Since that time, formal announcement has been made by the Coordinator of a committee to make these studies. I am advised that the committee, which is constituted of various Western railroad officers, will devote its entire time to this subject in the hope of furnishing a prompt report. 6. Proposal of C. & N. W. Railway Company to Eliminate Charges for Heater Service on Potato Shipments.-With my letter of September 1st, I enclosed copy of my Circular C-6-1 of August 23, 1933, on the above subject, embodying my conclusions in this case and recommending against the proposal. Advice was subsequently received from Mr. F. W. Sargent, President of the C. & N. W. Railway Company, that my conclusions were accepted and that they would be governed accordingly. Very truly yours, H. G. TAYLOR, Commissioner. COMMITTEE REPORT REGARDING BASIC PASSENGER FARE Your Committee recommends that, in the territory of the Western, Southwestern and Trans-Continental Passenger Associations-effective November first, or as soon as practicable thereafter, and for an experimental period of six months--the following bases for passenger fares and rules related thereto be adopted: (1) Three cents (3¢) a mile, short-line mileage, for one-way tickets, good in all classes of equipment. (2) Pullman surcharge to be eliminated. (3) Scrip books to be continued at present net rate of 2.7¢; passenger officers to review and determine size and time limitation of such books. (4) Two cents (24) a mile, short-line mileage, for one-way tickets, good in coaches; but any road or any group of railroads to be at liberty to make a higher coach rate or none at all for any locality. Question of acceptance in tourist sleepers is referred to the passenger officers and the Pullman Company to dispose of; this failing, question to be referred back to the committee. (5) Two cents (2¢) a mile each way, short-line mileage, for round-trip tickets, with limits not exceeding thirty (30) days, and two and one-half cents (2%) for tickets requiring longer limits, good in all classes of equipment. (6) No convention rates lower than those above-named to be made. Party rates not to be made, except for organizations and on bases agreed upon by the passenger associations. (7) In connection with the foregoing, it is necessary that initiative in creating passenger traffic shall not be destroyed, and railroads must be in position to meet competition by highway, air or water. Therefore, any rates necessary to meet competition may be made by any railroad or railroads provided all concerned agree thereto. If all do not agree, then reductions may be made only in accordance with established practices of the passenger association concerned. Any member of any such association not in accord with result so determined may, through the executives of his company, invoke the authority of the Commissioner of the Western lines. Any rate that is an exception to the bases established under foregoing for purpose of creating traffic and not to meet competition by highway, air or water, must, in order to be made effective, meet with the approval of all railroads concerned. CARL R. GRAY, EXHIBIT No. 311 REGULAR MEETING OF THE COMMITTEE OF DIRECTORS Regular meeting of the Committee of Directors was held at 3:30 P. M. Wednesday, November 15, 1933, in the Board Room of the Bank of the Manhattan Company, 40 Wall Street, New York City. The following were in attendance: Stephen Baker, E. N. Brown, Walter W. Colpitts, Henry W. de Forest, F. W. Doolittle, Allen P. Green, James G. Harbord, W. A. Harriman, Will H. Hays, C. Jared Ingersoll, Arthur Curtiss James, Francis F. Randolph, Geo. T. Slade, O. P. Van Sweringen, H. G. Taylor, Commissioner. Mr. Henry W. de Forest, Chairman of the Committee, presided at the meeting, and Max Glenn acted as Secretary thereof. The minutes of the preceding meeting, held on September 13, 1933, were read and approved. Upon request of the Chairman, the Commissioner advised the meeting briefly concerning matters upon which he had been engaged subsequent to the meeting on September 13th, some of which had previously been reported to the Committee through monthly letters, as follows: Proposed reduction in rates on various commodities between Chicago and Missouri River points, by the Chicago Great Western Railroad Company, decision upon which had been furnished and advice received that the Chicago Great Western would proceed to take independent action contrary to the conclusion reached by the Commissioner. Proposal of the Southern Pacific Company to extend the limits of the experimental 2¢ round trip first class passenger fares to twenty-one and thirty days. Proposal of the Southern Pacific Company and the Chicago, Rock Island & Pacific Railway Company to modify rule to permit single occupancy of compartments by passengers holding but one railroad ticket. Revival of proposal of the Missouri Pacific Railroad Company and the Denver & Rio Grande Western Railroad Company to establish the so-called all commodity rate between St. Louis and Kansas City, Mo., and Denver, Colo. Proposal of the Illinois Terminal Railroad System to establish week end excursion passenger fares on a basis of one cent per mile. Proposal of the Southern Pacific Company to establish week end excursion fares in the States of Texas and Louisiana, limited to 150 miles, at a rate of onehalf cent per mile. Investigation into rates established by Southeastern lines on the East Bank of the Mississippi upon a lower basis than permitted on the West Bank account Presidents' Agreement. Request of Emergency Relief Administration for reduced freight rates for the movement of Emergency Relief Supplies. Air Conditioning of passenger equipment. Activities of Regional Coordinating Committee, Western Railway Group. The Commissioner reported to the Committee of Directors that a reduction in rates proposed by the Chicago Great Western Railroad Company, consisting of a reduction to 30 cents per 100 lbs., with a minimum of 30,000 lbs., on various commodities west-bound and a smaller number of commodities east-bound, between Chicago and Missouri River points and the Twin Cities, has been opposed by all other railroads serving the same territory, that he had recommended against the proposed action but has been unable to compose the controversy, and that the Chicago Great Western has advised him of its intention to file the tariffs covering the reduced rates, merely modified to some extent in respect of the commodities affected. After consideration the Committee (fourteen members being present, not including director McCulloch of the Chicago Great Western) unanimously adopted the following resolutions: "Resolved, That in the judgment of the Committee of Directors of the Railroads of the Western District the action proposed by the Chicago Great Western reported by the Commissioner and above recited is unwise and would be disastrous to the net revenues of all the railroads serving the territory affected by the proposed reduced rates in that it would adversely affect other rates and result in a loss of revenue to the interested railroads as a whole in excess of any possible recovery of traffic taken from the railroads by motortruck competition: and that the Committee considers that such action cannot, consistently with the interests of the industry as a whole, be taken, by one railroad independently and contrary to the judgment of the Commissioner and of all the other interested railroads." "Resolved, That the Committee regrets that Charles A. McCulloch, a member of this Committee as a representative of the directors of the Chicago Great Western, was not present at this meeting to participate in the discussion of this matter; and that Director McCulloch be advised of the views of the Committee as hereinbefore expressed, with the request that the Chicago Great Western reconsider and recede from its proposed action, or, otherwise, that it afford an opportunity for a subcommittee of this Committee to confer with President Joyce and Director McCulloch of that company, and in the meantime defer action." "Resolved. That the Chairman be authorized to appoint a subcommittee, of which he shall be a member ex officio, to confer in behalf of this Committee with the representatives of the Chicago Great Western." Report was made to the Committee concerning action taken at a conference of railroad directors and investors in railroad securities called by Mr. Pierre S. du Pont and others in New York City on November 14th, at which time request was made for the appointment of a Steering Committee to consist of nine railroad directors, three from each of the Eastern, Western, and Southeastern regions to represent stock holding and investment interests in those territories for the purpose of dealing with the various railroad problems. Three members were appointed on such Committee at the meeting, those being Messrs. Pierre S. du Pont, Eastern Territory; Henry W. de Forest, Western Territory; Jeremiah Milbank, Southeastern Territory; and each appointee was requested to secure the appointment of two additional members from their respective territories in order that the Committee of Nine might be properly constituted. After considerable discussion, the following resolution, upon motion duly made and seconded, was unanimously adopted: "Resolved, That the action of the conference of railroad directors and investors in railroad securities called by Mr. Pierre S. du Pont and others, held in New York City on November 14, 1933, in appointing a Steering Committee of Railroad Directors, be by this Committee approved, and that the Chairman of this Committee be authorized to appoint two additional members to represent Western Territory, and the three Western members be empowered to act for this Committee on the Steering Committee. "Resolved further, That the Chairman, or the three Western members of the Steering Committee be, and they are hereby, authorized to call a special meeting of the Committee of Directors, if such action is deemed desirable, in order that questions of policy may be discussed, and/or to call upon any members of this Committee for assistance or cooperation in carrying out such program as may be adopted." It was understood that immediate action would be taken to secure the appointment of the directors from the three regions to the Steering Committee, and that the Western Group of such committee would take the initiative in arranging for an early meeting in order that the activities contemplated might be initiated at the earliest possible moment. There being no further business to come before the meeting, same was duly adjourned at 5:30 P. M. MAX GLENNING, Secretary. EXHIBIT No. 312 To the Committee of Directors: COMMISSIONER OF WESTERN RAILROADS, For your information I am outlining below the activities upon which I have been engaged during the month of November 1933. Some of these subjects were discussed at the meeting of the Committee of Directors held in New York on November 15th. 1. Proposed Reduction in Rates on Miscellaneous Packing House Supplies West-bound, and Inedible Packing House Products East-bound, Between Chicago and Missouri River Points.-This subject was discussed at some length at the meeting held in New York on November 15th and you are familiar with the action taken thereon at that time. Subsequently, on November 20, 1933, the Interstate Commerce Commission suspended the filing of these tariffs until July 1, 1934, and set the subject down for hearing on December 18, 1933. Following that action I am advised the Chicago Great Western Railroad Company has withdrawn its application. 2. Proposal of Southern Pacific Company and Chicago, Rock Island and Pacific Railway to Publish New Rates for Single Occupancy of Compartments and Drawing Rooms.-As outlined in my letter to you of November 20, 1933, conclusions were furnished on this subject. However, I have been advised by two companies affected within the time limit prescribed that they were not in complete accord with those conclusions. 3. Proposal of the Southern Pacific Company to Establish Round Trip FirstClass Fares on Pacific System Line on Basis of Fare and One-Third of New Three-Cent Rate, With Limit of Twenty-one Days; Also, Round Trip Fares to and From the Pacific Coast, Daily, on Basis of Fare and One-Third of the New 84949-44-pt. 12——7 Three-Cent Rate, Food for Thirty Days.-Conclusions with respect to this subject were forwarded to you with my letter of November 20th. 4. Proposal of the Southern Pacific Company to Establish Week-End Excursion Fares in the States of Texas and Louisiana Limited to 150 Miles at a Rate of One-half Cent per Mile.-Conference between Passenger Traffic Officers of interested railroads was held on this matter on November 1, 1933, at which time the subject was very thoroughly canvassed in an effort to reach an understanding which would result in an observance of the basic passenger fare agreement, and at the same time permit companies in border-line territory to meet rates established by railroads in other territorties not subject to the basic passengerfare, agreement. It developed in the discussions that the Southern Pacific is confronted by a situation at New Orleans which is somewhat different than exists elsewhere in Western territory. In view of that fact it was proposed that the road modify its proposal so as to apply only to the territory within a radius of 150 miles from New Orleans. To this the Southern Pacific agreed and the modified plan was concurred in by all the other lines. Your attention is directed to my Circular Letter C-13-2 of November 28, 1933, relating to this subject. 5. Proposal of the Missouri Pacific and D. & R. G. W. R. R. Companies To Estab lish a So-called "All Commodity" Rate Between St. Louis and Kansas City, Mo., and Denver, Colo.—As advised at meeting on November 15th, the above proposal was revived by the two companies named and protest again filed with me as Commissioner against the adoption of such rate. A conference of all interested parties was called to discuss this matter on November 22nd at which time arguments for and against were presented. Additional information with regard to the amount of freight which might possibly be affected is being secured from Denver roads. As soon as this information is received, this subject will again be given consideration and conclusion thereon reached as promptly as possible. 6. Proposal of the Illinois Terminal Railroad System To Establish Week-end Excursion Passenger Fares on a Basis of One Cent per Mile.-The above proposal was protested to me as Commissioner on the basis of being in violation of the basic passenger-fare agreement in Western territory and also as endangering through rates between Chicago and St. Louis. Conference of all interested parties was held on November 21st, at which time the subject was thoroughly canvassed both as to the relationship of the proposal to the basic passenger-fare agreement as well as its possible effect upon other fares in Western territory. The situation of the Illinois Terminal Railroad System is considerably different from that of steam carriers in that it offers more frequent service, and such service is possible through greatly reduced costs of operation. There are grounds for the opinion it holds that the effort which it is making to meet competition of the highways has had a marked effect and resulted in regaining a large amount of traffic to the rails without at the same time interfering with the passenger traffic of other carriers. In view of all of those circumstances, it was the sense of interested parties, as expressed at the meeting, that the Illinois Terminal should be allowed to continue its experiments in this direction until other lines in that territory complain further that the maintenance of the rates threatens to break down through rates or that they find it impossible to maintain the fares authorized in the basic agreement, in which event proponent stands ready to withdraw the 1-cent fare. With this understanding, therefore, this subject is being held in abeyance pending further developments. 7. Freight Train Schedules Between California and Seattle.-This subject was referred to in my letter November 20, 1933, file C-14-2, with which a copy of my report and conclusions was furnished. Subsequently, request was filed with me within the time limit specified that the case be reopened and the matter is now being held in abeyance pending a conference between interested lines. This I will arrange to have at some early convenient date, and further effort will be made to compose the situation to the satisfaction of all concerned. 8. Proposal by the Southern Pacific Company To Establish a Party Fare Between Houston, Texas, and Atlanta, Georgia, During Month of December to Handle the Movement of a Football Team. The fare proposed above was protested to me as Commissioner of Western Railroads by the Missouri Pacific Railroad Company. However, at the time of the conference held on November 21st, further consideration was given to the matter, and in light of the exceptional circumstances existing, the protest of the Missouri Pacific Railroad Company was withdrawn. The matter, therefore, has been disposed of without necessity for conclusions being furnished by me. 9. Regional Coordinating Committee, Western Railway Group.-The activities of the Western Regional Coordinating Committee have been steadily increasing and the survey which was initiated of the so-called "Prince Plan" for consolidation of western railroads has now been completed. Before turning the results of such survey over to the staff of the Federal Coordinator, meeting of the Presidents of all roads concerned was held in Chicago on November 29th in order that the matter might be given full consideration in light of the individual interest which each carrier might have therein. A study is also being started by the Federal Coordinator into the movement of carload traffic throughout the United States, which is thought will be of much assistance in enabling him to reach conclusions with regard to the many traffic problems that have been presented to him for consideration. 10. Federal Emergency Relief Administration.-As outlined in my letter November 1, 1933, request was made upon the railroads of the United States to reduce rates for the movement of Federal Emergency Relief supplies. A conference between executives representing western carriers and officers of the Federal Emergency Relief Administration was held in Washington on November 14th, at which time it was agreed that the only reductions to be made in Western Territory would be those necessitated on account of land grant rates and competitive rates on non-land grant roads compelled thereby. This, it was felt, would make a reduction in general freight rates for the movement of these commodities, ranging from thirty-five to forty percent. The land grant rates would, of course, be applicable in any event on shipments moving under Government bills of lading and created in themselves such a substantial reduction that the basis outlined above was readily accepted by the Relief Administration. Very truly yours, H. G. TAYLOR, Commissioner. EXHIBIT No. 313 COMMISSIONER OF WESTERN RAILROADS, To the Committee of Directors: For your information I am outlining below activities upon which I have been engaged during the month of December 1934: 1. Industrial Truck Extension by Missouri-Kansas-Texas Railroad at San Antonio, Texas. As reported in my letter of December 1, 1934, the MissouriKansas-Texas Lines agreed, for the time being at least, to hold in abeyance the construction proposed pending conference between the President of that company and myself to further discuss the matter. On account of conflicting engagements, it has been impossible for me to meet with Mr. Sloan. However, Mr. G. T. Atkins, Vice President of the Missouri-Kansas-Texas Lines, representing Mr. Sloan, called upon me recently and advised that in the interest of harmony and to avoid becoming involved in a controversy with other Southwestern lines, the MissouriKansas-Texas Railroad would withdraw their proposal to construct this trackage at San Antonio. The subject, therefore, is now disposed of without the necessity for further consideration by the Committee of Directors. 2. Proposed Application of Intrastate Grain Rates to Interstate Traffic by Alton Railroad Company.-Following conference held in my office on November 28th, the Rock Island indicated a willingness to withdraw the reduced rates proposed for grain movements beyond Chicago via water, during the winter months, with the understanding that such rates might be re-established in the spring after the opening of waterways without protest from other carriers. It was thought that in the interim conference between interested roads might be held, looking toward some modification of the original proposal, both as to the reduction proposed, as well as area covered. This was agreeable to a majority of the Illinois lines and application made by the Rock Island to the Illinois Commerce Commission for permission to withdraw the tariff. However, it was understood that owing to pressure from shipping interests, the Commission would decline to grant such withdrawal, and accordingly new tariff has been filed upon statutory notice by the Rock Island, looking toward the re-establishment of grain rates as they existed prior to the making of a reduction. This will accomplish the same result and enable Illinois lines to handle all grain moved during the winter months upon a full rate basis. 3. Expedited L. C. L. Merchandise Service Between Chicago and the Twin Cities. In accordance with advice furnished in my letter of December 1st, studies |