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Mr. BOARDMAN. Perhaps I should ask you a question, Mr. Barton:

What would be the acceptance of a permissive wording there! I mean, would there be voluntary response to the thing, do you think, by the carriers involved ? We don't know; we are in the dark.

Senator BARTLETT. Mr. Boardman, I think your question is well put; and, perhaps for the benefit of all of us, Mr. Barton would explain the differences between the two bills?

Mr. BARTON. Under the Interstate Commerce Act, there are relatively few requirements for mandatory through routes and joint rates. There is, of course, such a requirement between common carrier railroads; and there is between common carrier railroads and certain water carriers; but as between railroads and trucklines, railroads and many other waterlines, there is none.

Both bills provide for a joint board of three members—one each from ICC, Federal Maritime, and CAB; one bill would require the establishment and filing of these routes and rates. The other bill would allow the establishment of the rates and routes but would require their filing after establishment.

I think that you will find there is considerable opposition to compulsory action on through routes and joint rates from some groups of carriers; it has been noted in the past that these mandatory arrangements are sometimes not very satisfactory-like leading a horse to water but not being able to make him drink,

I believe there is a feeling in some quarters that as far as practical results go, the bill establishing permissive arrangement might give better results, as far as furnishing transportation service goes, rather than the mandatory requirement

proposed. Senator BARTLETT. May I ask a question of you there, Mr. Barton:

If one or two carriers were to file permissively, would not that likely induce other carriers to file similar through tariffs ?

Mr. BARTON. Yes; for competitive reasons, and the fact that business would be facilitated and shippers accommodated, would probably lead to more use of permissive arrangements than would appear on the surface.

Mr. BOARDMAN. Senator, a question has arisen in our minds since we took a stand on Senate bill 1507, and I would like to ask a question on it, if it is in order.

Senator BARTLETT. It will be in order; and you may direct the question to Mr. Barton, who is the expert on this subject.

Mr. BOARDMAN. The question that comes up, Mr. Barton, under the legislation proposed, is this: We have operators in the Alaska maritime trade who—who-well, I can give you the names of them, in fact, the Foss Launch & Tug. Co. is an example, that operates a barge service out of Tacoma, that services our local pulp mill and other areas with a barge type of operation. There's an Upper Columbia River Towing Service. We are wondering if s. 1507 is enacted and becomes the law, and the regulations of the ICC come into play, whether others that might want to engage in that type of activity would be precluded from doing so? In other words, would they run into some very restrictive qualification items that might prohibit a free play of organizations that choose to engage in that type of activity

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Mr. BARTON. Mr. Whitehouse, of the ICC staff, is here, as you know. I believe that he can answer that question better than I can,

Senator Bartlett.

Senator BARTLETT. Mr. Whitehouse, would you care to come to the table?

Mr. WHITEHOUSE. My name is Henry Whitehouse, and I work for the Interstate Commerce Commission.

Mr. BARTON. In what capacity ? Mr. WHITEHOUSE. As an attorney on the staff of Commissioner TValrath.

There would be, to a degree, that fact that Mr. Bordman raised. If another carrier wanted to come in, he would have to file an application, and we would have to show public convenience and necessity, and get a certificate for the operation.

Mr. BARTON. Whereas, the present operations would be granted grandfather rights?

Mr. WHITEHOUSE. The present operations would get grandfather rights;

and, as it is now, anybody can move in, or out, at will. Mr. BOARDMAN. Well, I might state, Senator Bartlett, that I don't think that our group was fully aware that this implication, or this thing, might happen; and it might be that we would want to review our position on that particular piece of legislation; and, with your permission, file a later amending statement, to our--to this statement? I don't know, but I would like to ask if that would be permissible, in view of this implication?

Senator BARTLETT. That is permissible. You can file a supplementary statement, if you desire to, and we shall be glad to receive it.

Mr. BOARDMAN. As I state, this is something that hadn't occurred to us; and now that it does come up, it might have a bearing on our thinking

Senator BARTLETT. You amend or correct your statement originally given in any way you care to, Mr. Boardman.

Mr. BOARDMAN. Thank you.

Commissioner WALRATH. Senator, I have something supplementary to Mr. Whitehouse's answer to Mr. Boardman.

Senator BARTLETT. Commissioner Walrath, will you come forward and qualify yourself, and then we would be happy to hear your supplementary statement.

Commissioner WALRATH. Mr. Chairman, my name is Laurence K. Walrath, and I am a member of the Interstate Commerce Commission. This is not my first visit to Alaska, but I am very happy to be back.

I think my attorney, Mr. Whitehouse, would agree that what we are talking about, Mr. Boardman, when he answers you, is the common carrier operation which requires certification. Under the S. 1507, if it were passed, all of your carrier operations would, except those specifically exempț, come under our jurisdiction; and he is correct that they would show the need for the service, rather than at will, coming into participate in traffic which might be a sometime proposition, and which traditionally has made it difficult for any area of our country to develop a sound service, and one that you can rely upon.

I don't view the certification requirements as seriously as you might, at first glance, because over the period of time, we have found that the Interstate Commerce Commission and I am thinking now

Mr. BOARDMAN. Perhaps I should ask you a question, Mr. Barton:

What would be the acceptance of a permissive wording there? I mean, would there be voluntary response to the thing, do you think, by the carriers involved? We don't know; we are in the dark.

Senator BARTLETT. Mr. Boardman, I think your question is well put; and, perhaps for the benefit of all of us, Mr. Barton would explain the differences between the two bills?

Mr. BARTON. Under the Interstate Commerce Act, there are relatively few requirements for mandatory through routes and joint rates. There is, of course, such a requirement between common carrier railroads; and there is between common carrier railroads and certain water carriers; but as between railroads and trucklines, railroads and many other waterlines, there is none.

Both bills provide for a joint board of three members—one each from ICC, Federal Maritime, and CAB; one bill would require the establishment and filing of these routes and rates. The other bill would allow the establishment of the rates and routes but would require their filing after establishment.

I think that you will find there is considerable opposition to compulsory action on through routes and joint rates from some groups of carriers; it has been noted in the past that these mandatory arrangements are sometimes not very satisfactory-like leading a horse to water but not being able to make him drink,

I believe there is a feeling in some quarters that as far as practical results go, the bill establishing permissive arrangement might give better results, as far as furnishing transportation service goes, rather than the mandatory requirement proposed.

Senator BARTLETT. May I ask a question of you there, Mr. Barton:

If one or two carriers were to file permissively, would not that likely induce other carriers to file similar through tariffs?

Mr. BARTON. Yes; for competitive reasons, and the fact that business would be facilitated and shippers accommodated, would probably lead to more use of permissive arrangements than would appear on the surface.

Mr. BOARDMAN. Senator, a question has arisen in our minds since we took a stand on Senate bill 1507, and I would like to ask a question on it, if it is in order.

Senator BARTLETT. It will be in order; and you may direct the question to Mr. Barton, who is the expert on this subject.

Mr. BOARDMAN. The question that comes up, Mr. Barton, under the legislation proposed, is this: We have operators in the Alaska maritime trade who—who—well, I can give you the names of them, in fact, the Foss Launch & Tug. Co. is an example, that operates a barge service out of Tacoma, that services our local pulp mill and other areas with a barge type of operation. There's an Upper Columbia River Towing Service. We are wondering if s. 1507 is enacted and becomes the law, and the regulations of the ICC come into play, whether others that might want to engage in that type of activity would be precluded from doing so? In other words, would they run into some very restrictive qualification items that might prohibit a free play of organizations that choose to engage in that type of activity ?

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Mr. BARTON. Mr. Whitehouse, of the ICC staff, is here, as you know. I believe that he can answer that question better than Í can,

Senator Bartlett.

Senator BARTLETT. Mr. Whitehouse, would you care to come to the table?

Mr. WHITEHOUSE. My name is Henry Whitehouse, and I work for the Interstate Commerce Commission.

Mr. Barton. In what capacity?

Mr. WHITEHOUSE. As an attorney on the staff of Commissioner Walrath.

There would be, to a degree, that fact that Mr. Bordman raised. If another carrier wanted to come in, he would have to file an application, and we would have to show public convenience and necessity, and get a certificate for the operation.

Mr. BARTON. Whereas, the present operations would be granted grandfather rights?

Mr. WHITEHOUSE. The present operations would get grandfather rights; and, as it is now, anybody can move in, or out, at will.

Mr. BOARDMAN. Well, I might state, Senator Bartlett, that I don't think that our group was fully aware that this implication, or this thing, might happen; and it might be that we would want to review our position on that particular piece of legislation; and, with your permission, file a later amending statement, to our—to this statement? I don't know, but I would like to ask if that would be permissible, in view of this implication?

Senator BARTLETT. That is permissible. You can file a supplementary statement, if you desire to, and we shall be glad to receive it.

Mr. BOARDMAN. As I state, this is something that hadn't occurred to us; and now that it does come up, it might have a bearing on our thinking

Senator BARTLETT. You amend or correct your statement originally given in any way you care to, Mr. Boardman.

Mr. BOARDMAN. Thank you.

Commissioner WALRATH. Senator, I have something supplementary to Mr. Whitehouse's answer to Mr. Boardman.

Senator BARTLETT. Commissioner Walrath, will you come forward and qualify yourself, and then we would be happy to hear your supplementary statement.

Commissioner WALRATH. Mr. Chairman, my name is Laurence K. Walrath, and I am a member of the Interstate Commerce Commission. This is not my first visit to Alaska, but I am very happy to be back.

I think my attorney, Mr. Whitehouse, would agree that what we are talking about, Mr. Boardman, when he answers you, is the common carrier operation which requires certification. Under the S. 1507, if it were passed, all of your carrier operations would, except those specifically exempt, come under our jurisdiction; and he is correct that they would show the need for the service, rather than at will, coming into participate in traffic which might be a sometime proposition, and which traditionally has made it difficult for any area of our country to develop a sound service, and one that you can rely upon.

I don't view the certification requirements as seriously as you might, at first glance, because over the period of time, we have found that the Interstate Commerce Commission—and I am thinking now

of prior to my service on it-have been very liberal in the grants of water certificates. I don't say this to disagree with Mr. Whitehouse; I think that his answer was absolutely correct, Senator, that the bill would require certification; but I don't think that certification in itself should frighten us; that was the main purpose of my asking to speak, at this time.

Senator BARTLETT. Thank you, Mr. Commissioner. .
Mr. Barton, do you have any further questions?
Mr. BARTON. No more questions, Senator.

Senator BARTLETT. We are obligated to you, Mr. Boardman; thank you very much. Mr. BOARDMAN. Thank you, Senator.

,

. I might state that your very kind cooperation in addressing the Rotary Club this noon, is appreciated. If any of the other visitors here would like to attend that meeting, as our guest, we would like to extend that invitation. We know that you have to have lunch, somewhere; it is in the Stedman Hotel, in this same block. I would like to have the following communications, to me, placed in the record.

Senator BARTLETT. The five communications will be placed in the record at this point.

THE SECRETARY OF COMMERCE,

Washington, D.O. Mr. W. K. BOARDMAN, Ketchikan Chamber of Commerce, Ketchikan, Alaska.

DEAR MR. BOARDMAN: This is in reply to your letter of September 14, 1959, urging that this Department endorse S. 2261, a bill which would permit the use of Federal-aid highway funds in the construction of approaches to ferry facilities on the Federal-aid highway systems, and a companion bill in the House of Representatives.

These bills are under consideration by the Department, and formal views with respect to them will be submitted to the chairmen of the committeee to which they have been referred after appropriate clearance by the Bureau of the Budget pursuant to established procedures for the reporting by executive departments and agencies on pending legislation.

We realize that the establishment of a ferry service in southeastern Alaska is of unique importance to the State and to those persons and organizations in Alaska having an interest in the furtherance of transportation. We appreciate receiving, therefore, your views on this important subject. Sincerely yours,

Secretary of Commerce.

U.S. SENATE,
COMMITTEE OF INTERSTATE AND FOREIGN COMMERCE,

October 2, 1959.
Mr. W. K. BOARDMAN,
Manager, Ketchikan Chamber of Commerce,
Ketchikan, Alaska.

DEAR MR. BOARDMAN: Enclosed is a copy of an adverse report from the Secretary of Commerce with respect to S. 1956. A report on this bill was also furnished to Senator Magnuson by the Acting Secretary of State who reported that “The Department of State * * * perceives no substantial foreign policy implications in this bill, and accordingly makes no comment."

In view of the opposition to S. 1956 expressed by the Secretary of Commerce I thought you would want to study the complete text of his letter which may offer ideas for rebutting his position or for modification of the bill to obtain the acceptance of the executive branch. We would welcome any views you may have on this matter. Sincerely yours,

JOE JOSEPHSON, Legislative Assistant.

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