Mr. MANION. Yes, sir. Many of them will be the exclusive rail server of a small community. Some short-line roads are the only rail connections to an area, say to a valley, a geographical district. Senator PROUTY. In the event S. 1063 becomes law, it is your feeling that this would be very harmful to some of the small communities involved as well as the railroads? Mr. MANION. That is exactly my feeling, Senator. Senator PROUTY. Thank you. I have a statement of William D. Lamprecht, of the Southern Pacific Railroad, and it was asked that it be inserted at this point in the record. (Full text of statement follows:) STATEMENT OF WILLIAM D. LAMPRECHT, VICE PRESIDENT, SYSTEM OPERATIONS, SOUTHERN PACIFIC Co. My name is William D. Lamprecht, and I am vice president, system operations, of Southern Pacific Co. My address is 65 Market Street, San Francisco, Calif. I have held this position since July 1, 1960, and have been with Southern Pacific Co. since August 18, 1925. Southern Pacific Co. owns 76,267 freight cars, of which 60,992 have been acquired since 1946. Southern Pacific Co. is opposed to the passage of S. 1063, not because it differs with the stated objectives of providing the car owner with a fair return on its investment and meeting the necessity of an adequate car fleet, but because these objectives can be attained by voluntary cooperation of the railroad industry, and by the proper interpretation and application of the present provisions of section 1(14) (a) af the Interstate Commerce Act. The proposed bill would give greater regulatory power to the Commission, and it is my view that the industry should be seeking less regulation rather than more. Southern Pacific has for many years fought for the acquisition of an adequate supply of freight cars by railroads throughout the United States, and we think we have set an example by spending $443,561,217 on freight cars since 1946. In the past 5 years alone, we have purchased 9,567 new freight cars at a cost of $129,097,392, and plan to spend an additional $51,668,000 în 1963. We concur that the per diem rate should be high enough to encourage the acquisition of an adequate supply of cars. This aim can be satisfied, we believe, by a variable, or multilevel, per diem rate system, whereby the car user would pay a higher rate for a higher value car, and a lower rate for a lower value car. Acting through the Association of American Railroads, the owners of a majority of cars have already adopted such a plan, and it will become effective on January 1, 1964. We believe such a plan will adequately compensate a car owner, as it would provide for a return of the car owner's investment over the life of the car, and a reasonable interest return on the investment after consideration of Federal income taxes. The Commission has adequate power now to approve as reasonable such a system of per diem rates. It is not necessary to give the Commission the additional power contemplated by S. 1063, the precise extent of which may not be completely clear. The problems of adequate freight car ownership and car shortages have been with us for many years. The railroads today are taking active steps in attempts to solve them voluntarily. I would much prefer to see such a voluntary solution rather than through implementation of legislation such as S. 1063, which would add new powers to the already broad powers of the Interstate Commerce Commission. Senator PROUTY. Our next witness is Mr. Eldon Martin, vice president and general counsel, the Burlington Lines. Mr. Martin, that was a rather formidable array of witnesses who are not in concert with yourself. But I am sure you will uphold your end of the bargain very successfully. FURTHER STATEMENT OF ELDON MARTIN, VICE PRESIDENT AND GENERAL COUNSEL, BURLINGTON LINES Mr. MARTIN. Mr. Chairman, I may, of necessity, be somewhat disconnected in my remarks, because this is in the nature of rebuttal and not subject to the type of organization which I hope my original statement gave you. One or two points, before I forget them, with respect to statements by recent witnesses: Mr. Manion, for the short lines, and some of the questions you asked him about their per diem payments: By and large the short lines do not pay very much per diem. Generally speaking, the important trunkline that connects with the short line provides the equipment for the short lines; and while the per diem charge is $2.88, it is assessed, perhaps, in some cases, against a particular short line. Through the method of reclaim, that amount is reduced or repaid. It is very difficult to say exactly how much the short lines paid; but, in the prior record on one of the prior bills, I had some figures, and I think it developed that the actual payment was $1.43-or something like that per day, instead of the then established charge. The reduction was brought about by the so-called reclaim procedure. In any case, the amount of actual money which the short lines, socalled the members of Mr. Manion's organization-actually pay out is a relatively small amount of money. And I think, if he wants to check it out, he will find that is correct. One other point on the short lines. Some of his members, I am sure, would not join him in opposition to the bill. I know of one, at least-Fort Worth & Denver Railroad, for whom I speak in arguing in support of this legislation-who is a member of the Short Line Association, and I am quite confident he will admit there are several of his members who, it may be assumed, are supporting rather than opposing this legislation, although I do not suggest that a majority of his members are in that position. A majority, unquestionably, oppose it. Mr. Newton this morning gave some figures about the amounts of per diem paid and received by various railroads, and he submitted for the elucidation of the staff a statement of those payments for 1961. Now, I don't know why he chose 1961 when the 1962 figures were available. I would like to give you, likewise for the elucidation of the staff, the comparable 1962 figures. Senator PROUTY. We will have this included in the record, Mr. Martin. Mr. MARTIN. If the 1961 is included, the 1962 should be included. I didn't understand either was to be, but it makes no difference to me. Senator PROUTY. I think they should both be included. (The documents referred to follow :) Hire of freight cars-Class I railroads in the United States, year 1962 Hire of freight cars-Class I railroad in the United States, year 1962-Continued 2 Figures shown for Lehigh & New England are for 10 months ended October 31. Lehigh & New England was abandoned effective October 31, 1961. Portion of abandoned lines now being operated by Lehigh & New England RR., a class II carrier. |