureau of clubs and pla 'r%"iinnl, June 30, 1927.
44. Coupon books issued, sold, etc., fiscal year 1927.
45. Amounts of injury payments made during the period August 1, Dois, to
June 30, 1927.'
46. Injury and death payments, September 7, 1916, to June 30, 1927.1
47. Number of injuries by extent of disability for each division or department.1
48. Niafure of non-fatal cases, by department or division.'
49. Number of cases and compensation paid, classed by injury.'
50. Class of work being performed by employees at time of injury, by depart-
ments and divisions.'
51. Cause of injuries, by departments and divisions.'
52 Cost of commissary supplies purchased and sold during fiscal year 1927.'
53. Collections from other than employees.'
54. Collections, Panama Railroad land rents.'
55. Rental of silver (laborers') quarters.'
56. Panama Canal accounts payable vouchers retgis.tcr1-L
57. Panama Railroad accounts payable vouchers rei-t-r.-'d.1
58. Employees' bonds.'
59. Report of the accounting bureau (general and cost accounts).'
Ei6. Report of payroll section (claims bureau).'
61. Report of claim *'tft-.-r-personal injury claims.'
62. Report of the claim clerk-freight and cargo claims.'
63. Report of rent and other collections from silver enployeue..'
64. Report of the general inspection bureau.'
65. Report of the time inspection bureau.'
fil Report of the property inspection bureau.'
67. Origin and destination of cargo passing through the canal, fiscal year 1027,
Atlantic to Pa-itic.
I Oinitte I from publication; sea notes on follow ing pages.





HR1'TOT OF GOVERNOR OF TL4E PANAM.\I.\ AN.\1L


No.
68. Origini and destination of uarg' pa--.ing tlirouigh the Pacific to Atlantic.
69. S1a.iteillent ,lIwing, by nationality, the number of transits of '.-- l-
a;giregn-it Panama Canal net t'riiliage, tolls csM'-lsd, and tons of cargo
carried through T'lic Panama Canal by fiscal years from the, puni'ing of the
Canal, AuLgrrt. 15, 191 1, to June 30, 1927.
EXPLANATION OF FINANCIAL AND STATISTICAL .sTATEMENTS
A brief explanation of tables numbered 1 to 69, inclusive, follows:
Table No. 1 ciimrd 1v iiitnc! iu1t.-A few changes have been
made in this stateiinnit. The trial balance shown last year has been
omitted. This trial balance showed the canal expenses, b1I-ii1'ss5
expenses, and c;intl earnings for the year on the asset side, and the
canal revenues and business revenues separately on the liability
side. These saic figures a-rn shown in Tables 24, 25, and L2. The
therielictal interest account i;i been closed arind the accuniiliitedl
interest added to the account United States Treasiur y, n- the jit r'rest
on amortiz/atiomi and depreciation of cinal fixed property is theo-
re'in1lly accruiniii in the Treasury. The comiimercial capital invest-
mniiit w\v;s reduced by 4-100,000, covering the book value of the
ste;nirshlip P( nti/ni,', which was (,(ld and the net proceeds covered
into the Treasury it, miscellaneous receipts. Further refel! liCEi
is made to the ,i!- of this vessel under Table No. 25. The SI 00,000
was tiraisferreui to national defense capital as has beeni done in
simiiilar (uses before.
The forni-wr delpreciation count has been divided into two
aiCcounts- depreciation unfundedd), and repincei)llt reserves
(funded). The depreciation account now only contains the accumu-
lated depreciationr on ca;ltid fixed property, for which no f:iunds zirv
provided for replaceriment. The reserve for replhcenient includes
accrued depreciation for which funds are actually available for
Imiltkingi replacement ts of cHiml transit equipment and b'rsii';- prop-
erty and equiipment. These accounts are further explained under
the heading of Tables Nos. 24 and 29.
A new account was opened under the heading of "Contingent
reserve,"' or "Reserves for contingencies," to which were tranrsferre d
the unpaidI salaries and wages from the beginning n of the operation
of The Pananima Canal to June 30, 1925, unclaimed as of December 31,
192I', and the unpayable vouchers registered prior to July 1, 1925.,
unpaid .4s of December 31, 1926, and the account. was debited with the
amount of uncollectible accounts receivable. The amounts writ ten
off were as follows:
I':irlaiineld salaries and wuage. --------------------- *17, 5:. 87
Unclaimed accounts payable_----------------------- 12, 679. 2"
Total ------------------------ ------- 233. 12
Iiciollectible accounts receivable------------------- 9, 337. 49
Net amount --__----------------------- --- .11, 895. 63




HEPORT OF GOVERNOR OF THE PANAMA CANAL


The ntucounts receivable are of two kinds, viz, hospital bills against
silver employees, collectible by pay roll deduction, incurred between
July 1, 1921, and June 30, 1925, uncollected as of December 31, 1926,
$7,867.99; and general accounts receivable registered prior to July
1, 1925, uncollected as of December 31, 1926, $1,469.50. During
the periods in which the foregoing dormant accounts have accunmu-
itedl, the pay rolls have amounted to approximately $130,000,000,
and accounts payable to S60,000,000 and the accounts receivable to
82S0,000,000. In writing these amounts to the contingent account,
none of the items have been canceled. Efforts are still made to
collect, and when claims are received for salaries and wages or vouch-
ers, they are paid from this contingent fund. The difference between
the above net amount and the amount shown in the table, $11.47,
repren.ents the net result of such collections and payments subsequent
to February, 1927, when the account was established. The balance
in this account is also separated by appropriations from or to which
the various items are payable.
The net surplus from operations, which has previously been carried
in two account under the bheadings of "Canal surplus" and "Business
surplus," has been combined in one account, the total amount to
June 30, 1927, being $79,953,875.53 as detailed in Table No. 27.
TWir VX'o. ?-Sviniiiuiry of i ere'iou(z. and expenses.-This is a new
table showing comparatively for the fiscal years 1926 and 1927, the
net results of operation of both transit and business units. The
canal transit surplus for 1927 amounts to $15,611,093.80, which is
$8,301,845.52 in excess of 3 per cent on the investment. In other
words, the net rev-enues for the fiscal year represents approximately
612 per cent on the investment. The net revenue from business
*openritiion- amounts to $876,536.80, which is $132,040.06 in excess of
the 3 per cent, on the investment, the net revenue being approximately
321 per cent on the investment in business facilities. The combined
operations show a net revenue or surplus of $16,487,630.60, which is
a little in excess of 6 per cent on the total commercial investment
in The Panama Canal.
Table No. 3-Approprhitorni and fund accounting.-This table
shows the balance of appropriated and available funds in the United
States Treasury and in the hands of the Panama Canal fiscal officers
as of June 30, 1927. The fiscal officers (i. e., the disbursing clerk in
Wai-inirton, and the paymaster and collector on the Isthmus) had
cash on hand amounting to $1,983,725.21, as compared with $2,890,-
455.56 at the end of the previous fiscal year. The paymaster's cash
balance was $968,406.01, compared with $2,107,988.49 the previous
yel "I, a red auction of $1,139,582.48. Taking the miscellaneous receipts
and trust funds out leaves a working cash balance in the hands of
the fiscal officers of $1,306,599.66.





REPORT OF GOVERNOR OF THE PANAMA CANAL


The balance available for expenditure, after providing for direct
liabilities, obligations, and reserves, is $1,422,678.28, the greater part
of which is allotted and obligated for expenditure during the fiscal
year 1928 on projects not completed at the end of the fiscal year.
This balance includes an itemi of approximately $200,000 representing
the difference between the amount appropriated and the amount
actually spent on the new Miraflores Diesel electric plant. This
saving will be carried forward in the estirmatcs for deduction from
the appropriation requirements. A part of the foregoing available
balance is the unexpended balance of the $1,100,000 which was bor-
rowed from the electric light and power system 's reserve for replace-
ment, which is to be restored to that reserve when the exact amount
is determined.
The amount shown under the heading of work in process and
suspense represents the expenditures which have been made but
which have not been charged off or set up in the capital account on
the books. The credit items under this heading payable from sani-
tation and civil government funds, represent reserves for items
obligated for the fiscal year 1928. The $5,581,368.18 under the
heading of general ledger reserves is made up of the reserves for
replacement, extraordinary repairs, gratuity, and contingencies shown
in the general b.ilance sheet., Table No. 1. This is the balance in
reserve after withdraw ing $1,100,000 from. the electric light and
power plant reserve for replacement, which amount is added to the
amount appropriated by Congress to meet the operation and main-
tenance requirements for 19'27.
From the balance available June 30, 1927, the sum of $820,669.15,
representing the profits on business operations during the fiscal year
1927, is immediately transferable to miscellaneous receipts.
Table No. 4-Approprivfiion.S by Congress.-Tliere has been no
change in the appropriations for canal construction. The various
acts are shown in detail in Table No. 3 of the annual report for 1924.
The status of the authorized bond issue, showing the amount appro-
priated and the balance available for appropriation within the limit
of the cost of the canal and the authorized bond issue, is shown at
the end of this table.
The total amount appropriated to date for the annual payments
to the Republic of Panama for the use of the Canal Zone is $4,000,000.
The total amount appropriated for the operation and maintenance,
sanitation, and civil government of The Panama Canal and Canal
Zone to June 30, 1927, is $96,915,081.88. From this amount there
has been returned to the surplus fund in the United States Treasury
$7,754.98, which includes $127.36 returned to the surplus fund during
the. fiscal year, being the balance of the appropriation for increased




REPORT OF GOVERNOR OF THE PANAMA CANAL


coml'penstilion, 1924. This leaves $96,907,326,90 expended or avail-
able for expenditure.
The appropriations for the fiscal year .1928, not included in the
above figures, are as follows:
Operation and maintenance- _--------------------- 5, 830, 000
Sanitation------------------------------------- 670, 000
Civil government-------------------------------- 1, 100, 000
Total------------------------- -------- 7, 600,000
In addition to this, there is obligated for expenditure during 1928.
an unexpended balance of $342,189 brought forward from the fiscal
year 1926, and $1,100,000 from the reserve funds.
Table No. 5-Cash d',burwf"iieaenfs aind receipts.-The Treasurer of
the United States advanced to the fiscal officers of The Panama
Canal during the fiscal year 1927 the sum of $7,102,000 and dis-
bursed directly from the Treasury $257,619.30, a total disbursement,
of $7,359,619.30. Against this amount, the fiscal officers of The
Panama Canal remitted to the TreI'isury the sum of $248,558.30,
and (irect collections by the TreaciisuIt amounted to $2'41.,080.02, a
total of $'42,63S.32, resulting in a net withdrawal from the United
States Trca-u.iry of appropriated funds amounting to $6,816,980.98,
as compared with $7,749,540.47 withdrawn the previous fiscal year.
This difference is entirely accounted for by the fact that the pay-
Ilnatcr red uced his <;i-;h balance on hand June 30, 1926, by more
than $1,000,000
The sum of $785,238.42 was transferred from the appropriation
for operation and mtilintenln'e to init:cellaineous receipts in the
United States Treasury, covering the business profits for the fiscal
year 1926.
Tildle No. 6-Disbursements by the paqir 'i,'f r.-Disbursements to
the amount of $20,705,445.66 were made during the year by the
paymniuster. Of this amount, the sum of $8,004,893.38 was for the
account of the Panama Railroad Co. Employees on the gold rolls.
were paid $6,917,327.30 and those on the silver rolls, $4,434,590.49
The amount of $1,348,634.49 was paid on miscellaneous vouchers.
Collection on the pay rolls amounted to S4,303,045.29. Of this
amount the sum of $3,161,431.32 was; collected for comlmissary
coupon books, the remainder for miscellaneous items. Of the total
collections, the sum of $3,556,487.71 was disbursed by the pay-
master, the bdllance, $747,457.58, being transferred to the collector's
accounts.
The Chase National Bank, of New York, Panama branch, was.
continued as a Government. depositary. The Panama Railroad
account was transferred from the Chase National to the National
City Bank of New York, Panama branch, on June 1, 1927. This.





REPORT OF GOiVERNOR l'I THE P.\.NAMA. CANAL


was done at the request of the National City Bank, in order that
they might have at least 50 per cent of the Government. busine-ss
on the Isthmus. During the yetr, the sum of SS,852,250, Panamar
Railroad fund.-s, was tr1Lns4rrid to the ti-ircr, New York. This
sumn includes 8$2,0021,2)30 cash transfer, of which $1,046,450 was
mutilated currency. App)roXimticly t- $400,000 in new currency was
put ill circul'iItion by the paiymaster during the year. The pay-
master requisitioned $2 .2,;72,000 from the TreaC-urer of the United
States. Of this amount, $522,(00 was sent to the Isthmus in cash.
The cash situation continued satisfactory, with the gold reserve
reniiiin in consitanit at about $35(1,000.
TaLles Vo.s. 7,8, ind 9-7r c(iptls anil di'4ir.si nnii-' bI the collector.-
The miscellanrous rccipts collections amoirunted to .$24 ,53,022.S6,
of which $24,2:;0,009.13 -was for tolls and the bilLanve for postal
receipts, taxes, fees, fines, etc., and amortiz/;tion and interest on the
invest ment in public w\-orks iii the cities of Panama and Colon.
Collections repaid to appropriations amounted to $9,229,450.33. The
amount li;undled thrniigh the collector's secuvrimity deposit accounts
totalled 8:31,5(-l2,1ila).04, as shown in Table& No. 5. In addition to
these amounts, the collector handled indlependelnt funds consisting
of clubhouse funds, tri'-t funds, postal ?avinmgs funds, money order
funds, intire-t, and Treasury s-vine- certificates, as shown in Table
No. 7, amountiniz to over $2,000,000. Collections for a.Icount of
the Panama Railroad Co. ;iniounted to $16,015,216.71, making a
total cash tiurnoveir, exclu-zi\ce of the 'Seuriity Deposit funds, of
approximately $5.1,500,000.
Table .No. 10-Salrtic.s and iti by The Panama Canal employees during the fiscal year 1927 was
$11,412,461.30. Of this amount, $6,053,565.S3 was earned by gold
employees, and $4,458,895.47 by employees on the silver rolls. The
total pay roll for the fiscal year 1926 ; as $10,801,s686.46. Of the
amount paid for sal;rii's and wages during the fiscal year 1i27,
$9,642,225.34 was payanble from the appropri;ntion for operation and
maintenance, $875,452.14 from the sanitation appropria tion, and
$894,783.82 from the appropriintion for civil government. These
figures include the employees of the business divisions, thini ont (ly
for which is collected back and repaid to the aippropriaitio In.
Table No. 11-Acconiit/s nr'Ceible.-TIeC number of bills registered
during the year was 41,009, covering S32,044,990.24, compared with
37,425 bills and $31,(133,s90..S diiuring the fisenl year 1 921i, an in-
crease Qf 3,584 bills co ering $1,011,099.36. This table shows in detail
the bills registered for tolls by months during the fis-cal year, the
largest amount being in the month of Maarch, 1927, $2,218,070.59,
and the smallest amount in Noveimbuir, li26, 1 $1,2s6,,103.3). The
total amount of tolls bills re .i-teried was 824,230.00)5.29, which is
64950--t7- 6




REPORT OF GOVERNOR OF THE PANAMA CANAL


$1,298,085.51 more than last year. The increase in tolls in the fiscal
year 1926 over 1925 was $1,530,987.54, a total increase of $2,829,073.05
in two years.
Table No. 12-Coirnparatie statunent of accounts receirable.-The
uncollected bills at the end of the fiscal year 1927 amounted to
$651,660.10, compared with $795,926.04 the previous year.
Table No. 13-Co inparafite statf en t of account- painablc.-Vouchers
payable at the end of the fiscal year amounted to 81,632,376.04,
which is $110,261.94 more than was outstanding at the end of the
previous fiscal year. The unpaid vouchers exceed the uncollected
accounts receivable by 8980,715.94.
Table No. 14-Nafional defense expenditures.-This table shows the
individual items which were charged off as an arbitrary proportion
of the cost of constructing The Panama Canal, representing its value
from a national defense standpoint. The difference between the
amount so charged off and the total cost of constructing the canal
is carried in the accounts as the commercial value of the canal, on
which a ret urn on the investment is expected. This account was in-
creased during the fiscal year by $460,160.23, of which $60,160.23
covers the expense of fences around the locks, and $400,000 the
value at which the steamship Panalima was carried on the books, this
vessel having been sold as reported under the head of Table No. 18.
The total amount now charged to national defense in order to write
down the cost of The Pannama Canal to a fair commercial value, as
directed by the Secretary of War in a letter to the Governor, dated
October 18, 1921, is $113,122,892.83.
Table No. 15-Canal i.ixrd property.-The book value of the fixed
property -used in connection with the transiting of vessels as of June
30, 1927, amounted to $236,674,901.07. There were no withdrawals
during the year, but additional property was set up in the capital
account amounting to $559,812.06. Two additional towing locomo-
tives were placed in service at a cost of $87,915.50. Additional
expenditures were made in connection with the proposed Alhajuela
dam, amounting to $4,615.19. The total amount expended on this
project to date is $243,585.84, most of which is for purchase of rights
and the depopulation of the area which will be submerged. The
suim of 836,311.79 was spent on additional streets and sidewalks.
The sumn of $53,001.66 had been spent to the end of the fiscal year on
the new municipal building, Cristohal, which was authorized at an
estimated expense of $559,000, to house the post office, police station,
courts, and various other offices at the Atlantic terminal. The
$100,000 set up under the heading of storehouses is the appraised
value of the old Miraflores power plant building, which is to be con-
verted into a storehouse for locks spare parts. This was a transfer
from the electric light and power system under the heading of "Busi-





REPORT OF GOVERNOR OF THE PANAMA CANAL


ness property," and not a cash expenditure. The S23,630.53 cover-
ing the cost of the powder Imagazine. at Corozal is an adjustuiment of
prior year accounts, the cost of this maga2zini e Ihvinig beenl charged
into current operating expenses. The two buildings transferred for
the use of the bure:.u of clubs and playgrounds tit a book value of
$16,600 involved no cash, being simply a transfer on the books.
Under the heading of aisyuliIns, the female ward, $134,760.04, and the
mess hall, Corozal, $S.S,013.2', cover new construction and are not
complete. The cost of the infliriiriry at the Palo Seco leper co:lodny,
$9,894.70, is an adjustment of prior year accounts, this itemi lhvimng
been originally charged into current operations.
Table No. 16-CanllIl trian.<;f it ipu it.-The amount invested in
equipment used in connect ion with the trinsiting of vessels and chan-
nel maintenance was $4,504,489.78, an increase of 8363,565.90.
There were a number of reductions, prii wipally through the stile of
individual pieces of equipment, aimounlting to $44,761.76. There
was an increase of $408,327.66, of which $314,250 represents the cost
of construction and book value of throe new steel barges constructed
in prior years, but which had not previously been added to the book
value of transit equipment. T slie- barges were constructed from
depreciation or reserve for repLicement funds, and in order to make
these funds available, the book value. of the equipment for which
the replacement funds were provided was written down. During the
past year it has been determined that it is better bookkeeping and
accounting to retain the equipment on the books at its original cost
as long as it remains in service, together with its offsetting deprecia-
tion or reserve for replacement funds, and to set up any new equip-
nient required by the use of such funds at its cost so as to maintain
a proper property record. The other increases consist of a new tug,
Coco Solo, constructed at a cost, of $:37,500; la uncli Do717 in, $ 15,726.24;
barge 00, $14,432.33; and a number of capital improvements on other
items of equipment as shown in the table.
Table No. 17-Business property.-This table shows the entire in-
vestment in the business activities of the canal, consisting of fixed
property, equipment, material and supplies, cash, work in progress,
and undistributed business capital, separated according to the divi-
sions using same. The undistributed business capital charged against
the divisions is made up of a portion of the general store stock (repre-
senting the value of standard material and supplies held in reserve
for the business divisions); cash; and accounts receivable registered
in the transit accounts for account of the business units. The capital-
ization of these business units amounts to $31,363,145.81, an increase
of approximately $1,000,000 over the previous ye.tar. These increases
are principally in connection with additional fixed property and equip-
ment which are explained under Tables 18 and 19.




REPORT OF GOVERNOR OF THE PANAM.\.\ CANAL


Tnllh- No. 18-Business fiJurd prop<-tty.--The total amount of fixed
property in use by the business divisions as shown in Table No. 17
was reduced by 8S14,083.77 and increased by $1,554,198.43. The
reduce ions include the amortization of public works in the cities of
Panama and Colon amounting to $56,388.47. The old Mirnflores
steam-powleri plant was withdrawn from the account; the building
it-elf, valued at $100,000, was transferred to the account "Canal fixed
property," to be used later on as a locks storehouse, and the machin-
iry, valued on the books at $208,270.31, was surveyed for sale.
In connection with the water system, a inumbir of units of the
old Gatun-Colon w after sy tein, valued at $42,274.99, were with-
drawn when the new system was set up.
The steamiiship Panama was sold and the book value, $400,000,
withdrawn from the accounts. This vessel \\was constructed at.
Criip's shipyard in Pliladelphiin in 1Y,)'. In 1905 it was purchased
by the Isthmnian Canal Commission from Ward & Co., agents for the
New York & Cuba Mail Steamship Co., for $650,000 for the purpose
of carrying material and supplies and employees to the Isthmus.
Its name then was Harana, which in 1906 was ch.ii1ged to Paianmi.
At the completion of the canal $250,000 of its value was written into
"Canal construction" and from that time on it was carried in the
capital account at a value of ?400,000. It was continuously oper-
:ited by the Panama Railroad Co., and in January, 1926, was sold to
the Alaskan Steamship Co. for the sum of $170,000. Of this amount,.
$2,029.72 was spent for towing, hand! ii.2 lines, and crane service.
The balance, $167,970.2s, was covered into the Treasury as miscel-
hliinous i cieipts toward the amortization of its original value. This
amount is shown in Table No. 25 under the heading of "Proceeds
from Government property."
A number of gold and silver quarters were sold, demolished, or
itrlanferird and withdrawn from the account, in the sum of $35,650.
The increases include the expeniditure-. on the new Miraflores.
power plant, the Gatun-Colon water system, and the construction
of new gold quarters. The additional expenditure on the new Mira-
flores Diesel electric po\\er plant was $47.6,248.67, and this plant now
stands on the books at $1,443,563.25. This is not the final figure, as
there a re some charges which have not yet been entered on the books.
A neiw electric sub.-tation was added at Summliit at a cost of $19,529.17.
The Gatun-Colon new water system \\;w practically complete at the
end of the previous fiscal year but the expenditures were curried in
"Work in process" and the amount set up in the accounts in 1927
was $413,256.67.
lxpeinditures on 87 new houses at New Cristobal (all of which are
not completed) amounted to $369,832.45 to June 30, 1927, and new
garage stalls were erected at a cost of $31,460.01.





REPORT OF GOVERNOR OF THE PANAM..\ CANAL


The other items included in the additions to business' property,
marked with an asterisk (*), were purchased, constructed, or acquired
in prior years through the use of depreciation funds or charged into
current operations, and in order to get. them on the financial property
records they have now been set up as follows: Marine barracks
erected at the Cristobal shops to house Navy personnel while over-
seeing work on Navy floating equipment, $8,283.OS; additional fuel-
oil pipe lines at various locations as shown in the table, $156,232.84;
seven new cottages, New Cristohal, constructed several years ago
from depreciation funds, $51,408.73; and new garage stalls similarly
constructed, $26,136.58.
As explained in connection with the new steel barges referred to
in Table No. 16, these items had not been previously set up in the
financial property records due to source of funds from which they
were constructed, and the change has been made this year so as to
get all the property on the records at its original cost. with an off-
setting entry for depreciation or reserve for replacement. The items
in this table so set up amount to $242,062.13.
Table No. 19-B8isines equ ipment.-The value of equipment in
use by the various business diviions of The Panama Canal at the
end of the fiscal year was $1,117,570.51. The total withdrawals
amount to $13,896.28, representing transfers, sales, and surveys.
The increases, with the except ion of the a automobiles, cover purchases
of new machinery and tools for current use. Under the heading of
automobiles there is an adjust merit covering the cost of automobiles
purchased during prior years frIomU depreciation funds or funds
reserved for the replacement, of automobiles. The amount shown
was not all expended during the fiscal year, but a change has been
made in the method of accounting whereby newly purchased auto-
mobiles will be set up in the capital account and the old ones will not
be withdrawn from the capital account until actually retired froimi
service. The amount, purchased during prior years and set up
during the fiscal year 1927 is approximately $135,000.
Table No. .20-Wlaterir'nrk.-, .seler-, (7and pairtmen )i< in cities of
Pananma and Colon.-The aniount invested in waterworks, sewers,
and pavements in the cities of Colon and Panama, reimbursalble to
the United Stat.es on June 30, 1927, was $1,712,943.03, of which
$932,723.51 is in the city of Panama, and $7S8,219.52 in Colon.
The Panama Canal supplies water to these two cities from the
Canal Zone system and maintains the sewers and streets in the two
cities under a contract entered into between The Pannimn Canal and
the Republic of Panama in 19!07. The Panama Canal collects the
water rentals from the residents of these two cities and uses the
funds to cover the cost of the water and maintenance of sewers and
streets, interest on the unamortized investment, at 2 per cent per




REPORT OF GOVERNOR OF THE PANAMA CANAL


annum and amortization based on 50 years from 1907. During the
term of this contract The Panama Canal has used $3,344,445.52 for
main tenance, operation, and repairs of the water system, sewers, and
streets; interest, on the investment amounting to $1,068,062.54 and
$943,933.61 repaid on the capital cost have been covered into the
United States Treasury as miscellaneous receipts.
TaIle No. 21-Material and supplies.-The total store stock on
hand June 30, 1927, amounted to $4,382,709.71. The reserve for
inventory store stock adjustments amounts to $412,517.06.
Table No. ..2-- Material and supplies receirtd and issued.-The
amount of stores purchased for stock during the year was $3,788,-
828.23 in addition to which material and supplies were purchased
for direct delivery to divisions at a cost of $1,198,045.94, making the
total purchases for the year $4,986,874.17. The mechanical division
Manufactured material and supplies for stock at a cost of $394,861.49
and the dredging: division recovered run-of-bank gravel from the
Chagres River at Gamboa at a cost of $239,406.58, making the total
local expenditures for material $634,268.07; a grand total from all
sources of $5,621,142.24. The business divisions drew material and
supplies to the extent of $2,822,096.20 and the t rinsit divisions
$1,671,536.05. The sales amounted to $1,189,490.04, which includes
sales to the Panama Railroad Co.
Table No. 23-ConiparaLr'!i' aftenifnt of ,iatrial and supplies by
coiind7;1itieK'..-This table shows the value of general store stock on
hand by commodities in comparative columns for the fiscal years
1926 and 1927, the general store stock at the end of the fiscal year
1927 amounting to $3,714,972.92. The value of fuel oil on hand was.
$163,177.57; medical stores, $67,427.78; Panama Canal Press stock
of paper, stationery, etc., $83,981.61; lock parts at Corozal store,
$438,740.91; gravel in the Ganmboa gravel pile, $250,385.20.
During the year 1927 run-of-bank si:ul and gravel reclaiming
operations were, carried on by the dredging division in the Chagres
River north of Gamboa:
Quantity pumped to Gamboa, 208.140 cubic ya;.K, at a cost of---- $176, 892. 40
The value of old material remaining in the old pile was---------- 69, 240. 32
Cost of tranp|)'.rf(ati(iiwi and establishing piles of run-of-bank
material at Cristobal and Diablo- --_------------------------- 17, 388. 28
Cost of transportation and establishing piles of washed sand and
washed gravCel at Cristobal --------------------------------- 8, 392. 99
New washing machine, Gamboa------------------------------- 32, 094. 65
Screening plant, Gamboa ------------------------------------- 4, ii;j3. 26
Total----------------------------------------------- 308,646. 90





REPORT OF GOVERNOR OF THE PANA.MA CANAL 81

Local stock piles established at Cristobal and Diablo
were charged to the general storekeeper for issue and
sale as follows:
6,366 cubic yards washed sand and gravel stored
at Cristobal------------------------------ $17, 506. 50
25,472 cubic yards run-of-bank material stored
at Cristobal and Diablo----------------- -----40, 755. 20
Total charged to the general storekeeper----------------- $58, 21 1. 70
Balance chargeable to the stock pile at Gamboa----------- 250, 385. 20
On June 30, 1927, there were 215,436 cubic yards of old and new
run-of-bank material in the pile at Gamboa which, divided into the
$250,385.20 gives an average cost in the pile of $1.16 per cubic yard.
It is contemplated to write down the value of the old material to the
extent that the average cost in the pile will be $1 per cubic yard. It
is estimated that the cost of loading on cars ready for shipment over
the Panama Railroad will average approximately 40 cents per cubic
yard, making a total of $1.40 on cars at Gamboa ready for shipment,
and the issue and sales prices will be fixed accordingly.
Table No. 24-Canal transit expenses and earnings.-Under the
present system of accounting, the gross operating expenses of the
divisions engaged in the transiting of vessels through the canal,
together with the cost of sanitation and civil government, are first
reduced by the earnings in those units and the net expense is then
compared with the revenues from tolls and other miscellaneous
receipts.
The net cost of operation and maintenance, sanitation, and civil
government of The Panama Canal and Canal Zone, exclusive of the
theoretical amortization and depreciation charges, was $8,049,474.04,
compared with $7,293,945.97 the previous year. The net expense is
divided as follows:

1927 1926

Civ il government ----.-----------------------------.------------------$1,000,675.31 $998,406.58
S.1.iniL.i--n. hospit ilizaition and niedlni.iI. srvicv........................... 6.ri.i.948.88 653,509.43
Opei. tion nn't rniir.t:nance................... ....... ................. 6,378,849.89 5,:.42.029.96
Total--. -....... ----------------------------------------- 8, 0411. 474. 08 7,293, 945. 97

These figures do not include expenditures for improvements and
construction enumerated in Tables 14 to 19, inclusive.
The gross operating costs, including the ziniortization and depre-
ciation charges, were $12,180,734.79, but these are reduced by
earnings amounting to 13,18:3,019.77, covering all kinds of supplies
and services furnished employees for which the employers are re-
quired to pay, for pilotage, tug and launch service, handling lines
for vessels, and for charges rnide to business divisions, which in





REPORT OF GOVERNO'RH OF THE PANAMA CANAL


turn make collections for the supplies and services to the credit of
the appropriations. The net expenses, including amortization and
depreciation charges, ainuunt to $8,907,715.02.
EXECUTIVE DEPARTMENT
Under this heading are grouped the salaries and office supplies
and expenses of the Governor, engineer of maintenance, executive.
secretary, correspondence bureau, personnel bi rellau, record bureau,
etc., the shipping commissioner, cost of publishing the Canal Record,
land office and law book expenses, official railroad motor cars, and
clubs and playgrounds. The net executive office expenses amounted
to $211,119.38. Expenses in connection with the work of the shipping
commissioner amounted to $40,669.82. The cost of printing the
Canal Record was $14,065.99. More than one-third of the strictly
executive expenses is charged off to business divisions as overhead,
which is reimbursed to The Panama Canal through the various
business activities by adding surcharges to direct costs.
The Government's contribution to the operation and maintenance
of clubs and playgrounds has been limited to $100,000 a year for a
number of years, and everything over and above that amount paid
from the receipts an d profits from the operation of the clubhouses.
However, during the fiscal year 1927 an additional $20,000 was
allotted for the purpose of making necessary repairs to the club-
houses themselves, making the total contribution $120,000. The
business activities of the Panama Canal clubhouses are shown in
Tables 40 to 43, in'liisive. The total net expenses of all units
grouped under the exec utiv e depart ment amounted to $391,200.44,
which is approximately $28,000 more than last year, $20,000 of
which was contributed toward clubhouse expenses.
ACCOUNTING DEPARTMENT
The grs)-s expense. of the accounting department on the Isthmus,
including the collector's and paymaster's offices, were $520,324.51.
Of this amount, $:327,240 is charged off to business divisions and
the Panama Railroad for clerical and accounting work performed
for them and wais absorbed in those operations in the form of over-
head recovered throt'igh siirch'arges. This leaves the net expense of
the accounting department payable from appropriations, at $193,-
084.51, an increase of approximately $13,000 over the previous fiscal
year, $10,600 of which is in the accounting department proper for
increased salaries and accounting equipment, and $2,400 in the col-
lector's office. These increases were necessary on account of the
increased volume of business done. Some of the bureaus of the
accounting depart ment, such as the railroad accounts bureau, com-
missary accounts and commissary coupon accounts, are entirely
chargeable to the Panama Railroad.





REPORT OF GOVERNOR OF THE PAN..1AMA CANAL


WASHINGTON OFFICE
The net expenses of the Washington office, including the chief of
office, the purchase and inspection bureau, the assistant auditor and
disbursing clerk, wevre $223,160.36. From the gross expense of the
purchasing bureau, the sum of $41,5.83.49 was charged off to busi-
ness storehouse operations on the Isthmus, representing the pro-
portion of purchasing and inspection expenses chargealble to material
and supplies purchased for use in business activities and for sale,
which amount is recovered through surcharges added to the price
of material.
CIVIL GOVERNMENT

The gross expense of all activities under the heading of civil govern-
ment amounted to $1,067,306.04, of which $66,630.73 was charged off
or collected from other inte rests, leaving the net amount $1,000,675.31.
The net expense for the administration of estates and other civil
affairs was $17,667.85. In the customs service certain collections
are made for the inspection of household goods and personal effects
for shipment to the States. The gross post-office expenses were re-
duced by $11,744.80, collected for the handling and transferring of
mails other than Canal Zone, leaving the net expenditure of
$156,858.79. The net cost of operating the school system, including
the two high schools, was $260,604.29, after deducting $9,751.48 for
school tuitions and the proceeds from the sale of school books and
supplies. The gross expense of the police department, including the
prisons and penitentiary, was $397,410.59, of which $44,633.11 was
recovered for police services furnished the Panama Railroad.
HEALTH DEPARTMENT

The gross cost of operating all hospitals, asylums, quarantine and
public health service, sanitation, and street cleaning was $1,4S2,473.98,
and the earnings amounted to $812,525.10, leaving the net expendi-
ture from appropriation $669,948.88. The largest amount of reven ties
derived from the operation of any single unit was at Ancon Hospital,
amounting to $372,318.27. The gross expenses of operating Corozal
cripple farm and insane asylum amounted to $189,753.30, of which
$164,016.94 was recovered from the Republic of Panamnia for taking
care of its insane and from the sale of produce from the farm, leaving
the net. expense to the Government only $25,736.45. The Panama
Canal's share of the cost of street cleaning and garbage disposal in the
cities of Panama and Colon was cut in Ihalf during the year. Under
prior arrangements for a number of years The Panama Canal stood
50 per cent of this cost in the city of Colon and the Republic of
Panama the other 50 per cent and for the same work in the city of
Panama, the Republic of Panama contributed a flat sum of $38,000




REPORT OF GOVERNOR OF THE PANAMA CANAL


and The Panama Canal stood the balance of the cost. The Panama
Canal's proportion in both cities was approximately $50,000 prior to
the fiscal year 1927. -Under date of July 27, 1926, the Secretary of
Foreign Relations addressed a letter to the executive secretary, agree-
ing that effective August 1, 1926, the Republic of Panama would
pay 75 per cent of the cost of street cleaning and garbage disposal in
both Colon and Panama, and this new arrangement: has reduced The
Panama Canal's proportion to approximately $25,000 per year. As
an offset against this reduction in 1927, the quarantine service ex-
penses were approximately $14,000 grea t.er than the previous fiscal
year and the expienes at Palo Seco leper colony approximately
$12,000 greater.
OFFICE ENGINEER, METEOROLOGY AND HYDROGRAPHY AND SURVEYS

The gross cost of planning and drafting, blue printing, etc., was
$69,690.21, of which $54,047.82 was charged off to business opera-
tions and const ruction work, leaving the net expense from appro-
pri:tionr at $15,642.39, which is slightly in excess of the net expense
during the previous yve:r.
During the year the sectionn-; of meteor'olo dgy and hydrography and
surveys were combined under one head, the hydriographer being
placed in c1I:i;iri-z of both, and the former head of the section of surveys
being placed in charge of the northern district of the municipal
engineering division. The net expense of the division of meteorology
and hydrnigriplihy was $34,278.52 and of the su-rvey work $33,283.64.

GENERAL STOREHOUSES

The grIn-s cost of operating the generaIl storehouses, including the
handling and transportation of materials and supplies on the Isthmus,
was $541,355.).-I, of which amount $223,929.12 was charged to
business storehouse ope! -;tinpis, representing that part of the general
stor1cihoni-e expenses chargeable to mintcirial used by business divisions
and sold, which is recovered through surcharges added to the price
of the material. The net store operating cost payable from the
appropriaitioii- \\w;-. $317,426.47, which is slightly less than the
previous year.
PUBLIC BUILDINGS AND GROUNDS

The gross expense of the chief quartermaster's office and the four
district quartermasters, was $401,204.98. This expense is reduced
by $231,450.32 covering services and supplies charged to employees,
business divisions, the Panama Railroad, etc., for general utility
service, janitor service, care of grounds chargeable to employees,
sale of gasoline, mattress-factory operations, etc. The net expense
payable from appropriation for care of buildings and grounds was




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