Statements submitted by-Continued Speyer, H. W., president and general manager, AAA Transportation, Page 170 Sutherland, D. L., chairman of the board, Middle Atlantic Trans- Anderson, Gale C., executive secretary, Nebraska Cooperative Coun- Bewley, William C., chairman, Georgia Peach Industry, Post Office Box 286, Macon, Ga., to chief clerk, Committee on Interstate and Foreign Commerce, dated May 4, 1953... Blaine, Charles E., and others, representing National Cattlemen's Association, National Wool Growers Association (Texas) and Southwestern Cattle Raisers Association, Texas Sheep and Goat Raisers Association and Live Stock Traffic Association (of Texas), to Hon. Dwight Griswold, dated July 8, 1953 Darcy, Charles J., chairman, NRFA Traffic Committee, and warehouse Decker, C. S., acting chairman, legislative committee, the National Council of Private Motor Truck Owners, Inc., Sheraton Building, Washington, D. C., to Hon. Dwight Griswold, dated July 13, 1953__ Marshall, Charles, president, Nebraska Farm Bureau Federation, Lincoln, Nebr., to Hon. Dwight Griswold, dated July 2, 1953. Reneker, George J., chairman, the transportation committee, the Chicago Live Stock Exchange, Chicago, Ill. Report from Interstate Commerce Commission, dated July 7, 1953. House Report 519, 83d Congress. Resolution from Mountain-Pacific States Conference of Public Service 49 104 AMENDMENT TO INTERSTATE COMMERCE ACT (Trip-Leasing) WEDNESDAY, JULY 8, 1953 UNITED STATES SENATE, SUBCOMMITTEE OF THE COMMITTEE ON Washington, D. C. The committee met, pursuant to call, at 10:02 a. m., in the District of Columbia Committee room, Senator Dwight Griswold, presiding. Present: Senator Griswold. Also present: Mr. Edward R. Jelsma, member of the professional staff. Senator GRISWOLD. The subcommittee will come to order. I will first ask that a copy of the bill and a copy of the report of the House committee relative to this bill, as well as a copy of the hearings of the House committee (by reference only) on this bill, shall be incorporated as a part of the record. (The bill and the report referred to are as follows:) H. R. 3203, 83d Cong., 1st sess.] AN ACT To amend the Interstate Commerce Act, with respect to the authority of the Interstate Commerce Commission to regulate the use by motor carriers (under leases, contracts, or other arrangements) of motor vehicles not owned by them, in the furnishing of transportation of property Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 204 of the Interstate Commerce Act, as amended (49 U. S. C., sec. 304), is amended by adding at the end thereof the following subsection: "(e) The Commission is authorized to prescribe, with respect to the use by motor carriers (under leases, contracts, or other arrangements) of motor vehicles not owned by them, in the furnishing of transportation of property "(1) regulations requiring that any such lease, contract, or other arrangement shall be in writing and be signed by the parties thereto, shall specify the period during which it is to be in effect, and shall specify the compensation to be paid by the motor carrier, and requiring that during the entire period of any such lease, contract, or other arrangement a copy thereof shall be carried in each motor vehicle covered thereby; and "(2) such other regulations as may be reasonably necessary in order to assure that while motor vehicles are being so used the motor carriers will have full direction and control of such vehicles and will be fully responsible for the operation thereof in accordance with applicable law and regulations, including the requirements prescribed by or under the provisions of this part with respect to safety of operation and equipment; but nothing in this part shall be construed to authorize the Commission to regulate the duration of any such lease, contract, or other arrangement for the use of any motor vehicle, or the amount of compensation to be paid for such use." Passed the House of Representatives June 24, 1953. LYLE O. SNADER, Clerk. 83D CONGRESS 1st Session } HOUSE OF REPRESENTATIVES { REPORT No. 519 AMENDING THE INTERSTATE COMMERCE ACT WITH RESPECT TO AUTHORITY OF INTERSTATE COMMERCE COMMISSION TO REGULATE THE USE, BY MOTOR CARRIERS OF PROPERTY (UNDER LEASES, CONTRACTS, OR OTHER ARRANGEMENTS) OF MOTOR VEHICLES NOT OWNED BY THEM JUNE 8, 1953.-Committed to the Committee of the Whole House on the State of the Union and ordered to be printed Mr. WOLVERTON, from the Committee on Interstate and Foreign Commerce, submitted the following REPORT [To accompany H. R. 3203] The Committee on Interstate and Foreign Commerce, to whom was referred the bill (H. R. 3203) to amend the Interstate Commerce Act in order to prohibit the Interstate Commerce Commission from regulating the duration of certain leases for the use of equipment by motor carriers, and the amount of compensation to be paid for such use, having considered the same, report favorably thereon with amendments and recommend that the bill as amended do pass. The amendment to the text of the bill is as follows: Strike out all after the enacting clause and insert the following: That section 204 of the Interstate Commerce Act, as amended (49 U. S. C., sec. 304), is amended by adding at the end thereof the following subsection: (e) The Commission is authorized to prescribe, with respect to the use by motor carriers (under eases, contracts. or other arrangements) of motor vehicles not owned by them, in the furnishing of transportation of property "(1) regu.ations requiring that any such ease contract or other arrangement shall be in vriting and be signed by the parties thereto. shall specify the period during which it is to be in effect and shal specify the compensation to be paid by the motor carrier, and requiring that during the entire period of any such lease, contract, or other arrangement a copy thereof shall be carried in each motor vehicle covered thereby: and "(2) such other regulations as may be reasonably necessary in order to assure that while motor vehicles are being so used the motor carriers will have full direction and control of such vehicles and will be fully responsible for the operation thereof in accordance with applicable law and regulations including the requirements prescribed by or under the provisions of this part with respect to safety of operation and equipment; but nothing in this part shall be construed to authorize the Commission to regulate the duration of any such lease, contract or other arrangement for the use of any motor vehicle, or the amount of compensation to be paid for such use." The other amendment modifies the title of the bill so that it would read as follows: A bill to amend the Interstate Commerce Act, with respect to the authority of the Interstate Commerce Commission to regulate the use by motor carriers (under leases, contracts, or other arrangements) of motor vehicles not owned by them, in the furnishing of transportation of property. GENERAL STATEMENT This legislation concerns the practice, quite generally followed by motor carriers engaged in the transportation of property in interstate commerce, of using, under trip lease arrangements, motor vehicles owned by other persons. A trip lease is a lease of a motor vehicle, with or without driver, for a single one way or round trip. The Interstate Commerce Commission has issued an order which, among other things, would require that any lease for use of a motor vehicle must be for not less than 30 days. This, in practical effect, would abolish trip leasing, a practice which has been lawful in the regulated motor carrier industry for many years. The order is scheduled to become effective on September 1, 1953. The principal purpose of this legislation is to vacate that portion of the Commission's order which prohibits leases of less than 30 days' duration, and to deny to the Commission for the future the power to issue orders which seek to control the duration of leases of motor vehicles. The committee strongly favors this legislation because, according to the testimony presented to it, the 30-day lease rule (1) would put out of business a substantial number of truckers, largely those engaged in hauling agricultural commodities; (2) would thus deprive the farmers of this Nation of a highly flexible motor transportation service which is available to them at the places where it is needed at the time it is needed, both for the handling of peak loads and at other times; (3) would thus impair the existing means for efficient and economical distribution of livestock, fish, and agricultural products, including grain and highly perishable seasonal commodities, to consumers' markets; and (4) would in consequence have the effect of impairing the agricultural exemption provided for in section 203 (b) (6) of the Interstate Commerce Act. The amended bill would also, as did the introduced bill, deny to the Commission the power to regulate the amount of the compensation to be paid by a regulated motor carrier for the use of a motor vehicle not owned by such carrier, since through such regulation the Commission might be able in effect to abolish trip leasing. This committee recognizes that there are conditions growing out of motor carrier use of leased vehicles which need to be regulated. In the Commission's order above referred to (which is set forth in full in appendix A) there are provisions, other than the 30-day lease rule which are aimed at correcting these conditions, and no substantial objection has been made to these provisions. The committee is convinced that if these provisions of the Commission's order (not including the 30-day lease requirement) are adequately enforced, much can be accomplished toward correcting the evils which the Commission has found to exist. However, in order that the Commission will not be lacking in power adequately to control the situation, the bill as amended by the committee would confer on the Commission express statutory authority, which heretofore has been lacking, to deal with these problems. HEARINGS The committee held public hearings on this bill on April 21, 22, 23, 24, 30, and May 7, 1953. Testimony in support of this bill was received from Members of Congress, the Department of Agriculture, the American Farm Bureau Federation, the National Grange, the National Council of Farmer Cooperatives, the National Farmers Union, the National Fisheries Institute, the Northwest Horticultural Council, the National Livestock Producers Association, the National Association of Commissioners, Secretaries, and Directors of Agriculture, the Growers and Shippers League of Florida, the United Fresh Fruit and Vegetable Association, the International Apple Association, and certain shippers, and motor carriers. BACKGROUND INFORMATION Part II of the Interstate Commerce Act provides for regulation of the transportation of persons and property by motor vehicle in interstate commerce. The two principal classes of carriers regulated are common carriers, which operate under certificates of public convenience and necessity, and contract carriers, which operate under permits. For purposes of this discussion these carriers are referred to as authorized motor carriers. Ever since the enactment of part II of the Interstate Commerce Act in 1935 it has been a common practice of authorized motor carriers of property to perform the services covered by their certificates or permits through the use (under leasing or similar arrangements) of motor vehicles owned by other persons, and in many cases such arrangements include the services of a driver. Such arrangements have never been considered to be unlawful, and have become an accepted part of the motor transportation system of the country. Such arrangements are made under a great variety of circumstances, in some cases covering periods of months or years. The type of arrangement with which this legislation is concerned is that of trip leasing for a single one-way haul or round trip. Virtually all large motor carriers occasionally trip lease a truck with driver to handle peak loads, and there are some motor carriers, who own a limited number of motor vehicles or none at all, who make very substantial use of vehicles under trip leases. The leasing practices of authorized motor carriers have, in the opinion of the Interstate Commerce Commission, presented troublesome problems for many years. In 1940, the Commission's Bureau of Motor Carriers began a study of such leasing practices. The study was suspended during the war, but was resumed thereafter, and in 1947, tentative rules to govern the practices were offered to representatives of the carriers for criticisms and suggestions. The motor carriers were unable to agree as to the action that should be taken to correct abuses in such practices. As |