Rates on wheat and corn, C. L., in cents per 100 pounds, from stations on the St. Louis & San Francisco Railroad, in Oklahoma Territory, to Galveston, Tex., for export.

Rates on wheat and corn, C. L., in cents per 100 pounds, from stations on the Missouri, Kansas & Texas Railway, in Oklahoma Territory, to Galveston, Tex., for export.

Rates on wheat and corn, C. L., in cents per 100 pounds, from stations on the Chicago, Rock Island & Pacific Railway, in Oklahoma Territory, to Galveston, Tex., for export.

It may be interesting to note the probable reductions in revenue which will be effected by these changes. We have no figures for the Missouri, Kansas & Texas or the St. Louis & San Francisco. In the year 1906 the Chicago, Rock Island & Pacific moved 1,240 cars of wheat and 132 cars of corn to Galveston for export, which, upon the assumption that our reduction is approximately 4 cents per 100 pounds, and that the cars load 50,000 pounds to the car, would amount to $27,440. The Santa Fe System moved to Galveston from Okla12 I. C. C. Rep.

homa Territory during the same year 902 cars of wheat and 303 cars of corn. Upon the above basis the reduction applied to this movement would mean a loss of $24,100. This loss of revenue is not sufficient to induce us, in case of these defendants, to leave in effect rates which seem to be indefensible except upon the ground of imperative need for greater earnings.

No. 911.

COMMERCIAL AND INDUSTRIAL ASSOCIATION OF UNION SPRINGS, ALA.,

v.

LOUISVILLE & NASHVILLE RAILROAD COMPANY; SOUTHERN RAILWAY COMPANY; ILLINOIS CENTRAL RAILROAD COMPANY; MOBILE & OHIO RAILROAD COMPANY; ST. LOUIS & SAN FRANCISCO RAILROAD COMPANY; NASHVILLE, CHATTANOOGA & ST. LOUIS RAILWAY COMPANY; CENTRAL OF GEORGIA RAILWAY COMPANY; WESTERN RAILWAY OF ALABAMA; SEABOARD AIR LINE RAILWAY; AND UNION SPRINGS AND NORTHERN RAILWAY COMPANY.

Submitted May 1, 1907. Decided July 11, 1907.

1. In a territory where the basing point system has been in operation since the advent of railroads, rates to a complaining point made by a combination of the through rate to the nearest trade center and the local beyond need not, under the construction of the fourth section of the act by the Supreme Court, be reduced to the basis of every neighboring point of like distance when the other points in the group whose rates are sought have the advantage of water or other competition.

2. Not all discriminations, but only those which are unreasonable, are unlawful. 3. Where undue discrimination is not shown, the rates complained of can only be reduced by the Commission when in its opinion they are shown to be unreasonable in themselves.

R. E. L. Cope, for complainant.

Ed. Baxter for defendants.

REPORT OF THE COMMISSION.

CLEMENTS, Commissioner:

Union Springs, Ala., is located at a junction of the Central of Georgia Railway with branches extending about 30 miles south to

Troy, 40 miles west to Montgomery, 40 miles east to Eufaula, and 55 miles northeast to Columbus. The rates from St. Louis, Nashville, and Memphis are the same to Columbus, Opelika, and Eufaula, but are higher to Union Springs by the amount of the locals from Columbus or Montgomery, though such traffic as reaches Montgomery via the Central of Georgia passes through Union Springs. Complaint is made that the class and commodity rates of the defendant carriers from St. Louis, Mo., Nashville and Memphis, Tenn., to Union Springs on carload lots are unreasonable and unjust and unduly discriminatory against Union Springs as compared with the rates from the same points of origin to Columbus, Ga., Montgomery, Eufaula, and Opelika, Ala. During 1906 the local deliveries of the Central of Georgia Railway in Opelika were 2,599 tons in less than carload lots and 35,454 in carloads; Eufaula, 4,833 tons in less than carload lots and 52,834 in carloads; Columbus, 12,188 tons in less than carload lots and 260,887 in carloads; and for Union Springs, 3,367 tons in less than carload lots and 21,619 in carloads.

The distances from St. Louis, Nashville, and Memphis are practically the same to Union Springs as to Columbus and Opelika, but greater to Eufaula. The population of Union Springs is about 4,000; Eufaula, about 5,000; Opelika, over 5,000, and Columbus, 30,000. There are two roads at Union Springs, Opelika, and Eufaula, and at Columbus three. The first-class rate from St. Louis to Columbus, Opelika, and Eufaula is $1.26 per 100 pounds; from Memphis 99 cents, and from Nashville 69; while to Union Springs the rate was at the date of the hearing $1.61 from St. Louis, $1.34 from Memphis, and $1.03 from Nashville, a difference against Union Springs of 35 cents per 100 pounds. Since the hearing there has gone into effect a reduction from all three points to Union Springs of 2 cents per 100 pounds on first class, with a greater reduction on some other classes, so that the discrimination against Union Springs on the respective classes is now as follows:

These reductions were intended to make the basis of rates to Union Springs about the same as that obtaining at Troy, situated approximately 30 miles south, to which place transportation is alleged by representatives of the carriers to be under about the same conditions as at Union Springs regarding competition.

The rates from Nashville, Memphis, and St. Louis are fixed on the basis of the rates from Louisville, Ky. These rates from Louisville

are made in competition with water routes by way of the Ohio, Mississippi, the Gulf, the Alabama River from Mobile to Montgomery, and the Chattahoochee River to Columbus. On the Chattahoochee River eight or nine steamboats run from Columbus either up Flint River or to the Gulf. Prior to February 1, 1902, the rates to Union Springs over the Central of Georgia were made on the basis of the Montgomery combination. Later there was built from the Seaboard Air Line at Fort Davis a branch 7 miles to Union Springs, and from this time reductions in the rates either to Columbus or to Montgomery worked a reduction also in the rates to Union Springs. An effort had been made in 1884 before the Alabama commission to secure the same rates to Opelika as to Columbus. The majority of the commission were in favor of similar rates, but one of the commissioners, Mr. C. B. Ball, made a minority report suggesting certain differentials on the various classes to Opelika above Columbus, and these differentials, known as the Ball Arbitraries, were accepted by the roads and continued in force until 1888, when the rates to Opelika were made the same as those to Columbus.

In the first year of the existence of the Interstate Commerce Commission an attempt was made to secure the same rates for Opelika as Montgomery, but the Commission held that though Opelika deserved to be placed in the list of trade centers, (a system existing throughout that territory), under the discriminations resulting from the Ball Arbitraries then in effect, the result of giving Opelika the same rates as Columbus and Montgomery would be to increase the then existing discriminations as against the local points on each side of it, which the Commission was not then prepared to direct. At a later date, however, Opelika was placed by the carriers in the same class with Columbus and Montgomery. The same demand is now made for Union Springs, and though the conditions are not the same, there is much to be said in support of this contention. But in view of the construction of the statute by the Supreme Court of the United States that the carriers may and the Commission must in the adjustment of rates give due consideration to competition whether by rail or water or of markets, and that greater charges for shorter distances than for longer ones, even over the same line in the same direction, the shorter being included in the longer, made with due regard to the existence of competition at the longer distance point and the lack of it at the shorter, or having regard to the degree or potency of such competition at the respective points, is not unreasonably discriminatory and therefore not forbidden by law, it is difficult for us to find any basis upon which to condemn the rates in question as unduly discriminatory. Upon many rulings of the court to the effect above stated is based the further holding that the circumstances and conditions affecting