under the same degree of regulation as is now provided in the case of the railroads and the motor carriers, not only for the good of the latter but for the good of the water carriers themselves. Thank you, sir. The CHAIRMAN. Thank you, Mr. Commissioner. Mr. HOLMES. May I ask a question just before he leaves, Mr. Chairman? The CHAIRMAN. Yes, Mr. Holmes. Mr. HOLMES. I believe reference was made in a report issued by the Interstate Commerce Commission that the class 1 railroads had a financial interest in 128 motor-carrier lines, and their investment amounted to practically $43,000,000. That was as of May 1, 1936. Would it be possible to give the committee some idea as to the extent further interest has been acquired by the railroads in motor trucks? Commissioner EASTMAN. Motor-carrier lines? Mr. HOLMES. Yes. Commissioner EASTMAN. Well, since that time, if they have obeyed the law, they have not acquired any further interests. They have to get the approval of the Commission. We have pending some cases where the railroads are endeavoring to acquire control of motor carriers. Mr. HOLMES. But they have not gone out, on a wholesale scale. and bought up controlling interests of motor-truck companies? Commissioner EASTMAN. No; there have been a number of cases where they have secured options and where their applications are pending before the Commission at the present time. Mr. HOLMES. It was noted in that report that while their investment was $43,000,000 they earned an income of 32 million dollars, which is a fairly good return. Commissioner EASTMAN. Yes. Mr. PETTENGILL. Is that net or gross? Mr. HOLMES. That is net, by the 128 motor-carrier lines. INTERSTATE COMMERCE COMMISSION, Hon. CLARENCE F. LEA, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D. C. DEAR MR. LEA: In connection with my testimony on H. R. 1668, February 9-10, I undertook to furnish to your committee certain additional information. Herewith I am sending you the following: 1. Table showing “Number of establishments, number of employees, and value of products, 1914, 1929, and 1933", by divisions of the country, derived from the Census of Manufactures, Department of Commerce. In this census, establishments with products valued from $500 to $5,000 were excluded, beginning with 1921. However, by going to the 1914 census, it was possible to exclude the data relating to this group, so that the figures in the table are comparable. The correction was hardly necessary as to number of wage earners and value of products, as the excluded group amounted to less than 1 percent of the total, but it constituted over one-fifth of the number of establishments. 2. Table showing "Population of the United States by divisions" for the census years 1910, 1920, and 1930. The divisions shown are the same as in the table relating to manufactures. It was not possible, however, to make the showing for the same years. 3. Table showing "Selected statistical items" for class I railways for the years 1923, 1929, 1935, and 1936. This is in response to the request of Congressman Cole for the latest figures available corresponding to those shown in the report of your committee on H. R. 3263, July 22, 1935, printed as Report No. 1560, Seventy-fourth Congress, first session. As shown in the table, not all of this information is as yet available for 1936. 4. A copy of the Commission's Rules of Practice, showing rule XVIII. Congressman Pettengill asked me to furnish a copy of the Commission's Fourth Section Order No. 8900. This order was rescinded by the Commission August 1, 1932, and the instructions contained therein were incorporated in said rule XVIII. In this connection, Congressman Pettengill referred to the expense incurred by the carriers in the preparation of fourth-section applications and the complex and voluminous character of these documents. The expense and the volume, of course, depend upon the adjustment of rates involved and the character of the relief sought in connection therewith. If the adjustment includes all rates on certain traffic in one of the major rate territories, such, for example, as the rates on grain and grain products between points in southern territory, it may require a comparatively voluminous application to set out the character of relief desired, with suitable illustrations and other information suggested in rule XVIII. However, applications covering such extensive adjustments of rates constitute a relatively small number of the applications filed. The vast majority are of small volume, and no great length of time is required for their preparation. We shall be glad to furnish the committee with copies of typical applications, if it is interested in this phase of the matter. In addition to the above, Congressman Pettengill asked for a statement of the number of cases during the past 5 years in which fourth-section relief was denied even though such relief was not opposed by shippers. I find that in the years 1932-36, inclusive, the Commission entered 1,839 orders denying relief, each order covering one or more applications. To compile the information desired, it would be necessary to examine the record of each of the cases covered by such orders. In 1932. 100 denial orders were entered, and in eight cases, or 8 percent of the total, the relief so denied was opposed by shippers. Many of the denial orders issued in 1932 were entered in so-called "1910 applications" in which no defense of the fourth-section departures was offered by the carriers, and examination of these cases presented little difficulty. However, to examine the cases disposed of for that year required the services of two men a total of about 7 hours. It is estimated that to examine the cases disposed of during the other 4 years will require the services of three men for an additional week. Because the use of our force for this work would interfere with our work on current fourth-section applications, we would like to avoid such use, if possible. Mr. Pitt's best estimate is that the number of cases in which relief was denied and shippers indicated their opposition, during the 5-year period, would amount to somewhere between 5 and 10 percent of the total number of cases in which relief was denied. Perhaps this estimate will satisfy the purposes of your committee. However, if the precise figures are desired and you will so advise me, we shall, of course, do the necessary work, notwithstanding our desire to avoid it. Mr. Pitt tells me that the explanation of the small percentage of denial cases in which shippers voiced opposition lies in the fact that the majority of applications for relief, at least 80 percent, are filed by carriers having circuitous routes and desiring to meet rates of more direct routes. Shippers as a rule are not particularly interested in such applications. Where relief is denied in such cases, it is because the routes are grossly circuitous and/or it does not appear that the proposed rates are "reasonably compensatory." It is an effective way of preventing wasteful transportation. In revising my remarks. I observed that the figures prepared for me showing the time taken in deciding fourth-section cases were not on a uniform basis. In many instances the time was reckoned from the date when the applications were filed, but in others, where there were hearings, it was reckoned from the date of the submittal of the case to the Commission for decision. I think that the time should have been reckoned in all instances from the date when the application was filed, and am having the figures revised accordingly. Probably I shall be able to submit them to you tomorrow. It appears that the reason for reckoning from the submittal date in the cases where it was done, was the fact that there is not infrequently a delay between the date of filing and the date of submittal for which the carriers themselves are responsible. However, I do not think this is a sufficient reason for failing to show the entire elapsed time. Respectfully yours, JOSEPH B. EASTMAN, Chairman Legislative Committee. Number of establishments, number of employees, and value of products, 1914, 1929, and 1933: Census of manufactures [Statistical abstract of the United States, published by Department of Commerce] 1 Division Percent increase over 1914 of dollars) 1 Revised to exclude establishments with product of less than $5,000. 2 Decrease. Population of the United States by divisions Selected statistical items of class I railways, 1923, 1929, 1935, and 1936 [From reports to Interstate Commerce Commission unless otherwise noted] 1 From p. 7 of Committee Report No. 1560, House of Representatives, 74th Cong. 2 From Ex. 733, Ex Parte 115, prepared by Bureau of Railway Economics. $331, 915, 459 994, 371 $3, 450, 308, 927 * $188, 302, 000 2 $593, 025, 000 $236,897, 281 1,065, 922 $4,052, 734, 149 $319,716, 035 INTERSTATE COMMERCE COMMISSION, Hon. CLARENCE F. LEA, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives. MY DEAR MR. CHAIRMAN: In my letter of yesterday, the 16th, I mentioned that I had asked our fourth-section board to revise the figures previously furnished to me, and which I had submitted to your committee, so as to show in all instances the time elapsed between the date the application for fourthsection relief was filed and the date when the Commission entered its order. Herewith I am sending you a memorandum to me from Mr. Pitt, the chairman of the fourth-section board, which gives the revised figures and comments on them. The memorandum is, I think, self-explanatory. Whatever the situation may have been in the past, the statistics indicate that the Commission is now handling fourth-section applications expeditiously. As I have suggested, if it is desired to insure expedition in the future, the same time limt can be attached to action under the fourth section as is now provided with respect to suspension cases. Respectfully yours, JOSEPH B. EASTMAN, Chairman, Legislative Committee. FOURTH SECTION BOARD MEMORANDUM TO COMMISSIONER EASTMAN FEBRUARY 16, 1937. Referring to your request for further information concerning the figures reported by us with respect to the time elapsing between the date that applications for fourth-section relief were submitted in shape for consideration by the Commission and the date that orders were entered therein: In our reports with respect to the applications in which orders were entered granting temporary relief we figured the time from the date the application was filed to the date the order was entered. If, however, the application did not contain sufficient information to enable it to be considered and it was necessary to obtain further information from the carrier the time was figured from the date the additional information was received to the date that the order was entered. For example, if an application was filed March 1, 1936, and contained all the information necessary to enable the Commission to enter the order, the time was figured from the date of filing to the date of the order. If the application did not contain sufficient information and it was necessary to obtain further information from the carrier the time was figured from the date the information was received until the date the order was entered. In the cases where no temporary relief was granted and it was necessary to assign the application for hearing the time required for deciding the case was figured from the date it was submitted after hearing until the date of the order disposing of the matter. This time was shown because the date on which an application is filed does not indicate that the matter has been presented to the Commission at that time in such shape that it may be considered and passed on. Furthermore, in these applications in which hearings are required the applicants, not infrequently, are not prepared to proceed with the hearing on the date of the assignment and the hearing is postponed at their request. For example, this was what happened in the case of application no. 14080 filed by Agent Toll on behalf of transcontinental carriers for relief to establish reduced rates on sugar, beet and cane, carloads, from San Francisco and Crockett, Calif., to points in Illinois and other Middle Western States, which has been referred to several times during the hearings on the Pettengill bill. This application was filed April 28, 1930, and purported to be made on behalf of carriers parties to Toll's tariff I. C. C. No. 1226, including the IllinoisCentral, Southern Railway, and certain carriers members of the Trunk Line Association, of which Mr. Robert N. Collyer was chairman at the time. The Illinois Central, Southern Railway, and Agent Collyer promptly filed a protest against the application, stating that Agent Toll had not been authorized to file the application on their behalf. This matter was called to the attention of Mr. Toll by letter from Secretary McGinty on May 13, 1930, and he was re quested to amend his application to show correctly the carriers on behalf of which relief was sought therein. Agent Toll advised under date of May 15, 1930, that the matter would be referred to representatives of the Pacific coast terminal lines for their consideration. Three amendments to the application were later filed to correct the above defects, the first on November 3, 1930, and the last on December 22, 1930. In the meantime the application was assigned for hearing July 14, 1930, at San Francisco, Calif. Immediately following this notice of hearing requests were filed by numerous parties having an interest in the matter for a postponement of the date of hearing. By letter of June 28, 1930, Agent Toll asked on behalf of applicants that the hearing in application no. 14080 be postponed "until sometime in September" to enable the carriers to complete information to be submitted at the hearing, the preparation of which had been interrupted because of the necessity of working on other cases then pending before the Commission. It was not practicable on account of previous assignments to set the case for hearing in September, but by notice of October 20, 1930, it was assigned for hearing at Chicago November 18, 1930. Subsequently carriers and shippers interested in application no. 14080 asked that the hearing be further postponed because of hearings assigned on or about the same time, of other cases to which they were parties. No objection was filed by applicants and the matter was again postponed and by notice of December 10, 1930, it was assigned for hearing January 12, 1931, at Chicago. It will be noted, therefore, that while the application was received April 28, 1930, the applicants were not prepared to proceed with the hearing "until sometime in September" or approximately 5 months after the date of filing. Furthermore it will be noted that errors in the application were not finally corrected until December 22, 1930, or nearly 8 months after the application was filed. Circumstances of somewhat similar nature have occurred in various other applications in sufficient number to make it unsafe to base any calculation as to the time required by the Commission to pass on fourth section applications, from the time the application is filed. The Commission cannot pass on applications unless they contain adequate and accurate information. In most of the applications on which hearings are held the facts necessary to properly consider the issues presented cannot be ascertained except by a hearing. Following a hearing briefs may be filed and a proposed report and argument may be requested. All of these various steps must be completed before the case is in shape for consideration by the Commission and the expedition with which these steps are completed depends on the cooperation of the applicants and their readiness to proceed when the case is assigned for hearing. Because of these reasons we showed in our previous report as the time required after filing. or submittal of applications before orders were entered, the period that elapsed after the applications were submitted where the applications were heard and no temporary relief was entered, and in a case where temporary relief was entered we showed the date of filing, or the date final amendments were received to the application, where additional information was required before the application could be passed on. In accordance with your request we have now prepared a statement showing the actual time which elapsed between the date the applications were filed, regardless of any intervening circumstances that may have occurred between the time of filing and the date the order was entered by the Commission. These figures are as follows: Applications for relief from the long-and-short-haul provision of sec. 4 to meet water competition filed during the period Jan. 1, 1930, to Dec. 31, 1936 Number of applications in which orders were entered granting temporary or continuing relief_____ 1193 Number of applications in which orders were entered denying relief_ 36 15 4 Total 248 Of the applications of, the average number of days that elapsed after date of filing before orders were entered, were as follows: 90 applications in which temporary relief was authorized, average number of days elapsed after filing__ 50.14 1 Includes 4 applications in which temporary relief was authorized and the application later withdrawn. |