CHAMPLAIN WATERWAY FEASIBILITY REPORT

SUPPLEMENTARY REPORT

THE INTERNATIONAL JOINT COMMISSION

(UNDER THE REFERENCE OF 5 JULY 1962)

THE INTERNATIONAL CHAMPLAIN WATERWAY BOARD

31 DECEMBER 1965

INTERNATIONgL CHAMPLAIN' MATEXWAY BOARD Washington, D . C . Ottawa, Ontario.

31 December 1965.

In te rna t iona l J o i n t Commission, Ottawa, Ontario. Washington, D.C . Gentlemen,

bansmi t t ed herewith i s a Supplementary Report i n response t o

your request of 26 October 1965 f o r addi t ional information t o t h a t contained

i n our f e a s i b i l i t y r epor t t o you dated 30 June 1965.

Respectful ly submitted,

FOR THE UNITED STATES: FOR CANADA:

&L E& Z

Melvin E. Scheidt, Member Gerald N i l l a r , Member

>

Mark Abelson, Member Robert H o Clark, Member

INTERNATIONAL CHBMPLAIN WATERWAY BOARD

CHAMPLAIN WATERWAY F U S I B I L I T Y REPORT

SUPPLEMENTARY REPORT

TABLE O F CONTENTS

D e s c r i p t i o n

I - GENERAL

AUTHORITY CHANGES I N BOARD AND COMMITTEE MEHBERSHIP PURPOSE O F REPORT

I1 - FUTIONALE O F BOARD' S STUDY

CONCEPT IMF'ROVEMENTS CONSIDERED COST ESTIMATES ECONOMIC B E N E F I T S

C o m m o d i t i e s Selected f o r Principal A n a l y s i s Surveys of Po ten t i a l Traffic E s t i m a t e s of A c t u a l Traffic E s t i m a t e s of A c t u a l B e n e f i t s

I11 - FRYER'S ISLAND DAM

GENERAL FUTURE O F FRYERnS ISLAND DAM I N THE EVENT O F

AN INTERNATIONAL WATERWAY IMPROVEMENT FUTURE O F FRYERDS ISLAND DAN I N THE ABSENCE O F

AN INTERNATIONAL WATERWAY IMPROVEMENT

I V - REQUIREMEMIS O F WATER-RELATED RECREATION

V - PLANS O F STATES O F VERMONT AND NEW YORK AND PROVINCE OF QUEBEC J N R FUTURE DEVELOPMENT O F AREA

I m m T I O U CHAEPUIR WATERvJkY BOARD

CHBMPLdIM 1JBTER#BY PEASIBILITY REPORT

SUPPLENFJTARY REPCW T

.l+. AU'I'HORIn.,. In a letter dated 26 October 3965 to the Chairmen

of the International Champlain Waterway Board, the International Joint

Commission requested the Board to supplement its 30 June 1965 Feasibility

Report in the following particulars:

"(a) Further elaboration of the rationale underlying

the Board's feasibility study;

(b) the future role of Fryer's Island Dam and related

works, with or without the improvements in the

Champlain Waterway considered in the report;

(c) requirements for water-related recreation, in

the absence of an improved commercial waterway;

and

(d) clarification of the extent to which plans,

which the States of New York and Vermont and

the Province of Quebec or their agencies may

have for future development in the area, have

been taken into account in the'80ardts study of

alternative plans of improvement,"

The Board was requested to fqnish this supplemental information as soon

as possible, and, in any event, before the end of Dececber 1965.

Za GEANGES IN BOARD AND GOMNITTEE MEMBEZiSHIP. Following the

eempletion of the Board" Feasibility Report dated 30 June 1965# the

International Joint Commission appointed Mr, Mark Abelson, Regional

Coordinator, Bortheast Region, UoSo Department of the Interior, as

member of the United States Section of the International Champlain

Waterway Board vice Mr, John B, Bennett, retired, Mr, D,C. Leavens,

member of the Uo S. Section of tHe Board, rresigned from the UeS.

Department of Commerce on 30 November 1965 and as of the date of this

report, no replacement for him has been named, Also Colonel R.T, Batson,

District Engineer, UoSo Arqy Engineer District, New York, replaced

Colonel 14,M. Miletich as Chairman of the United States Section of the

Board's Committee, The Board wishes to note also that throughout the

course of its studies Mr, Jean-Paul Chevalier, District Engineer,

Federal Department of Public Works, Montreal, Quebec, served as alternate

to Mr, G, Millar on the Canadian Section of the Board, The remainder of

the Board and Committee membership is as noted in paragraphs 2 and 4 of

the Board's Main Report of 30 June 1965,

3. PURPOSE OF REPORT. The purpose of this supplementary report

is to present the results of the Board's investigations with respect to

the four items referred to in paragraph 1 , The comments on each of the

items are contained in the following paragraphs,

I1 - RATIONALE OF BOARD'S STUDY

4* CONCEPTo The International Joint Commissionos directive to

the Board relative to the conduct of the Champlain study stated in part:

"In scheduling the various phases of investigation and study necessary

under the Reference, the Board is requested to examine carefully the

economic consequences of such an improved waterway and its effects in

both countries and to proceed, subsequently, with further investigation

in such detail as it may deem appropriate", Pursuant to this instruction,

the Board interpreted its initial task to be the accomplishment of a

first-phase or feasibility study, to establish reasonable estimates of

t,he costs and benefits for several alternative waterways with different

governing dimensions and following more than one route. Then, i I ' onf; oc

nore of these alternatives awearea eccnonically scvantaqeou,, a 1ui.ltL 7.)

rnore detailed investigation would be undertaken to determine tile nci.:i

suitable dimensions and other features with greater precision, and to

provide a more rigorous analysis of the costs and benefits. The current

re~ort covers the first of the two phases.

5. liiZ3i.VEIvENTS CilNSIBEEiED, In order to judge the comparative

advantages of various channel depths,the Board considered three degrees of

improvement as being representative of the type of waterway that might

warrant more detailed study, It was considered that the three scales of

improvement chosen were adequate to bring out the economic potentialities

of shallow and deep-draft canals, The three improvements were:

(3.) a. 1 2 - f t , xaterway in Canada r~ith some improvenent

to the 12-ft, facilities now available in the

United States, to represent the minimum improvement

that might provide soine benefit to co~;~n.ercial

navi-tion;

(b) a 14-ft, wa,terwa?j tc, y m i t the passage of a four-

bzrge tow in a single lockage, 51,s representative

of a modern barge type waterway;

(c) a 27-ft. waterway similar to the existing

St, Lawrence Seaway as representative of a

deep-draf t waterway.

6 . The only route considered in Canada for a 12-ft. waterway

would follow the Richelieu River for its entire length. For this depth,

it was considered that there would be less construction involved in

modifying existing channels and fadlities than in building a completely

new artificial section, thus satisfying the criterion of a minimum cost

improvement. For the 14-ft. and 27-ft. waterways in Canada this same

route was considered, as well as an overland route from the Richelieu

River in the vicinity of St. Jean, Quebec, to the South Shore Canal of

the St, Lawrence Seaway near Montreal, This overland route was selected

as being the most practical of several alternatives which were investigated

in this study, In the United States, the route for all scales of improve-

ment would follow the existing waterway.

7 , COST ESTIMATES: Cost estimates were compiled on the basis of

available information, supplemented by general reconnaissance surveys of

routes and by a limited program of subsurface investigation in Canada.

Although neither detailed surveys nor comprehensive geological explora-

tions were conducted, the estimates are considered sufficiently accurate

for the purpose of the report, The construction costs were reduced to

average annual charges in accordance with standard grocedures, based on

an assumed project life of 50 years, The estimated annual cost for

operation and administration was added, less a credit for the costs that

would be involved in maintaining the existing waterway if no new develop-

ment were undertaken, to give an estimate of the total annual costs of

new facilities.

8, ECONOMIC BENEFITS. The economic benefits that could be exgected

over a 50-year period were evaluated on an average annual basis for compari-

son with the annual costs. The appraisal covered all likely benefits,

including possible industrial stimulation and other collateral benefits as

well as saving in transportation charges to prospective users of the ' water-

way, It was found that almost all of the benefits would be in the form of

transportation savings; the other benefits and detriments would be too

small to affect the evaluation.

9 . Commodities Selected For Principal Analysis - In recognition of the fact that an improved waterway would require a major capital investinent,

it w2s apparent that, if the improvement were to be justified, a large

volume of traffic in those bulk materials for which water transportation

offers substantial savings must be developed, Consideration of the

economics and resources of the tributary area disclosed that the primary

cornodities most susceptible to movement by water were iron ore, coal, -.

forest products, non-ferrous metals and chemicals* In addition, petroleum

and grain were selected for detailed analysis, the first because it now

constitutes the major commodity transported over the existing waterway in

the United States, and the second because of its importance to the

agricultural industry in the area adjacent to the waterway.

10, Surveys of Potential Traffic - Surveys of potential traffic were made by economic consultants. Questionnaires were widely distributed

to cover the whole range of possible shippers on the waterway and were

followed up by personal interviews and by telephone. iJhile the surveys

were intended to secure information with respect to the seven commodity

groups noted above, respondents were encouraged to include any potential

traffic in other commodity groups, The survey returns included 1a.r-

movements that would not be carried on the International Champlain Waterway

for any one of a number of reasonso The largest portion in this category

- some 30 million tons - consisted of coal, limestone and aggregates moving between points which would not be served by the waterway whether

or not it was improved. These and other irrelevant movements were

eliminated as a first step in preparing estimates of potential traffic,

Further, analyses were made of the relevant industries in the area to

determine the volume of movement not reported in the survey, and to estiaatc

the volume that might possibly move with advantage by the waterway, In

addition to the information obtained in the Champlain rJaterway traffic

survey, data developed in a prior survey conducted in the United States

relative to improvements in the entire New ~ o r k State Barge Canal systein

were also taken into account in the evaluation of potential traffic on an

improved Champlain Waterway, The potential movements reported in the @or

survey and not duplicated in the Champlain survey consisted of the same

commodities as those selected for detailed study. Further, the prio>

survey disclosed that some industries important to the local economy,

such as the graniteand marble industry in Vermont, would not use water

transportation because of high transhipment and handling costs and require-

ments for more frequent shipments and shorter transit times than would be

available by water, An estimate of the total potential traffic was

developed from these various sources and was projected into the future on

the basis of careful analysis of the economic base of the regions served

by the waterway,

11, Estimates of Actual Traffic - An estimate of the traffic that would move by an improved waterway was made by comparing the freight rates

at which commodities could be expected to move on an improved waterway

with the lowest freight rates now available for movements over the existing

facilities, whether by road, by rail or by existing waterway, If the

estimated rate by the improved waterway was found to be lower than that

now available, it was assumed that the traffic would move on the improved

waterway, Thie method of estimation exaggeratee the volume of potential

traffic that may be diverted to the improved waterway, because it neglects

the probability that the present carriers would retain a substantial part

of the traffic by judicious rate reductions. mile it is possible that

the waterway may attract or create some new traffic that is not foreseen,

it is unlikely that such traffic would be substantial enough to offset

the loss of potential traffic because of rate competition. It may be

concluded therefore that the total volume of potential traffic as foreseen

in the report is substantially on the high sideD

12. Estimates of Actual Benefits - The estimates of savings per ton of waterway traffic similarly are based on comparisons of unadjusted

freight rates, and hence are optimistic on much the same grounds, Since

both the estimate of the traffic and the estimate of the savings are on

the high side, it is apparent that the benefit estimates are likewise

overstated, A more precise estimate of benefits would require a comparison

of the estimated costs of movement by the competing routes, rather than a

comparison of the freight rates payable, Such a refinement of analysis

would, in the Boardvs opinion, produce a lower estimate of potential

traffic and a lower evaluation of economic benefitse Since the benefits

as calculated fall far short of the estimated cost of each project, refine-

ment of-the analysis is not warranted.

7

I11 - FRYER'S ISLAND DAM

13, GENERAL. The Order of Approval of the International Joint

Commission dated 10 June 1937 authorized the construction and operation

of remedial works in the Richelieu River for the reclamation and protection

of low lands in the counties of St, Jean, Iberville and Missfsquoi in the

Province of Quebec, The two essential elements of these works were to be

the excavation and enlargement of the channel through the natural barrier

in the river in the vicinity of St, Jean and, as a compensating feature,

the construction of a control dam at Frgerls Island, about seven miles

downstream of St. Jean. Operation of these works in accordance with the

approved regulation plan would produce lower flood stages in the spring,

reduce the duration of the flood period, increase Lake Champlain levels

in the late summer and fall, and slightly reduce them during the non-

navigation winter months. The reduction in the flood peak, and in the

duration of the flood, would be beneficial to' foreshore interests along

both sides of the upper Richelieu River and the shores of Hissisquoi Bay

by making additional acreage of fertile soil available to agricultural

production, The proposed regulation plan was not prejudicial to fore-

shore interests below the dam, nor to power installations which existed

in 1937 but which have since been dismantled. Although flood control

was the primary purpose of the authorized works, an incidental benefit

would accrue to navigation interestsby virtue of slightly improved channel

depths during the late summer months,

1 4 The Fryerss Island Dam was constructed in 1938, and has

subsequently been maintained in working order, but the channel excavation

through the natural rock barrier, and other related works, have never

8

been carried out. For this reason the dam cannot effect the proposed

regulation, and its gates remain in the fully open position.

15. FUTURE OF FRYER'S ISLAND DAM IN THE EVENT OF AN I ~ A T I O N A T J

WATERWAY ImOVEMENTo The ourrent study of the feasibility of an improved

International Champlain Waterway included an examination of five alternative

plans for the Canadian Section. In all cases, Fryer's Island Dam could be

incorporated in the Waterway eo as to provide control of the upper reach

and alleviate flood conditions. Excavation through the natural rock

barrier near St, Jean would provide the navigation channel as well as

permit the release of increased outflows in accordance with the regulation

plan. The dam is located such that both the overland waterway route to

Lafiairie Basin and the alternative Chambly Canal cut-off section of the

Richelieu River route to Sore1 would lead from the controlled waters of

its head pond.

16, The 12-ft, barge canal improvement scheme considered in this

feasibility study comprises a 150-ft. wide channel in the St. Jean-Fryer's

Island section, excavated to the same depth as the 400-ft, channel originally

proposed and approved for the 1937 remedial works project, In all other

respects, the land acquisition and construction work involved in this

6,7-mile section are substantially the same as that proposed in the 1937

project, and the estimated total first cost is $16,6 million (~e~tember

1964 price level), This is therefore the estimated cost of those works

which would not only be a component part of an international 12-foot water-

way, designed for the benefit of navigation, but would at the same time

virtually accomplish the original Lake Champlain regulation project, which

was designed to provide flood control benefitso The Board did not interpret

9

its terms of reference in this waterway study to include an investigation

of the economic benefits of flood control which would be realized by

completing the remedial works as an independent project, and putting

Fryer's Island Dam into operation,to consummate the original Lake

Champlain regulation scheme It cannot therefore state whether the $16,6

million expenditure would be economically justifiable from the point of

view of flood relief benefits only. However, if such justification were

found to exist today, as it was considered to exist in 1937, then this

part of the estimated waterway cost could be deducted from the benefit-cost

analysis, For example, in the case of the 12-ft. depth waterway, the net

annual charges to Canada would then be an estimated 83,330,000, giving a

benefit-cost ratio to Canada of 0,06 instead of 0.04, In the case of the

14-ft, and 27-ft. depth waterways, the channel bottom widths in the

St* Jean-Fryerts Island section have been designed as 370-ft. and 350-ft.

respectively, Although these closely approximate the 1937 project width,

the excavation depths are greater, and other construction features are

different, so that a cost comparison cannot so easily be made, However,

due to the high capital cost of these 14-ft. and 27-ft, waterway proposals,

the deduction of any amount in the order of $16.6 million would not alter

the benefit-cost ratios within the two decimal places to which they have

been given,

17. FUTURE OF m m q s ISW DAM IN THE ABSENCE OF AN INTERNATIONAL

WATERMAY IMPROVEMENT. Without knowledge to the contrary, it is assumed

that these works may yet be completed and operated for their originally

intended purpose, Based on 1964 construction prices, the cost qf doing

so, including the construction of dykes, the excavation of a 400-ft. wide

channel through the rock shoal at St, Jean, the modification of existing

~bridgea, and the expropriation of riparian property, has been estimated at

$20,400,000. Compared with the 150-ft, channel previously mentioned, the

difference of $3.8 million is due almost entirely to the greater quantity

of solid rock excavation involved,

18, In addition to providing flood relief for low lands adjacent to

Lake Champlain and the Richelieu River, the following benefits might be

attributed to the regulation of Lake Champlain outflows and water levels:

(a) An increase in the controlling water depth for

navigation in Lake Chnmplain and in the Richelieu

River upstream from Fryer's Island,

(b) Recreational improvement of Lake Champlain and

the Richelieu River as a result of the stabili-

zation of water levels and outflows,

(c) Some beneficial effect on water quality in the

Richelieu River and the north end of Lake

Champlain by virtue of increasing the minimum

flow at Fryerss Island from about 2,400 cfs.

to 4,700 cfe,

19, A partial development of the project, somewhere below the

level required to meet conditions set forth in the 1937 Order of Approval,

might provide part of the benefits of full development, Blso, some local

benefits might be obtained from Fryer's Island Dam as it presently exists

if it were used to regulate the water level upstream to St, Jean at some

elevation below that at which the stage-discharge relationship for Lake

Champlain would be affected, 11

20. It may be noted that a full development of the remedial works

project would, and a partial development might, permit navigation to follow

a river course from the international boundary to Fryer" Island, thereby

eliminating several miles of the existing Chambly Canal. A new entrance

to the canal would be constructed near the dam. The depth of the rock

excavation at St. Jean would determine permissible vessel draft,

21, A precise determination of the various possibilities of

operating F'ryerPs Island Dam would require further detailed study,

IV - REQUIR23ENTS OF WATER-RELATED RECREBTION

22. During the course of the feasibility studies the emphasis has

been placed on commercial transportation economics and the costs df improved

commercial navigation facilities, but the recreational aspects of the

Champlain Waterway were also considered, The investigations undertaken by

the Board confirm the excellent qualities of the Champlain Vaterway area

for water-related recreational activities, It is evident that the

recreational capability of the area depends to some extent on the

continuing maintenance of the existing navigation canals as necessary to

accommodate the present volume and the anticipated growth of recreational r

boat traffic,

23, The recreation data available to the Board indicates that the I

project area can expect to experience an annual growth rate in recreational

boating of about 2 percent up to the year 2020, The general growth in the

demand for outdoor recreation has been interpreted to be proportional to

the rate of increase in boating in the system, The present and projected

facilities demand for the United States boating population is shown in

12

Appendix B, Table 4 of Section 3, Also, the estimated transient boating

will become increasingly important in relation to the overall recreational

traffic, This is illustrated in Appendix B, Table 5 of Section 3,

24. As required by the Terms, of Reference,the Board has determined

the benefit-cost position of an improved waterway as an alternative to the

existing canal and other competing modes of transportation, In this

oontext, and there being no evidence to the oontrary, it has been taken I .

for granted that the existing waterway facilities will be continued in

service.

25. The level of maintenance and the rate of replacement or

rehabilitation of all these facilities are subject to the policies of the

operating entities. At the present time the agencies in both countries

responsible for the maintenance of the navigation facilities along the

route of the proposed waterway maintain them at as high a standard as is

feasible, considering age and obsolescence of equipment. In the United

States, the Federal Government has recently completed improvements at

the Troy Lock and Dam, The State of New York is following a long term

program of restoration and modernization in the entire barge canal system.

In Canada, it is understood that reconstruction by the Federal Government

of the St, Ours Dam in the Richelieu River is planned and some moderni-

zation of equipment of the Chambly Canal is contemplated,

26, Recreational activity constitutes a major source of income

and employment in the project area but the benefits already accruing

from water related recreation cannot be credited to future improyements

considered in the feasibility study. Also, any capital expenditures which

may be made in the foreseeable future to maintain the existing system as

a going concern have not been taken as a credit against the cost of an

improved waterway as given in Table 6 of the bin Report. However, in

computing annual charges,a credit has been allowed for the present

average annual maintenance expenditures in view of the fact that a new

waterway would replace all or part of the existing facilities*

27. As indicated in the Main Report, water-related recreation is

already well developed in the project area and fully integrated with am

existing navigation system that now provides adequately for recreation

seekers who travel by water, While a new waterway might result in some

improvement for recreational traffic, other offsetting factors such as

more rigorous regulations occasioned by increased commercial traffic would

preclude any significant increment of recreation benefits attributable to

an improved commercial waterway,

28. The feasibility study, which has taken into account the water-

related recreation aspect as outlined in the foregoing, has led to the

conclusion that an improved commercial waterway would not be an economic

undertaking nor would it contribute significantly to the other uses of the

water resources of the project area, including recreation, These findings

with respect to an international improvement should not be construed as

implying a lack of justification or desirability of improvements or

modifications as may be considered unilaterally by the present operating

entities* There may well be justification for major improvements in the

present canals to ensure continued full use of the recreation potential;

this could be true, for example, in respect to the Chambly Canal, This

canal facility would be completely replaced by any of the alternative

14

proposals for an International Champlain Waterway via the Richelieu River

route, If no such international development is undertaken, and if it is

assumed that navigation is not to be disrupted by abandonment of this

link in the existing system, it can be expected that steadily muunting

annual maintenance costs will be incurred to keep the present canal in

operational order. In the not too distant future, progressively heavier

capital investment for major rehabilitation work or possibly a new canal

eystem may be required, The latter might be designed for 12-foot navigation

to conform with the dimensions of the existing St, Ours Canal and the United

States part of the system, or to some lesser depth in view of the

predominant recreational use, The estimated first cost of a new 12-foot

canal between Chambly Basin and Fryer's Island is $4003 million, provided

that byergs Island Dam were placed in operation by completing the remedial

works in the section up to St, Jean, at a cost of $16,6 million, as explained

in a previous section of this Supplementary Report, No design or cost

estimates have been prepared for the construction of a replacement canal

to a lesser draft, but it would be reasonable to expect that even a new

6*-ft, draft facility would cost in the order of 75 percent of the 12-foot

project estimate,

29, With respect to the Champlain Canal, if the growth in transient

recreational traffic occurs as estimated in lippendix B, Section 3, and no

improvements are made in the interests of co&ercial navigation, it is

anticipated that an increase in water supply for canal operation will be

required to accommodate the increased recreational traffic around the

close of the current century,

V - PLANS OF STATES OF VERMONT AND NEW YOBK AND PROVINCE OF QUEBEC FOR FFTURE DERBLOP~NT IN AREA

30. In the course of the feasibility study and associated collateral

studies, numerous agencies of the States of New York and Vermont, and the

Province of Quebec, were contacted. While the primary purpose of these

contacts was to develop engineering or statistical data pertinent to a

particular phase of the study being investigated, information obtained on

planned activities or anticipated developments was also utilized.

31, Recently, the designated liaison representatives of the Governors

of New York and Vermont, and of the Government of the Province of Quebec,

were requested to furnish information on any plans which the states,

province or their agencies might have for future development in the area

of the Champlain Waterway, None of the information that has been received

in response to these enquiries would significantly change the economic

analysis presented in the Main Report or modify the conclusions reached

therein.