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Holliday, Gilbert R., office manager, Hillside plant, Callaway Mills
Morrow, Giles, general counsel, Freight Forwarders Institute ---
Scarpinito, Vincent J., general traffic manager, M. Lowenstein & Sons,
Washer, Charles A., transportation counsel, American Retail Fed-
Acme Boot Co., Clarksville, Tenn., letter from Charles B. Shanks,
American Institute for Shippers' Association, propored amendments
Additional material submitted for the record by-Continued
Barry & Foley Motor Transportation, Inc., Worcester, Mass., letter
from F. Dalton Barry, president-treasurer..
British Industries Corp., Westbury, N.Y., letter from Harold Fried-
Letter dated December 27, 1967, from Robert O’Nan, president,
Letter dated January 12, 1967, to American Trucking Associa-
Clipper Carloading Co.:
Exhibit A-Tons of freight received from shippers (table) --
Exhibit B-News articles concerning the small-shipment problem.
general traffic manager
1967, at its 30th annual convention, Miami Beach, Fla.
Text of section 409 of part IV of the Interstate Commerce Act,
Views on amendments proposed by ICC and certain shippers'
associations, letter dated February 5, 1968..
Holman Transfer Co., Portland, Oreg., letter from Leonard P. Clark,
Houston Merchants Shippers Association, Inc., Houston, Tex., letter
from W.J. Wallace, secretary
& Helpers, letter from Carlos Moore, legislative director --
plying to comments of Freight Forwarders Institute on amendments
Appendix A-Membership list-
Appendix B-Officers and directors.
Mid-Tennessee Freight Association, telegram from Harry Zimmer-
National Industrial Traffic League: Rates of return of class A freight
forwarders, 1957-66 (table).
Binder, vice president..
203 214 70
Additional material submitted for the record by_Continued
Selover Trucking Co., Inc., South River, N.J., statement of Donald
A. Mac Millan, president.
letter from T. J. O'Neill, president.----
of C. G. Lundquist, general traffic manager.
January 29, 1968, re rail carriers share of revenue under joint
rate movements, plan 1, TOFC.
Leslie, traffic supervisor.-
Staudenmaier, Jr., traffic manager.
ment of Richard C. Childs, president..
Green, manager of physical distribution..
FREIGHT FORWARDER-TOFC CONTRACTS
TUESDAY, JANUARY 23, 1968
HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON TRANSPORTATION AND AERONAUTICS,
COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE,
The subcommittee met at 10 a.m., pursuant to notice, in room 2123, Rayburn House Office Building, Hon. Samuel N. Friedel (chairman of the subcommittee) presiding:
Mr. FRIEDEL. The Subcommittee on Transportation and Aeronautics today is commencing hearings on H.R. 10831, a bill which I introduced by request, which would amend section 409 of part IV of the Interstate Commerce Act, so as to authorize contracts between freight forwarders and the railroads.
Part IV regulates freight forwarders as common carriers of freight in their relationship to shippers which utilize their services. Except for section 409, the freight forwarders in their relationships with the other carriers regulated by the Interstate Commerce Act are not treated as carriers but simply as shippers.
Section 409, which has been amended several times, provides that freight forwarders under part IV may enter into contracts with common carriers by motor vehicle subject to part II of the act. In such relationship the compensation paid under the contracts is comparable with divisions of a joint rate rather than with compensation received by carriers from shippers under a published tariff.
The bill, H.R. 10831, simply extends the scope of section 409 so that freight forwarders could make contracts with railroads as well as with motor carriers as the statute now provides. It is the same proposal as that before the committee in 1956 when hearings were held on H.R. 9548 (84th Congress) with the exception that it is proposed now that forwarders may enter into any type of contract, not merely that of “piggybacking,
At this point we shall include in the record a copy of H.R. 10831 as well as the letters which have been received from the agencies commenting upon the legislation.
(The bill, H.R. 10831, and departmental reports thereon, follows:)
[H.R. 10831, 90th Cong., first sess.)
A BILL To amend section 409 of part IV of the Interstate Commerce Act, as amended, to
authorize contracts between freight forwarders and railroads Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That subsection (a) of section 409 of the Interstate Commerce Act (49 U.S.C. 1009(a)), as amended, is amended to read as follows:
"Sec. 409. (a) Nothing in this Act shall be construed to prevent freight forwarders subject to this part from entering into or operating under contracts with
common carriers by railroad subject to part I of this Act, or from entering into or continuing to operate under contracts with common carriers by motor vehicle subject to part II of this Act, governing the utilization by such freight forwarders of the services and instrumentalities of such common carriers by railroad or motor vehicle and the compensation to be paid therefor: Provided, That in the case of such contracts it shall be the duty of the parties thereto to establish just, reasonable, and equitable terms, conditions, and compensation which shall not unduly prefer or prejudice any of such participants or any other freight forwarder and shall be consistent with the national transportation policy declared in this Act: And provided further, That in the case of line-haul transportation by common carriers by motor vehicle between concentration points and breakbulk points in truckload lots where such line-haul transportation is for a total distance of four hundred and fifty highway miles or more, such contracts shall not permit payment to such common carriers by motor vehicle of compensation which is lower than would be received under rates or charges established under part II of this Act."
Sec. 2. The heading of section 409 is changed to read as follows: "UTILIZATION BY FREIGHT FORWARDERS OF SERVICES OF COMMON CARRIERS BY RAILROAD AND BY MOTOR VEHICLES."
OFFICE OF THE SECRETARY OF TRANSPORTATION,
Washington, D.C., October 27, 1968. Hon. HARLEY O. STAGGERS, Chairman, Committee on Interstate and Foreign Commerce, House of Representa
tives, Washington, D.C. DEAR MR. CHAIRMAN: This is in reply to your request for the views of this Department concerning H.R. 10831, a bill to amend section 409 of part IV of the Interstate Commerce Act, as amended, to authorize contracts between freight forwarders and railroads.
Since this proposal involves considerations present in H.R. 6533, a bill now before the Committee, dealing with joint rates and through movements between surface transportation common carriers subject to the jurisdiction of the Interstate Commerce Commission, our comments will also make reference to the latter bill.
In the comments of the Department of Transportation of August 25, 1967, supporting H.R. 6533, we noted in passing that “this legislation would at long last bring greater equality of regulation among all of the various surface modes of transportation subject to the Interstate Commerce Act except freight forwarders, an omission from the bill the Department regards as unfortunate.” The Department of Transportation continues to be of the opinion that freight forwarders should be included within the scope of H.R. 6533. Forwarders perform a muchneeded public service, particularly for shippers and consignees of small shipments. In this regard, it should be emphasized that one of the primary purposes of H.R. 6533 is to aid in the movement of such traffic. Moreover, with the rapid development of trailer-on-flat car movements by the railroads, we believe that as a matter of competitive equality freight forwarders should be permitted to participate to a greater degree in the different TOFC plans and other types of joint arrangements with railroads since many of these arrangements are now available to motor carriers. For example, with the decision of the Interstate Commerce Commission in Ex Parte 230, Substituted Service-Piggyback, 322 I.C.C. 301, recently affirmed by the Supreme Court, the so-called "open tariff” regulations of the Commission permit motor carriers to share in plan III TOFC operations. Forwarders, however, are excluded from participating in plan I arrangements, a valid coordinated joint intermodal service.
H.R. 10831, however, takes a somewhat different approach. It would amend section 409(a) of the Interstate Commerce Act so as to permit freight forwarders to enter into contracts with rail common carriers subject to the limitation that the parties to these contracts establish them on just, reasonable, and equitable terms which shall not unduly prefer or prejudice either party to the contract or any other freight forwarder and which shall be consistent with the National Transportation Policy. With this amendment, freight forwarders would be placed in the same position with regard to railroads as they now are under present law with regard to motor carriers, except that as to contracts involving the linehaul transportation of truckload lots of forwarder traffic between concentration points and break-bulk points where the distance is 450 miles or more, contracts