Franklin D. Roosevelt

Message to Congress on Panama Canal Tolls.

February 26, 1937

To the Congress:

I transmit herewith for the information of the Congress, report of the Committee on Panama Canal Tolls and Vessel Measurement Rules, appointed under the provisions of the Act approved April 13, 1936, "for the purpose of making an independent study and investigation of the Rules for the Measurement of Vessels using the Panama Canal and the tolls that should be charged therefor." As provided by law, the report contains the Committee's "advisory recommendations of changes and modifications of the rules for the measurement of vessels for the Panama Canal and the determination of tolls as it finds necessary or desirable to provide a practical, just and equitable system of measuring such vessels and levying such toils."

For over twenty years, numerous attempts have been made to secure the enactment of legislation which would abolish the dual system of measurement whereby tolls are computed under one set of rules, with a limiting factor on the amount to be collected, determined by different and continually changing rules of measurement over which the President has no jurisdiction.

The Committee points out in its report that the Panama Canal Act of 1912 clearly intended to provide that the President should be given full authority to prescribe rules for the measurement of vessels at the Panama Canal, and to fix within certain well defined limits prescribed by the Congress toll rates that were to be charged on vessels passing through the Canal. Due to the effect of the Attorney General's interpretation made in 1914 of the requirements of the Panama Canal Act, not only has the average transit charge per vessel, foreign and American, been much lowered, and the total revenues of the Canal correspondingly reduced, but the transit payments made for vessels of like earning capacity have become widely different; and this has taken place without any change in the rate of tolls fixed by the President to be paid by all types of commercial vessels, and without any modification of the rules prescribed by the President for determining the tonnage upon which the established rate of tolls should be paid.

It was not intended that the Panama Canal Rules, prescribed by the President in 1913, should forever remain unchanged, nor was it intended that the toll rates should remain fixed at the rates prescribed by the President in 1912. With development in ship construction and increases in traffic the time has come when the rules should be modified and the rates reduced. This cannot be accomplished in a satisfactory and impartial manner without the enactment of remedial legislation abolishing the dual system and establishing the Panama Canal Rules of Measurement as the sole rules for the measurement of vessels at the Panama Canal, and the tonnage on which Congress should prescribe the limits within which the President may act in fixing the toll rates.

An effort was made at the last session of the Congress to secure the enactment of such legislation, but there were those who felt that an independent study of the entire subject should be made first by a neutral committee before final action was taken. That study has now been made and an exhaustive report has been submitted.

The Committee has made certain recommendations as to the 'enactment of necessary legislation which I approve. Its enactment will permit the President to proceed administratively to carry out the further recommendations of the Committee as to the modifications of the rules and the rates to be charged, in order to provide a practical, just, and equitable system of measuring vessels and levying tolls.

I cannot urge too strongly the enactment of legislation that will so amend existing law as to provide:

(1) That tolls for the use of the Panama Canal shall be based upon vessel tonnage determined by the Panama Canal Rules of Measurement as prescribed by the President.

(2) That the tolls upon commercial vessels, army and navy transports, colliers, supply and hospital ships shall not exceed One Dollar ($1.00) per Panama Canal net ton, and shall not be less than seventy-five cents ($.75) per Panama Canal net ton, when such vessels are laden.

(3) That a rate of tolls lower than is levied on laden vessels may be prescribed for vessels in ballast, without passengers or cargo.

Franklin D. Roosevelt, Message to Congress on Panama Canal Tolls. Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/209368

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