THE LIBRARY OF THE UNIVERSITY OF CALIFORNIA DAVIS STATE OF CALIFORNIA DEPARTMENT OF PUBLIC WORKS PUBLICATIONS OF THE DIVISION OF WATER RESOURCES EDWARD HYATT, State Engineer Reports on State Water Plan Prepared Pursuant to Chapter 832, Statutes of 1929 BULLETIN No. 28-A INDUSTRIAL SURVEY OF UPPER S.\N FRANCISCO BAY AREA WITH SPECIAL REFERENCE TO A SALT WATER BARRIER Below Confluence of Sacramento and San Joaquin Rivers An Appendix to Bulletin No. 28 1930 CALIFORNIA STATE PRINTING OFFICE SACRAMENTO. 1930 80996-A TABLE OF CONTENTS I'age letter of thaxsmittai 5 uh(;anizati()n, state department of pubeic works 7 or(ia\izati()n on ixdustre^l survey s CHAPTER S^i-2, STATUTES OF IDlil) y FOREWORD 10 Chaptb^s I THE EUONOMH'S OF PLANT LOCATION 11 (Jrowth and migration of industries 11 Plant location as a proljU-ni of industrial engineering 11 Relative importjince of location factors 12 Accessibility versus proximity 14 Planned modification of factors 15 From the general to the specific in plant site selection 15 The quest for cooperative benefits IG Intangible factoi-s of plant location 17 East to west movement of industry 17 Western momentum under way . IS Chapi^ek II THE ECONOMICS OF PLANT LOCATION APPLIED TO THE SAN FRANCISCO BAY REGION 21 The labor situation 21 Transportation 22 Foreign commerce 23 Fuel and power 24 Raw material and markets 25 Sites 25 Comparison of the several areas in the bay region 25 The west shore of San Francisco Bay 2G The east bay communities 27 The upper bay 28 3Iarkets and raw material sources of upper bay industries 30 Raw material sources 30 Markets for upper bay products 31 Dominant location factoi's in the upper bay area 32 Summary of location advantages of bay region as a whole 35 Obstacles to the industrial development of the San Francisco Bay region 35 Summary of outstanding location advantages afforded by the upper bay area 30 Cn.VPTEB III WATER AS A PLANT LOCATION FACTOR— IN GENERAL AM) IN THE ARP:AS UNDER SPECIAL CONSIDERATION 37 The Pacific Coast situation 37 The lower San Francisco Bay area situation 38 The upper San Francisco Bay area situation 38 Salt water difficulties 39 The relative importance of water to the upper bay industries 41 2 — 809!I6-A 4 DIVISION OF WATEK RESOURCES Chapteu IV Pago THE INDUSTRIAL SITUATION IN THE UPPER BAY AREA— PRESENT AND PROSPECTIVE 43 The location history of the area by decades 44 The effect of salinity on plant location 4~t Present growth of the upper San Francisco Bay area 4.") Value of the product of industries 40 Number of employees in industries 4(! Growth of payrolls — il Growth of the capital investment 47 The prospective growth of the upper bay area 47 Chaptek V THE PROBLEM OF WATER COSTS IN THE UPPER BAY AREA 51 Cost as related to source ,jl AVater from underground sources Gl Water from public supply systems 51 Water for process purposes 52 Water for cooling and condensing purposes 5o Effect of salinity 5o Relative importance of water costs _ oil Present cost and consumption of water for cooling and condensing 57 Present cost and consumption of water for boiler and process purposes 58 Estimated cost for present consumption of water from a bai-rier lake 58 Comparative water rates in other localities 59 Chapter VI SUMMARY AND CONCLUSIONS 61 The baclcground of the survey 01 Merits of the upper bay as an industrial area _ 62 The water problem of upper bay industries 02 Suggested alternate sources of fresh water 04 I. Importation from sources outside local area 04 II. Salt water barrier lake 04 Estimated tax burden 05 Basis of State or Federal aid 00 Final conclusions 00 LIST OF INDUSTRIES IN UPPER BAY AREA 69 SUMMARY OF CONTENTS OF STATE ENGINEER'S QUESTIONNAIRE. 70 LIST OF PLATES Plate Page I. Present and potential industrial districts in San Francisco Bay region folloicing 70 II. Present industries and present and potential industrial districts in upper San Francisco Bay area foUo^ivlng 70 LETTER OF TRANSMITTAL Mk. Edward Hyatt, State Eno-ineer, Sacramento, California. Dear Sir: Tlie committee ai)i)ointed by you to make a study of the indnstrial develoi)ment of the upper San Francisco Bay area in relation to a salt water barrier begs leave to submit the report hereto attached. The committee bases its findings upon an industrial survey prepared by Professor George W. Dowrie, of the Graduate School of Business of Stanford University. Mr. Dowrie has devoted six months of intensive study to this subject. He was assisted by Mr. Oscar A. Anderson, a graduate fellow at Stanford University. Mr. Dowrie has availed him- self of the coo])eration of your staff and has had access to all the data in your otfice. He has made free use of the replies to the comprehensive questionnaire which your office sent out to the industries of the area. He has also had recourse to other public documents and has collected independently a large mass of valuable material through interviews and correspondence. Power and water comjjanies, research departments of various organizations, industrial executives, manufactures of cooling ('fiui)unent, industrial engineers. re]n-esentatives of government agencies, and numerous other persons who Avere in a i)osition to throw light upon the problem have cooperated most generously. The committee has been in close touch with the progress of the study at every si;age. Frequent meetings have been held at which the plan of the study and its progress were subjected to careful scrutiny. An pxceptionally comprehensive mass of data has been brought together and embodied in this report, which the committee transmits to you with its full approval. Briefly summarized, the conclusions of the committee are as follows: We find that the upper San Francisco Bay area affords a most attractive location for industries which require relatively large tracts of land, low cost of trans])ortation, proximity to population centers, and the com])arative isolation of a country site. The south shore of Suisan Bay contains, at ])resent, the cheapest solid ground near to deep water in the whole bay region. In respect to labor supply, power, transportation, accessibility to markets and raw materials, the upper bay region has exceptional advantages of which representatives of the industries now located in the area are well aware. The industrial growth of the area indicates that fhese advantages are of a substantial character. Study of such comparable data as were available shows that the late of growth measured in number of employees, in the size of pay rolls, and in the values created by manufacturing industries has for inany years been greater in this region than in the state as a whole, and decidedly greater than the trend for the United States. The only important disadvantage of the area, as set forth by repre- sentatives of the industries located there, has been the encroachment of salt water during the season when the two rivers have too small a flow to rei)el the salinity invasion. We do not find that the cost of securing fresh water necessary to carry on industrial ])rocesses is a major factor in the budgets of typical industries of the territory. HoAvever, to the extent that this cost creates a burden on any important industries in the area, it represents an economic handicap. In addition to this, the salinity consciousness, (T)) b DIVISION OF WATER RESOURCES which has been permitted to develo]), lias created a certain ])sych()logcical handica]) which it is highly desirable to dispel. Biiildinji' a barrier below the confluence of the Sacramento and San Joaquin rivers, and thus creating a fresh water lake, would doubtless remove both the economic and the psychological effects of the encroach- ment of salt Avater. Such a lake would be an attraction to heavy users of fresh Avater. If, however, the cost of building and maintaining the barrier should result in an unduly heavy tax rate upon property located in the territory, the burdens might well outweigh the advantages and result in a net loss. The influences which lead industries to locate in a particular spot are many and complex. If Suisun Bay could be turned into a fresh Avater lake at a cost AA'hich could reasonably be borne, it would probably tend to stimulate somcAvhat the industrial groAA^th of the area, but it is not to be exjjeeted that there Avould be any stampede of industries to locate on the shores of the lake. Competing locations would naturally olfer counter attractions and Avould probably match any water rates that might result from the construction of a barrier. After a careful study of all available data, it appears to the com- mittee that the present generation would have to assume a rather heavy burden for building and maintaining a barrier and that the gains realized in the reduction of Avater costs Avould only ])artially compensate for the expenditures Avhich it Avould be necessary to make. The com- mittee, therefore, is of the opinion that attention should be focused upon the real needs of the area and upon means of meeting them. The industries of the upper bay area have definite Avater problems which need to be solved, and it is' entirely appropriate that the coopera- tion of public authorities should be enlisted in helping to solve these problems. However, their solution does not seem, at present, to justify so elaborate and costly a remedy as a salt Avater barrier. The committee recommends, therefore, that serious attention be given to adequate measures for removing the causes of salinity con- sciousness from which the upper bay area is suffering and for furnishing an adequate supply of fresh Avater in the most economical way Avhich competent engineers can deA'ise. Respectfully submitted. Dean of Graduate School of Business, Stanford University, Chairman. Dean of College of Conimei"ce, Universitv of California. Consulting Engineer, San Francisco. San Francisco, California. November 19, 1930. ORGANIZATION STATE DEPARTMENT OF PUBLIC WORKS B. B. Meek Director Edwaed Hyatt State Engineer A. D. Edmonstox Deputy State Engineer 3— 80996-A ( 7 ) ORGANIZATION on INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA This report was prepared by George W. Dowrie, Professor of Graduate School of Business, Stanford University Assisted by Oscar A. Anderson, (iradudfe FelJoH', Stanford University under the direction and supervision of the folJowing committee appointed hy th(^ State Engfineer : Wtllard E. Hotciikiss, Chairman Dean of Graduate School of Business, Stanford University Henry P. Grady, Dean of College of Commerce, University of California A. D. SoiriNDLER, ('onsidting Engineer, San Francisco (8) CHAPTER 832, STATUTES OF 1929 Av act making an approprialion for work of exploration, investigation and prcliminanj plans in fnrtJierance of a coordinated plan for the conservation, development, and utilization of the ivater resources of California including the Santa Ana river, Mojave river and all water resources of southern California. [1 object to the item of $450,000.00 in section 1 and reduce the amount to $390,- 000.00. With this reduction I approve the bill. Dated June 17, 1929. C. C. Toung, Governor.] The people of the State of California do enact as follows: Section 1. Out of any money in the state treasuiy not otherwise appropriated, the smn of four hundred fifty thousand dollars, or so much thereof as may be necessary, is hereby appropriated to be expended by the state department of public "works in accordance with law in conducting work of exploration, investigation and preliminary jilans in furtherance of a coordinated plan for the conservation, develop- ment and utilization of the water resources of California including the Santa Ana river and its tributaries, the Mojave river and its tribu- taries, and all other water resources of southern California. Sec. 2. The department of public works, subject to the other pro- visions of this act, is empowered to expend any portion of the appro- priation herein provided for the purposes of this act, in cooperation with the government of the United States of America or in cooperation with political subdivisions of the State of California ; and for the pur- pose of such cooperation is hereby authorized to draw its claim upon said api)ropriation in favor of the United States of America or the appropriate agency thereof for the payment of the cost of such portion of said cooperative work as may be determined by the department of public works. Sec. 3. Upon the sale of any bonds of this state hereafter author- ized to be issued to be expended for any one or more of the purposes for which any part of the appropriation herein provided may have been expended, the amount so expended from the appropriation herein pro- vided shall be returned into the general fund of the state treasury out of the proceeds first derived from the sale of said bonds. (9) FOREWORD This report is one of a series of bulJetins on the State Water Plan issued by the Division of Water Resources pursuant to the provisions of Chapter 832, Statutes of 1929, directing further investigations of the water resources of California. The series includes Bulletins Nos. 25 to 36, inclusive. Bulletin No. 25, "Report to Legislature of 1931 on State Water Plan," is a summary report of the entire investigation. Prior to the studies carried out under this act, the water resources investigation had been in progress more or less continuously since 1921 under several statutorv enactments. The results of the earlier work have been pulilished as Bulletins Nos. 3, 4, 5, 6, 9, 11, 12, 13, 14, 19 and 20 of the former Division of Engineering and Irrigation, Nos. 5, 6 and 7 of the former Division of Water Rights, and Nos. 22 and 24 of the Division of Water Resources. This report is a part of a general economic investigation of a salt water barrier below the confluence of the Sacramento and San Joaquin rivers. It also is printed as Appendix A in Bulletin 28, which covers the entire subject. It deals with the economic aspects of a barrier as related to present and future industrial development in the upper San Francisco Bay area with particular reference to w^ater supply. The investigation, covering a period of six months, is based in substantial part on 101 replies from a comprehensive questionnaire submitted by the State Engineer to 114 industries located in the upper San Francisco Bav area. (10) CHAPTER T THE ECONOMICS OF PLANT LOCATION Growth and Migration of Industries. The kinds of factories and business establishments which may be obtained by a given region are of three main types: (1) new home industries; (2) branch pUints; (3) industries which have moved bodily. Most of the new industries which rise in an economic region are of the first type ; next in order come the branch plants ; last come the enter- prises which move as a whole. Some of the factors which lead to the establishment of new factories in a given region are as follows: (1) migration of population, which causes factories to follow people wherever they go; (2) new sources of fuel, power and water, making it profitable to carry on manufactur- ing at certain localities when motive power is available at attractive rates; (3) new sources of labor; (4) new raw material centers; (5) shifting of markets due to new inventions and demands; (6) develop- ment of distribution centers served b}^ land or water transportation, or both. Industry is sensitive to new developments which have business implications. If new developments bring new opfjortunities, or if changing conditions call for new industrial adaptations, business enter- ]irises endeavor to take advantage. IModern business is governed largely jjy the inexorable facts of cost accounting. When unnecessary waste and expense are present, this fact stands out like the proverbial sore thumb. When excessive expense is due to the fact that the location is no longer satisfactory, the industry moves, or puts up branch plants — if it can. The migration of cotton mills to the southern states is partially a result of reading the warnings of cold-blooded cost accounting. This is true also of branch steel plants which have been established in the South Chicago-Gary district. The same may be said of rubber, furni- ture, automobile and other industries which have come to the Pacific coast in order to be at the seat of a rapidly growing market. Plant Location as a Problem of Industrial Engineering. Originally the method of plant location was largely a matter of chance. Many factories were enticed to go to certain communities through the activities of booster clubs which had held out the bait of free sites, tax exemption and other special inducements. This vogue is passing. Appeals are coming to be made upon sound economic grounds. An advertising slogan used by one rapidly growing region is that industries come "Without benefit of bonus." Too often, the results under the old appeal were unhappy, both from the standpoint of the factory and that of the community. A sick business, operating under the handieaii of an illogical 7)lant site, is not an asset to any community. Sometimes an industrj^ is found in a region where transportation facilities are unfavorable, power costs high, and where other disad- vantages are present. The reason for its being there, in many cases, is tliat the originator of the product happened to live in that community, and establislied the industry there. Sometimes an industry has been (11 ) 12 DIVISION OP WATER RESOURCES established at a given site out of consideration for one factor, like power or transportation, without due consideration for other plant location factors which should have been taken into account. At best, the old methods were not particularly scientific; the procedure used was haphazard. Modern problems of plant location are now commonly solved by specialists. They have a scientific technique by which they can arrive at logical conclusions ; their methods in arriving at decisions are impartial ; they are not unduly influenced by the arguments of local boosters. A common procedure is to draw up a check list of all the plant-location factors which might be pertinent to the success of the industry concerned. With this done, the various prospective areas and sites are evaluated in the light of these factors. The finding of the most logical plant site involves a process of elimination. Relative Importance of Location Factors. The value of one factor as compared with another in choosing a plant location depends upon the industry involved and especially upon the particular company in question. The problem of plant location must always be one for individual case study; a sweeping generalization which attempted to rate the relative importance of location factors in a given type of industry would be a misleading guide for a particular firm with specific problems of its own. The men's clothing industry, for example, is often classed as an industry requiring a city site, because : the important market is in the city itself ; the class of labor needed may be conveniently secured, and the factory site needed is not large, since clothing manufacture is a multistory type of industry. These criteria may be applicable in a general way but are not to be depended upon for particular cases. Some of the most successful men's clothing plants are located in suburban and even rural districts. The exceptions made to tlie city-location theory are so many that it would be useless to make out a general i-ating scheme, showing the relative importance of location factors in a single industry, like men's clothing manufacture. This principle holds true for other industries as well. However, it may not be amiss tO' show how an individual expert on ]jlant location may rate the factors for a given factory in a given line of industry. Mr. W. L. Wotherspoon,* in discussing the investigation which led to the selection of a site for a refinery and rolling mill for monel-metal showed how he finally rated the several plant-location factors, but like many other writers on the subject, warned against sweeping generalizations. Relative iceight Factor in per cent -1. Fuels 33 2. Labor . 25 3. Living conditions 10 4. Power 10 5. Supplies 6 6. Climate 5 7. Transportation 5 8. Building costs 2 9. Taxes and laws 2 10. Site (cost and quality) 1 11. Water supply 1 * Proceeding-s of American Society of Mechanical Engineers, December, 1922. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 13 The weighting scheme sliows that for the particular factory in ques- tion the factor of fuel was thirty-three times as important as such factors as water supply or site-cost and quality, and that such a factor as power was twice as im])ortant as the factor of climate. However, these weight inus would not necessarily apply in the case of another metal industry, or even another mouel-metal mill, which had its own peculiar prohlems in competition and trade development to face. A recent industrial survey,* covering- sixteen thousand tirms in the United States and Canada, shows that the rankings given to location factors vary widely with the section in which the industry in question happens to be located, and, of course, with the type of product manu- factured. For example, the summing up of the rankings leaves water supply entirely out of the list of sixteen factors of which mention was made the oftenest. but if all of the participating industries had been heavy users of fresh water, or had all been located in a part of the country where abundant fresh water is not easily procured, water supply would undoubtedly have had a prominent place in the list. This does not mean that in such cases water cost necessarily looms large in the sum total of manufacturing costs, but it does mean that water-using industries can not function normally if they do not have Avater of suitable quality and in sufficient quantity. In the lists of important location factors given by seven writers t on the subject, selected at random, water is included in all but one case. A list of items, however, which is ranked on the basis of the number of times it was mentioned in reply to a questionnaire is not wholly with- out merit, for it does tend to reveal the phases of the subject that are causing the greatest concern. In the survey to which we have just referred the conspicuous place given to markets throughout the replies is indicative of the fact that nowadays disposing of his output is the manufacturer's chief concern. Such a state of affairs augurs well for the development of industries on the Pacific coast for the purpose of serving this important consuming area to better advantage. In simple plant location problems, there is often a paramount factor which determines the general nature of the site to be selected. Thus, the item of cheap and abundant power is of major importance for abrasive manufacturing. Niagara Falls has become important as a center of production for carborundum and other abrasives, because of cheap electricity. In the case of bulky, moderate-priced products, such as furniture, the plant site must be near as possible to the market served. Canning factories are influenced in their location by the perishability of the raw materials. These examples show how a given factor may be of major importance to one type of industry and of secondary importance to another. As a general thing, the importance of a given factor is relative to : (1) the nature of the business enterprise concerned, (2) the plus or minus values of the other factors which are peculiar to the region or site being considered. The interplay of considerations from these two points of view calls for an evaluating process that is anything but * Cooperative survey made by the Civic Developnient Committee of the National Electric Light Association and the Policyholders' Service Bureau of the Metropolitan Life Insurance Company (1927). t A. G. Anderson, ^y. M. Booth, H. S. Colburn, E. B. Powell, G. C. Smith, A. P. Wood and W. L. Wotherspoon. 14 DIVISION OF WATER RESOURCES simple. It is the algebraic sum of combined factors resulting in a minimum of costs that determines the locus point which is suitable for a plant site. The iron and steel industry * is a good example of the way circumstances alter cases in matters of plant location. Considering the diverse factors of (1) market, (2) ore, (3) fuel, which must be reconciled, the following practices are to be noted : Location of Industry Industry develops Avithin the common area. Example : Birmingham district, Alabama. Industry develops close to or within the common area. Example : Sydney, Nova Scotia ; Pueblo district, Colorado. Oi'e is drawn to the common terriroiy. Example: Pittsburgh district, ore from Lake Superior district. Coal is drawn to the common area : Steel industry of Italy, obtaining "Welsh or Westphalian coal. Industry locates within or close to the market ai-ea. Examples : South Chicago- Gary industries using Minnesota ore and West Virginia coal. Industry develops in or near the coal fields. Example : Steel industry in Saar coal field. Germ.any. Industry develops in or near ore fields. Examples : Steel industries at Lake Supe- rior ports, Duluth and Sault Ste. Marie, serving markets of Canada and north- western United States. The table suggests how the problem of plant location is affected by the varying combinations of plant-location factors. Accessibility Versus Proximity. The ideal in plant location is to have a site that is near the market, and at the source of raw material, fuel, power, water and labor supply. But, as seen in the case of the steel industry, it is not often possible to have all desirable factors centered at one place. This circumstance makes the factor of transportation important. In cane-sugar refining, for example, it is desirable to have a convenient source of raw material, but with cheap oceanic transportation there is no urgent necessity for having proximity of materials. In fact such an enterprise as the California and Hawaiian Sugar Corporation, Limited, which receives its raw sugar from Ha^yaii, can receive and ship more cheaply at its San Francisco Bay location than it could if located in Hawaii itself. Where good water transportation is to be had, the importance of proximity becomes lessened ; in a practical situation it is accessibility, through proper transportation media, that counts. The difference between accessibility and proximity is to be seen in fresh vegetable and egg marketing. Once the production of vegetables, fruit and eggs required nearness to market, but climatic advantages, • For details, see the study, "Location Factors in the Iron and Steel Industry," by Richard Hartshorne, pp. 241-252, Economic Geography, Vol. IV, No. 3, July, 1928. Distributioti of Factors (Material, fuel, market) (a) Ore producing, coal producing and market areas approximately coincide. (b) Ore and coal areas are adjacent or coincide ; no important local market. (c) JVIarket area coincides with coal area and ore area is accessible. (d) IMarket area coincides with oi'e area and coal area is separate. (e) Market lies between coal fields and ore fields with no great distance from route between them. (f) Coal area lies between the ore fields and market region. (g) Ore area lies between the coal fields and market region. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 15 fast transportation, and modern refrigeration methods enable distant producers to compete successfully with other producers who are a thousand or even severjil thousand miles closer to a given market. Again, the hardwoods of the Orient and the glass-making sand of Belgium are more accessible to various manufacturers in the United States than similar materials found in certain part of the United States itself. Conversely, distant markets may be more accessible, through water transportation, than nearer ones which can not be reached by cheap transportation. Planned Modification of Factors. In one sense, man is a creature of his environment, but in another sense he is a maker of it. Industries no longer settle where shipping, transportation and harbor facilities happen to exist. Railroads are now made to come where industries choose to locate, and if harbors are needed they are often built in case a natural one does not already exist. Similarly, if the water factor is not favorable in certain indus- trial areas while the other factors are, the water is brought to those areas, although the distance may be relatively great. A cardinal difference between the old New England industrial area snd the modern Piedmont-Carolina area is that in the former case industries settled where power happened to be, while in the latter ease power is transported to the place where the industries, because of other factors, find it advantageous to locate. Invention of single purpose machinery, for which operators can be readily trained, makes it unnecessary for plants to locate where there is an abundance of skilled mechanics. In Eussia, unskilled urban laborers and even peasants now help to make Ford cars. The perfection of a new type of manufacturing process emancipated the porcelain-products industry from the requirement of locating where a certain type of skilled labor was to be found. By the acceptance of a new production technique, the porcelain goods manufacturer can choose a plant location independent of the old skilled labor requirement. All of which means that plant location requires consideration not only of natural advantages, but of those that may be created through new technical processes. When once a site has been selected, buildings constructed, machinery installed, and a corps of employees trained, the die is cast. To avoid mistakes in location, it is necessary to view today's problems in the light of tomorrow's possibilities. From the General to the Specific in Plant Site Selection. The necessity for caution has led to circumspect approaches not only in the consideration of technical processes and transportation possi- bilities, but also in the consideration of regional environments. The question of a specific plant site is determined in view of preliminary questions about the general region considered. In determining upon a site for the new "Western Electric Company cable plant, which was to take care of Eastern, Southern and Pacific distribution, the first broad consideration was a choice between a middle western and an Atlantic seaboard location. Each region had its disadvantages, but calculation proved that a seaboard location would have the greater advantages. In turn, a New Jersey location was found to be advan- tageous over alternative choices in other parts of the Atlantic coast. 4 — 80996-A 16 DIVISION OF WATER RESOURCES Finally, there came the task of choosing between specific sites on a New Jersey water front. By a process of elimination and progression from the general to the particular, the actual site wanted was found at Kearny, New Jersey. The net saving secured, over the original "home-site" in the middle west, amounted to $275,000 per year.* The circumspect process of going from the general to the particular in selecting plant sites has tended to draw attention to the relative advantages of broad regions, such as the South, the Pacific coast area, the Atlantic coast region, and the Middle West section. On a lesser scale, the localities within regions and areas are considered comparatively. The Quest for Cooperative Benefits. Intensity of modern competition has had the parodoxical effect of stimulating cooperative endeavor. The recent regional planning movement for the benefit of community and industry represents an endeavor to temper the wastes of individual effort by the economy of a unified program. Another manifestation of the desire to secure the benefits of coopera- tion is to be seen in the development of comprehensively planned "manufacturing districts," offering transportation, power, water sup- ply and other joint services to the several factories. The Central Manufacturing District in Chicago, with its Junction Railway, is a case in point ; this single belt line gives all producers within the district a very convenient contact witli thirty-niue railways without the disad- vantages of delays, worries and costs that would result in dealing with many railways single-handed. The belt-line service is only one of many benefits received. The Bush Terminal of New York also operates on the cooperative benefit principle. As an illustration, manufacturers at the Bush Terminal obtained electric current for light and power at 3.3 cents per kilowatt-hour when other manufacturers paid 7.5 cents per kilowatt-hour. Similarly, insurance rates, freight handling costs and many other items of expense were particularly favorable to the companies enjoying mutual services. Other examples of planned "manufacturing districts" are to be found in such places as Los Angeles, Minneapolis, St. Paul and Kansas City. A still further indication of desire for associational advantages is to be seen in the rapid development of "metropolitan districts" in which satellite industrial communities tend to develop and cluster about established cities. With a suburban location, a manufacturer may enjoy first-class banking facilities, the services of well-stocked supply houses, the advice of consulting engineers, the benefits of competing railroads, and many other advantages of a city. On the other hand, there are not the disadvantages in the way of an expensive and cramped site, traffic congestion, or expensive water charges. Furthermore, a comprehensive "metropolitan district" offers special inducements to industries which serve as a complement to major industries already established, wliich tends to give the district as a whole a well-balanced character. ♦ See "Plant-location Factors of Western Electric Co., Kearny Works," by C. C. Spurling, page 697, Mechanical Engineering, Vol. XIjIX, No. 6, June. 1927. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 17 All these trends — regional planning, carefully designed manufactur- ing districts, and more or less spontaneously developed metropolitan districts — reflect the modern desire to capitalize the benefits of cooperation and mutual services. Intangible Factors of Plant Location. After tangible factors of plaiit location have been considered, there still remain the relatively intangible factors. In the last analysis, it is the intangible element that is often the deciding factor which deter- mines whether an industry shall be establislied in this region or that, in one locality or another. This accounts for sairprises "when a given community believes it has advantages greater than those of another community and is disappointed to have the prospective industry locate at the other place. Among the more intangible factors to be considered is that of com- munity and regional morale. With a region divided against itself there is less appeal to prospective industries than that made by a region which is an integrated unit. An integrated region is one that does large-.scale planning of a nature that assures the greatest po.ssible present and future economies in industrial operation. Future economy, especially, is something to ponder in choosing a location. xVn industry that comes into an area without benefit of com- prehensive planning in that area may soon become the victim of unfore- seen costs, due to snarled conditions in water supply, transportation, and the like, which wise planning might have forestalled. The problem of regional development is not unlike the problem of municipal develop- ment ; where comprehensive municipal planning is absent, there is sure to be congestion, confusion and unnecessary expense. Other things being equal, that region or locality is the rao.st promising which has the least criss-cros.sing of purposes, the least need for overlapping of expenditures for mutual service needs, and the most comprehensively developed natural resources. For stich reasons, various writers call attention to ''community attittide" as one of the intangible factors to consider in deciding upon a plant location ; right attitude is regarded as a form of industry insurance. The United States Cen.sus calls atten- tion to momentum as an important factor to consider in plant location. This is another way of saying success breeds success. Risks are good if ;i commtmity rates well in both tangible and intangible factors, and if the ball has already started rolling in the community's industrial development. East to West Movement of Industry. Both cultural and economic progress seem to move from ea.st to west. Western Europe derived her ideas and products from the east, and the American colonies, in their turn, depended upon western Europe for the satisfaction of their cultural wants and for all but the most elementary of their material needs. In like manner, the western states of America haA'e been dependent upon the eastern half of the country for manufactured products and for economic and social leadership. A study of industrial trends reveals the extent to which the dependence of the west upon the east for manufactured products is lessening. Physical barriers to the industrial development of the west are being removed through developments in chemistry and engineering. 18 DIVISION OF WATER RESOURCES But little prooress lias been made in removing , psychological obstruc- tions which impede the migration of certain industries. Textile manu- facturing is an outstanding case in point. Since there is no well- developed center of textile production, experienced manufacturers hesitate to enter the Pacific coast field. Although there appears to be no logical reason why textile mills should not be established on the Pacific coast, as well as in New England and the southeast, capital is hesitant about establishing lone mills in new and unproved territory. California's growth in the field of heavy industry now affords special opportunities to complementary industries which utilize light forms of labor found as a surplus in heavy industry centers. Because of a plentiful sxipply of natural gas and oil, and comprehensive electrical developments, the cost of power is relatively low. Furthermore, the mild climate of the Pacific coast reduces plant construction and heating costs. Taken as a whole, tlie Pacific coast also has an advantage over the east in respect to proximity to the principal textile raw materials ;" wool, silk and cotton. Most American wool is produced in the western states and most of the imported wool comes from Australia and New Zealand. Much of the latter passes through California ports to be cleaned and manufactured in the east, after which a part of the finished product is ship])ed west again. Similarly, the western states are nearest to the source of supply for silk, which is obtained from Japan and China, but the material is transported through western ports to the silk mills of New Jersey and Pennsylvania, the eastern mills having to pay millions of dollars in express, insurance and interest for these land shipments. In respect to cotton, California is adjacent to Arizona and Lower California, wliicli obtain excellent results in cotton growing. Yet, like wool, this raw material goes east to be manufactured into textiles, and a considerable part of the finished product is sent back for western consumption or passes through the west on its way to the Orient. The location of the national style center in the east still con- stitutes a serious impediment to the development of the textile industrj^ in the west, but among American cities, Hollywood is coming to be recognized as second to New York in its influence upon style trends. The situation is similar to that whicli formerly existed in the auto- mobile tire industry, in which the west depended upon the eastern manufactured product. But, with the early inertia overcome in getting plants established in the west, California has now become the second largest tire manufacturing center in the world, providing for western consumption and exportation to the Orient. With psychological diffi- culties removed, there is no logical reason why other new industries should not be established in the west on an extensive scale. Westerm Momentum Under Way. — An index of the momentum of development being experienced by the Pacific states is to be seen in population figures. In the last decade, the geographical group con- sisting of California, Oregon and Washington, with an increase of 46.4 per cent, proved to be the fastest growing division in the entire United States. Of the Pacific states, California has had, by far, the most rapid development. The number of inhabitants reported for 1930: viz, INDUSTRIAL SURVEY OF TTPPER SAN FRANCISCO BAY AREA 19 ,%642,282, rei)resents a s'^in oi 64.6 per cent over its population of 1920. In i'aet, 2,215,421 of the Pacific coast's gain of 2,584,741 was made by California, the growth of the Los Angeles area having been especially marked. This exceeds the rate of growth of every other state in the Union. Tliis growth of the west is naturally developing a largo consuming area for western products. Tlie response on the ])art of business interests to this shift in popula- tion is seen in the data on western industrial development. A study of the United States Census of Manufacturers shows that the number of manufacturing establishments in the United States showed an increase of 14.3 per cent from 1914 to 1927. During the same time, the number of manufacturing establishments in California showed an increase of 5S.2 per cent — a rate of growth four times that for the United States as a whole. Similarly, for the same period, the value of manufactured ])roducts for the United States as a whole increased 121 per cent ; while tlie manufactured products of California increased 280 per cent in value, representing a rate that was 2.3 times that of the nation as a whole. Equally significant is the fact that "Value added to manufacture" showed an increase of 185 per cent for the United States as a whole, during the period from 1914 to 1927, but the increase in California was 334 per cent. In 1927, the products of industry in the State of California had a value of approximately 2,600 million dollars, of which 1,088 million was added by manufacture. This exceeds the sum of: (1) the value of all crops produced in California in 1927, 479.8 millions; (2) the value of the output of fisheries, 10 millions; (3) the value of all mineral production, 459.6 millions (including metals, stone, natural gas, crude petroleum, clays, salt, sand, etc.), and (4) the value of the output of the forests of California, estimated at 60 millions.* During its early stage of development, an economic region is con- cerned principally with the extraction or production of raw materials. The Avest is still an important source for the products of mines, forests, farms and fisheries, but California, particularly, is fast passing into the industrial stage of its development. Economically speaking, California is approaching its adulthood. One of the great trade assets of the Pacific coast is its favorable location for Oriental trade. While it is true that Pacific coast trade with Europe has grown faster than that of the United States as a whole, during the past decade, it is probable that Pacific coast trade with Asia and Australasia will greatly exceed European trade in the Future, t For the United States as a whole, the ])hysical volume of foreign trade has increased by about one-half since pre-war days, while the foreign commerce of the Pacific coast has about trebled. The foreign trade of the San Francisco bay region is comparatiA'ely well balanced and diversified. Only one item, raw silk, is (is high as 15 per cent of the total volume. Three-fourths of the import trade of Seattle consists of raw silk, which raises its import figures to twice the amount of its * The figure for fore.st products was obtained from the Forest Handbook of California for 1930. The other data are from the United States Statistical Abstract •for ■i;t29. t Unless otherwise specified, data on foreign trade have been assembled by Dean H. P. Orady. from reports of the Chief '.f Kngin-ers, United Sfatis Army, .and from tlie .statistienl statements of the San Francisco customs district. 20 DIVISION OF WATER RESOURCES exports. Portland, on the other hand, exports six times as much as it imports, because its principal articles of foreio-n trade are the lumber, wheat and apples gTown in that region. Pour-tifths of the Avater-borne commerce of Los Angeles is petroleum and most of the remainder consists of lumber from the Pacific northwest. Aside from petroleum, flour, lumber and canned goods, the ])roducts of Pacific coast mills and factories as yet constitute a relatively insignificant part of our foreign exports. These same mills and factories still fall far short of supplying the large consuming areas about them with manufactured products, so it is not surprising to find that they have little to sell abroad. As for the possibilities for building up a substantial foreign outlet for coast industries other than the four types mentioned above, political and economic developments in the Far East have a large part to play. The constant turmoil in China, the anti-foreign goods movement in India, the progress of Japan in supplying her own wants are- all unfavorable factors so far as expanding our market is concerned. And yet, in spite of them, Pacific trade has increased year by year with respect both to volume and variety of products. The populations of India and China. ])articularly, are so huge that an average purchase of one additional dollar's worth of foreign products, l)er capita, would increa.se foreign trade by some three-quarters of a billion dollars. Undoubtedly both nations will eventually be indus- trialized, but in the m-eantime, with every slight step upward in their very low standards of living, they afford an enormous potential outlet for industrial products. China's present situation surely offers no encouragement to the C^alifornia exporter, but examples of other nations have shown that when once sufficiently able leadership is found, things right themselves surprisingly fast. The share of the Oriental nmrket which the Pacific coast states will receive de])ends upon the ability of manufacturers in this area to com- pete with those from other industrial areas. If the other location fac- tors, plus skill in management, are sufficiently favorable, the situation of the California industries on the shores of the Pacific should enable them to hold a sub.stantial share of Oriental trade. However, since foreign trade is only a small percentage of the whole, the chief urge for industrial development for some time to come will be the Pacific coast population that can advantageously be supplied with commodities manufactured in Pacific coast factories and mills. INOUSTRIAI. SITR\-EY OP UPPER SAN FRANCISCO BAY AREA 21 CHAPTER IT THE ECONOMICS OF PLANT LOCATION APPLIED TO THE SAN FRANCISCO BAY REGION The territory sin rmimliiiii- San Fraiieiseo Bay, inchidino; its two upper arms — San Pablo and 8nisun bays — and the navigfable portions of the Sacramento and San Joaquin rivers, in many respects constitutes an economic unit. There exists a stronar interdependence among the .several areas which constitute this region. Its important common interests and problems call for a well-articulated regional program rather than for displays of local rivalry. San Francisco is the financial capital of the region and the location of the executive officers of most of the large enterprises operating within its boundaries. San Francisco. Oakland. Sacramento and Stockton are the ]irincipal wholesale and retail distributing centers of the area, and the whole area looks to them for the more highly specialized types of personal service. The Labor Situation. The bay region as a whole, -with its population of considerably over a million, is well supplied with industrial workers. Wage rates, how- ever, are relatively high, as will be seen from the data which follow. On the other hand, it would be necessary to have comparable data concerning relative etficiency of labor before assuming that higher money wages result in higher labor cost. According to a United States Department of Labor Survey * as of July 1, 1929, the average hourly entrance w^age rates in cents, for common labor, were as follows for industries of the type which prevail in this region : 2C3 fegfej ;t.^ Ot3 O^ \^^ Ofe J) ?•* sw "-iS *e *^ "-2 2^ * ^S: 'a.S 5*1: g.* s.§ sli S.- 2- ^ ^ 2 "^cS^ ^t^ e.". ?^ QCo rt Industry , a, ^ Iron, steel 42.5 41.8 41.8 43.6 36.8 35.4 28.5 48.6 Leather 42.2 50.0 44.2 43.4 ___ 34.6 33.7 52.6 Paper 44.0 47.4 41.6 44.4 39.2 36.4 27.1 43.3 Petroleum 45.7 ___ 46.3 51.4 50.0 40.3 32.5 57.4 Cement 37.8 ___ 42.5 38.0 35.7 ___ 31.0 47.2 Foundries 39.8 39.6 42.0 43.5 40.3 27.5 32.6 51.4 Meat packing 42.0 44.8 41.9 42.0 42.1 40.0 ___ 41.9 Average for 13 industries •surveyed 43.7 48.0 4C.4 48.4 41.8 30.2 26.8 47.9 A comparison of average weekly pay envelopes in identical industries for the same week of April. 1929, taken from the same source of infor- mation, shows the relationship between regions as it exists w^hen the pay of more highly skilled factory workers is averaged in with the type covered by the preceding table. East-North-Ceutral ^32.15 Pacific 28.40 Middle Atlantic 27.50 Xew England 25.30 South Atlantic 20.15 ♦Monthly Labor Re\-i«>w. Ortober. 1929, p. 172. 22 DIVISION OP WATER RESOURCES It will be noted that while wage scales on the Pacific coast are higher than the average for the country, they are lower in both instances than the prevailing rates in the great industrial area comprised in the east-north-f-entral states.* Transportation. The area is served directly by the main lines of three transcontinental railroad systems, the Western Pacific, the Southern Pacific and the Santa Fe. The Northwestern Pacific serves the territory north from Sausalito to Eureka. Not all parts of the bay area have equally good facilities and equally prompt service, but a common rate schedule applies over the whole bay region. Some important parts of the area have lacked the stimulus which competing rail lines afford, but the Interstate Commerce Commission seems disposed to sanction the entrance of competing lines wherever the situation seems to warrant. The bay area, in common with the rest of California, has an unusually complete network of improved motor highways. The oppor- tunity thus afforded for the use of trucks has made possible delivery direct to the purchaser, or, if rail or water shipping is necessary, delivery is made by truck to the point of shipment. The whole of the United States is so thoroughly covered with main lines of railroad that no section possesses any great advantage over another in that respect. Rail hauls, however, compared with water shipments, are expensive and, in the case of articles which haA^e large bulk and weight in proportion to their value, railway charges can soon become prohibitive. It is for this reason that the greatest economic development tends to occur where water transportation is available. In addition to its foreign, intercoastal and coast-wise commerce, the bay area has a large volume of local traffic along its own shores and on the two important rivers and the smaller streams tributary to it. The following data, compiled by Dean H. F. Grady.t show in approx- imate figures the relative importance of the water-borne commerce of the port of San Francisco from the standpoint of destination : To foreign countries $1,500,000 daily average To Hawaii 250,000 daily average To Atlantic Coast of United States 330,000 daily average Coastwise 2,800,000 daily average Local 2,000,000 daily average In his annual report for 1929, the Chief of Engineers, United States Army, gives the total water-borne commerce of the four leading Pacific coast ports as follows : Rank Rank- Short among among tons U. S. ports Value U. S. ports San Francisco __ 41,019,000 2d .$2,257,747,000 2d Los Angeles 25,696.000 4th 956,702,000 4th Seattle 8,907,000 11th 773,747,000 7th Portland 9,165,000 10th 343,220,000 13th Much is said about the advantage of plant location on deep water where ocean "freighters" can come directly to the company's dock, but relatively few concerns in the San Francisco Bay area have any * In this sroup are Illinois, Indiana, Ohio, Michigan and Wisconsin. t See footnote on page 19. INDUSTRIAL SURVEY OI' Ul'l'KR SAN FRANCISCO BAY AREA 2;{ such volume of shipments to or from ])oints on a given steamship route as to warrant a call for an ocean vessel. Even the very smallest of enterprises, however, finds it profitable to utilize the smaller bay and river craft in brino-ing in raw materials and sending out their finished products. Ocean steamship lines are keenly competitive, and whenever a sufficient volume of merchandise is forthcoming from any point in the bay area on a sufficiently deep channel there will be no lack of such service. Foreign Commerce. We have already indicated in the preceding chapter the volume of commerce of the San Francisco customs district. The following table shows the principal items of export and import, arranged in order of total value.* Exports Imporfs Canned and dried fruits Raw silk Refined mineral oils Green coffee Barley Copra Raw cotton Burlap Automobiles Chinese wood, nut, or tung oil Canned fish Raw sugar Canned milk Coconut oil Asphalt Tea Redwood lumber Print paper Cigarettes Tin Canned vegetables Bananas Rice Crab meat Flour The port of San Francisco ships relatively little for other areas. Nine-tenths of the volume of products imported are consumed in northern and central California, and the same proportion of exports are produced there. As noted in the preceding chapter, an examination of products imported and exported indicates how little California has developed general manufactures such as constitute the list of exports from major eastern ports, and likewise hoAv few" manufactures are received from foreign countries by water. The following are the best foreign customers of this shipping area, according to the data for 1929 :* United Kingdom 39 million dollars Japan . 24 million dollars Philippines 16 million dollars Canada 7.6 million dollars Australia 27 million dollars China 16 million dollai"s New Zealand 8.4 million dollars The remaining amount, 74 million dollars, w^as distributed among the other countries of the world. It can be readily seen that the Orient and Australasia con.stitute an important part of the foreign market for the San Francisco Bay region. That adecpiate competition exists for the business which the bay region offers is evidenced by the following statement of the shipping facilities afforded on the routes indicated.! * .Annual (1929) Statistical Statement of Customs District of San Francisco, t 1930 issue. Tear Book of "San Francisco Business," p. 69. 5 — 80996-A 24 DIVISION Ol^' WATKK RES0UK(.;E8 To Australnsia 8 lines Around the world 5 lines To the Orient and Hawaii 15 lines To Pjurope 17 lines To Centra] and South America 13 lines Intercoastal 21 lines Coastwise 22 lines Fuel and Power. Fuel oil is supplied by barge from the four large refineries in the upper bay. A slight advantage in cost is had by the upper bay indus- tries because of tlie shorter haul. The price of fuel oil per barrel in this area compares "with prices elsewliere as follows : * San Francisco Bay .$0.89 Portland and Seattle 1.10 Los Angeles (El Segundo) 0.85 St. Louis 1.26 Chicago $1.36-1.40 Detroit 1.57 Pittsburgh 1.68-1.73 New York 1.15 Boston 1.15 At 89 cents ])er harrcl, fuel oil costs 14.7 cents jkm- million British thermal units. Natural gas from the oil fields is available to the industries of the bay region. A minimum rate of 14 cents per thousand cubic feet is made to industries for that part of the flow of gas which is in excess of domestic and other similar requirements. At this rate the cost would be 12.2 cents per million Britisli thermal units. Natural gas is being made available to certain industrial centers in the east, but comparable cost data can not be had. However, by reducing the prevailing cost of coal to a British thermal unit basis, a comparison of fuel costs may be obtained, although to make gas and coal costs truly comparable an industry would have to add to its coal cost the expense for handling, storage and labor charge for stoking and removing ashes. The following table shows in British thermal units the cost of coal in certain cities (without the added costs indicated above), the cost of fuel oil in the San Francisco Bay area, and the cost of natural gas in the same area.f Cost per miUion British Ihrrnial units for Fuel oil San Francisco Bay 14.7 cents Chicago 22.8 cents Birmingham Atlanta __- St. Louis 20.8 cents Cleveland Buffalo _-_ Pittsburgh 28.2 cents Baltimore Electric power lines serve all ])arts of the bay region from a common "hookup," and at the same scale of prices. Tlie following table, com- piled from charts ])repared by the statistical department of the Pacific * Figures furnished by the Standard Oil Company of California. t Information regarding gas, coal and power rates furnished by the Pacific Gas and Electric Company. for for Natural gas Coal 12.2 cents 14.3 cents 13.0 cents 16.0 cents 10.5 cents 12.2 cents 13.9 cents 9.7 cents 17.4 cents INDUSTRIAL SUKVKV ()!•' Ul'MEK SAN FRANCISCO BAY AKKA Z>i Gas and Electric Company, shows how prices of electric current to industrial users compare for different centers : COST OF ELECTRIC POWER TO INDUSTRIAL USERS Based on uniform load factor and use of 400 hours per month City or locality Size of installation 100 500 horsepower horsepower (cost in mills) (cost in mills) 1,000 horsepower (cost in mills) St. Louis Detroit Chicago Pittsburgh, Pennsylvania Los Angeles (municipal).. San Francisco Southern California (outside Los Angeles) 24.8 23.2 17.7 16.6 13.6 12.8 16.6 24.8 21.5 12.7 13.5 11.1 11.1 10.0 10.0 13.0 11.0 fl.5 8. 9. 9. Raw Materials and Markets. Since these are primarily problems which concern specific industries and do not lend themselves to much generalization, their treatment will be taken up in detail only in connection wnth the plants in the upper bay area. We need only note here that cheap water transportation has compensated for the great distance by land from certain ra-w materials, and that the surrounding territory has supplied the rest. Likewise, adequate markets are afforded (1) by the presence in the western states of nearly a tenth of the nation's population, and (2) by the fully developed ocean transportation system which we have already described. Sites. The question of ^tlie cheapness and quality of industrial sites, like that of markets and raw materials, can best be dealt with in connection with specific areas. The bay with its several arms and tributaries offers a shore line more than four hundred miles in total extent, so that the possibilities for expansion along a water front, so far as mere space is concerned, are practically unlimited. In addition there are in the nine counties within a radius of forty-eight miles from San Francisco many thousands of acres of additional land offering potential industrial sites. Comparison of the Several Areas in the Bay Region. Although the chief concern of this study is with the area which borders upon Carquinez Strait and Suisun Bay, a brief comparative survey of the other principal industrial areas in the region will place the study in proper perspective. Before taking up the several areas in their turn, it will be of interest to note the distribution of the water-borne commerce, in 1929, as an index of present utilization by tlie bay region of its several shipping points :* Short tons ^'(lhl(' San Francisco (Citv) 14.400.000 .$1.61.S,000,000 Oakland .5.800.000 327,000.000 Richmond 5,800.000 119,000.000 San Pablo Bav 4.700,000 82,000,000 Suisun Bav 4.000,000 64,000.000 Carquinez Strait 9,700,000 228,000,000 Other points 1,800,000 54,000,000 • See footnote on page 19. 26 DIVISION OF WATER KESOURCKS West Shore of San Francisco Bay. — San Francisco, proper, lias been zoned for light, heavy and unrestricted industry. Prom Fort IMason to China Basin, however, the whole water front is fully occupied. While some fairly large sites are still available back from the water front, they are attractive to the type of industry which can afford to pay prevailing prices because of certain other peculiarly favorable con- ditions. Keelamation work * at Islais Creek, authorized by the state, will make available some 280 acres which should sell for $1.50 to $3 per square foot. According to local authorities land at that price is destined for purposes of distribution and multi-story manufacturing plants.t An extensive area south of Hunter's Point, near to a deep channel in the bay, could be made available for industries at from 50 cents to a dollar per square foot. The San Francisco city district is second in the state in value of industrial output.^ but its industries have selected their locations largely because of proximity to the local market. The existence of deep water at San Francisco has fostered industries like coffee, spice and chocolate processing, Avhich derive their products from abroad and distribute them through the channels available in a large urban center. South San Francisco, already the seat of a number of industrial plants of the heavier type, has ample acreage for large-sized plants at moderate cost. Since it lacks direct access to deep water, a 19.000-foot channel is contemplated, which would tend to increase greatly the value of the sites adjacent to it. South San Francisco, although a separate municipality, is closely connected by rail, street car and highway with San Francisco, and is in the same terminal rate area. In San Mateo County below South San Francisco, a large area of marsh and of dry land extends back from the bay to the cities and towns built along the Southern Pacific line. Seven thousand acres of dry land are already available for industrial uses. Between South San Francisco and Port San Francisco, just north of Redwood City, further land could be made suitable for indu.stries at from $2,500 to $5,000 per acre. In many cases, a firm foundation would have to be secured through the use of piling. At Port San Francisco, an area of about 3500 acres, and perhaps 640 acres additional, is available for development. An engineer's report states that ' ' the first unit will provide 100 acres with 500 lineal feet on thirty feet of water." Clay* and shale underlie this land at a depth of 30 to 40 feet. At Redwood City, definite plans are under way for a deep water barge canal, together with 2800 feet of docks, cold storage facilities and a turning basin. Port San Jose, at the extreme lower end of the bay, is still another deep water outlet for the products of the Santa Clara and adjacent valleys which is being given serious consideration. * It should be borne in mind in reading this chapter of the report that on substan- tially all lands which have been filled from dredged materials the costs of foundations will be higher than whore the structures are built on natural soil. This added cost has to be weighed against the advantages of having a plant located on deep water. t These data for the W'est Bay District furnished by the Industrial Department of the San Francisco Chamber of Commerce and Mr. F. T. Letchfield, Industrial En- gineer, San Francisco. t U. S. Census of manufactures, 1927. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 27 The whole territory on the Avest side of the bay north of San Jose has been served directly by but one railroad line, the Southern Pacific, but access is had across the bay to the other trunk lines, the same rates to outside points ap})Iyino- on both sides of the bay. The examiner for the Interstate Commerce Commission has recommended to the Com- mission that the Western Pacific be allowed to build a line into San Francisco, crossing: the bay near Redwood City. This added line, with Ihe Bayshore Highway and two transbay bridges nearby should add considerably to the attractiveness of the whole San Mateo County indus- trial area. A deep channel extends down the bay as far as Dumbarton Bridge, but access to it from the industries on the shore would have to be provided by dredging channels. San Mateo and Santa Clara counties are so admirably adapted for residential purposes that there exists a conflict of interests. Owners of attractive homes and extensive estates resist encroachment of industries. This situation is bound to place a limit on industrial development in these counties. Fresh water for industrial use in the San Mateo country area can be obtained from private wells or from the municipal supply. Several large industrial wells are in use at South San Francisco, but the con- stantly increasing drain upon the limited supply of underground water on the Peninsula does not offer much encouragement for additional water supplies from this source. East Bay Communities.* — On the east side of the bay, below Alameda, the wide salt marshes lying between the deep water and solid ground make utilization of the land for industrial purposes a matter of the somewhat distant future. In Alameda and Oakland, land values are high, and in some sections of the former natural foundations are none too good. The typical price of $30,000 to $40,000 for available acreage is high for plants which require a considerable amount of land and find no marked advantage in being situated within an urban district. Oakland, like San Francisco, will probably appeal chiefly to the multi-story type of establishment whose product can absorb a relatively high land cost. A large interest operating under the name of the Berkeley Water- front Company, has obtained control of much of the shore line from the Key Route Pier to Richmond, and will undoubtedly develop indus- trial sites for the types of industry which require large acreage and, at the same time, should be located relatively close to large centers of population, and be readily accessible to deep water facilities. At Richmond, additional high class industrial property is being made available along a channel thirty-two feet in depth. Attractive sites thus will be provided for terminals and raannfacturing plants requiring deep water transportation facilities. A large potential industrial area exists between Point San Pablo and Pinole Point. This would require buUdieading and filling, and would only be made available to take care of special types of plants requiring large areas free from obstruction. ea.sy accessibility to deep water, and good labor supply. • Information on the East Bay situation was obtained from Mr. F. D. Parr of the Parr Terminal Company, San Francisco. 28 DIVISION OF WATER RESOURCES Some wells are in use in the plants of east bay industries, but the new east bay municipal supply from the Mokelumne River is the principal source of fresh water. The Upper Bay. — Stockton * has recently assumed a new importance as a potential industrial area. A twenty-six-foot channel which is now under construction through the upper part of Suisun Bay and the San Joaquin River will enable ocean A'essels to dock at the Stockton ter- minals. As a result, the considerable tonnage of grain, canned fruits and vegetables, dried fruits, and some manufactured products which heretofore has had to be shipped by rail or river to a San Francisco Bay port from the central valley area can be loaded on vessels at Stock- ton. In like manner, inbound shipments of lumber, w^ood pulp, and g:eneral merchandise can be brought directly to Stockton. The present industries, for the most part, are the type which serve the local area (farm machinery, containers, boats) or process its products (canneries) . Ample fresh water can be had in the river, with little trouble from salinity at that distance from the Golden Gate — about ninety miles. Tile city is served by all three transcontinental lines. Much land is available for industries, but that which is best located is low-lying and Avould have to be protected by levees. t Industrial growth in the near future, as at present, will be devoted largely to serving the surrounding territory and processing its products. Sacramentol is some twelve miles farther from the ocean than Stock- ton. Sacramento also serves the great central valleys. It is located on two of the transcontinental lines and connects with the third at Stockton. It has a ten-foot river channel to Suisun Bay.§ The water in the river at Sacramento is soft and free from salinity. Abundant industrial land is available, although, as in the case of Stockton, the best situated land would have to be protected from inundation. Flour mills, fruit and vegetable canneries and a large can factory constitute the principal industries. The rest are mostly of the smaller local variety. A ship canal to Sacramento has been under consideration for a long time, but now that the Stockton project has become a reality, the facilities of that port should, for some time to come, prove adequate to serve the territory tributary to both cities. There is no immediate likelihood of a considerable influx of industries which are not closely related to the local area. The following data, from the Market Data Handbook of the United States Department of Commerce, 1929, show the status of manu- facturing in the several cities of the bay region in 1927 : * Document 554, House of Representatives, 68th Congrefi.s, \»t Session, "S;ui ■Toaquin River and Stockton Channel, California," 1925. t C. E. Grunsky, Report on Sacramento Deep Water Ship Canal, 1925, p. 61. % C. E. Grunsky, Report on Sacramento Deep Water Ship Canal, 1925, esp. pp. 1-61. § The old ninf-font channel is in procof--s of heing deepened to ten feet. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 29 1 Number ! 1 of plants 1 i Number of wage earners Thousands of dollars Wages Co6tof materials Value added Value of product 2,092 866 197 131 58 41,909 23,235 6,359 3,001 14,450 $61,134 35,031 8,377 4,240 22,000 $237,642 167,549 25,210 13,178 215,000 1 $192,086 94,227 17,759 1 10,718 i 70,000 $429,728 Oakland-Berkeley-Richmond Sacramento Stockton Upper Bay' 261.776 42,969 23,895 285,000 'Data inclrde all major basic industries below An;i(-ch and above Richmond approximately 80 per cent being from replies to State Engineer's questionnaire, 15 per cent from Byron Times, 12th DevelopQ:ent Edition, and 5 per cent es;imate.l. From Point Pinole to Autioch on the south shore of Carquinez Strait and Sui.sun Bay. and at Vallejo and Benicia on the north shore, are located the group of industries which are the special concern of this study. Here inexpensive land is nearer to deep water than at any other point in the bay region. Large tracts have been available away from centers of population where fumes from industrial processes and the liazards of explosive manufacture create a minimum of concern, although this situation is changing with the growth of the upper bay communities. Xo handicap of city-street rights of way, or building restrictions hampers the laying out of the plant. From Crockett to Martinez there is little land readily available between the hills, the railway lines and the water. To the east of Martinez, a stretch of lowland has been purchased for reclamation in the general neighborhood of Point Edith. From this proposed development to Antioch, a considerable acreage of solid land is still available — the typical price is about $7,000 an acre for water front property and about $2,000 for that a half a mile or so farther back.* The Stockton deepwater project will add to the attractiveness of this area for industrial purposes. At Pittsburg, particularly, wells have been used to supply fresh water when the water in the river becomes brackish. Other industries supplement their own river supplies with the filtered and treated river supply of the California Water Service Company. The Southern Pacific and Santa Fe railroads traverse the Contra Costa side of the bay, and the Western Pacific, through its ownership and use of the Sacramento Northern, provides the shipping services of a third transcontinental system. The north shore of Suisun Bay and the strait is served by the Southern Pacific and the Western Pacific. The Mare Island Navy Yard at Vallejo, the government arsenal at Benicia, and some private industrial enterprises in these two cities con- stitute the present development. Port Sacramento, between Vallejo and Benicia, is being projected as a further extension of north shore industrial and .shipping activity. Because of the wide area of marsh land and shallow water which prevails along the north shore of Suisun Bay, it will probably not be developed industrially for some years to come. The types of industry which exist in the upper bay area have pro- ceeded to build up their own labor force with a favorable turnover rate and comparative freedom from disturbances. The typical wage of • Data obtained from a company specializing in upper bay industrial sites. 30 DIVISION OF WATER RESOURCES unskilled male labor seems to be 50 cents an hour. Italians, Portuguese, Mexicans, with some American laborers, furnish the common labor supply. Skilled labor averages from 75 cents to a dollar or more an hour.* The upper bay is, on the whole, better adapted to making products intended for distribution by steamer and rail over a wide area, than providing the jiopulations of the large urban centers with the things they consume directly. However, so populous a region with so great a number and variety of industries, commercial firms and farms, offers no mean outlet for the products of an industrial district, even though the more basic type of industry predominates. Markets and Raw Material Sources of Upper Bay Industries. Few of the raw materials used by upper bay producers, aside from the products handled by canneries, originate within the area. The presence of many of them in California and other western states and the easy accessibility of the rest, because of low water transportation costs, has prevented the raw material factor from becoming an impedi- ment to the industrial growth of the upper bay area. Raiv Material Sources. — Specifically, according to the statements received from the industries themselves, the problem of securing raw materials for the several types of industry in the upper bay is met as f ollOAVS : Oil refineries : 1. By pipe lines from San Joaquin Valley. 2. By oil steamers from southern California. Lumber products : Rail and steamer, or combination of the two, from Oregon, Washington and California. Cane sugar refinery : Steamer from plantations in Hawaiian Islands. Steel mills : 1. Local scrap. 2. Pig iron from Utah. 3. Eastern and foreign water-borne shipments. Rubber mills : Rubber — Straits Settlements ; Cotton — southern California and San Joaquin Valley. Chemical companies, including sprays, insecticides, etc. : California, Japan, Washington, Texas, Belgium. Canneries — Vegetable and fruit : Nearby ranches. * Data with respect to the upper bay area have been obtained almost wholly from a questionnaire prepared and sent to the industries of the area by the office of the State Engineer. A brief summary of the contents, given at the end of this report, evidences the comprehensiveness and painstaking character of this search for per- tinent facts concerning the industrial situation and water problems of the area. For some six months after the fjuestionnaircs were placed in the hands of the industries, much "follow-up" work had to be done by the State Engineer's staff, in order that the fullest possible information might be .secured. Short of a prohibitively expensive plant-by-plant investigation by a staff of experts, the data are probably the most complete and reliable that could be obtained. INDUSTRIAL SURVEY OP UPPER SAN FRANCISCO BAY AREA 31 Canneries — Fish : San Joaquin and Sacramento rivers and upper bay, and trawlers from Pacific Ocean. Explosives : Chile, Texas, Pacific coast states. Ship yards : Pacific coast and eastern United States. Dairy products : Nearby ranches. Asphalt products : Largely California, some from Trinidad, the Orient and eastern United States. Brick works: Clay at site. * Beverages : Local mineral springs. Grain cleaning, warehousing, etc. : Local valleys. Mills— Flour and feed : California — mostly. Some from "Washington, Oregon, Idaho and the east. Sand, gravel, cements, etc. : Local river and bay bottoms. Paper boxes : 1. Paper from east and mills in north. 2. Board from Stockton, Antioch and "Washington. 3. Straw, scrap paper and rags from local sources and wood pulp from northern mills. Tannery : "Western states, Argentina, Mexico. As has been noted, the above information was obtained from the replies to the questionnaire sent to tlie several industries by the State Engineer's office. No complaint was* made by any of the industries to the effect that they were badly located with respect to raw material supplies. Markets for Upper Bay Products. — The following statement compiled from the State Engineer's questionnaire shows the market for the products of upper bay industries : Oil refineries : North and South America, Europe and the Far East. Lumber product manufacturers: Mill work — mostly local. Some wood products sent to east and middle west. Sugar refinery : Thirty-five states of the United States. Steel mill : Eleven western states and the Orient. 6 — 8099G-A 32 DIVISION OF WATER RESOURCES Rubber products mill: World wide market. Chemical plants : Eleven western siates. a small amount to the middle west and foreign countries. Canneries : The whole world. Explosive plants : The Pacific states. South America and the Far East. Ship yards: The Pacific coast ; United States Navy. Asphalt product plant : Eleven western states, Alaska, ^Mexico, the Orient. Brick works and other building materials : The bay region. Beverage plant : The bay and delta areas. Flour and feed mills : Poultry and stock feeds are for the most part sold localh^; the Sonoma, ]\Iariu and Napa County chicken ranches comprise a large market. Flour is sold in California and the Orient. Box Factories : Local poultry and fruit interests require a large quantity of wooden boxes. Paper boxes have a world-wide market. Tanneries : Leather is sold on the coast and in thirty foreign countries. So far as most points in the west are concerned, and those foreign and eastern markets which can be reached by water, the upper baj' region has no difficulty in meeting competition, provided other factors are favorable. Two or three firms, however, which cater to San Fran- cisco and Oakland trade, expressed dissatisfaction with the upper bay as a location for their industries. Dominant Location Factors in the Upper Bay Area. ~ The following table indicates the number of times the industries listed the several location factors directly or by implication in replying to the State Engineer's question as to why they chose a location in the upper bay : 1. Water transportation facilities 63 2. Rail transportation facilities 53 3. Good highways 51 4. Close to the market for a particular product 43 5. Raw materials at hand or cheaply obtained 34 6. Existence of a suitable building 15 7. Satisfactory labor force 10 8. Near San Francisco and Oakland 10 9. Ample cheap fresh water at time of locating 10 10. Comparative isolation 6 11. Climate 5 12. Adequate site at low cost 3 13. Recognized center of the industry 2 14. Favorable topography 2 INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 33 When asked to point out the special advantages and disadvantages experienced in their present locations, thp varions gronps stre!?sed the following : I. Frnit and vegetable eaninTs and pickling works — Special advantages: 1. Nearness to a perishable raw material. 2. Access by rail, highway, steamer, to foreign, inter- coastal and bay markets. Special disadvantages : None specified. II. Lumber and wood products — Special advantages : 1. Raw material by water at low transportation cost. 2. Large consnm])tion area reached b}^ rail, water, highway. Special disadvantage : 1. Too long a haul to its two large customer areas, San Francisco and Oakland. III. Rubber products — Special advantages : 1. Crude rubber brought to dock from Orient. 2. Fabric from California cotton. Special disadvantage : 1. Very heavy water user for process. Product adversely affected by salty water pumped from bay during salinity period. I V. Chemicals — Special advantages: 1. Raw materials come from Asia and western United States — transported cheaply. 2. Fumes blow away from cities. Special disadvantages : 1. Only cheap water 7iow available is in the bay and rivers. Cooling apparatus used deteriorates at abnormal rate because of saltiness of its supply during dry season. 2. Certain processes not undertaken because of lack of cheap fresli water sup]>ly during salinity period. V. Oil refineries — Special advantages : 1. Accessibility of foi-eign, western and local consuming territory. 2. Plead of valley pipe lines. Special disadvantages : 1. Type of ai)])aratus used wears out faster when cooling water becomes salty. 2. Fresh water bought from public supply systems is too costlv. 34 DIVISION OF WATER RESOURCES VI. Fish canners — Special advantage : . 1. Raw material from two rivers and the ocean. Special disadvantages : None specified. VII. Ship building- Special advantage : 1. Can float vessels directly into deep water. Special disadvantages : None specified. VIII. Creamery — Special advantage : 1. Adjacent to ranches. Special disadvantage : None specified. IX. Powder plants — Special advantage : 1. Isolation of sites. Special disadvantage : 1. Tj^pe of cooling apparatus u.sed is destroyed relatively fast because cooling water is salty. X. Copper smelting and refining — Special advantages : 1. Ore transported to plant at satisfactory cost. 2. Prevailing winds carry fumes away from cities. Special disadvantage : 1. When river water used in process becomes salty it injures product. XI. Paper and fibre j)roducts — Special advantage : None specified. Special disadvantage : None specified. XII. Iron and steel products — Special advantage : 1. Large suppl.y of scrap metal in populous area. New iron produced in Utali and transported at satisfactory cost. Special disadvantage : 1. Obtain present water supply from wells. Dependa- bility for future expanded program, questionable. River water is cheaper and softer, but is salty in dry season and turbid during flood period. INDUSTRIAL SURVEY OP UPPER SAN FRANCISCO BAY AREA 35 XTTT. fane sugar refining — Special advantage : 1. Deep water from i)]autations to plant. Special disadvantage : 1. Hea-^y user of water of very low chlorine content. Has obtained such su]iply at great expense heretofore. (Is now developing a new supply in the hope of obtaining a considerable reduction in water cost.) Summary of Location Advantages of the San Francisco Bay Region as a Whole. 1. Xearesrt of the manufacturing areas of the west to the west's geographical population center. 2. Large consuming population within its own limits and in adjacent valleys. 3. Lack of extremes in temperature. 4. Location in extensive fruit and vegetable canning region favorable for canneries, can companies, tin mills, makers of food machinery and implements used in planting and cultivating raw product. 5. Served by a network of railway lines. 6. Motor highway system comprehensive and up-to-date. 7. Ocean steamship lines to forty foreign countries and to eastern, southern and Pacific coast ports of the L"!nited States. S. Labor supply adequate and comparatively free from labor troubles in plants, n. Power — electric, fuel oil, natural gas — at rates which compare favorably with other industrial areas. 10. Navigation between points in the bay and into Sacramento and San Joaquin rivers. 11. Acce.ssibility to the San Francisco money market, one of the largest in the United States. 12. Numerous plant locations with bay water available for industrial uses. Obstacles to the Industrial Development of the San Francisco Bay Region. 1 . ^Municipal water supplies are being provided at such great expense that a price of 24 to 30 cents per thousand gallons is exacted in most instances. Tliis. no heavy user of fresh water can afford to pay unless the other location "factors are sufficiently favorable to wipe out the handicap. 2. T'nlike most important industrial centers of the east and south, the bay region proper.* contains no stream or lake along which an industry can locate and pump an abundant supply of fresh water the year around. 3. Private wells, which furnish an abundant supply of fresh water in some regions, are used by a few industries in the bay region, but this source of fresh water can not be relied upon to any great extent. * Kxrludos locations on the two river.s above the line of .salinity encroachment. 36 DIVISION OV WATER RESOURCES Summary of Outstanding Location Advantages Afforded by the Upper San Francisco Bay Area. 1. Availability of ];u'<>e aereao-e of l^vel sites on solid ground and deep water. 2. Low cost of sites compared ^vitll other developed bay areas. 3. Adapted to one-floor tyi)e of heavy industry which covers large acreage and whose main markets call for deep water transporta- tion. Will not attract so readily those which can pay large rate for space in a city. 4. Equal availability, with otiier i)arts of the region in respect to raw materials from California or n(Mghboring states, or those brought in by way of ocean vessels. 5. Relative isolation for industries that are obnoxious or dangerous to city populations. 6. Pour of the largest oil refineries in California are located in this area, which assures a plentiful supply of fuel oil with a negligible transportation cost. 7. Natural gas and electric power are available to industries at as low rates as elsewhere in this region. 8. Labor supply and cost are favorable. 9. Raw material for canneries, such as the asparagus of the delta, the fruit from the two great valleys, and fish from the rivers, is close at hand. The obstacles noted in the case of the bay region as a whole apply with equal force to the u]ipei' bay. 1. Oil refineries 11. 2. Iron and steel industries 12. 3. Meat packing plants 4. Soap and soap compound 13. factories 14. 5. Sugar refineries 6. Tanning establishments l.j. 7. Paper manufacturing industries 16. S. Textile industries 17. 9. Cement mills IS. 10. Explosive manufacturing 19. plants 20. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 37 CHAPTER irr WATER AS A PLANT LOCATION FACTOR— IN GENERAL AND IN THE AREAS UNDER SPECIAL CONSIDERATION I\I()st Muthorities on phiut location include water as a factor to be considered in the establishment of a factory. It is an item that is fre- quently -weighed with such other factors as market, raw materials, labor, transportation, power and fuel. From an industrial point of view, tliere are three important aspects of the water situation, viz, its quantity, its quality, and its cost. Some of the industries which find the quantity of water an important item for manufacturing purposes are : Rubber product industries Plants manufacturing chemicals and allied products Industrial power stations Food canning and preserving industries Dyeing industries IJeverage production plants lee making plants Paint and varnish plants Salt refineries Gelatinous product industries Cooling and condensing call for especially large quantities of water, either salty or fresh. Fresh water is used also for boiler purposes, for washing, cleaning, filtration processes, boiling or treating products, distillation, steaming, etc. Quality of water available is of primary importance in many indus- tries. Textile mills demand a great volume of soft w^ater free from iron and sediment. Rayon mills, for example, will not tolerate such elements as iron, magnesium and calcium, w^hich discolor goods or give hardness to the water. To remove undesirable elements in the water usually involves considerable expense and therefore various kinds of textile mills consider softness and purity of water as one of the major considerations of plant location. Suitable Avater has been one of several factors which have attracted rayon and other mills to the southeastern s-tates. Canneries need a water under a hardness of 170 parts per million, a water that is clean, sanitary and low in organic nitrogen. Power producers, oil refineries and steel plants need (1) a good quality of boiler water, free from sediment and oil, fresh and soft, and (2) large quantities of either salty or fresh water for cooling and conden.sing. The Pacific Coast Situation. The salvation of the Pacific coast states is the oceanic wdnd which precipitates its moisture for the benefit of the western mountain .slopes. If the prevailing wind were from the opposite direction the west coast w^ould be barren indeed. ^Mountains like the Sierra Neyadas, with their long western slopes, serve as a condenser for the precipitation of water from the moist west winds. Properly utilized, the fresh water afforded is ample for a large coastal civilization. 38 DIVISIOX OF WATER RESOURCES Taken as a whole, the surface- waters of the Pacific slope vary greatly in quality. In respect to hardness', the water is softest in the north and hardest in the south. In some parts of California water is relatively hard, but Mokelumne River water, for example, Avhich is the source of the east bay municipal supply in San Francisco-Oakland region, has a hardness of only 40 parts per million, which constitutes a softness that is comparable with water found in such low-average states as "Washing- ton, Oregon and New York. Much of the water used by municipalities, ranches and industries in California is pumped from underground. This extensive practice has led to a serious falling of the water table in many parts of the state. The wise utilization of water resources is becoming a major problem in California. Surface storage is an important means for proA'iding against shortage of water. The Lower San Francisco Bay Area Situation. The east and west sides of the lower San Francisco Bay have both had to take steps to forestall water famine. The cities on the east side of the San Francisco Bay have formed the Ea.st Bay Municipal Utility District for the purpose of bringing water some ninety miles from the Mokelumne River to reservoirs at Oakland and Berkeley. San Francisco is incurring the heavy expense of bringing in the Hetch Hetchy water supply from the Tuolumne River. Smaller towns and A-arious industries about the lower San Francisco Bay are depending largely upon wells and somewhat upon local sur- face water as a source of supply. Lack of water is retarding the deA'elopment of desirable residential sites on the foothills in the region. A further exploitation of underground waters and some tying in with the large municipal supply projects will have to be done, if near future needs outside of the large cities are to be met. The Upper San Francisco Bay Area Situation. The region about the San Pablo and Suisun bays is much less densely populated than the lower bay area, hence the need for an abundant supply of fresh water has been less urgent. The public water supply companies to be found about the upper bay have thus far been able to get along with local sources of supply and have not as yet been driven to seek distant ones. The water companies, sources of water obtained. annual consumption, and cost of water to large users are as follows: Organization Source of wat*r Annual demand inmillion gallons Cost to large users in cents per thousand gallons Antioch Municipal Water Works 212 94 1,105 94 200 ■9.3 Benicia Wat«r Company 44.0 California Water Sersnee Corporation . .. Sacramento River and wells Wells and East Ba.v Municipal supply Wells __. — California Water Service Corporation 23.3 Hercules Wat«r Company 26.7 Pittsburg Municipal Water Works 16.7 Martinez Municipal Water Works 213 34.7 Vallejo Municipal Water Works 570 26.3 ' Within city limits of Antioch. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 39 It can be seen from a comparison of this table with that on page 60 that the cost of water to hirpre nsers from public supplies is high com- pared Avith prices which prevail in the United States east of the Rockies and in the Pacific nortliwest. This is partly due to the fact that the water-supply companies- have cnconiitered heavy costs, for which customers must pay. The California Water Service Corporation has spent one and a half million dollars at Clyde in developing a pumping project and reservoir to yield three and a half million gallons a day. An ultimate yield of eight million gallons is being planned. The point of intake is at ]\Iallard Slough. The eouipany sells water to Martinez and Concord and covers the territory from Pinole on the west to Bay Point on the east. What the company Avill do in its future development program is contingent upon other developments in the region and upon its success in securing the patronage of large users of water. This same method of procuring fresh water for this area is susceptible of much further development. All told, with respect to water supply, the upper bay region is oj>erating at an economic disadvantage. This is the inevitable result when a single coordinated plan of development is lacking. The fol- lowing illustrations show the need of careful regional planning with respect to water supply : The California and Hawaiian Sugar Refining Corporation, Limited, has been bringing water to its plant at Crockett by means of barges, which at times must go many miles up-stream to reach a source of fresh water supply. During recent years, this source has been supplemented from July to December, inclusive, by a Marin County supply taken aboard barges at San Quentin. In an attempt to alleviate its difficulties, wells were also dug in the hope that industrial water could be found, but there was no success. A nine-mile pipe line from San Pablo to Crockett was projected, but the supply was found to be too uncertain. The corporation believes that its water problem has now been solved by a pipe line being constructed to bring water from wells in Napa Valley. The Hercules Powder Company at one time received its water from Pinole Creek. This source of supply ran out and. us an emergency measure, water had to be secured from Spring Valley in drums. Many wells were drilled also, and a special .six-inch pipe was connected to the East Bay Water Company's system, but during the peak of its business the powder company was still hampered by lack of adequate water supply. During the war the supply of munitions from this area was seriously curtailed by the shortage of fresh water. In Solano County, during the war. soldiers had to be rationed as to water because of shortage. At the present time, such of the industries of Contra Costa County as must have a considerable supply of fresh water for boiler and process, depend upon wells and public supplies as a sup- plementary source when the volume of river flow is at its minimum and the salt encroachment is present. Salt Water Difficulties. The encroachment of salt water upon a fresh water area raises a problem in conneetion with both domestic and industrial water supply. Ono 7'e;isf)n is tlutt salino water can not be treated and niado fresh, in 40 ' DIVISION OP WATER RESOURCES large quantities, without prohibitive expense; it is particularly hard to remove dissolved salt from water. Even when some new source of fresh water supply is found, the economic troubles in tryinu' to surmount the water question do not necessarily come to an end. The new supply secured may be more or less temporary in nature, and still newer sources must be sought after the temporary source becomes unsuitable or deficient. Companies which turn from bay Avater to wells as a recourse in the time of salt water difficulty are often compelled to find new wells as old w^ells become useless. In their reply to the questionnaire, the representatives of a very large water-consuming industry in the upper bay area stated: Depreciation on wells is placed at 10 per cent as the wells get salty in time and have to be abandoned. Another large user states his case in tho following manner : Water from our private wells has been used for boiler water during summer seasons until the summer of 1929 when hardness increased to 82 grains per gallon, making it unfit for boiler use. Hardness was approximately 40 grains in 1921. Another manufacturer, Avho uses river water for some purposes and well water for others, saj^s : We have had three wells turn salt since 1924. Aiiother manufacturer makes the following statement : Since 1924 this company has been without water in summer time from which it was possible to manufacture. In 1924 it cost $5,000 to haul water for .* Under present conditions we could not afford to manufacture this article in summer during the last four or five years. When asked as to what financial loss, if any, they have incurred from the salinity conditions in the ui)])er bay and rivers, several tj'^pical industries replied as follows : A. Depreciation of plant equipment is double that with fresh water. Have losses due to the eating away of condenser tubes, condenser boxes, piping, and concrete by hot salt water. Salt water after It is heated by condensers and coolers eats away both concrete and steel. This would be reduced 50 per cent by the use of fresh water. B. Apparatus is designed for the use of salt water. C. Have been forced to vise thicker walls for condensers, which helps to meet the corrosion problem, but cuts down the efficiency of equipment. Many other adaptations in equipment are being made. Increased cost of manufactured products and plant operation is 5 per cent. Costs in plant maintenance and depreciation of plant equipment are 300 per cent above normal with fresh water available. Costs in 1929 in excess of costs in 1920 directly chargeable to salt water conditions amounted to $81,000. D. Financial loss due to increased .salinity of river : Plant operation, $4 0,000 per year. Depreciation of plant equipment, $3,600 per year. Depreciation above normal with fresh water is about 200 per cent. Nam<' (if priidnrt ninittcd. Confidential information. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 41 E. Increased depreciation above normal tor various types of equipment is 100 to 400 per cent. F. As close as we can figure it, the financial loss to this company due to salt water is in excess of $20,000 per year. G. Depreciation of equipment for condvuser and cooling purposes — four times that resulting from fresh water. H. Mechanical roasler.-^ and imwcr house oundensers dftcriorate very rapidly by reason of salt water. I. Abnormal cost due to excessive depreciation of plant eiiuipnient and added expenses in plant maintenance is 35 per cent above normal. J. High salinity does not result in abnormal depreciation of condenser and cooling equipment because necessary expenditure for equipment to resist salt water corrosion has been made. K. Depreciation rate for heated water equipment is 30 per cent above normal. L. Abnormal depreciation rate of condenser and cooling equipment is ?500 per year for this company. These cases show that the water in the upper bay can be employed for certain industrial nses the year around, but that (1) deterioration is increased if the type of cooling equipment used is not ada])ted to this most economical source of water, and (2) that a cheaper fresh water supply should be deyelo])ed for boiler and process use. The Relative Importance of Water to the Upper Bay Industries. The upper bay area, by chance or design, contains an unusually large proportion of heavy water using industries. According to their own statements, they were not attracted to the area, primarily by the supply of fresh water which tlie up])er bay afforded during the greater part of the year, but this factor seems to ha^'e been given considerable weight by some of tliem. Tlie canneries, chemical plants, iron and steel mills, oil refineries, powder works, paper company and rubber mill, which dominate the upper bay industrial set-up, all use large amounts of water for process or cooling, or both. In no case does the water cost constitute more than a small fraction of the value of the product.* It miglit still be true, however, that those industries which have to meet keen competition from plants located on plentiful supplies of fresh water, other manufacturing costs being equal, would find that the water situation in the upper bay would put them under a severe handicap. None of the industries in the area have moved away because of the water situation, and four new enterprises of considerable size — The Johns-Manville rom])any, the tinplate mill at the United States Steel Products plants, tlie Sliell Products Company, and the Stockton Brick Company, near Pittsburg — liave located there since tlie salinity con- dition becaiiK^ troublesome. However, such a complication of factors is involved in the location of a ucav plant that one is hardly safe in attributing to salinity conditions tlie failure of still other enterprises to locate in the upper bay area. Furthermore, a representative from the bay region states that he recently engaged in six weeks of conferences with eastern officials of plants who contemplated establishing Pacific coast branches. t He reports that the industries in question were attracted by the market, labor and transportation facilities of the upper bay district, bnt were repollcd by th(^ cost of fresh water. * See table on page 56. t Statemont of Mr. Warren MoRryde, Consulting Engineer, San Francisco. 42 DIVISION OF WATER RESOURCES Industries are likely to be frightened by the mere fact that municipal water is selling at from 9 to 44 cents per thousand gallons and averag- ing over 24 cents, that private well supplies are not altogether reliable, and that river water is salty a portion of the year. On the other hand, if a careful investigation were made, it would probably show that all other factors were so favorable in the upiDer bay, and its water diffi- culties so far from being unsolvable, that the present unfavorable water situation could be materially discounted. On its face, the proposal to solve the area's Avater difficulties by the construction of a salt water barrier would add another attractive loca- tion factor to the imposing list which the upper bay district affords, pro- viding that such a project did not bring with it a marked increase in the tax burden of the area. If such an increase did result the barrier might repel rather than attract new plants. INDUSTRIAL SURVEY OP UPPER SAN FRANCISCO BAY AREA 43 CHAPTER IV THE INDUSTRIAL SITUATION IN THE UPPER BAY AREA- PRESENT AND PROSPECTIVE The only official description of the upper bay industrial situation is that published by the Federal Government in the "Market Data Hand- book," issued by the United States Department of Commerce. The first, and also the latest number of the handbook (1929), gives the situation for 1927 as follows: Number of establishments In Contra Costa Type of industry County Food and kindred products 29 Textiles and their products 1 Paving material 4 Iron, steel and their products 5 Machinery 3 Forest products 8 Leather and its products Rubber products 1 Roofing material 1 Paper industries 2 Printing and publishing 15 Chemicals and allied products 19 Stone, clay, glass, etc., products 7 Metal products, except iron and steel 2 Tobacco products Musical instruments Transportation equipment 1 Railroad repair shops 4 Totals 102 40 142 Unfortunately the handbook does not separate out the industries of Richmond, which is in Contra Costa County, but in reality belongs to the eas-t bay industrial area, rather than to the upper bay. From the questionnaire .sent the industries, however, we are able to present the following tabulation of the more important upper bay industries, beginning at Pinole Point and extending on both sides of Carquinez Strait and Suisun Bay eastwai-d to the mouths of the Sacramento and San Joaquin rivers : Ijocation and type Number of Location and type N timber of of industry industries of industry industries Antioch — Benicia — Fibreboard products 1 Canneries 1 Canneries 3 Arsenal 1 Lumber products 1 Tannery 1 Shipbuilding 1 Chemicals 1 . Tractor factory 1 Avon — OiKrefining 1 Crockett — Bay Point Grain cleaning, etc 1 Sugar refining 1 In Solano County Total 19 48 1 4 5 1 4 2 10 1 1 1 1 2 11 26 2 21 1 8 1 3 1 2 6 Lumber products 1 Shipbuilding 1 Chemicals 1 <^Jf»nt— Cement mill 1 Explosives 44 DIVISION OF WATER RESOURCES Location and type of industry Hercules — Number of Looation and type industries of industry Poit Costa — Number of industries Explosives 1 IVIai'tinez — Copper smelting 1 Lumber products 1 Oil refining 1 Pittsburg — Fish Products 2 Steel products 1 Chemicals 3 Asbestos products 1 Dairy products 1 Wood products 1 Rubber products 1 Brick works 1 Brick works 1 Grain cleaning, etc 1 Oil products 2 Rodeo ( Oleum ) — Oil refining 1 Selby— Ore smelting 1 Vallejo — Navy yard 1 Flour milling 1 Dairy products 1 If one undertook to describe in a sentence the^ nature of the industrial activity in the upper bay, he would characterize it as the type which, for one reason or another, operates best outside of congested metro- politan areas and yet finds it highly desirable from the standpoint of either its markets or material sources to have at its command as good shipping facilities as location in a large port city would afford. The Location History of the Area by Decades. Not all of the dates when these industries were established are avail- able. Such as were furnished in the questionnaire are the basis for the following location record by decades : Before 1881 Arsenal 1 (1850) Navy yard 1 (1853) Cannery (fiiiit) 1 (1870) Cannery (fish) 1 (1875) Grain cleaning 1 (1876) Powder mill 1 (1880) 1881-1890 Ore smelter 1 Lumber products 1 Grain cleaning 1 Fl Cannei-y (fish) 1 (1927) Chemical plant 2 (1923) (1930) Shipyard 2 (1926) (1928) Lumber products 1 (1927) Dairy products 1 (1922) Asliestos products 1 (1025) Tin plate mill* 1 (1929) Brick works 1 (1930) existing- steel mill. It is evident that during each of the decades given, at least* one important industry has chosen the upper bay as its location. Viewed from the standpoint of present size of plants and value of output, 1901-1910 seems to have been the "golden era" of industrial establish- ment in the upper bay. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 45 The decade just eoming; to a close has been distinguished by three outstanding developments: (1) The Johns-Manville Company estab- lished an asbestos products plant (1925) ; (2) The Steel Corporation (1929) built a tin plate mill in connection with its steel mill; (3) The Shell Products Company is establishing a large chemical plant (1930). The new tin mill is the first one to be built west of St. Louis. It was erected at a cost of $3,000,000 and its corps of new workers mate- rially increases the steel corporation's labor force at Pittsburg. The fact that 18 per cent of the national output of tin plate was used on the coa.st prompted this development. All of the raw materials but the tin are produced in Utah. The latter is brought direct by steamer from the Straits Settlements. ^Making the tin plate near the source of con- .sumption avoids the heavy rust and other damage (10 per cent) incurred in ocean shipments from the east. The Effect of Salinity on Plant Location. An effort wa.s* made in connection with this study to obtain accurate information as to what industries, if any, have been lost to the upper bay area because of the salinity problem, but results were not satis- factory.* Since no dependable list can be made, one can only report the "hunches"' of numerous individuals. The result is that in the case of no industry can it be said without fear of contradiction that it was or was not frightened away from the upper bay because of the salinity problem. As was pointed out earlier, the tangible location factors, themselves, are many and they are interwoven in complicated fashion. Add to that the intangible personal factor and it is but natural that one finds much difference of opinion as to what led to the location of a given plant in a given place. Even responsible people and the industries themselves frequently find it difficult to single out the ultimate determining element. Present Growth of the Upper San Francisco Bay Area. It wouljl be highly dc'^irable to compare the growth of the upper bay area with respect to employees, wages, capital investment, value of output and other items with (1) the United States, (2) with California, and (3) with other local industrial areas. Unfortunately, there are no census figures for the upper bay area as such. These for the United States and for California are available for 1904, 1909, 1914. 1919. 1923, 1925 and 1927. The 1929 census has been taken but the data will not be compiled for many months; the material in the 1927 census of manufactures did not become available until 1929. Data obtained by the questionnaire method are never wholly satis- factory. Xo matter how carefully the questions are framed, different • Two large industries which chose another location after considering various sites in the , San Francisco Bay region have written as follows: Industry A: "The chief factors' taken into consideration were adequate supply of satisfactory labor with adequate housing facilities in vicinity of plant site, sufHcient power at reasonable rates, and adequate water supply at no cost except cost of pumping. A large factory needs large quantities of fresh, cool water, and being assured of an ample supply underneath its plant with low puir.ping cost was one of the main factors in selecting the site." Inefustry B: "The water situation was one of a number of factors which influenced our decision to locate in , but it was not necessarily the deciding factor." 46 DIVISION OF WATER RESOURCES interpretations will be placed upon them and will render them incom- parable, at least to some extent. In this case some industries did not care to reveal certain facts about their operations, while others did not have the requisite records at hand. Particularly with respect to the capital inve&"tment figures and those covering water costs, reservations will have to be made. The replies do. however, represent a sufficient percentage of the whole and probably sufficient comparability to warrant their use in showing trends since 1924. The following figures indicate the relative change in recent years, in the three areas given : Value of the product of industries hi U. S. In California 1919 $62,000,000,000 $1,981,000,000 1921 43,618.000,000 1,758,000,000 1923 60,529.000,000 2,214,000,000 1925 62,668,000,000 2,442,000.000 1927 62,718,000,000 2,593,000,000 In the Tipper Bay Area {partial total)^ 1924 $71,066,000 1927 $84,840,000 1925 80,463,000 1928 91,023,000 1926 84,172,000 1929 90,516,000 1 Includes only those industries furnishing these data for all six years in State Engineer's questionnaire, being Nos. 1, 2, 8, 11, 15, 19, 21, 23, 25 and 28, as shown in the list of industries at end of this report. During the past five years the average annual growth in value of products in the upper bay has been approximately 5.5 per cent. From 1923 (the first year given after an acute depression) until 1927 the average annual increase in the value of product for the United States as a whole was slightly lesrs than 1 per cent, and for California 4.3 per cent. It is greatly to be regretted that data do not exist for tracing the trends back over an extended period for all three areas. It is needless to point out that comparisons for such short periods lose much of their value. Numher of employees in industries Average for the year In U. S. In California 1919 8,997,900 243,700 1921 6,944,300 198,300 1923 8,776,600 246,100 1925 8,381,500 249,500 1927 8,349,700 262,800 In the Upper Bay Area {partial totaiy 1924 8,854 1927 10,048 1925 9,566 1928 10,954 1926 10,324 1929 12,195 1 Includes only those industries furnishing these data for all six years in State Engineer's questionnaire, being Nos. 1, 2, 8, 10, 11, 14, 15, 19, 20, 21, 23, 28, 31, 32, 33, 35 and 37, as shown in the list of industries at end of this report. During the years 1924-1929 the average annual increase in workers employed in upper bay industries has been 7.5 per cent. For the INDUSTRIAL SURVEY OP UPPER SAN FRANCISCO BAY AREA 47 United States as a whole there was a decrease of industrial workers from 1923 to 1927, and for California an increase of not quite 2 per cent. Growth of payrolls In U.S. In California 1910 $10,460,000,000 $805,000,000 1921 8,200,000,000 284,000,000 1923 11,007.000.000 35.3,000,000 1925 10.727.000,000 350.000.000 1927 10,848,000,000 378,000,000 In the Upper Bay Area (partial total)^ 1924 $13,993,000 1927 $16,504,000 1925 15,309,000 1028 18,020,000 1926 17,010,000 1929 21,123,000 ' Includes only those industries furnishing these data for all six years in State Engineer's questionnaire, being Nos. 1, 2, 8, 10, 11, 15, 19, 20, 21, 23, 28, 29, 31, 32, 33, 35 and 37, as shown in the list of industries at the end of this report. Prom 1924 to 1929 the average annual increase in the upper bay })ayroll was slightly more than 10 per cent. For the United States as a whole from 1923 to 1927, there was a decrease during the first bieniiium and, from 1925 to 1927, an average increase over the preced- ing biennium of slightly more than 1 per cent, and for California an increase over the four years of 1.8 per cent. Growth of the capital investment Since the government does not include this item in its enumerations we shall not be able to make comparisons, but the partial * upper bay figures are : 1924 $26,262,000 1927 $28,930,000 1925 26,453,000 1928 31,928,000 1926 27,876,000 1929 ______ 34,851,000 As noted previously, this item is particularly susceptible to wrong interpretation. However, though the totals for the several years may not be dependable, they serve to confirm the impression of steady growth obtained from the other data, showing an average annual growth of over 6 per cent. While no one knoAvs what the growth might have been under other conditions, the figures Ave have been able to procure indicate that a healthy expansion has been going on in the upper bay area, at least since 1924. Separate computations of the average annual groAvth in value of products, number of employees, payroll and capital investment in the area north of San Pablo Bay, including Napa and Petaluma, show rates of growth for these items that are practically identical with those just given for the upper bay area, and furnish some additional confirmation of the steadv expansion of industrv in the entire area since 1924. The Prospective Growth of the Upper Bay Area. Representatives of the industries themselves, when asked to predict their water needs for 1940, placed their total requirement at 44 billion gallons annually, an increase of 54 per cent over present consumption. This, of course, makes no allowance for ncAv industries. If the 2^loni * Includes only those industries furnishing these data for all six years in State Engineer's questionnaire, being Nos. 1, 2, 9, 10, 11, 14, 15, 21, 25, 28. 31 and 33, as shown in the list of industries at the end of this report. ('Orresponding Partial toials in partial total estimated per for cent of totals IDJiO for all industries $135,200,000 75 25,800 88 $ 50.200,000 92 $276,200,000 61 48 DIVISION OP WATER RESOURCES investmenf increase of existino- industries keeps pace with this esti- mated growth in water requirements, tlie 82 millions of dollars given for 1929 in tlie following table will have increased to 127 millions, and assessed valuation, which averages about a third of plant investment, will have increased by a])i)roximately 15 millions. But the rates of increase in investment, payrolls, employees and value of product have all been somewhat greater during the past five years than these amounts Avould indicate. Each decade has witnessed the establishment of important new plants. If the average annual rate since 1924 continues until 1940, we should have the following picture of the industrial set-up of the upper bay area in 1940: Partial totals for 1929' (a) Capital investment— $82,346,000 (h) Number of employees 14,100 (c) Payroll $23,654,000 (d) Value of output $172,111,000 ^ Includes all industries in area that made returns in State Engineers' ques- tionnaire ; or, by reference to numbers in list of industries in table at the end of this report : For (a) Nos. 1, 2. 3, 9, 10, 11, 14, 15, 17, 21, 25, 28, 29, 30, 31, 33, 34, 35, 37 and 38. For (b) Nos. 1, 2, 3, 5, 6, 7, 8, 9, 10, 11, 14, 15, 17, 19, 20, 21, 23, 25, 28 and 30 to 38, inclusive. For (c) Nos. 1. 2, 3, 5, 6, 7, S, 9, 10, 11, 14, 15, 17, 19, 20, 21, 23, 25 and 28 to 38, inclusive. For (d) Nos. 1, 2, 3, 6, 7, 8, 9, 10, 11, 14, 1.^), 17, 19, 21, 23, 25, 28, 29, 30, 31, 34, 35, 36 and 38. In making these calculations it was assumed that the actual mnount (not per cent) of increase shoAvn the last five years will continue during the eleven years from 1929 to 1940. No one knows what the future has in store with respect to any economic situation. It is a reasonable assumption, however, that, given an adequate low^-cost supply of fresh water for boiler, process, and similar needs, the industrial growth of the upper bay area will at least maintain its present rate. In the first place, except for a limited list of industries, confined, for one reason or another, to some particular eastern or foreign locality, the establish- ments represented by the three hundred thirty odd commodities in the Census of Manufactures will fertd to serve the Pacific coast marl^et from Pacific coast plants. The following reasons are ofifered in justification of this assumption : I. A recent report on industrial de^-elopment in the United States and Canada compiled from information received from manufacturers, shows that accessibility of markets is the outstanding location factor in thf minds of some sixteen thousand firms. II. Pipe lines for natural gas and oil and long distance electric trans- mission lines have all but wiped out ditfercMices in power cost in the .several market areas. III. The rapid progress of the science of industrial chemistry has (a) provided new raw materials, (b) made possible the utilization of lower grade and waste products. IV. Similar progress in the engineering field has eliminated much of the highlv skilled labor force which tied industries to certain areas. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 49 V. Improved transportation and new deep waterways have given cheaper access to raw materials'. VI. The west has attracted so lieavy a migration of workers from the east, Mexico and the Philii)|)int>s. that a surplus of labor is available in most fields. VII. National advertising with its })laying up of standard brands has built up a sutiUcient western demand for the products in question to warrant the establishment of plants on the coast from which a more satisfactory distribution service can be maintained. VIII. So far as industrial processes are concerned, heat, humidity, and other physical factors have lost their dominating influence over plant location since artificial controls have been devised, hence any unfavorable climatic elements which might be present in a western location would no longer act as a hindrance to the establishment of certain types of industry in this- area. IX. The records show that industries actually are developing faster on the coast than in the United States as a whole. In the period of economic recovery, beginning with 1923 and ending with 1927 (last census available), the average annual rate of growth of industrial out- ])ut was- 0.8 per cent for the United States and 4.3 per cent for California. X. The following tables procured from the Research Department of the Oakland Chamber of Commerce show how the railroad rate struc- ture with but few exceptions favors distribution of even high-class shipments from the San Francisco Bay region over the sections indicated. FREIGHT RATE PER 100 POUNDS, FIRST CLASS Destination From San Fran- cisco Bay territory From Ohio territory From Illinois- Wisconsin territory From Iowa, Missouri, Arkansas, Louisiana territory From Indiana- Michigan territory From Northeast and middle Atlantic territory Boise $3.31 2.95 4.20 3.66 .84^ .841^ 2.67J^ .72 1.13^ 2.16H 3.66 1.391^ $4.80 S4 35 $4.20 3.71 3.71 2.46 5.79 4.95 4.20 4.95 4.20 3.71 3.04 4.95 $4.57 4.77 4.77 3.52H 6.09}^ 5.25 4.57}^ 5.25 4.57H 3.981^ 4.13M 5.25 $5.25 Butte 4.951^ 3.98 5.40 Casper 4.95H 3.70 6.24M 5.40 4.80 5.40 4.80 5.31 4.3!}^ 5.40 3.98 2.73H 5.941^ 5.10 4.35 5,10 4.35 3.98H 3.34H 5.10 5,40 Denver. 4.15^ Eureka... 6.39H Lo8 Angeles... 5.55 Phoenix 5.13 Portlaod... 5.25 Reno.-. 5.25 Salt Lake City 5.37 Santa Fe 4.76}^ Seattle 5.55 XI. With an antici]iated decline in relative importance of the European trade of the United States, and an increase in the growth of trade with the Orient and Australasia, the fimr element involved in supplying the nations on the Pacific from Atlantic coast industries is a factor which works in favor of the establishment of additional branch plants on the Pacific coast. It should be added, of course, that as the trade with Asia and Australia increases, branch plants wall begin to be built in that trade area also. In the second place, western state con- sumption of ])roducts of the type produced by upper bay industries is [)robably well in excess of the average for the country as a whole, and the ])opulation of this consuming area is growing faster than the United States as a whole. In addition, the exports of these same products 50 DIVISION OF WATER RESOURCES from Pacific coast ports have been increasing even faster than domestic consumption. Advertising firms and sales managers, in fixing sales quotas for vari- ous territories, calculate the percentage of the total output which the users in a given territory are likely to buy. This is done by taking such indicia as population, bank deposits, telephone connections, incomes, etc., and arriving at a resultant percentage of probable con- sumption, or the sales quota. The latest obtainable quota for the eleven western states is 10.2 ]jer cent. Assuming that substantially this same percentage of the products of heavy users of water is consumed in this western state area, we can ascertain its consumption of this type of products by taking 10.2 per cent of the national consumption (domestic production plus imports less exports). The following is the list of heavy water-using industries which are at all likely to supply western and export demand from plants locatpd in the upper bay area : Consumed Exported from in rvest Pacific coast Rubber products $110,000,000 $4,650,000 Glass 28,200,000 300,000 Iron and steel products— 822,000,000 2,020,000 Petroleum products 214.000,000 111,600.000 Asbestos products 4,500.000 260.000 Pipe 9,500,000 400,000 Paint and varnish 52,000,000 800,000 Chemicals 54,800,000 8?>0,000 Soap 28,700,000 230,000 ■ Sugar 70,300,000 100,000 Explosives 7.200,000 1,200,000 Leather 53,700,000 3,640.000 Roofing 12,300,000 630,000 Slaughtering, etc. 305,000,000 650,000 Totals $1,272,200,000 $127,310,000 Estimated total consumption for 1927, $1,399,510,000. At the rate of groAvth in the ])opulation of the eleven western states, predicted by population experts, there should be a 35 per cent increase in consumption in 1940. This would raise the item $1,272,200,000 to $1,717,470,000. If the same present trend continues with respect to export trade, the $127,310,000 in exports of products of the listed hieavy water users will have increased to $200,000,000 by 1940, making a total demand of $1,917,000,000 in this market, for the products of the indus- tries most likely to locate in the upper bay area. With its very attrac- tive list of location factors, the upper bay area can reasonably be expected to maintain its present rate of increase and receive its share of the additional increment carried by the westward movement of industrial i)lants. No one is so rash as to think that all of this market's demand for the products of heavy water using industries will be sup- plied within this area, but the estimated consumption figures show what an attractive goal lies before the upper bay industries. Just how much of this estimated maximum volume of business the upper bay area could succeed in securing, no one can foretell. Such intangibles as community spirit and morale, relative skill at industrial salesmanship, and indus- trial area programs, often more than offset the tangible attractions of an industrial site. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO liAY AREA 51 CHAPTER V THE PROBLEM OF WATER COSTS IN THE UPPER BAY AREA As we saw in Chapter HI, upper hay industries ohtain their supplies of Avater from three principal sources: (1) public supply systems, (2) private wells. (3) the rivers — meaning; by the latter also supplies of water pumped from any of the bodies of water which comprise upper San Francisco Bay. In all three cases, water cost figures should include all expense attached to whatever transmission and distribution lines, pumps, storage facilities and treatment are needed. Not only water bills and actual operating costs are involved, but also interest, main- tenance and depreciation. In drawing up the questionnaire sent to the industries, great pains were taken to include all of these factors, but exact comparability of data was probably not secured. Cost as Related to Source. The cheapest sources of water supply are lakes, streams and wells, in close proximity to the ]ilace of use and obtainable either by gravity diversion or by low pumping lifts. Where water supply must be pumped, the cost of water for any given capacity varies directly with the magnitude of pumping lift. As a rough approximation, for every $100 spent to pump a given quantity of water through a head of 10 feet. $2,500 must be spent if the pimiping head is 210 feet. ^Vater from Underground Sources. — For supplies obtained from under- ground sources there are often other disadvantages which tend to increase the cost above similar supplies obtained from lakes and streams. There is usually a definite limit to the amount of available water in any underground reservoir and an overdraft by excessive pumping fre- quently results in a lowering of the water table. The variation and increase in pumping head that often occur, result in increased pumping cost. Moreover deep well pumping equipment is generally more expen- sive and of lower efficiency than surface pumping equipment and these combine to further increase the cost of pumping from underground sources. Those large upper bay industries which now pump from an under- ground water supply with low lifts at their plants report costs of two to three cents per thousand gallons, while with less favorable conditions the corresponding cost rises to nearly 25 cent? per thousand gallons. Such water is harder than river water and, therefore, usually requires treatment for boiler use. The smaller user of well water naturally has a greater expense per thousand gallons consumed, and his costs are found to range from 11 to 83 cents per thousand gallons. If an abundant underground supply, with a low pumping head, can be found at one's plant, this furnishes an economical solution for his water problem. But as has been pointed out before in this study, the status of the under- ground water in the San Francisco Bay region does not warrant our looking to that source as the principal dependence of domestic and industrial users. Waier from PuUk Supply Systems. — Water furnished by existing public supply systems in the upper bay is relatively costly, even at the lower rates quoted to large users. First, no one water company has a 52 DIVISION OF WATER RESOURCES sufficient volume of business to enable it to operate at the optimum volume and minimum cost. Second, public water supplies are desigrned for human consumption and are commonly subjected to such treatment as will make the water sterile and palatable. For many industrial needs raw rater would serve just about as well, hence when industries buy their water from a public system they are paying for unnecessary frills. Third, for a large supply of water, the public company or municipality must resort to a stream. Wells are used by some smaller public systems in the upper bay, but the major company in the area lias ceased to rely upon this source. If river water is obtained from above the salinity encroachment area, the cost of a long pipe line is incurred in addition to the usual puritieation expense. If the water is pumped close at hand, there must be sufficient additional storage, main, and pump capacity to procure and store, during the fresh water period in winter and spring, a sufficient supply to carry consumers through the dry and saline period of the summer and fall. It is not sui']n'ising then to find the industries reporting total water costs all the way from 11 to 98 cents per thousand gallons for the portion of their su])ply which they receive from public systems. Except for about a half dozen companies in the area the amounts consumed are small and the relatively high unit costs include the expense of special treatment or equipment, or both. So far as boiler, drinking, sanitary and other similar needs are concerned, the total volume required is so small in most industries that what seems like a heavy rate per thousand gallons places no substantial burden upon them. Water for Process Purposes. The amount and quality of water required for processing varies greatly Mith the industry. In the case of sugar refining, the large amounts of process water used must be unusually free from salt. The California and Hawaiian Sugar Refining Corporation, Limited, state that they have paid as high as 4 per cent of their cost of manufacture for water, but they estimate that their newly acquired source of supply will reduce their present cost of water bj^ some 30 per cent. Others, like the rubber and paper industries, require large amounts of process water. The rubber company evaporates river water for process uses and claims a loss in their devulcanizing plant during the high salinity period of 1929, amounting to $2,250 per month. The sugar company is not disposed to risk the water in a barrier lake for process pur]ioses, being content with the new source of supply of which we have just spoken. Industries in the Pittsburg-Antioch area which use a large quantity of water for processing, pump it from the river, except when the salinity is too great. They must then resort to public or private supplies. The river supply for process purposes is procured by the largest user at 1.5 cents per thousand gallons. A group of moderate-sized river water consumers report somewhat higher costs for process water generally, ranging from slightly more than one cent to over 12 cents per thousand gallons, while one of the smaller users reports his cost in excess of 30 cents. The largest user, to which reference was made above, places its annual loss, because of inability INDUSTRIAL SURVEY OK Um^KK SAN FRANUISOO HAY AKKA ^hi to jn'ocess with river water all twelve months, at some $1,600 — the amount jjaid for iniblie sn])|)ly water in excess of the cost of pumping it from the river. This amounts to 0.04 of 1 per cent of the value of lliis company's annual out|)nt aiul 0.1? of 1 ])er cent of its annual payroll. The use for purposes otlier than cooling and condensing amounts to 425 million gallons per month for all of the upper bay industries included in this study, while the use for cooling and condensing amounts to 1880 million gallons per month. Of the 425 million gallons used for all other pui-})oses, the one industry which was referred to as having suffered a loss of $1,600 a year uses nearly 115 million gallons, oi- more than one-fourth of the entire amount. Water for Cooling and Condensing Purposes. Cooling and condensing water is required in very large quantities in the steel, oil, rubber and sugar industries, some of the wood products and chemical plants and at tlie navy yard. Unless an industry is ])articularly well situated with respect to the other factors, industrial engineers consider that it can not afford to pay more than six cents ])er 1000 gallons for cooling and condensing water. The following table shows what water for tliis purpose is costing typical large users in the upper bay : Annual Cost per consumption, in thousand gallons, Tiidiistii/ millions of gallons in cents A 1.050 1.8 B 1,420 2.6^ C 840 1.1 D 1,020 7.7=' B 490 1.2 F 7,290 0.8 1 Three per cent of this water from private wells, but has no material effect on unit cost. - In this case 2 per cent of the water is obtained from public supply and has the effect of increasing- the average cost about 7 per cent. Effect of Salinity. — So far as quantity of water and the cost of pumping are concerned it can be seen that industries on the upper bay have a very attractive situation. As we noted in another connection the diffi- culty lies in the damage caused to cooling equipment by salt w^ater action during the salinity period. There are two ways of eliminating the more rai)id deterioration of cooling equipment due to salt water action: (1) By siibstituting the somewhat more expensive salt-resisting equipment for the present cooling apparatus as fast as the latter needs to be replaced (any extra expense for the new type of equipment ought to be offset to some extent at least hy the lower depreciation charge) ; (2) by providing a supply of fresh water to the industries, in such volume, and at such a price, as would warrant its use for cooling and condensing, either by building a barrier or by importation by means of a conduit from the most practical source. To evaluate the additional expense of salt-resisting cooling and con- densing (Hpiipment over similar nonsalt-resi.sting equipment, four of the larger typical users were interviewed and their estimates of main- tenance. de])reciation and capital cost for both types of equipment obtained. A wide variation occurred in the answers obtained, due 54 DIVISION 01<' WATER KESOURCES largely to the types of industries selected. All of the industries in the upper bay area were then classified into four groups, one for each of the industries interviewed, in accordance with the similarity in their use of cooling and condenser water. To each of the industries in the same group the rate of increase in cai)ital and annual cost per unit of consumption for the industry interviewed was assumed to apply and, in combination with any industry's total use of cooling and condenser water, gave the total increase in capital and annual cost for the indus- try. Based on this method of analysis and on the data obtained from these larger typical industries, it is estimated for all industries in the area that the capital cost for cooling equipment designed for salt water conditions would be about $200,000 more than that for equipment designed for fresh water conditions ; and that the annual cost of cooling water under salt water conditions and with salt-resisting equipment would be about $150,000 more than under fresh water conditions and with fresh water equipment. The above estimated amounts of increased capital and annual cost apply to all of the industries in the entire area above Richmond. For the industries above the Dillon Point site only, the corresponding estimated amounts would be $175,000 as the increased capital cost, and $138,000 as the increased annual cost. It is believed that the above figures present a reasonably accurate picture of the total value of fresh water for cooling purposes to the entire area. They represent an increase in total capital cost of less than one-fifth of one per cent and an increase per thousand gallons of cooling and condenser water of less than two-thirds of a cent. This estimate of the additional expense of salt-resisting cooling equipment is for a complete change from nonsalt-resisting to salt-resisting equip- ment for the present salinity conditions ; neither of which conditions are generally ap])licable to the upper bay area. Practically all of the industries have some of each type of equipment, being more nearly on the salt-resisting basis as the industry is further downstream. To estimate the decrease in cost of cooling and condensing water with fresh water available above a barrier, the following alternate method of analysis is presented. The present costs of cooling water were reduced by tiie decreased depreciation figures estimated by the industries them- selves in the State Engineer's questionnaire for fresh water conditions as against present conditions. This resulted in the estimated amount of $70,000 as the indicated saving, which includes all industries above Richmond in the entire area. For the industries above Dillon Point site only, this corresponding estimated amount of indicated saving would be $43,000. However, the additional reduction in annual charges due to less interest on a smaller capital iiivestment and to lower main- tenance cost that could be obtained with fresh water are not included. The previous study for a complete change of equipment indicated that depreciation constituted the major portion of the difference and, there- fore, it is thought that the true value of fresh water for cooling and condensing purposes lies somewhere between the two figures of $70,000 and $150,000 for the industries in the entire area above Richmond and $43,000 to $138,000 for the industries above Dillon Point site only. That the extra cost of using salt water for cooling and condensing purposes over fresh is quite small is substantiated by the following INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 55 letter received from a ooticci-h whioli uses pure sea water exclusively for these purposes : It does not seem to us that there is any additional cost of operation of steam condensing equipment utilizing salt water, as compared with fresh water. The principal source of expense with condensers, is condenser tubes, and there is a rery wide variation in the life of tubes of different manufacture. Admiralty Mixture brass tubes are rather generally used for plants using salt water, and for plants using fresh water about one-half use this same tube, and the other half use Muntz Metal, which latter are about 10 per cent cheaper than Admiralty. Our experience indicates that the use of salt water in the average life of condenser tubes is about four years. However, we have had variations from six months to twenty-five yeai-s. The data which wp have, indicates that fresh water plants obtain about the .same life. Temperature of the condensing water is a very important condition, because the higher the temperature, the larger the surface required in order to obtain the same vacuum, or a larger volume of circulating water must be handled. With higher temperature fresh water, quite often sludge is formed in the tubes, which offers resistance to the flow of water ; reduces the vacuum, and is quite troublesome to remove, sometimes requiring chlorination of the water as a preventive measure. At times fresh water carries incrusting solids which form scale in the condenser tubes, reducing turbine efBeiency, and is troublesome to remove. "We are of the opinion that there would be but slight, if any, advantage of locating a steam power plant so as to utilize fresh water for condenser purposes. A competitor of the above company states in reply to a similar inrpiiry that : The extra cost of using salt water over fresh water of the same temperature for condensing purposes is about 2-5 cents per million gallons pumped. Still further evidence that the cost of cooling with salt water may not be much greater than with fresh is presented by a firm which manufactures cooling and condensing equipment and whicli replied that: The increased cost of supplying Admiralty Metal tubes in place of Muntz Metal tubes would amount to about 1^ per cent of the total cost of a condenser, the exact amount depending upon the size of the equipment and its construction. They were unwilling to estimate the relative deterioration rate with salty and fresh water becau.se it has been their experience that simi- larly equipped plants in comparable locations have had widely differing rates of deterioration. They attribute much of the mischief done to upper bay equipment to sewage and various contaminations introduced by waste products from industrial plants. So far as the manufacturing costs of present industries are concerned, therefore, it is a question of letting them continue to bear whatever ;idded expense salt water corrosion occasions or of substituting one of tlie two altf'niativcs just sf-t foi-th. 56 DIVISION OF WATER RESOURCES Relative Importance of Water Costs. Since we have no data covering the relative importance of the various items which go to make up the respective manufacturing costs of upper bay products, we can not say with assurance just how consequential the cost of water really is. The nearest approach we can make is to compare total expenditures for water with such other items as are available, viz, ca])ital investment, payroll and value of output. The following table has been compiled for 1929, for thirteen out- standing industries which submitted usable data: RELATIVE IMPORTANCE OF WATER COSTS Capital Investment' Value of product' Pay roll" Cost of water (total) Industry Cooling water' Other water' All water' As per cent of value of products A B C D E F $3,068 11,300 8,866 5,731 4,070 S2,290 60,000 9,245 37,194 n2,ooo =4,250 3,961 1,883 2,870 2,765 =2,500 2,000 2,696 $368 1,470 4,062 2,667 1,284 570 1,323 447 543 343 480 320 186 $25.3 15.6 19.2 78.1 42.0 $33.0 161.9 26.9 113.8 40.4 21.6 63.2 3.8 9.0 3.6 5.3 3.5 11.0 $58.3 177.5 46.1 191.9 82.4 21.6 119.1 13.3 14.9 40.5 10.4 3.5 11.0 2.5 0.3 0.5 0.5 0.7 0.5 G 55.9 9.5 5.9 36.9 5.1 0.35 H I J 1,342 2,000 0.7 0.5 1.5 K 0.4 L 454 854 0.2 M 0.4 Totals $173,654 $790.5 (mean) 0.45 ' Values in thousands of dollars. ' Items so marked not furnished with the other data sent by the industries to the State Engineer. They are taken from the industrial survey made by the Byron Times, and published in its twelfth annual development edition, page 5. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 57 Present Cost and Consumption of Water for Cooling and Condensing. The folloM'inii- table t'oi- cooling and condensing: water shows the ])resent total consunij^tion of water and the maximum, minimum and average cost thereof from public and private supplies, from river, and from all sources combined for the industries in the following areas: A. Pittsburg- Aiitioch area above Cliipps Island site. r>. Crockett-Pittsburg area — between Dillon Point and ('liii)ps Island sites. C. Riclimuiul-Crockett area — between Point San Pablo and Dillon Point sites. PRESENT COST AND CONSUMPTION OF COOLING AND CONDENSING WATER IN UPPER SAN FRANCISCO BAY AREA Based upon data furnished by the industries Area A AreaB AreaC Total AandB Total Area I. From public water supplies — a. Total consumption in million gallons per 18.0 33.0 33.0 33.0 13.2 28.0 28.0 28.0 18.0 33.0 33.0 33.0 64.1 8.8 2.2 AA 13,867.0 39.0 0.8 2.0 13,949.1 39.0 0.8 2.0 31.2 33.0 28.0 32.0 II. From private sources — a. Total consumption in million gallons per 64.1 8.8 2.2 4.4 3,769.9 39.0 1.1 2.0 3,834.0 39.0 1.1 2.0 64.1 b. Maximum cost in cents per 1000 gallons. c. Minimum cost in cents per 1000 gallons. d. .\vcrage cost incents per 1000 gal Ions... III. From river — a. Total consumption in million gallons per 8.8 2.2 4.4 10,097.1 13.4 0.8 2.0 10.115.1 13.4 0.8 2.1 9,609 1 8.4 0.4 2.2 9,622.3 8.4 0.4 2.2 23,476.1 b. Maximum cost incents per 1000 gallons. c. Minimum cost in cents pet 1000 gallons. d. .Average cost incents per 1000 gallons... I\'. From combined sources — a. Total consumption in million gallons per 39.0 0.4 2.1 23,-571.4 b. Maximum cost incents per 1000 gallons. c. Minimum cost ia cents per 1000 gallons. d. .\verage cost incents per 1000 gallons... 39.0 0.4 2.1 This table shows a regular small increase in the average cost of water from all sources as the distance downstream and the salinity increase, being 2.0, 2.1 and 2.2 cents per thousand gallons for areas A. B and C. respectively. The relatively low cost shown above for cooling water, the total use of which is over 80 per cent of the entire industrial water consumption, indicates a favorable situation for the industries as regards cooling water. The indicated saving for the entire area above Richmond, as previously estimated, which might be obtained in cost of cooling water sup])lied by a fresh water barrier lake, namely between $70,000 and $150,000 annually, does not appear to be of great importance. 58 DIVISION OF WATER KESOURCES Present Cost and Consumption of Water for Boiler and Process Purposes. , ■: A similar table of consumption and cost of water for boiler, process and other uses is presented below with identical headings as regards sources and areas. PRESENT COST AND CONSUMPTION OF BOILER AND PROCESS WATER IN UPPER SAN FRANCISCO BAY AREA Based upon data furnished by the industries Area A 43.3 50.0 11.0 21.0 891.1 37.0 2.2 3.5 2,265.7 4.8 1.1 1.4 3,200.1 38.2 1.2 2.3 Area B Area C Total AandB Total Area I. From public water supplies — a. Total consumption in million gallons per year b. Maximum cost in cents per 1000 gallons c. Minimum cost in cents per 1000 gallons d. Average cost in cents per 1000 gallons _. II. From private sources — a. Total consumption in million gallons per year b. Maximum cost in cents per 1000 gallons. c. Minimum cost in cents per 1000 gallons. d. Average cost in cents per 1000 gallons III. From river — a. Total consumption in million gallons per year b. Maximum cost in cents per 1000 gallons. c. Minimum cost incents per 1000 gallons. d. Average cost incents per 1000 gallons IV. From combined sources^ a. Total consumption, in million gallons per year -- b. Maximum cost incents per 1000 gallons. c. Minimum cost incents per 1000 gallons. d. Average cost incents per 1000 gallons. .. 358.7 93.0 29.0 35.0 260.6 24.5 1.8 23.8 154.4 7.2 0.8 773.7 93.0 2.3 25.8 777.6 60.0 14.0 38.0 26.7 83.0 2.8 10.9 324.3 12.7 6.7 12.4 1,128.6 59.7 6.6 29.7 402.0 93.0 11.0 34 1,151.7 37.0 1.8 8.1 2,420.1 7.2 0.8 1.8 3,973.8 93.0 1.2 6.9 1,179.6 93.0 11.0 36 4 1,178.4 83.0 1.8 8.1 2,744.4 12.7 0.8 3.0 5,102.4 93.0 1.2 11.9 Estimated Cost for Present Consumption of Water from a Barrier Lake. In the course of this study estimates, based upon the data submitted by the industries, have been made as to how much the making of the upper bay area into a fresh water lake would affect industrial water costs. Too much dependence should not be placed in the completeness and comparability of the results because thoroughly satisfactory figures would have involved a personal investigation at each plant conducted by a staff of experts. The estimated costs for present consumption are shown in the following table : ESTIMATED COST FOR PRESENT CONSUMPTION OF WATER FROM A BARRIER LAKE Based upon data furnished by the industries. Costs of water do not include any portion of a barrier cost or any extra expense that might be necessary for treatment or disposal works to obtain fresh water in or from a barrier lake I. Cooling and condensing water — a. Total consumption in million gallons per year b. Maximum cost in cents per 1000 gallons. c. Minimum cost in cents per 1000 gallons. d. Average cost incents per 1000 gallons II. Boiler and process water — a. Total consumption in million gallons per year b. Maximum cost incents jier 1000 gallons. c. Minimum cost in cents per 1000 gallons, (i. Average cost in cents por 1000 gallons 3,834.0 35 7 1.0 18 3,200,1 40.6 1.0 1.7 Area B 10,115.1 12.9 0.7 1.7 773.7 13.8 0.8 3.9 Area C 9,622.3 8.4 0.4 2.0 1,128.6 10.1 0.4 2.9 Total AandB 13,949.1 35.7 0.7 1.7 3,973.8 40.6 0.8 2.1 Total Area 23,571.4 35.7 0.4 1.8 5,102.4 40.6 0.4 2.3 INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 59 The indicated saving which might be realized for boiler and process water supplied from a fresh water barrier lake in place of present sources is considerably greater and more important than in the case of cooling water. For all industries submitting usable data the total estimated annual saving in the cost of boilei*, process and other water, except cooling and condensing, would be about $500,000. This indicated saving, as estimated from the data furnished by the industries, includes the water supply at present used by the California and Hawaiian Sugar Corporation, which is about to complete a new water supply system to take care of its entire fresh water requirements for the present and for some years in the future. The figure also includes the indicated savings for all industries in the area above Richmond. For the indus- tries above the Dillon Point site only the corresponding estimate of indicated saving would be about $190,000. Since salt}' water is not suited to most of these boiler, process and other uses, the river supply has had to be supplemented by connections with wells and iniblic systems. The marked difference in the figure for Area A and those for B and C is accounted for by : (1) the fact that the public supply is far cheaper at Antioch than elsewhere, (2) the fact that the wells in Area A are the best in the whole region, and (3) the fact tliat the salinity dii^culty is the least in the upper area. In all of the above estimates of indicated savings in cost of industrial water supplied from a fresh water barrier lake in place of present sources, it should be noted that no allowance has been made for addi- tional costs which might become necessary either for w^ater treatment or sewage and industrial waste disposal or for expensive water supply intakes. It is assumed that suitable fresh water could be obtained simply by pumping directly from a barrier lake close to the plant location on the bay shore. If expensive treatment and disposal works or water intake works were required, the cost of such works would tend to decrease the indicated savings estimated above. Comparative Water Rates in Other Localities. Some cities or water districts make special rates to heavy watei'-using industries on the theory that even though the rate is so low that it does not cover the cost of the service, the community will be the gainer because of the industrial growth fostered thereby. If the rate is based upon the economy of quantity consumption, such reductions are sound, but when they are so great as to constitute a *'sop," the ultimate effects are bad. An industry is in business to make money and should pay its own Avay. The following table shows the rates charged large industrial users in leading American cities and the minimum quantity to which the minimum rate applies: 60 DIVISION OF WATER RESOURCES COMPARATIVE WATER RATES City 1. Atlanta 2. Baltimore 3. Chicago 4. Cincinnati 5. Cleveland (i. Detroit 7. Los Angeles 8. Mobile 9. New Orleans 10. Oakland 11. Philadelphia 12. Pittsburgh, Pennsylvania. 13. Portland, Oregon 14. San Diego 15. San Francisco 16. St Louis 17. St. Paul 18. Seattle Per 100 cubic feet $0 09 08 06 12 06 04 07 209 04 05 20 216 05 03 04 Per 1000 $0 12 10% 068 16 08 05H 09M 10 07 279 OSVa 14 06^^ 30 288 om 04 05^ Minimum quantity to which rate applies Excess of 20,000 cubic feet per month. Excess of 1.000,000 feet per year. Over 100,000 cubic feet per year. Over 100,000 cubic feet per month. Rate to largest users. Over 100,000 gallons per month. Over 50,000 cubic feet per month. Over 1,150,000 cubic feet per year. 750,000 gallons or more per year. Over 120,000 cubic feet per month. For all over 33,000 cubic feet per month. Over 1,000,000 cubic feet per month. Over 500,000 cubic feet per month. Over 30,000 cubic feet per month. Three of the California cities listed are obviously making- no material reduction to large consumers, while the fourth, Avith comparable water costs, has adopted a policy of fostering industrial development by means of attractive water rates to heavv users. INDUSTRIAL SURVEY OF UPPER SAN FRANCISCO BAY AREA 61 ni AFTER YI SUMMARY AND CONCLUSIONS The Background of the Survey. In the earlier part of this study the foundation was laid for this ai)]iraisal of the industrial problems of the upper bay area. An examination was made of the factors which o^overn industries in the selection of locations for plants. The conclusion was reached that plant location is becoming more a matter of careful independent investigation by the industry and less one merely of community boosting. Chambers of commerce have an important legitimate role in connec- tion Avith the location of industries, in the shape of collecting and placing at the disposal of industries reliable information relative to the several location factors, THIS BOOK IS DUE ON THE LAST DATE STAMPED BELOW AN INITIAL FINE OF 25 CENTS WILL BE ASSESSED FOR FAILURE TO RETURN THIS BOOK ON THE DATE DUE. THE PENALTY WILL INC«9>rASE TO SO CE'- ' >URTH DA A' -^r -lAY -J- T- {)y,\) LlbKAKY DUE v7 1969 ;c/:j DEC. 5 REfD APR 8 1 1978 DAVIS - INTERUBRARY LOAN i DAYS AFieiLEHxin-'! 78 APR 1 8 REG'O Book Slip-25TO-7,'53(A8998s4)458 PHYSICAL SCIENCES LIBRARY A2. 26A LIBRARY UNIVERSITY OF CAUFORNU DAVIS ±i 1596 UNIVERSITY OF CALIFORNIA, DAVIS 3 1 II! I liiiii 111 III mil ill! 75 02037 68