uminously in Washintgon that the joint board concept, which is outlined in other bills before us now, is the one more likely to win congressional favor than the mechanism set forth in S. 1507. H.R. 6244 provides "grandfather" rights for motor carriers and freight forwarders operating within Alaska and between Alaska and other States, and for water carriers operating within Alaska; provides for the Interstate Commerce Commission regulation of the Alaska Railroad, and it makes the Interstate Commerce Act apply to forhire water carriers operating between ports of Alaska and the ports of other States.

S. 2451, H.R. 8521, and H.R. 8564 are companion bills and they are for the establishment of a joint board, the Joint Board to which I previously alluded, for through rates and joint rates, and to make mandatory through routes and joint rates by carriers engaged in transportation of property between the State of Alaska, the State of Hawaii, and other States.

S. 2452 has substantially the same purposes, but the filing would be permissive for through joint rates rather than mandatory, and the bulk of the testimony which the committee has heard to date, and it has heard in bulk, is in favor of the permissive mechanism.

Also there is S. 2514, which would establish the Alaska Railroad as a Government corporation. I shall say to you people of Seward that it is my belief that we are going to have to wait until a subsequent hearing or hearings in Washington to acquire the kind of information we need for intelligent legislation on this subject. It is a highly technical matter, and it is difficult, of course, for a layman to reach a conclusion on it without having had opportunity for background material.

The committee has considered two bills which have to do with the possible establishment of a ferry system in southeastern Alaska. I shall not list those by number here because I would suppose it would be a matter of local rather than general interest.

Then there is S. 2702, to provide for the conveyance of certain lands to the State of Alaska. This directs the commissioner of public roads to give the State quitclaim title to certain lots in Valdez, and this is in connection with a facility that is intended to be used there for the case of the mentally ill.

Now the chairman is grateful that the mayor of Seward, Mayor Petrovich, has honored us with his presence at this meeting, and we should be very glad to hear from you, Mr. Mayor, in case you have any general words before we call upon the witnesses.

How do you spell your name?

STATEMENT OF HON. ALEX PETROVICH, MAYOR OF SEWARD,

ALASKA

Mayor PETROVICH. I am Alex Petrovich, mayor of the city of Seward.

It is with great pleasure that I welcome this body to the city of Seward. It is quite an honor to sit in front of this committee working for the good of the State of Alaska and honoring us here in the city of Seward. There are men in the community who are posted on the current situation, having given it their diligent time and study, and I wish at this time to say that our first witness from Seward is

Mr. Jack Werner. Mr. Jack Werner I think is in the position to discuss the bills in which we have an interest. I hope that you enjoy being in Seward and I am sure that our city will benefit on account of this hearing today. Thank you, Senator Bartlett.

Mr. BARTLETT. We are glad to have this welcome from you and appreciate your presence here, Mayor Petrovich, and I want to put it on the record that the mayor of Seward was one of the best postmasters Naptown ever had. Thank you, sir, very much.

Mayor PETROVICH. Thank you, Bob.

Senator BARTLETT. The committee will be glad to hear Mr. Werner and, Jack, perhaps before you come on here in a formal way we could have an idea who the witnesses are going to be and their names and try to call them in some sort of order. Who wants to be heard? Who is going to be heard? The committee wants to hear anyone that desires to testify.

STATEMENT OF JACK WERNER, BUSINESSMAN, SEWARD, ALASKA
Mr. WERNER. Mr. Chairman, my name is Jack Werner, resident of
Seward.

Senator BARTLETT. You are a businessman here, Mr. Werner?
Mr. WERNER. That is correct, Mr. Chairman.

Senator BARTLETT. What is your business?

Mr. WERNER. Retail food business. I am not prepared to make a statement at this time on any one of these bills. Some of these bills are not of particular concern to Seward, but we have considerable concern for some of them. I am not sure that I know, at this time, who wants to speak on the bills, but I think the Chair should go ahead with its regular questioning and invite the people.

Mr. BARTLETT. All right. Do you want to testify first, or not? Mr. WERNER. I will testify later, Senator.

Mr. BARTLETT. All right. Now, who is it who would be willing to approach this monster, the mike, and declare upon any one or all of these bills?

STATEMENT OF LARRY URBACH, CHAIRMAN, BOARD OF DIREC

TORS, CHAMBER OF COMMERCE, SEWARD, ALASKA

Mr. URBACH. My name is Larry Urbach. I am chairman on the board of directors of the chamber of commerce, and a local retail clothing owner here. The chamber of commerce has gone on record, I believe you have received a letter on it, on the bill about the corporation of Alaska Railroad. We feel that there should be a local representative on that board of directors from Seward, Anchorage, and Fairbanks, being it is so vital to the economic growth of our area that we must know, very well, what is going on, and that is the only way we feel that we could really be on the inside. As you well know, what the railroad means to Seward through its docks and all, why, it is Seward property, you might say.

Mr. BARTLETT. Mr. Urbach, Seward has a particular peculiar dependence upon transportation, does it not?

Mr. URBACH. Yes, it does.

Mr. BARTLETT. Is the movement of cargo the chief business of Seward?

Mr. URBACH. At the present time it is our major industry here. The major source of income for the city.

Mr. BARTLETT. What else do you have here to give aid and comfort economically to the community?

Mr. URBACH. Our largest industry here is the Standard Oil Co. which has been here for years and produces quite a payroll for our city. Then there is Texaco, which has just moved in, and then our new shrimp industry. When we get through with transportation we would like to talk to you on that part of it, too. The protection of our American industry against foreign industry.

Mr. BARTLETT. Tell us one thing now about the shrimp industry, as to its coming here?

Mr. URBACH. Seward is located so that we have our two Alaska Steamship boats a week out of here, plus coastwise barges, which is a wonderful transportation setup, rather than have to store it like they do some places and maybe in the wintertime get a boat a month out. We can move it. There are shrimp here. The Cobb has just been making a survey of the area and I believe that they feel that the shrimp are here in such quantity that they feel they will never deplete it. The shrimp industry in the whole country has expanded in the last 10 years, so we have been told. We have three canneries here right now, all of them quite new, and it could be a major or the major industry in the city before too long.

Mr. BARTLETT. Do you understand that the shrimp reserves are substantial?

Mr. URBACH. Yes, that is what we have been told, that there is untold quantities of shrimp.

Mr. BARTLETT. And this resource has never been utilized locally before?

Mr. URBACH. Yes, sir.

Mr. BARTLETT. Well, the shrimp packed and processed from here are naturally in active and direct competition with shrimp from other sections?

Mr. URBACH. Yes, sir.

Mr. BARTLETT. In the United States and of course elsewhere? And how does your Seward shrimp fare in this competitive situation?

Mr. URBACH. Our local shrimp are small; smaller than the average you get in the other areas, which is good in the way that it can be used for so many things. The others aren't as desirable for soups and that type of cookery in which they don't need the larger shrimps. Mr. BARTLETT. Do you get any larger shrimp here?

Mr. URBACH. We get some, yes.

Mr. BARTLETT. Well, how far east are these shrimp sold? What point is this? Can they be put up here and shipped as far east as Chicago, say, or even New York and compete with shrimp from elsewhere?

Mr. URBACH. Not with foreign shrimp, no. They couldn't compete with foreign shrimp. There is no duty on foreign shrimp, so we can't compete with them. The labor might be 40 cents a day over there, why in some of these foreign countries it is impossible for American labor, no matter whether it is in Alaska or Texas or Louisiana to compete with them.

Mr. BARTLETT. Can your Seward shrimp compete with those shipped up to New York from New Orleans, do you know?

Mr. URBACH. I don't know. I believe your Louisiana and New Orleans shrimp are more what we would commonly call prawns than shrimp. In other words, they are much larger.

Mr. BARTLETT. Yes, they are much larger and at the risk of offending our friends from the South, I shall say they are not nearly so tasty.

Do you agree?

Mr. URBACH. Oh, very much so.

Mr. BARTLETT. H.R. 6244, Mr. Urbach, provides among other things for regulation as to rates of the Alaska Railroad by the Interstate Commerce Commission. Now, the committee has had two views expressed on that and this is not unusual to have divergence of opinion. One view is that if every other form of transportation having to do with Alaska is going to be under regulation by the ICC or by Joint Boards composed of representatives of the ICC, the Civil Aeronautics Board, and the Federal Martime Board, it is not right that one important transportation agency, namely the Alaska Railroad, shall be without any regulation except that imposed by the Department of the Interior, and that it is essential in the establishment of a sound transportation system in the State to serve the best interests of the public that the Alaska Railroad be brought within this arrangement. The other view, very forcibly expressed by the Interior Department hearings in Washington, is that the Alaska Railroad is altogether unique as a transportation agency; that it was brought into being not to make money, but to promote the economic development of Alaska; that likewise now it serves an essential purpose for the military; that if the ICC has control of its ratemaking structure there will be a very messy situation because it will be necessary to have two forms of accounting, the railroad accounting and general accounting office procedures or some strange combination between the two probably won't work, and that the ICC being required to use the capital investment of the railroad as the basis for ratemaking most likely would have to raise freight rates and perhaps raise them very much. And the ICC, through its witnesses says this isn't so.

Now, I should like to ask you, as a general proposition, and I don't expect you to have the technical answers to these matters any more than I have now, as a general proposition do you believe the Alaska Railroad should be left as is or brought within the jurisdiction of the Federal Commission which has this authority over other railroads elsewhere?

Mr. URBACH. I am not very well up on this point because I don't know enough of what ICC regulations would be, but it seems to me if the truckers are going to compete why they have to have pretty much the same regulatory body to keep them equal, I mean an equal basis, if one isn't under it and the other is, and you can have so many change the rate so much it wouldn't be fair to the truckers to have to have a certain rate and then the railroad could undercut it or if the railroad has to have a certain rate the truckers could undercut it, it seems there should be some regulation to equalize them.

Mr. BARTLETT. Do you have any views at all, Mr. Urbach, on this Joint Board suggestion?

Mr. URBACH. That might be a good solutionMr. BARTLETT. This doesn't have to do directly with the Alaska Railroad, but it is more general in nature. The committee has been told that if this were done joint rates could be filed through joint rates and this might and probably would result in rather substantial reductions in transportation costs for the consuming public of Alaska, and so far as I can recall there has been general unanimity that something of this order is called for. Have you studied this matter and do you have suggestions to make to the committee?

Mr. URBACH. No; I haven't. As a businessman, though, I know that I get freight out of St. Louis and it costs me much more to get it from St. Louis to Seattle than it does from Seattle to Seward. Now, what the reason is, I don't know, but it is there; and we understand there are different rates if something is coming to Alaska, whether it is going to Hawaii, or maybe just stopping in Seattle that we are paying a much higher rate. If that is so, why there is something wrong there.

Mr. BARTLETT. You are in favor of any sound legislation which will lower transportation costs?

Mr. URBACH. Very much so.

Mr. BARTLETT. Mr. Perley, do you have any questions to ask?
Mr. PERLEY. No, sir.

Mr. BARTLETT. Thank you very much, Mr. Urbach. Your views will appear in the printed record and will be considered and studied and evaluated by the committee.

Mr. WERNER. Mr. Chairman, I would like to talk on the railroad bill.

Mr. BARTLETT. Yes, Mr. Werner.

STATEMENT OF JACK WERNER, OF SEWARD, ALASKA

Mr. WERNER. In the first place, I think when the Alaska Railroad was first built and constructed in Alaska, the purpose of the Alaska Railroad was to aid in the growth and the development of the northern and north-central part of Alaska. In the years since Fairbanks has grown into a splendid city and Anchorage has a population of 60,000 people. The whole country has changed and the country has developed a lot since the time the Alaska Railroad was built. The policy of the rate structure of the Alaska Railroad has changed, and it seems to me as though the idea of aiding in the growth of Alaska has gone by and the railroad is looking more and more to the profit angle. They are worrying each year about showing a profit for the Alaska Railroad, which of course is part of the Department of the Interior. I would be very happy to see the Alaska Railroad regulated by some ratemaking body that is recognized, whether it is the ICC or the joint organization that you spoke of. I think that its rates should be regulated by such a group, because the time has gone by when they could set their own rates and now they should be regulated by the regular ratemaking body.

Mr. BARTLETT. Mr. Werner, are you speaking for yourself as an individual businessman, a citizen of Seward, or for a group?

Mr. WERNER. I am speaking for myself, Mr. Chairman.

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