PROPOSAL OF CERTAIN LINES TO ESTABLISH REDUCED RATES ON CANNED OR PRESERVED FOODSTUFFS, CARLOADS, FROM POINTS IN UTAH, IDAHO, WYOMING TO DESTINATIONS IN OKLAHOMA AND TEXAS Reduced rates on canned or preserved foodstuffs from Denver, Colorado, and points grouped therewith, published to become effective July 1, 1941, as result of independent notice, were permitted to stand because it was alleged that the rates were designed to meet truck competition which had been substantially proved. In order to maintain established relationships with reduced rates from the Denver group, the Union Pacific and concurring Southwestern lines filed notices of independent action to reduce rates on these commodities from Utah, Idaho, and Wyoming to destinations in Oklahoma and Texas, which proposals were appealed because it had not been proved that truck competition was a factor to any appreciable extent and, further, it was felt that to spread the reduction to that additional territory would make it impossible to defer claims of other important origins of canned goods for similar reductions, particularly California. It developed at the hearing there was some doubt that the reductions from Colorado would accomplish the results desired, and in his report the Commissioner stated it appeared unwise to undertake to preserve an established relationship in view of this element of doubt. Therefore, and considering the volume of canned goods traffic and resulting revenue involved, the Commissioner recommended that the proposed reductions from Utah, Idaho, and Wyoming be not made effective. No dissent from the Commissioner's conclusion was received, and no action has been taken contrary to his recommendation. PROPOSAL TO REDUCE RATES ON DECIDUOUS FRUITS FROM POINTS IN COLORADO AND UTAH TO DESTINATIONS IN SOUTHWESTERN STATES, INCLUDING MEMPHIS, TENNESSEE, NATCHEZ AND VICKSBURG, MISSISSIPPI Proposal to reduce rates on deciduous fruit from points in Colorado and Utah to destinations in Southwestern territory, was initiated to meet truck competition and to make available to Southwestern destination markets reductions which had already been approved from those origins to Western Trunk Line territory. The proposal was protested on the ground that if made effective, corresponding reductions would follow from other origins, particularly the West Coast, and to other destinations, thereby jeopardizing the very substantial revenue now received from the transportation of these commodities by Western carriers. The bulk of this traffic originates on the West Coast, and an attempt to hold to rail lines the lesser movement from the Colorado-Utah territory did not appear sufficient justification for the reductions proposed. The Commissioner therefore recommended that the proposal be not made effective. No objection was received to the Commissioner's recommendation, and no contrary action taken. The following subjects, which were not cases under the Commissioner Plan, were also discussed by Commissioner Johnston: 1. Expedited Train Service on Carload and Less Carload Merchandise Saint Louis to Denver. 2. Proposal of the Katy to Establish Reduced Rates on Grain and Grain Prodnets from Northwestern Oklahoma to Texas Points; Also Texas Gulf Ports, Domestic and Export. 3. General Labor Situation. There being no further business, the meeting was duly adjourned at 4:00 P. M. F. M. WILSON, Secretary. EXHIBIT No. 319 To the Committee of Directors: COMMISSIONER OF WESTERN RAILROADS, For your information, I am outlining below activities upon which I have been engaged during the month of June 1936: 1. Proposal of the A. T. & S. F. Ry. Co. To Establish 11⁄2¢ Coach Fares Intrastate in California.-There has been no change in the status of this controversy since my report of May 6, 1936. 2. Optional Honoring Arrangement on Interstate Tickets by the A. T. & S. F. Ry. Co. Between Los Angeles and San Francisco With Santa Fe Trail Stages.-Briefs outlining the positions of the parties to this controversy have now been submitted to the Committee of Directors and in my letter of June 25th, advice was furnished that upon review of the briefs presented, no basis could be found for changing the conclusions previously reached under the Commissioner Agreement. It is assumed that final disposition or direction will be given this subject at the meeting of the Committee to be held in New York on July 8, 1936. 3. Proposal of the C. St. P. M. & O. Ry. Co. To Reduce Rates on Fine Coal From Head-of-Lakes to Chaska, Minn.-While protest to the above proposal was filed under the Commissioner Agreement on May 28, 1936, the subject has been held in abeyance since that time based upon the understanding that the Omaha Line is preparing to withdraw the proposal. 4. Freight Schedules Between Chicago, St. Louis, Kansas City, and Denver.— In September 1934, in view of a re-arrangement of freight train schedules between Chicago and St. Louis, and Denver, Colo., it was deemed desirable in the interest of all of the carriers to enter into an agreement fixing definitely the time for delivery of freight from both Chicago and St. Louis at Denver. This action was reported to the Committee of Directors in previous correspondence. Subsequently, claims were presented by certain shippers in Denver to the railroads account failure to deliver shipments which were available at Denver but delivery of which was delayed owing to the agreement. These claims were prosecuted through the courts and on June 22, 1936, the Supreme Court of the State of Colorado rendered a decision providing, "We cannot think the carrier's attitude was reasonable nor was it made so by an agreement with other carriers binding all to identical treatment of shippers and consignees." Conference between executives of the Denver delivering lines was held in Chicago on June 27, 1936, at which time it was determined that further consideration of this subject would be required by roads having trains arriving at Denver prior to 5:30 P. M., following which decision as to final action, taking into consideration the Supreme Court decision of the State of Colorado, would be rendered under the Commissioner Agreement. At 5. Fine Coal Rates into the State of Wisconsin.-Some time ago carriers from the Head-of-Lakes and Ashland found it necessary to grant reduction in rates on fine coal into the Twin Cities, in order to meet gas competition at those points. In taking such action, Fourth Section relief was not secured, and as a result, the rate between the Head-of-Lakes and the Twin Cities was reduced from $1.65 per ton to $1.25 per ton, carrying with that like reductions to intermediate points. As a result, Stillwater, Minn., a short distance out of St. Paul, was granted a reduction in such rates to $1.25 per ton. Immediately, paper mills at Eau Claire and Ladysmith requested a similar reduction in rates which were granted. about the same time, paper mills located in the Fox River Valley District in Wisconsin requested a reduction in coal rates from Lake Michigan ports to Fox River Valley destinations. Account barge and truck competition, the lines from Green Bay, Wis., to Appleton District points granted a reduction from the Commission's scale of 94 cents to 75 cents per ton for that movement. Owing to pressure exerted at other Lake Michigan ports, similar rates of 75 cents were made into Fox River Valley District from Milwaukee, Manitowoc, Sheboygan, Marinette, and Menominee. In view of the reduced rates from Head-of-Lakes to Eau Claire and Ladysmith, as well as the reduced rates from Lake Michigan ports into the Fox River Valley, proposal was made by the Green Bay & Western Ry. Co. to reduce rates from $1.41 per ton on fine coal from Green Bay to Wisconsin River Valley points to $1.25, thus placing the Wisconsin River Valley upon a comparable basis with Eau Claire and Ladysmith and providing a reasonable differential between the Fox River Valley rates and the Wisconsin River Valley rates. Later, lines participating in fine coal movement from the Illinois, Indiana, and Eastern Kentucky coal fields requested permission of the Interstate Commerce Commission to reduce the fine coal rates from those districts to Eau Claire, Wis., 16 cents per ton and simultaneously requested Fourth Section relief to avoid spreading such rate reductions. At a conference between the Chief Traffic Officers of roads involved, held in the office of the Commissioner, tentative agree ment was reached to the effect that (a) Head-of-Lakes and Ashland lines would endeavor to readjust upward the rates on fine coal to Eau Claire, Ladysmith, and Cornell; (b) the Fox River Valley lines would endeavor to reach agreement looking toward the rearrangement of the Commission's scale of rates from Lake Michigan ports into the Fox River Valley of 94 cents per ton, except between Green Bay and Appleton, where, on account of truck and barge competition, it was contemplated a rate of 75 cents per ton would be maintained; (c) the Green Bay & Western Ry. Co. would hold in abeyance publication of tariff providing for a reduction in fine coal rates from Green Bay to Wisconsin River Valley District points at $1.25 per ton; (d) Illinois railroads agreed to refrain from taking action upon application pending before the Interstate Commerce Commission, seeking Fourth Section relief on fine coal rates from the Illinois, Indiana, and Eastern Kentucky Coal fields to Eau Claire, Wis. Delay subsequently developed in handling this matter by the Head-of-Lakes lines. However, at a subsequent meeting, the Fox River Valley lines agreed upon a readjustment of fine coal rates from Lake Michigan ports to points in the Fox River Valley District, which would maintain the Commission's scale of 94 cents from all ports to all points in the Valley, except that a rate of 85 cents per ton would be established from Green Bay to Appleton, in order to meet barge and truck competition. It was later found that the Green Bay & Western Ry. Co. had published the reduced rates into Wisconsin River Valley points from Green Bay. However, this had no bearing upon the Fox River Valley situation, which will remain composed on the basis indicated above. Further steps are now being taken with the Green Bay & Western Ry., looking toward maintenance of the previous rates into the Fox River Valley, and it is hoped that these efforts will prove successful. 6. Transcontinental Freight Schedules. Recently, in order to permit Eastern railroads handling traffic from Wisconsin and Iowa points to New York through the Chicago gateway to meet competition afforded by cross lake ferry and rail connections from Milwaukee and Manitowoc into Atlantic Seaboard points, schedules out of Chicago were established, leaving at 7:00 A. M. and providing second morning delivery at Atlantic Seaboard thereafter. It developed that a large amount of traffic originating in California and Pacific Northwest points was available for movement on the newly established 7:00 A. M. trains and, as a result, the Transcontinental schedules which have been in effect for many years were reduced to the point where ninth morning team track and late auction delivery were afforded at New York, as compared to the prior schedules affording tenth morning deliveries. Conference between Eastern and Western carriers was arranged on June 9, 1936 in an endeavor to stabilize the Transcontinental schedules and at the same time recognize the schedules from Wisconsin, Iowa, and Illinois points to New York, account truck competition. At that time agreement was reached subscribed to by Eastern, Western, and Chicago Belt Lines to the effect that arrangements would be made covering the delivery of traffic at Chicago to the Belt Lines and the subsequent delivery of such traffic by the Belt Lines to Eastern connections in such manner as would maintain tenth morning delivery at New York markets and other Eastern points carrying a comparable schedule. Effort was made to perfect a plan whereby the above might be accomplished by cooperation of Western railroads and Chicago Belt Lines. However, this failed of its purpose and notice was served by the Indiana Harbor Belt Railroad Company of intention to withdraw from the agreement, effective Monday, June 29th. In view of the particular interest in this subject by Western carriers, it was felt that some step should be taken which would preserve the integrity of tenth morning delivery at New York, since a change to ninth morning delivery at New York would automatically carry with it request upon the carriers by Chicago consignees for seventh morning guaranteed auction delivery at Chicago. To that end, Western carriers agreed to withhold delivery of California and North Pacific Coast shipments for Eastern destinations at Chicago until sufficiently late on the seventh morning to avoid the possibility of such cars moving forward on the newly established Eastern trains. This program is now in effect and will doubtless prove successful. Policing of the agreement has been placed upon the office of the Commissioner and every effort will be made to secure a maintenance of existing schedules, since it is felt that change in schedules to advance deliveries at Atlantic Seaboard points will involve larger expenditures upon the part of Western carriers for freight train service without producing any additional freight revenue. At the meeting of the Committee of Directors to be held on July 8th, report will be submitted concerning the activity of Western carriers in conjunction with 1936 joint advertising program and Railroad Week. Very truly yours, H. G. TAYLOR, Commissioner. EXHIBIT No. 320 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 July 1936: 1. Proposal of the A. T. & S. F. Ry. Co. To Establish 12¢ Coach Fares Intrastate in California.-There has been no change in the status of this controversy since my report of May 6, 1936. 2. Optional Honoring Arrangement on Interstate Tickets by the A. T. & S. F. Ry. Co. Between Los Angeles and San Francisco With Santa Fe Trail Stages.— This subject was considered at meeting of the Committee of Directors held on July 8, 1936, at which time the following resolution was unanimously adopted: "WHEREAS briefs have been received by the Committee of Directors from the Southern Pacific Company and the A. T. & S. F. Ry. Co., supporting their respective contentions in the optional honoring arrangement in dispute, and "WHEREAS, upon request of the Committee of Directors, the Commissioner has reviewed the subject in light of these subsequent submissions to the Committee of Directors and has reaffirmed the decision rendered. "Be it resolved, That, after careful review and consideration by the Committee as a whole, it determines that no good purpose would be served by pursuing the subject further." This information has been transmitted to the Chief Executives of both the Southern Pacific Company and the A. T. & S. F. Ry. Co. 3. Proposal of the C. St. P. M. & O. Ry. Co. To Reduce Rates on Fine Coal From Head-of-Lakes to Chaska, Minnesota.-There has been no change in the status of this controversy since my report of July 2, 1936. 4. Freight Schedules.-As reported at meeting on July 8th, there has been considerable agitation looking toward a reduction in time on Eastbound Transcontinental Freight Schedules. Early in June some of the Eastern carriers placed new schedules between Chicago and the Atlantic Seaboard in effect, which, if transcontinental traffic should be handled in such trains, would shorten the schedule from California from tenth morning to ninth morning at New York. It is understood that the auction at New York begins at 10:30 P. M. and while the new schedules would afford a 1:30 A. M. arrival and thus make possible ninth morning team track and late auction (7:00 A. M.) it would be necessary under the proposed schedules to make the early auction to which the bulk of this traffic is destined. As a result, it was felt that if the ninth morning team track and late auction (7:00 A. M.) were granted, demand would immediately be forthcoming for ninth morning early auction which would necessitate a revision of schedules from the Atlantic to the Pacific Coast carrying with it a guaranteed seventh morning auction at Chicago instead of the existing eighth morning auction with the understanding that cars available at Chicago will be delivered for seventh morning auction. Following a conference of Eastern and Western carriers held in Chicago, it was determined that the existing schedule of tenth morning at Atlantic Seaboard points should be maintained and in order to insure maintenance of such schedule, agreement was reached whereby Western carriers would refrain from delivery of traffic originating in California and at stations in the Pacific Northwest located west of the Cascade Mountains for the newly established 7:00 A. M. trains out of Chicago. Restrictions placed upon that traffic, however, did not apply to traffic originating at stations intermediate to the Cascade Mountains and Chicago. The St. Louis lines felt that by permitting intermediate traffic to move on the expedited schedule to New York through the Chicago gateway, the St. Louis gateway was placed at a serious disadvantage and accordingly request was made upon Eastern carriers by St. Louis lines for the establishment of a service from St. Louis to the Atlantic Seaboard which would be comparable to that afforded from Chicago. As a result of that request, conference was held in Chicago on July 24th and later conference in St. Louis on July 28th, following which certain Eastern lines agreed to establish, effective August 3d, trains out of St. Louis departing at 2:30 A. M. and connecting with the 7:00 A. M. trains out of Chicago, thus placing Chicago and St. Louis gateways on a parity in the handling of this intermediate traffic. Request has been received from shippers to permit the restricted traffic to move on these new trains and secure ninth morning delivery at Atlantic Seaboard points. However, at the present time, it is the intention of Western carriers to endeavor to maintain previous schedules and avoid the large expenditure necessary to expedite and guarantee a shortened schedule without regaining to the rails additional sufficient traffic to warrant such increased expense. 5. Railroad Week, 1936.-Western Railroads celebrated the Second Annual Railroad Week during period July 13-18, 1936. At that time practically every station in Western territory was able to secure the cooperation of Chambers of Commerce, Service Clubs, such as Rotary, Lions, etc., and other civic and commercial organizations in carrying out a program which brought the advancement in railroad practices before the public in Western territory. Reports received following Railroad Week indicate that this activity in 1936 was even more successful than in 1935. It is estimated that approximately 3,000 addresses were made at various points in Western territory before commercial clubs and other civic organizations outlining railroad practices and policies, and the support which has been received from the press in this territory has been exceedingly gratifying. The fact that Western carriers embarked upon a joint advertising campaign in which not only the daily papers but the country weeklies in Western territory were used, undoubtedly had an influence, but the expressions received from publishers and others indicate a decidedly favorable attitude toward railroads and the resultant publicity cannot be other than beneficial to the industry a a whole. Very truly yours, H. G. TAYLOR, Commissioner. EXHIBIT No. 321 COMMISSIONER OF WESTERN RAILROADS, To the Committee of Directors: For your information, I am outlining below activities upon which I have been engaged since my last report of September 10, 1936, to date: 1. Proposal of the A. T. & S. F. Ry. Co. To Establish 12-Cent Coach Fares Intrastate in California.-There has been no change in the status of this controversy since my report of May 6, 1936. 2. Proposal of the C. St. P. M. & O. Ry. Co. To Reduce Rates on Fine Coal from Head-of-Lakes to Chaska, Minnesota.-The Minnesota Rate Committee on October 27, 1936, put in effect a tariff naming a rate of $1.52 on fine coal from Head-of-Lakes to Chaska, Minn., and inasmuch as the protestant road is a party to such tariff, the matter was disposed of without the necessity of a Commissioner ruling. 3. Freight Schedules-(a) Proposal of Colorado & Southern, Fort Worth & Denver Lines to Inaugurate Expedited Freight Schedules Between Denver and Fort Worth-Dallas-Houston to Enable That Route To Compete With Existing Routes in Handling Traffic Originating North and West of Denver to Fort Worth, Dallas, and Louisiana Territory.—Protest filed as result of this proposal was explained in some detail in my letter of September 10, 1936, ending with advice that following conference on September 8, decision under the Commissioner Agreement was being withheld pending opportunity for the Missouri-Kansas-Texas lines to further review their situation, with the thought that formal protest might be withdrawn and no change in service made between Kansas City and Texas. As was forecast, the Missouri-Kansas-Texas R. R. did withdraw their formal protest to this service, serving notice of intention to revise their schedule to arrive at Fort Worth comparable to the proposed C. & S.-F. W. & D. C. arrival. Following this decision, the Union Pacific served notice of intention to make deliveries of traffic at Kansas City for evening departure that heretofore had been due for delivery the following morning. The Union Pacific's announcement brought protest from the Burlington Lines, claiming that traffic destined to Oklahoma points and other destinations in the South and Southwest, formerly arriving Kansas City 2:00 A. M., would arrive Kansas City 4:00 P. M. of the previous day in time for forwarding on evening trains out of Kansas City. Hearing was had on the Burlington protest and it was the position of the Union Pacific and its connections at Kansas City that they were merely meeting the Burlington's schedule between Denver and Fort Worth. It was pointed out |