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Mr. Ellis. On the basis of adjustment by the railroads, it would carry it back there?
Mr. VETTELS. Yes, that is the basis carried in there.
In its brief, the Chicago, Milwaukee & St. Paul Railway explains this matter as follows:
The rates between Chicago and Pipestone are not normal rates, and were not fixed with reference to their reasonableness per se. They were adjusted to meet a commercial necessity which does not exist at Granite Falls, and are of distinct benefit and advantage to a large section of growing country. They are so adjusted as to afford a considerable area west and north of Pipestone competition in the distribution of merchandise, which could not exist without the abnormal adjustment of interstate rates which obtains. Substantially the same basis of class rates applies to Pipestone as that which applies to Sioux Falls, and the same bases of distributing tariffs apply out from those places, so that in common territory to the north and west of both places, jobbers in each place compete on terms of fair equality with those of the other. The evidence shows that jobbing is done at Pipestone and that none is done at Granite Falls.
After issue joined the third-class rate from Pipestone to Chicago was increased to 47 cents, and the third-class rate from Granite Falls to Chicago was increased to 59 cents.
It is evident that the rates on butter and eggs in carloads via the Chicago, Milwaukee & St. Paul Railway from Granite Falls to Chicago are too high by at least the difference between that rate and the rate on the same commodities in carloads from the more distant point, Pipestone, to Chicago by another branch of the same railroad. The just, fair, and reasonable rate for that carrier to observe in the future on this traffic between Granite Falls and Chicago, therefore, is 47 cents per hundred pounds, and an order will be entered accordingly. As to the other carriers named as respondents, it is evident that no further findings or order need be made and as to them the complaint may be dismissed.
12 I. C. O. Rep.
ADAMS EXPRESS COMPANY.
Submitted September 12, 1907. Decided November 4, 1907.
Defendant's rate per car for the transportation of horses from New York to
Columbus is $200; from Columbus to Kansas City, $350; from Columbus to St. Paul, $350. The rate per car from New York to St. Louis is $300; from St. Louis to Kansas City, $150; from New York to Chicago, $250; from Chicago to St. Paul, $200. Thus the total charge from New York to Kansas City when the shipment is stopped at St. Louis is $450 ; when stopped at Columbus, the total charge is $550. Similarly, the charge from New York to St. Paul is $450 when the shipment is stopped at Chicago, and $550 when the shipment is stopped at Columbus. Held, defendant's rate of $350 per car from Columbus to Kansas City and Columbus to St. Paul is unjust and unreasonable, and should not exceed $250 per car.
Louis G. Addison for complainant.
REPORT OF THE COMMISSION.
The petition in this case deals with express rates on horses from New York to western points. McLaughlin Brothers are dealers in horses, having their principal place of business at Columbus, Ohio, and branch places of business at Kansas City, Mo., and St. Paul, Minn. They import large numbers of horses from Europe, and these they ship by express from New York to Columbus, and later send them to their western branches.
The superintendent of traffic of the Adams Express Company, Mr. J. Zimmerman, filed in this case the following table showing the express rate and the cost to the defendant of transporting a carload of horses to the points here indicated under a valuation of $75 per head, the lowest valuation accepted by the company:
To this table was appended the following note: This table is prepared for the purpose of showing the comparative rates and expenses. Those items of expense only are included which are directly charge able against each particular shipment. This is for the purpose of showing the comparative expense, and does not represent the absolute expense to the company of doing the business, nor does the item marked net” state the absolute profit to the company on each shipment, but is greatly in excess thereof. In order to arrive at the absolute expense it would be necessary to include not only terminal expenses, which are referred to in the testimony, but also the proportionate share of officers' and agents' salaries and all other general operating expenses of doing the comp ny's business. I have not attempted to enter into this calculation for the reason that I understand that the only question is whether the rates New York-Columbus, Columbus-Kansas City, etc., are unreasonable, as compared with the rates New York-St. Louis, St. Louis-Kansas City, etc.
From this table it would appear that a dealer may transport a carload of horses upon the local rate from New York to St. Louis for $300 and may at a later time transport the same or a different carload of horses from St. Louis to Kansas City for $150, making a rate of $450 for the two movements, as against a rate when the same horses are stopped at Columbus of $550 (New York-Columbus, $200; Columbus-Kansas City, $350). To transport a carload of horses from New York to Chicago costs $250, and if the same or another carload is transported from Chicago to St. Paul the charge is $200, making a combined rate of $450 from New York to St. Paul, whereas if the horses were stopped at Columbus the rate would be New York to Columbus, $200, Columbus to St. Paul, $350, or $550. It is against this discrimination as to Columbus as a shipping point that this complaint is directly urged.
The column headed “ Transportation " gives the amount which the Adams Express Company under its contract with the rail carriers pays for transportation of the car. This amount in each case is based upon a contract made between the Adams Express Company
and the rail carrier. The contract between the defendant and the Pennsylvania Railroad requires that the former shall pay to the latter 56 per cent of the rate which it receives, while the Burlington receives 574 per cent of the express rate. Thus, on shipments from Columbus to St. Louis the Pennsylvania Railroad receives $112 out of the $200 rate charged, and on the haul from St. Louis to Kansas City the Chicago, Burlington & Quincy Railway receives $86.25 out of the $150 rate, making a total of $198.25 which the express company pays to the railroads for the transportation of the car from Columbus to Kansas City, for which service the express company charges $350.
The next column, headed “ Stalling," gives the cost to the express company of building stalls in the car which the railroad company furnishes. It is a uniform charge of $21.20. A messenger is also provided, whose compensation varies with the distance of the journey.
The column headed “Total” therefore includes the total expense outside of terminal expenses, general operating and office expenses of the company, which, together with the profits of the company, are included under the heading “ Net.”
The distances between the points here concerned (according to the Official Railway Guide) and the rates per car mile figured from the above tables are as follows:
From these figures it appears that the defendant charges 18 cents per mile more for shipments between Columbus and Kansas City than it does for shipments between New York and Columbus and 15 cents per mile more on the Columbus-St. Paul shipment than the New York-Columbus movement.
A further comparison, which is not without suggestion, is that which can be made between the special, or through, rates between New York and Kansas City and between New York and St. Paul, with the local rates applying to and from St. Louis and Chicago. The New YorkKanses City through rate is $400; the New York-St. Louis rate plus the Kansas City rate is $450. The New York-St. Paul through rate is $400 and the New York-Chicago rate plus the Chicago-St. Paul rate is $450. In both cases it is seen that the express company's local rates make a sum of $50 in excess of their through rate. When the local rates in and out of Columbus are combined, however, there is a difference between the local and the through rate of $150.
From all the facts presented, and after consideration of the questions here involved, it appears to us that the rates west of Columbus are unreasonable and excessive; and it is herein ordered that the rate between Columbus and Kansas City shall not exceed $250 per car and that the rate between Columbus and St. Paul shall not exceed $250 per car.
CHICAGO, MILWAUKEE & ST. PAUL RAILWAY
Submitted October 22, 1907. Decided November 4, 1907.
In the transportation of coal by defendant to Kansas City consignees desire
delivery on the lines of other carriers which assess switching charge of $3 per car. At one time defendant absorbed said switching charge in its trans portation charge, later discontinued the practice, and subsequently resumed