$690 million in 2008 dollars
For years, the low-lying plains of the West, especially the areas around Arizona, California, Colorado, Nevada, and New Mexico, suffered from a severe lack of water for the residence, their animals, and for irrigating their farmlands. In fact, it was the hottest, driest region in the United States. With more and more people moving into this area it became quite clear that something had to be done to provide the necessary quantities of water and electric power not only to satisfy the present requirements but also for future generations. As a result, during the Coolidge administration it was determined that the time had come to harness the enormous power of the Colorado River with the construction of a colossal dam in a project of monumental proportions. Consequently, a commission was formed composed of representatives from the states involved and the federal government who were determined to arrive at an agreement on how the waters of the Colorado and its energy output would be distributed. Representing the United States and the driving force behind the project was the Secretary of Commerce Herbert Hoover who was appointed by President Warren G. Harding in 1921.
Meanwhile, as the talks continued, surveys were being conducted by geologists and hydrologists who determined that Boulder Canyon would be a suitable site for the project but later revised their plans and moved the proposed site 8 miles farther downriver to the Black Canyon area.
The agreement between the states and the federal government was signed in 1922 but took another six years before the bills authorizing the construction wound its way through Congress and was subsequently signed by President Coolidge in December of 1928. In January 1931, during the administration of Herbert Hoover, now the thirty-first president, Congress released the specifications and their request for bids from private construction companies. Since the business community was still reeling from the effects of the Great Depression many ambitious contractors saw a tremendous opportunity not only to be part of a historic project but also to put people back to work and perhaps to make some money as well.
But when the magnitude of the project was examined in detail, many companies found they did not have the financial means or resources to carry out this enormous effort and dropped out of the bidding. Particularly disconcerting was the clause in the contract which required $2 million up front from the winning contractor with an additional $5 million due later. Since these were the depression years, coming up with that kind of money was near impossible, even for the most successful businessman.