of existing means of transportation and documentary simplification. We would understand that the authorized experiments and such conditions as might be imposed, to the extent that they might affect shipper-carrier relationships, would be subject to applicable laws; for example, a shipper would not be deprived of his right reserved to him under existing law, to challenge the reasonableness or the applicability of particular experimental rate bases and classifications to certain transportation for which the shipper makes payment. Section 2(b) of the bill outlines the method by which the regulatory agencies would authorize experiments after notice to the public affording interested persons opportunity to submit written views. We think that the present language leaves some doubt as to whether notice to the public is all that is required prior to authorization of an experiment, whether views of interested persons will be collected prior to the authorization, and whether effect should be given to such views in the determination of the desirability or possible value of an experiment. Control and careful supervision are provided only after the experiment is authorized; procedures and considerations prior to authorization should also be carefully planned and programed. We note that on page 2, line 20, “of 1958" probably was intended to be added after the word "Act." Also, on page 3, line 1, after "1958" it may be desirable to add in parentheses "49 U.S.C. 1483." SECTION 3 This section would amend sections 2, 216(d) and 305 (c) of the Interstate Commerce Act, 49 U.S.C. 2, 316(d), and 905(c), to prohibit unjust discrimination by rail, motor, and water common carriers against other carriers as to services or rates in the transportation of loaded or empty vehicles or shipping containers. The section embodies part I(A) (4) of the President's message proposing that legislation be enacted to assure all carriers the right to ship vehicles or containers on the carriers of other branches of the transportation industry at the same rates available to noncarrier shippers. Possibly it was intended that there be included in this section these additional citations to the United States Code: page 3, line 19-49 U.S.C. 316(d), page 4, line 3-49 U.S.C. 905 (c). We do not believe that the changes proposed in this section of the bill would adversely affect the United States as a shipper, or the functions and operation of our Office and we recommend that your committee give it favorable consideration. SECTION 4 Section 4 of the bill provides for the establishment of through service, joint rates and joint boards and is based on a recommendation contained in part I(D) (2) of the President's message. We are in accord with the idea of intermodal joint rates and through service. However, in the interests of uniformity, we feel that the proposed amendments to section 1003 (d) of the Federal Aviation Act of 1958, beginning on page 6, line 13, of the bill, might well be revised to include authority equivalent to that contained in section 22 of the Interstate Commerce Act, 49 U.S.C. 22, at least to the extent it relates to persons or property of the United States. Section 22 permits rail common carriers to carry, store, or handle property "free or at reduced rates" for the United States, among other shippers, and has been incorporated by reference into parts II, III, and IV of the Interstate Commerce Act, dealing respectively with motor carriers, water carriers and freight forwarders. See 49 U.S.C. 317(b), 906(c) and 1005(c). In the broader view we favor the amendment of section 404 (b), 49 U.S.C. 1373 (b), to reflect similar authority in air carriers to transport persons or property for the United States free or at reduced rates. In this connection, see the attached copy of our letter of March 2, 1962, B-127532, to you recommending inclusion of a provision for reduced rate authority in H.R. 7318 or comparable bill. The proposed amendment of section 1003 (f) provides that any joint board shall have the same powers which section 216 of the Interstate Commerce Act confers upon the Interstate Commerce Commission in respect to common carriers of property by motor vehicle. Since section 216 of the Interstate Commerce Act does not provide for reparation awards for unlawful rates and charges on past shipments, this would leave shippers without any right to challenge the lawfulness of payments on those shipments. A cross-reference to section 308, 49 U.S.C. 908, for the purpose of establishing reparation procedures might suffice to reserve the requisite powers to joint boards. We note that H.R. 5596 and S. 1283, both introduced in the 87th Congress, would require motor common carriers and freight forwarders to pay reparations to shippers who have been charged unlawfully high rates and that section 7 of this bill proposes a similar reparations procedure with respect to air carriers subject to the Federal Aviation Act of 1958. SECTION 5 Section 5 would amend section 205 (f) of the Interstate Commerce Act, 49 U.S.C. 305(f), to authorize the Interstate Commerce Commission to make cooperative agreements with the various States to enforce State economic and safety laws relating to highway transportation. We understand that the purpose of the section is to help eliminate unlawful (gray area) trucking operations. The enactment of this section of the bill would not affect the functions and operations of our Office. It seems to be in the public interest and we would have no objection to its enactment. However, on page 9, line 4, "(49 U.S.C. 305)" probably should be “(49 U.S.C. 305(f)).” SECTION 6 This section implements legislative recommendation No. 4 of the Interstate Commerce Commission's 75th Annual Report. It proposes to emend section 222 (h) of the Interstate Commerce Act, 49 U.S.C. 322 (h), by extending the civil forfeiture provisions of the act to unlawful operations and safety violations by motor carriers and by increasing the dollar amount of the forfeitures. A similar bill, S. 2764, has been introduced in the 87th Congress at the request of the Interstate Commerce Commission. The proposed section, if enacted into law, would not affect the functions or operations of our Office. It seems to be in the public interest and we see no objection to its receiving favorable consideration by your committee. SECTION 7 Section 7 of the bill proposes to amend section 901 of the Federal Aviation Act of 1958, 49 U.S.C. 1471, to subject air carriers to civil liability for violations of the act and to establish various time limitations on actions by and against common carriers by aircraft subject to the act. The subjection of regulated carriers to civil liability for violation of regulatory acts is a question that in recent years has received considerable attention from all concerned in the transportation industry. In 1959, in T.I.M.E., Inc. v. United States, 359 U.S. 454, the Supreme Court decided that shippers, including the United States, paying unlawful charges for motor common carrier transportation, are without redress because part II of the Interstate Commerce Act does not contain reparations provisions similar to those in part I of the act. Since that time several bills have been introduced which would subject motor common carriers and freight forwarders (pt. IV of the Interstate Commerce Act, pertaining to freight forwarders, likewise contains no reparations provisions) to civil liability for violations of the provisions of the act. For example, see H.R. 5596, which was introduced in the first session of this Congress. That part of section 7 of this bill (H.R. 11584) which amends sections 901 of the Federal Aviation Act of 1958 by adding sections 901 (c) through 901 (e) would provide a similar remedy for shippers who are forced to pay unlawful charges for air carrier transportation. We believe that neither the United States nor private shippers should be required to pay transportation charges to any regulated carrier without the corresponding right, in proper circumstances, to challenge the lawfulness of those payments on past shipments. The enactment of the reparations part of section 7 of this bill, along with the enactment of H.R. 5596, would broaden the uniformity in the treatment of regulated carriers for civil liability for violations of the Interstate Commerce Act and of the Federal Aviation Act of 1958. We, therefore, strongly recommend favorable action on the reparations provisions of section 7 of this bill. Under the present laws, similar time limitation periods are applicable to actions by and against all carriers subject to the Interstate Commerce Act. See sections 16(3), 204a, 308, and 406a of the act, 49 U.S.C. 16(3), 304a, 908, and 1006a. The part of section 7 which amends section 901 of the Federal Aviation Act of 1958 by adding section 901 (f) through 901 (g) would provide the same limitation periods to common carriers by aircraft subject to the Federal Aviation Act of 1958. We favor the enactment of this limitation provision since it would complete a uniform pattern of limitation of actions for all carriers regulated by the Interstate Commerce Act and for common carriers by aircraft regulated by the Federal Aviation Act of 1958. SECTION 8 Section 8 of the bill would amend section 1006 of the Federal Aviation Act of 1958, 49 U.S.C. 1486, to provide for the exclusion from the general procedure relative to review of Civil Aeronautics Board orders by Federal courts of appeals the review of any order concerning reparations issued pursuant to the reparations provisions contained in section 7 of the bill. Such exclusion is compatible with the proposed addition of section 901 (e) and 901(f) (3), which would require proceedings for review to be undertaken in a Federal district court or a State court. On page 16, line 13, the year "1956" apparently should be "1958." SECTION 9 This section of the bill would provide for the simplification of Government transportation rates and procurement and for the transportation of mail by motor common carriers. It is designed to encourage the development of simplified rate structures and systems for Government transportation, adaptable to automatic data processing and separate and distinct from the complex system prevailing in the case of commercial transportation. The simplified rate system would be accomplished by (1) authorizing the proceurement of Government transportation from all modes of carriers, without regard to any law requiring formal advertised bidding procedures and (2) providing for the initiation and establishment through progressive research and development of a simplified rate structure for Government traffic. It implements a recommendation contained in part I(D)(3) of the President's message. Section 9 also would give the Post Office Department greater flexibility in the use of motor common carriers for the transportation of mail, a provision based on a recommendation contained in part I (C) (4) of the President's message. The idea of simplifying the common carrier rate and classification system for the purpose of adapting it more readily to the requirements of automatic data processing is deserving of serious study and development. Perhaps as important, however, is the need to make this system more understandable and more capable of convenient application for the user of common carrier transportation service. Its present-day complexities impair its usefulness in business and Government for budget, research, and other purposes. On page 17, line 23, page 18, line 8, and page 19, line 3, the designation "Administrator, General Services," may have been intended to be "Administrator General Services Administration." SECTIONS 10 THROUGH 13 These sections of the bill, which are based on a recommendation contained in part I (C) (5) of the President's message, proposed to transfer to the Department of Commerce the railroad loan guaranty authority of the Interstate Commerce Commission and the aviation loan guaranty authority of the Civil Aeronautics Board. Provisions also are included for the continuance of actions taken by the Board and by the Commission unless or until changed by the Secretary of Commerce, and for the transfer of persons, property, records, and unexpended appropriations from those agencies to the Department of Commerce. The transfer of loan guaranty authorities to the Department of Commerce would not affect the functions or operations of our Office. Enactment of the section seems to be in the public interest because it will remove from the regulatory agencies promotional transportation activities possibly better suited for administrative purposes in an executive agency and we see no objection to its receiving favorable consideration by your committee. However, in connection with section 10 (a) of the bill, we note that section 8 of the act of September 7, 1957, 71 Stat. 629, Public Law No. 85-307, provides that the guaranty authority in section 3 of the act shall expire 5 years after September 7, 1957. We also note that the proviso in section 11(d) of the bill refers to "section 503 of the Interstate Commerce Act, as added by section 2 of the Transportation Act of 1958." However, section 503 is repealed by section 11(a) of the bill. In summary, subject to the suggestions indicated above, we recommend favorable consideration of the bill by your committee. Sincerely yours, JOSEPH CAMPBELL, Comptroller General of the United States. GENERAL SERVICES ADMINISTRATION, Hon. OREN HARRIS, Chairman, Committee on Interstate, and Foreign Commerce, DEAR MR. CHAIRMAN: Your letter of May 9, 1962, requested the views of the General Services Administration on H.R. 11584, a bill "to provide for strengthening and improving the national transportation system, and for other purposes." As you know this legislative proposal would implement certain recommendations contained in the message on an efficient transportation system which the President sent to the Congress on April 5, 1962, House Document No. 384. Section 9 of the bill which deals with the simplification of Government transportation rates and the procurement of transportation services by the Government would implement a proposal contained in the legislative program of the General Service Administration for the 87th Congress, 2d session. Under the Federal Property and Administrative Services Act of 1949 (63 Stat. 383; 40 U.S.C. 481), the General Services Administration is interested in transportation and traffic management on behalf of executive agencies from the viewpoint of a user of transportation services. Since H.R. 11584 would benefit users of transportation services by providing for a stronger national transportation system, the General Services Administration strongly recommends the enactment of this legislative proposal. The Bureau of the Budget has advised that there is no objection to the submission of this report to your committee and that the enactment of H.R. 11584 would be in accord with the program of the President. Sincerely yours, LAWSON B. KNOTT, Jr., Hon. OREN HARRIS, OFFICE OF THE POSTMASTER GENERAL, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D.C. DEAR MR. CHAIRMAN: This is in reply to your request for a report on H.R. 11584, which is designed to improve the national transportation system. We urge the enactment of this legislation. We are particularly interested in section 9(a)(1) of the bill which would permit this Department to enter into contracts with reliable motor common carriers to transport mail, without the requirement to advertise for bids. This would allow the Government to obtain mail transportation service from motor common carriers in the same manner and to the same extent as it obtains transportation for persons or property. We have been advised by the Bureau of the Budget that from the standpoint of the administration's program there is no objection to the submission of this report to the committee. Sincerely yours, J. EDWARD DAY, Postmaster General. The CHAIRMAN. It is quite obvious that in the proposals involved here, as is usual with transportation matters, that differences of opinion will inevitably arise. Everyone recognizes the importance of these proposals, as indeed we recognize the importance of our common carrier system. So these hearings are highly important. It will be the purpose of the committee to make the best possible record for its consideration in an effort to resolve these questions in the public interest. Today we are honored by the presence of the Secretary of Commerce. We certainly, Mr. Secretary, appreciate the vast responsibilities you have for the welfare of our Nation, the importance of the position that you hold in matters of transportation, as well as in the entire field of economics. The committee is pleased to have you present today the views of the Department on these two, and any other bills, before this committee, involving matters contained in the transportation message. I believe you have with you your Under Secretary and other personnel of your Department which you may want to identify for the record. Mr. Secretary, you may proceed. STATEMENT OF HON. LUTHER H. HODGES, SECRETARY OF COMMERCE; ACCOMPANIED BY CLARENCE D. MARTIN, JR., UNDER SECRETARY FOR TRANSPORTATION; ROBERT E. GILES, GENERAL COUNSEL; ROBERT ABLES, ASSISTANT TO THE GENERAL COUNSEL; BYRON NUPP, STAFF ASSISTANT IN THE OFFICE OF THE UNDER SECRETARY FOR TRANSPORTATION; FRANK BARTON, DEPUTY UNDER SECRETARY FOR TRANSPORTATION; AND HENRY S. SCHARER, DIRECTOR OF PUBLIC INFORMATION, DEPARTMENT OF COMMERCE Secretary HODGES. Thank you, Mr. Chairman, and gentlemen. First of all, I would like to present my associates here with me, some of whom will be taking part. To my left, Mr. Martin, the Under Secretary of Transportation. To my right, Mr. Robert Giles, General Counsel. Sitting here, Mr. Henry Scharer, Director of Public Information. Mr. Frank Barton, Deputy Under Secretary, assistant to the General Counsel, and Mr. Nupp, staff assistant in the Transportation Office. Mr. Chairman, if it suits you and the committee, both the Under Secretary and I will make our statements, and then be available for questioning. The CHAIRMAN. Yes; that would be very well, Mr. Secretary. You may proceed, if you desire. Secretary HODGES. I appreciate the opportunity to come before your committee to urge your approval of H.R. 11583 and H.R. 11584. These two bills were submitted to the Congress by the Department. of Commerce with my letter of May 1, 1962. They are now before you as a followup to the recommendations made by the President on April 5. 1962, in his message to the Congress on the transportation system of our Nation. |