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COMPTEOLLER GENERAL OF THE UNITED STATES,
Washington, June 30, 1955. 2) POT PRIEST,
german, Committee on Interstate and Foreign Commerce,
House of Representatives, Washington, D.O. Iu M (HAIRMAN : Reference is made to your letter dated May 11, 1955, • 1 click there was enclosed a copy of bill H. R. 6141. You request a report *999 with any comment we may desire to make concerning this proposed
derstand that this bill is identical to bill S. 1920, introduced in the me states Senate on May 9, 1955. These bills are designed to implement the
l'lations made to the President in a recent report by the Presidential - evenmittee on Transport Policy and Organization, which was endorsed • President when released on April 18, 1955. While H. R. 6141 is in the
ta single bill, there is included a series of important proposed changes :- terstate commerce Act, which apparently will have far-reaching effect Le transportation industry and the users of transportation services. The
of a detailed report on all of the proposed changes in the Interstate * Act would entail extensive study. It has been said that many of
changes are highly controversial and that extensive hearings are con· Eu te for any of the proposed changes can be enacted into law. Our
:s are limited to those provisions of H. R. 6141 which would seem to . dret influence upon the United States Government in its capacity as a . innspiration services.
of the bill would amend section 22 of the Interstate Commerce amended by eliminating "the United States, State, or municipal gov
from the classes of shippers as to which section 22 provides that la part I of the act sball prevent the carriage, storage, or handling of
fror at reduced rates. It would eliminate also a similar provision ... 2 with respect to the transportation of persons for the United 2- toppen er at reduced rates. Section 8 of the bill would amend section
the Interstate Commerce Act, as amended, so as to include in paragraph
to 15a a provision which would authorize the establishment, mainte3bemt!08, and application of "rates, fares, charges, and rules and reg2 m geral application" for transportation service to the United States, - and municipal governments. It is apparent that the mentioned pro
<ifetion of the bill is intended to preserve for the benefit of the desigom la of shippers at least some of the current benefits of section 22 of the *** y* ('ommerre Act, which would be eliminated by the enactment of
9 H R 6141.
!s not required in the public interest, and we have recommended in
heas designed to accomplish that result. This view was predicated 7, fart, among others, that the proposed amendment of section 22, without = ).-n elsewhere in the act of a compensating or mitigating provision, Tatly increase the cost of Government operation. In that connection
is insited to the fact that in a letter dated April 30, 1932, the Assistant ury of Defense, Charles A. Coolidge in reporting to the Committee on ate and Foreign Commerce, United States Senate, upon a bill then pend
pated that annual Department of Defense costs would be increased by kan $1 million for transporting household goods alone, if the United
were to be excluded from the benefit of section 22 of the Interstate ('om-- Art in relation to that commodity only. Later information, in letter of wober 19, 1953, from the Department of Defense to this Office, is to the
er hat a subsequent statistical study of all movements of household goods bentor carriers shows that, if all traffic were required to move under rates
stay in M. F.-I. C. C. No. 57, rather than at rates provided in other tariffs Bually breed apparently by virtue of section 22 agreements, an increase of $1114 2 nn annually in cost to that Department would result. It is believed here at the probability of rates being obtained below a compensatory level, as to ryamsiderable amount of traffic, if any, under the authorization of section 2 Schciently negatived by the fact that the authorization in section 22 is perleave and not mandatory and by the further fact that the interests of perI ming carriers would not seem to be served by any consistent policy of furnish24 Gorerntsent transportation at a loss.
Obviously section 8 of the proposed bill, if its apparent purpose to afford the Government reduced rates is assured would compensate in some degree at least, for advantages that would be lost through the exclusion of the United States from the permitted concessions authorized in section 22. It is noted, however, that the authorization mentioned in section 8 of the bill extends only, in its terms, to rates, fares, charges, etc., "of special application" for transportation service to the United States, States, and municipal governments, and requires that such rates shall be subject with certain specified exceptions, "to all other applicable provisions of the Act." It is assumed it is the purpose of this provision to remove the rates, fares, etc., as so authorized, from attack on the grounds of being unjustly discriminatory or preferential when lower than other regularly established rates applicable commercially, but the omission from the bill of any express authorization of "reduced” rates for Government traffic and the indefiniteness possible of attachment to the phrases "of special application" and “all other applicable provisions" (emphasis supplied) are considered as justifying the suggestion that, if section 22 is to be amended so as to exclude the I'nited States from its provision, then the authorization to be afforded under section 8 of the bill should be made clear as permitting reduced rates for Gov. ernment traffic and providing that any discrimination in favor of the United States is not subject to attack per se. It would seem that, even with these spe cific provisions, section 8 of the bill, if enacted, would still require that such rates be subject to the minimum and maximum rate provisions of the bill.
It would seem, also, that the provision in section 8 of the bill, making the rates on Government traffic subject to all other applicable provisions of the act, except as specifically provided by section 8 of the bill, would render questionable whether the provisions of section 16 of the Interstate Commerce Act might not be considered as applicable to proceedings instituted by the Government. We considered the question of a proposal to prescribe limitations upon actions involving rates upon Government traffic in a report to the Committee on Interstate and Foreign Commerce, United States Senate, May 31, 1955, upon bill s. 543, and we expressed the view that any limitation of less than 3 years for instituting proceedings before the Interstate Commerce Commission to seek reparation as for unreasonable rates, with respect to transactions occurring during times of emergency, would be wholly inadequate to the due protection of the Government's interests. It is believed proper also to call attention to the fact that if the provisions of section 16 of the Interstate Commerce Act, with respect to limitations upon suits to recover overcharges, were to be considered applicable to the Government, the incongruous result would ensue that under judicial interpretations of section 16 of the act the carriers would be permitted 6 years within which to bring suit against the Government for collection of undercharges, as compared, with the shorter period of 2 years prescribed in section 16 with respect to suits by shippers for recovery of overcharges. It is believed the provisions of the bill should be clarified in this respect. We have no other recommendations to make at this time. Sincerely yours,
FRANK H. WEITZEL, A88istant Comptroller General of the United States,
DEPARTMENT OF THE ARMY,
Washington, D. C., April 24, 1956. Hon. J. PERCY PRIEST, Chairman, Committee on Interstate and Foreign commerce,
House of Representatirex, Washington, D.C. DEAR MR. PRIEST: Reference is made to your request to the Secretary of Defense for the views of the Department of Defense with respect to H. R. 6141, 84th Congress, a bill to amend the Interstate ('ommerce Act, as amended, so as to provide for a stronger national transportation industry, and for other purposes. The Secretary of Defense has delegated to the Department of the Army the responsibility for expressing the views of the Department of Defense.
The purpose of H. R. 6141 is to carry out recommendations made by the Presidential Advisory Committee on Transport Policy and Organization in its report released by the White House on April 18, 1935. The Department of Defense is interested in the effect that such legislation would have on the movement and cost of military traffic, and upon the the effect it might have on the health of a national transportation system adequate to meet the needs of national defense.
-* !Betpes are considered quite important. The comments in this report deal 12 wholly with implementive particulars. The Secretary of Defense particiem a the basic study of the existing regulatory scheme and was well aware ?! Dend to a) strengthen the common-carrier transportation industry, and .; \ rlar the shackles of regulation so that competitive forces, which have godh a vital part in the development of this country, would again assert ere in the transportation industry. The proposed legislation is designed
mphish these objectives and, in principle, has the wholehearted support of Iarnent of Iefense. The Presidential Advisory Committee recommended removal of the requirement
up approral (italie sic) for departure from both the long-and-short-haul * 49 and the aggregate-of-intermediates clause, appearing in section 4 of the
ortron 4 of the bill (p. 5, line 21, et seq.) makes two principal changes in + 4 f the act: • Repeals the aggregate-of-intermediates clause without any replacement.
Permits departure from the long-hand-short-haul clause if necessary to Totaal competition and if the charge to or from the more distant point is
'han a just rond reasonable minimum charge. 18--78 reasons, other than competition, may be ascribed for the establish
(rates wh:<h u ben aggregated result in a rate lower than the through rate ** en and between specified points. Consequently, outright unconditional
in the aggregate of intermediates clause will permit carriers to (a) raise
17h ratex to exceed the aggregate of intermediates, (b) continue, when ; "Lugh rates higher than the aggregate of intermediates, and (c) es
pe rates in excess of the aggregate of intermediates. Maintaining a
rate higher than the aggregate of intermediates cannot be justified on pnd except where one or all of the factors making up the aggregate of sertedians have been established to meet some type of competition. In genm. natra are limited to the aggregate-of-intermediate rates merely by the inser
alaraqs in tariffs. To repeal the aggregate-of-intermediates clause, leav686 pers only recourse under other provisions of the act, is likely to work
and unduly increase litigation under section 3 of the act without accomking any substantial improvement in regulation as a whole. It may also
up travelers and shippers to adopt or attempt various devices to interrupt tras l. or the transportation of their goods, so as to obtain the benefit of the the intermediate fares or rates, a result not in the direction of transporta
Grimary or orderliness. e proped outright exceptions to the long-and-short-haul clause (p. 6, lines
:Pibe :II) also go beyond the intent of the recommendations of the Presibez ? Advisory ('ommittee. However, the conditions established conform to 1 mrd in those recommendations and coincide with standards under which
Paterstate ('otumerce Commission today generally grants relief from the long14 burt-taul provisions. Apparently, the proviso in section 4 of the bill intends
perse all standards and remedies provided in other sections of the act. 1989. under the principle, expressio unius est exclusio alterius, construction Sarf auld become uncertain because of this proposed proviso. In order DT the possibility of varying legal construction in this connection, it is
d that the imposition or a lesser charge for longer than for shorter hauls • vt to the standards of lawfulness set forth in other sections of the act. 5 following quoted paragraph is suggested to meet the objections of the
. para raphs. Except for the italicizing of the phrase "Provided, howw go "Halle indicates additions with respect to the aggregate of intermediates
Rus and short-haul clauses. * 4 Paragraph (1) of section 4 of the Interstate ('ommerce Act, as
dis amended to read as follows: :! It shall be unlawful for any common carrier subject to this part or part .!! t. rlarge or receive any greater compensation in the aggregate for the transjuriation of passengers, or of like kind of property, for a shorter than for a longer
sance over the same line or route in the same direction, the shorter being inated within the longer distance, or to charge any greater compensation as a Idrest rate than the aggregate of the intermediate rates subject to the prori. us of this part or part III escept in cases where any or all of the single factor often used to make up the aggregate-of-intermediates rate has been established by the carrier to meet competition, but this shall not be construed as authorizing
san arrier within the terms of this part or part III to charge or receive "prost pompensation for a shorter as for a longer distance : Provided, howerer,
that such common carrier may charge less for longer than for shorter distances for the transportation of passengers or property if the charge established to or from the more distant point (a) is necessary to meet actual competition of another carrier or carriers, (b) is not less than a just and reasonable minimum charge, and (c) is not otherwise in violation of this part or part III.'"
In line 16, page 7 of the bill the word "interstate" should be "intrastate."
The proposed new section 15a (5) (p. 15, line 10, et seq.) which supersedes section 22 of the act provides for transportation service to the United States Government. It would appear reasonable and consistent with the authorization for rates, fares, charges, and rules and regulations of special application to substitute the word “for" for the word "to" mentioned above. It is therefore recommended that the said first sentence be changed to read as follows:
“The establishment, maintenance, publication, and application of rates, fare, charges, and rules and regulations of special application to transportation services for the United States, State, and municipal governments by carriers subject to this Act is hereby authorized."
On page 16, line 21 of the bill, the words “tenders or" should be added before the word “contracts." This change is required by the fact that very few actual contracts providing for free or reduced rates exist, whereas, thousands of unilateral rate tenders have been filed under section 22 of the act.
The fiscal effects of the bill cannot be estimated.
This report has been coordinated among the departments in the Department of Defense in accordance with procedures prescribed by the Secretary of Defense.
The Bureau of the Budget advises that there is no objection to the submission of this report for the consideration of Congress. Sincerely yours,
WILBER M. BRUCKER,
Secretary of the Army.
OFFICE OF THE POSTMASTER GENERAL,
Washington, D. C., November 17, 1955. Hon. J. PERCY PRIEST, Chairman, ('ommittee on Interstate and Foreign Commerce,
llouse of Representatires, Washington, D. C. DEAR MR. ('HAIRMAN: Reference is made to your request for a report on H. R. 6141, a bill to amend the Interstate Commerce Act, as amended, so as to provide for a stronger national transportation industry, and for other purposes.
This bill is related to the transportation of persons and property by railways, motor carriers, and water carriers, and has but limited relation to the transportation of mail.
Section 8 of this bill would amend section 15a of the Interstate Commerce Act so as to provide, among other things, for the “establishment, maintenance, publication, and application of rates, fares, charges, and rules and regulations of special application for transportation service to the United States, State, and municipal governments by carriers subject to this act" subject to certain conditions. The provisions of law embodied in section 542, title 39, United States (ode, authorize the Interstate Commerce Commission to fix rates for the transportation of mail by railways. Rates so fixed, however, do not apply to ma ils transported under special arrangements in freight trains, for which rates not exceeding the usual and just freight rates may be paid (39 U. S. C. 555). Hence, section 15a of the Interstate Commerce Act, as it would be amended by this legislation, would open up a possibility that carriers would file special freight rates for transportation service to the United States, lower than comparable rates for other shippers, which rates would be available to this Department, for bulk shipment of mail by freight. At the present time, limited use is made by this Department of this authority to ship mail at freight rates.
Section 9 of this bill would amend section 22 of the Interstate Commerce Act by deleting the United States as one of the parties to whom common carriers inay offer free carriage or reduced rate for the transportation of persons or property. However, no change would be made in the provisions of law embodied in section 1 (7), title 49, United States Code, wherein free transportation is authorized for "railway mail-service employees and persons in charge of the sten on duty and traveling to and from duty, and all duly accredited mais and advers of the Post Office Department and the Railway Mail Service - ce inspectors while traveling on official business, upon the exhibition or credentials. ." Thus, this bill does not affect the existing authority per tranquitation of postal agents and officers traveling on official business. Toto 11 de not affect the authority of the Postmaster General to enter
#racts with railway common carriers for the transportation of mails, & entendied in sections 565 and 571, title 39, United States Code, and ora), title 49, I'nited States Code.
Interstate Commerce Commission does not exercise control over rates for >>ansportation of mail by motor carriers or water carriers, and this bill Sm Dot affect the Postmaster General's authority to contract with such
1.s root believed that the enactment of this legislation would have any 1 rable effect upon the revenues or expenditures of this Department. to new of the foregoing, this Department would interpose no objection to
sotment of this legislation. is ...ng tbls. Department with respect to its report to the chairman of the RIP i mittee on Interstate and Foreign ('omnierce on S. 1920, a bill identical
H R 6141. the Bureau of the Budget stated that there would be no objection e sotm.c!on of the Department's report to the committee. werely yours
MAURICE H. Stans, Acting Postmaster General.
EXECUTIVE OFFICE OF THE PRESIDENT,
OFFICE OF DEFENSE MOBILIZATION,
Washington, D. ('., October 28, 1955. I PRO l'unst, derman, Committee on Interstate and Foreign Commerce,
House of Representatives, Washington, D. O. les Me Purst: Reference is made to your letter of October 25 in which
ont aur (nments concerning H. R. 6141, a bill to amend the Interstate corre Act, as amended, so as to provide for a stronger national transporta
lastry, and for other purposes. other evoditions of full mobilization the transportation system of the United ***** uld be under a serere and heavy burden and it is important that any pool transportation policy be designed to strengthen as soon as possible the 1.4e eletornts of that system so that they would be better equipped to handle wad. All segments of the transportation system have important emergency
e and should be economically capable of providing the maximum service **be technical development needed in time of war.
The report of the Presidential Advisory Committee on Transport Policy and
ARTHUR S. FLEMMING, Director.
June 20, 1956. 3. PO PRIEST, Chairman, Ilouse Interstate and Foreign Commerce Committee,
House of Representatives, Washington, D. C. Dreas ME. ('HAIRMAN: It has come to the attention of this Department that peer metamittre is conducting hearings at the present time on H. R. 325, a bill
up to amend section 22 of the Interstate ('ommerce Act, as amended, and fe her purposes. The bill would repeal that part of section 22 of the InterRate Premerce Act which enables the various Government agencies, particularly telupartment of Defense, to negotiate rates for the carriage of Government yerty with the various classes of carriers.