ways felt that the value of the testimony of a witness depends on the experience that the individual has had, and, as you have related, you have had considerable experience. That certainly qualifies you to render worthwhile service to the committee.

Mr. SPRINGER. Mr. Chairman, may I say that the Solicitor has a very fine reputation in the State of Illinois.

Mr. Loos. Thank you.

Mr. DOLLIVER. I want to get in a word, Mr. Chairman. He was born in Iowa, so he has had a good background.

The CHAIRMAN. And, if he had been in New Jersey.

Mr. HINSHAW. Of course California has given the gentleman employment for a large part of his life.

Mr. Loos. That latter I think is probably the most important, Mr. Hinshaw.

Mr. HARRIS. I am wondering if Texas cannot get in somewhere. Mr. THORNBERRY. It will, sooner or later.

Mr. Loos. I did some work for the Rio Grande Valley Citrus Exchange at one time.

The CHAIRMAN. You may proceed.

Mr. Loos. The substance of the legislation proposed in H. R. 3203, if enacted into law, would preserve intact the most efficient and economical transportation service yet developed in the marketing of a very large part of our total farm production.

A brief summary of the events leading up to this modern, flexible, and expeditious system of distributing farm commodities by motortruck may contribute to a better understanding of the serious condition which the proposed legislation, if adopted, would remedy.

Beginning around the turn of the century, with the initial social and economic program for getting the farmer out of the mud, there has come down to us our highway system of today. With improved methods of highway construction, accompanied by proficiency in carrying equipment, the marketing area for farm commodities has been enlarged through the medium of motortruck transport by going from the country or farmers' markets directly into the smaller consuming markets instead of transshipping to such markets through the larger centers. Other advantages now imperiled will be referred to later on.

Thus, with expansion of the marketing area for farm commodities, there began to develop collaterally another system of motor carriage whereby merchandise along with other fully manufactured and semimanufactured goods was transported between the industrial point of processing and various distant centers of population. These centers of population, both large and small, are also consuming markets for the food and fiber produced on the farm.

Motortruck operations between the States were placed under varying degrees of Federal administrative regulations by enactment in 1935, of what is now part II of the Interstate Commerce Act.

The group which is subjected to the more extensive range of regulation is made up of common carriers of general commodities, operating principally in relation to outbound movement of goods to which value has been added by processing.

The primary or No. 1 prerequisite is a certificate of convenience and necessity, many of which, while authorizing the holder to engage in transporting general commodities, also by choice of the holder exclude

certain commodities of importance to agriculture. Among these are: perishables, livestock, grain, commodities in bulk, commodities which are injurious or contaminating to other lading. The usefulness of these carriers to agriculture is peculiarly limited by rigid route and territorial restrictions, some of which are self-imposed.

The second attribute of regulation relating to this group of more fully regulated carriers is the requirement of filing tariffs setting forth their rates and charges, the levels of which have not been affirmatively fixed except in a fragmentary manner. The railroads and motor carriers of passengers are required to maintain through joint routes and rates, but not so these freight carriers of general merchandise. This type carrier maintains a rate structure which is closely attuned to the top strata of rates published by the railroads for transporting the higher grades of freight, but here that similarity ends, for the motor carriers place a mezzanine floor under the structure, whereas the railroad pattern extends down to the main floor level of mass transportation.

Another or a third incident of regulation applicable to the common carrier of general freight socalled, is the requirement of keeping books and filing periodic reports under a system of accounting practices prescribed by the Interstate Commerce Commission.

The fourth and final aspect of regulation is the requirements for the fitness of drivers, their hours of work and safety of equipment. These rules are referred to as the revision of 1952 in Ex parte No. MC-40, and as stated on the title page of the rule book are applicable to common carriers, contract carriers, private carriers and "exempt carriers" (sec. 203 (b)). The two kinds designated first are the minority category, which are subject to all of the four aspects of regulation heretofore briefly described. However, with respect to the majority category including farmer-owned trucks, other forms of private carriage and public carriage including the agricultural hauler, the Commission's jurisdiction does not include the first three incidents of regulation, but it is limited to the No. 4 or safety aspect of regulation. Attention is directed to three of the Commission's safety regulations:

192.3 Driving rules to be obeyed.-Every motor vehicle shall be driven in accordance with the laws, ordinances, and regulations of the jurisdiction in which it is being operated, unless such laws, ordinances, and regulations are at variance with specific regulations of this Commission which impose a greater affirmative obligation or restraint.

192.5 Alcoholic beverages.-No driver shall drive or be required or permitted to drive a motor vehicle, be in active control of any such vehicle or go on duty or remain on duty when under the influence of any alcoholic beverage or liquor, regardless of its alcoholic content nor shall any driver drink any such beverage or liquor while on duty.

192.6 Schedules to conform with speed limits.-No motor carrier shall schedule a run nor permit nor require the operation of any motor vehicle between points in such period of time as would necessitate the vehicle being operated at speeds greater than those prescribed by the jurisdictions in or through which the vehicle is being operated.

There are, of course, many other excellent rules which go to the promotion of safety on the public highways. Nevertheless, it may be seen that real policing for minimizing the hazards to life and limb is performed by the States, almost any one of which maintains a force

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vastly superior in number to that assigned to such duties by the Interstate Commerce Commission.

The substantial and material differences between the transportation needs of manufacturing and merchandising on the one hand, and the transport channels of marketing farm commodities on the other, will not be reconciled within the foreseeable future. Congress has dealt realistically with this situation from the very beginning, by limiting the Commission's jurisdiction over the operation of farmaffiliated trucks. By direct legislative amendments that limitation has been affirmed and emphasized. However, circumstances have arisen, which, unless removed, will admittedly circumvent the agricultural limitation or referring to such limitations in the vernacular the "agrcultural exemptions" will, by indirection, be seriously curtailed.

With both the quality and quantity development of our highway system attended by rapid technological improvements of the motor truck there has been a natural and normal increase in mutually advantageous operating arrangements between the more regulated common carrier of manufactures and miscellaneous merchandise and the less regulated agricultural commodity hauler. The common carrier of general freight with excess cargo offerings leases for a single trip the farm-affiliated vehicle which after discharging farm commodities would otherwise return empty to country markets or packinghouses for reloading farm commodities in the very area where the common carrier must terminate its excess cargo of processed goods. The movement of agricultural commodities is largely in one direction and unless the farm affiliated vehicle emptied at destination returns under load the empty cargoless miles result in serious economic waste.

It may be stated that utility by the railroads of a refrigerator car for perishables in one direction and for dry freight in the reverse direction is somewhat illustrative of the truck trip-leasing custom. If the long-established practice of trip-leasing farm-affiliated trucks to the certificated general freight carrier is abolished it cannot be denied that modern agricultural marketing will be disrupted and heavily burdened with transportation difficulties which are in conflict with the Agricultural Marketing Act of 1946 (U. S. C. 1946 ed. 1622j) providing for:

an integrated administration of all laws enacted by Congress to aid the distribution of agricultural products *** to the end that marketing methods and facilities may be improved, that distribution costs may be narrowed, that dietary and nutritional standards may be improved, and that new and wider markets for American agricultural products may be developed * * *

Some fully regulated carriers may have a flow of highly desirable traffic, well balanced as to movement in both directions. Other carriers, less fortunately situated, trip lease the farm-affiliated truck which otherwise would move empty. Thus, it is that the practice of trip leasing contributes materially toward minimizing empty wasteful mileage, both as to the more fully regulated carrier of general freight and the less regulated farm affiliated vehicle. This practice is but one of numerous factors affecting the operating ratios of more fully regulated carriers.

On the other hand, the practice of trip leasing farm affiliated trucks to the more fully regulated carriers has over the years become an in

tegral part of our modern system of marketing farm commodities. It is, as stated, but one of many factors bearing on the operating ratio of the fully regulated carriers. However, it is a most vital factor in the less regulated farm commodity carrier's ratio and without it his rate levels would be thoroughly disrupted and unstabilized. Continuance of the trip-leasing practice is essential to the modern, efficient, and economical transportation adjunct of marketing, so greatly relied upon by the agricultural community.

The present disturbed transportation system now confronting all of agriculture stems from the decision of the Interstate Commerce Commission of May 8, 1951, in its docket identified as Ex parte No. MC-43. The inevitable result of that decision will be to force from the highways of our country many of the agricultural truckers hauling exempt agricultural commodities to consuming areas by depriving them of their right to trip lease their equipment and requiring that all leases be for not less than 30 days. Enforcement of this regulation will greatly curtail the operations of haulers of agricultural products and thereby the farmers of the country will experience poorer service and higher transportation charges, which will be reflected in a reduction of the net price they obtain for their products.

The pending legislation appears to be the only way to protect the farmer's interest in preserving the present efficient and flexible system of marketing farm products by motor trucks. The pending bill poses to remove the restrictions on trip leasing imposed by the Commission's decision.

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Since the advent of the Motor Carrier Act some 18 years ago, and for many years prior thereto, the farmers have been able to market their products with opportunity for utilizing the trip-leasing practice. Now, without change of statute or practice, continuance of their present operations is facing severe disruption which will prove not only costly to them, because of the transportation charges on the things they produce and consume, but will cause, in addition, reliance upon an inferior method of moving their products to market. The main point to consider here is that higher transportation charges and inadequate service will likely narrow their marketing area.

The effective date of the ICC decision in ex parte No. MC-43 is not known at this time. Many farm interests have petitioned the Commission to stay its decision until pending legislation has been considered by this committee.

There is no assurance at present as to when the Commission's order may become effective, hence the necessity for prompt action on the part of Congress if the farmers' rights, as presently accorded, are to be continued without interruption.

There are now approximately 150,000 section 203 (b) (6) trucks hauling agricultural commodities and fish in interstate and foreign commerce. These trucks provide an efficient and highly flexible transportation service for the marketing of the products of the American farm. This type of service is indispensable to the prosperity of the agricultural community. Economical operation of the trucks is dependent upon two-way movements.

The practice of these carriers of trip leasing their trucks to motor carriers (now Commission-certificated) on the return trips began long before passage of the Motor Carrier Act of 1935 and has since greatly

expanded. Both parties to the trip lease, the agricultural hauler as lessor and the Commission-certificated carrier as lessee, benefit from the economies inherent in such use of equipment; and the farmer has the benefits of expanded markets and lower transportation costs.

The agricultural haulers, when hauling nonexempt commodities under such trip leases, are performing their hauling service for the Commission-certificated carriers and the operations are entirely those of the Commission-certificated carriers.

Passage of H. R. 3203 would permit the continuance of a major part of the service now provided by these 150,000 exempt trucks, to the advantage of the American farmer who now depends upon such service, the Commission-certificated carrier who utilizes the exempt vehicles to augment his fleet, and the truck owner himself who may thus continue in business.

The service provided by the trip lease trucks is a service which permits perishables to be more fully matured before harvesting, then transported overnight for long distances for distribution within a matter of hours. Availability of fresh fruits and vegetables well matured and harvested in fresh, appetizing condition increases consumer demand and is reflected in improved returns to the grower.

What has been said with respect to fresh fruits and vegetables applies likewise to the movement of grain, cotton, livestock, tobacco, wool, and many other farm products. Should truckers now hauling these products to distant markets fail to obtain a return load, it would ultimately mean the removal of many such trucks from agricultural hauling with resulting increased charges for use of a service of diminishing quality.

It is common knowledge that certificates of public convenience and necessity issued by the Interstate Commerce Commission invariably contain route, territorial, or commodity limitations which make it impossible for Commission-certificated carriers to provide the flexible outbound transportation required by agriculture. The Commission likewise does not issue operating authorities to serve the widely separated turnaround points of origin which would be necessary in order to meet the back-haul requirements of agricultural haulers.

Commission-certificated carriers have become geared to the special needs of different segments of agriculture in that they utilize the otherwise empty equipment of agricultural haulers on the latter's back-haul movements. Should the exempt carriers now be forced to cease trip leasing their equipment to Commission-certificated carriers on back-hauls, as the result of Commission action, 1 of 2 consequences must follow. The transportation charges on the outbound agricultural movements must be increased in order to compensate those carriers for their empty back-hauls, or such traffic will be diverted to rail carriers with their slower and less flexible services, including additional handling of the traffic. In either event, the marketing area would be appreciably restricted. We believe that is highly undesirable, particularly as regards the distribution of the products of agriculture and that it materially impairs the practical benefits which Congress originally intended for the agricultural exemptions.

For the foregoing reasons and those presented by other agricultural interests appearing before you, together with the reasons shown by our opposition to S. 2357 and S. 2362 at the last session of Congress, we recommend the passage of H. R. 3203.