We think as the result of our research that we can develop reasonably good plans for wholesale produce markets in large cities, mediumsize cities and small cities, but the problem now, after the plans have been developed is how can those plans be translated into improved wholesale marketing facilities where food can be handled more efficiently, with less deterioration, and where we can, in the words of the chairman, shorten the distance between the farmer and the consumer by the elimination of unnecessary operations.

The CHAIRMAN. Mr. Crow, you mentioned the interest of different groups in these terminal markets. I wish you would tell the committee something about the Washington Street Market, for instance, in New York; the amount of food that passes through that market, the percentage of it that is locally produced, and the percentage of the food that is locally consumed which goes through that market. Mr. CROW. I will be glad to.

The CHAIRMAN. The point I have in mind is this: It seems to me that that market, along with many other terminal markets, is definitely impressed with public interest for the reason that so many people deal in the market, either buying or selling. I wish you would explain that to the committee.

Mr. CROW. The New York market is a large market, the world's largest. In one market area on adjacent streets they handle fruits, vegetables, poultry, eggs, meat, butter, cheese, and the other perishable commodities, but in order to save time and facilitate the discussion I will use the fruit and vegetable group of commodities to illustrate conditions there, with the understanding that conditions for the other commodities are very similar.

About 200,000 carloads of fresh fruits and vegetables move to the New York markets for sale each year. That amounts to about one carload for every daylight minute of the year. This is about 8 to 10 percent of all the fruits and vegetables produced for sale fresh in the United States.

With that large volume that market is the predominant pricemaking market in the country, not only for the commodities moving through it but for commodities that do not move through it.

Rail receipts of these commodities that come to New York for the most part reach the end of the railroad line on the New Jersey side of the Hudson River. At that point the cars are put on ferryboats, car floats, and floated across the river to some piers on the New York City side.

As much of the car as they think can be sold that day is unloaded on the piers. If they do not think they can sell the entire contents of the car the remainder, in order to stay under refrigeration, would stay in the car and be floated back to New Jersey and brought back the next day.

The cost of floating the cars across the river to those piers is a part of the freight rate, but at that point the service that the railroad performs for the regular freight rate ends.

The contents of those cars must be unloaded on those piers at an unloading charge which averages perhaps $45 a carload. The Pennsylvania Railroad has its piers to unload its products. The Erie has piers. The New York Central has piers. The Baltimore & Ohio has piers, and so forth

Buyers could go to each of these piers and buy some commodities. and go on into the Washington Street market area to get the remainder of their supplies but except for a few commodities sold at auction they do not do that. Instead the supplies are loaded on trucks and trucked across to the Washington Street store area some two blocks

away.

The cartage charge is assessed on a per package basis but runs in the neighborhood of $50 per carload which, when added to the $45 for unloading, makes about $95 to get that carload over into the Washington Street store district.

Some time ago we counted the number of trucks trying to get to those stores on Washington Street to load or unload and at the peak of the day we found 1,350 trying to get there. The street is wide enough for only three lines of trucks to move down it at one time, and to load and unload the trucks must park parallel to the sidewalks. When there is a truck parked parallel to the sidewalk on each side of the street there is room for only one line of trucks down the street, and with a long 30- or 35-foot truck, or even a 25-foot truck, parking parallel to the sidewalk it takes up a great deal of curb space, so that only about 400 to 450 trucks can park adjacent to the wholesale houses in that market at any one time, leaving about 900 that cannot get to the place where they want to load or unload. Those trucks must await their turn to get to these places or else employ porters to carry products by hand between the trucks and the stores.

It is difficult to determine what the average porterage cost is, averaged over the trucks that do not have to be portered as well as those that do, but we are told that a conservative estimate would probably be $15 a carload which, when added to the $95, would make about $110 a carload for getting those commodities from the railroad car into the wholesale house in their principal market.

Those wholesale houses are quite small, and were not designed for efficient handling, so the dealers operating there have their problems besides the traffic congestion and porterage. Products are piled out to the edge of the sidewalk. They are not piled in the street, as they are in some other markets, because the street there is simply so narrow you could not pile anything in it and get trucks through at all.

Those supplies then move out of that area, porters usually carrying products to the buyers' trucks, and are distributed over the city, into New Jersey, and into Connecticut and upstate New York.

These supplies that come into that market to feed this vast population in those three States come from about 44 States in the Union. About one-fifth of all the fruits and vegetables sold in the New York market comes from California. So the California people are quite concerned about the operation of the New York market. Another fifth comes from Florida. Another fifth comes from New York State. The remaining two-fifths come from about 40 other States and some foreign countries.

Does that take care of the point you had in mind?

The CHAIRMAN. I think it does. Mr. Hope, do yon want to ask any questions.

Mr. HOPE. I would like to ask a question about this New York situation you have just described.

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You say you have to unload these cars and then you have to load the goods on the trucks and transport them a couple of blocks and unload again. What is the reason that you cannot transport these cars right into the Washington Street market where you are eventually going to unload the goods rather than go through all this loading and unloading and trucking?

Mr. CROW. There are two or three reasons why that cannot be done in the present market.

First, the market is located literally in the shadow of the skyscrapers of lower Manhattan. The New York Telephone Building is right on the edge of the market. The World Telegram Building is there, and land, of course, is very expensive. It would cost a great deal to tear down enough buildings and get enough land to put railroad tracks into the area.

Furthermore, the shape of that market, the lay-out of it, is such that it would be practically an impossibility to get those tracks behind those stores if you could stand the expense of tearing down buildings. In other words, the market would have to be redesigned to make it possible for railroad tracks to come in, and they would have to have a considerable amount of land to lay those tracks on and to take care of the approaches. Those are the two main reasons. Mr. HOPE. Possibly there is some reason why they could not use the city streets for that purpose, but I am wondering why the railroads could not use the city streets to the same extent that the trucks do in transferring those goods.

Mr. CROW. There would be the problem of the railroad tracks running down the street; and, in addition to that, the railroad car cannot be as flexible as the truck. The water front runs along on this side [indicating] so to speak. The market street runs this way [indicating]. In order to get tracks into those stores it would be necessary to bring that track around and down this way [indicating] which would take quite an area in order to get the necessary acreage to run those cars on land behind those buildings. It would be just almost impossible without wrecking that end of the city.

The CHAIRMAN. Will the gentleman yield there?

Mr. HOPE. Yes.

The CHAIRMAN. Even if that were done the situation would not be very greatly improved because you would still be using only one entrance to the marketing house; is that not true?

Mr. CROW. Unless you were to tear out the buildings in the rear to make a rear entrance that would be true. Even so, the buildings that you have would have the floors down at the street level and would not be efficiently designed for unloading those cars. It would be cheaper to start over.

The CHAIRMAN. You said that 10 percent of the fresh fruits and vegetables of the country grown for market usually go through that market?

Mr. CROW. Yes, sir. through all the facilities in New York City. The CHAIRMAN. And 20 percent of that 10 percent comes from California; another 20 percent from as far away as Florida. Have you made any calculations of the cost that attaches to perishable commodities going into that market, from the time they reach the East River until they reach the uptown merchant or the housewife?

Mr. CROW. Such studies have been made by other agencies, and I am familiar with the results.

The CHAIRMAN. All right.

Mr. CROW. Before the war the city department of markets in New York made a study of the cost of handling these perishables after they reached the city as a proportion of the consumer's price. They found that almost half the consumer's dollar spent for fresh fruits and vegetables in a New York retail store went to pay the cost of handling those commodities between the time they reached the city limits and the time they got to the consumer's kitchen.

There have been some studies since the war on particular commodities made by one of the bureaus in the Department of Agriculture. Those studies for those particular commodities tend to bear out the prewar study of the New York City Department of Markets to the effect that of these particular commodities nearly half the consumer's dollar goes to pay the cost of all kinds of handling inside New York City, and only slightly more than half the consumer's dollar goes to pay the cost of transporting to the city, of handling at the producing end, packaging, and growing the commodity.

The CHAIRMAN. Which includes the price that the farmer receives? Mr. CROW. That is right.

Mr. GRANGER. Will the gentleman yield?

Mr. HOPE. Yes.

Mr. GRANGER. Mr. Crow, as I understood your statement you said. it took about $110 a car. In the first instance, it would take $45 to unload a car anywhere, no matter where it was unloaded, would it not? Mr. CROW. No, I would say not for this reason: When we were visiting the New York market we went to a warehouse or wholesale building that was located on the railroad track with the floors at the height of a railroad car, which is as they should be. We checked the cost at that place of unloading the car onto the floor of that wholesale house, and the cost to be $9 a car for the unloading operation.

Mr. GRANGER. Did you take that into consideration when you figured the cost of $110 a car, in addition to that?

Mr. CROW. Not in addition to that. If it goes through the Washington Street market area it has a $45 charge for unloading on the pier, about $50 for trucking to the area, and about $15 for porterage; but for this dealer located outside the market, where the track came directly to his warehouse and where he had the right kind of warehouse and handling equipment, in lieu of that $110 he paid $9 for unloading on his floor.

Mr. HILL. I would like to ask a question.

I was on the subcommittee which went to New York and inspected that market. I would like for you to discuss with the committee the attempt that was made by the late Mayor LaGuardia to establish a market off to one side where they could bring in these carloads of fruits and vegetables much more efficiently or directly, and I would like to know what really has happened to that market.

Mr. CROW. There have been several proposals going back to about 1913 for rebuilding and/or relocating the New York market. Several mayors of New York have appointed commissions to develop plans for doing something about the situation. The most recent one was a plan developed under the sponsorship of the late Mayor LaGuardia.

He employed a firm of architects and engineers to develop a plan to rebuild the present Washington Street market in approximately its present area. Under his proposal he proposed to get the additional space that was needed by extending the space out over the river closing in, you might say, between the piers, to make land in that way, figuratively speaking. He was also going to take some of the area along West Street, which is the first street on land from the river, and construct partly on land and partly on water a facility to which rail and truck receipts could come, be displayed, be sold, and trucked away.

The architectural engineers drew up the plans and figured the costs of construction, but I have never seen any adequate studies of that plan to find out just what effect it would have on the cost of distribution if it were carried out.

There have been other proposals to relocate the market in New Jersey and in other parts of New York City, but all of these proposals have died while they were being born.

Mr. HILL. I believe he did construct a market, because I was on the market myself. I cannot tell you the direction, because I have no sense of direction in the city of New York, but I find that everyone who lives there does not use it.

Where is the market which LaGuardia constructed? He had a market. He built one.

Mr. CROW. That is right.

Mr. HILL. Where is that market?

Mr. CROW. The one you have in mind is a secondary market built up in the Bronx several miles north of this Washington Street district. In that area he built a comparatively small number of wholesale stores and he provided rail connections with those stores, and the stores are well designed. They have a farmers' market in conjunction with those stores, and in the farmers' market and stores combined they handle in the course of the year approximately 20,000 carloads of commodities. That is a secondary market that he built, and that is operating successfully. It is not a primary market to take the place of Washington Street.

Mr. HILL. The committee talked to as many truckers from New York as we could find in the market early that morning, and in no instance did we find a trucker coming into that market from New York who did not like it.

Mr. CROW. That is right.

Mr. HILL. They all said, "This is what we ought to have." That is why we should know what sort of plans you have in mind here. If we are going to do anything we must connect it up with the city. You cannot do anything with this bill unless you get the cooperation. of the cities.

There is another thing that struck me in this examination: It seems to me that we developed in the city of New York a number of dealers who were just dealing on paper. What your trouble there was is that you had too many folks who had no facilities to handle products, and yet they were getting their commissions on it. Have you ever taken that into consideration, as to what the trouble really was? The folks there would have a little dinky corner office which you could not turn around in. You find that they were doing a lot of business.