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DEVELOPMENT AND IMPROVEMENT OF TERMINAL

MARKETING FACILITIES

THURSDAY, JUNE 8, 19501

HOUSE OF REPRESENTATIVES,
COMMITTEE ON AGRICULTURE,

Washington, D. C. The committee met, pursuant to recess, at 10 a. m., in room 1310 New House Office Building, Hon. Harold D. Cooley (chairman) presiding.

The CHAIRMAN. The committee will be in order.

Mr. D. A. Di Vito, representing the New Haven Market Exchange Corp. is here and we will be glad to hear from him now.

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STATEMENT OF DOMINIC A. DI VITO, MANAGER, NEW HAVEN

MARKET EXCHANGE, INC., NEW HAVEN, CONN. Mr. Di Vito. We have arranged procedure to expedite our testimony in conjunction with our own personal statements and the National Association of Produce Market Managers presentation. Mr. Hogan from Florida, and Mr. Meyers of Virginia, are here. If it meets with your approval we will express our thoughts and will be glad to receive your questions.

The CHAIRMAN. That will be fine. You may proceed.

Mr. Di Vito. Then if I may, Mr. Chairman, I would like to call on Mr. Hogan, who will present the official statement of the National Association of Produce Market Managers, together with his own personal comments, which he may wish to make in connection with this bill.

The CHAIRMAN. We will be very glad to hear Mr. Hogan.

STATEMENT OF G. B. HOGAN, MEMBER, LEGISLATIVE COMMITTEE, NATIONAL ASSOCIATION OF PRODUCE MARKET

, MANAGERS

Mr. Hogan. I am G. B. Hogan, assistant director of the Florida State Farmers Markets, also a member of the legislative committee of the National Association of Produce Market Managers.

This prepared statement I am going to read here of course is as a member of the legislative committee of the National Association of Produce Market Managers, and at the appropriate time I would like to make some oral statement as to the views of the organization of Florida State Farmers Markets.

The National Association of Produce Market Managers is an organization which has as its members the managers of about 100 1 Under the rules of this committee no member may be quoted from this transcript.

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of the leading produce markets in the United States. Our membership comes from all parts of the country, with markets in some thirty-odd states being represented.

This association was formed as a result of our feeling that there is an urgent need in this country to improve the services that markets can render to the producers, distributors, and consumers of our farm products.

We market managers are sadly aware of the dilapidated condition and the inadequacies of many of the facilities which are used in the wholesaling of our perishable foods. We are most cognizant of the fact that when products must pass through these facilities they are bound to suffer serious loss in quality, and that cost of distribution is much higher than it should be. The result is a net loss to all of us, for we are all very much concerned with food. The consumer pays more for less; the farmer's return for his crop is smaller than it should be, and the people who handle distribution suffer losses and operate under economic hazards that would be greatly reduced under an efficient system of marketing facilities.

Realizing this, many of our market managers have put forth exhaustive efforts to bring about the development of modern wholesale markets in their respective localities.

There are many obstacles and diverse and involved problems to be overcome in establishing new market facilities; but, one way or another we have been able to overcome most of these difficulties. However, there is one problem that in many instances has so far been insurmountable. It is a very serious problem, for it has to do with the pocketbook. Raising the necessary moneys to finance the building of a market is almost invariably a difficult task. Why this should be is not easy to answer for there has been a splendid record of financial success by most of the modern markets that have been constructed. Nevertheless, the difficulty of raising money to build or improve facilities in the many places which need them still exists. Therefore, unless some action is taken, such as is proposed in the Marketing Facilities Improvement Act, our food-distribution system will continue to lag far behind the times.

We market managers feel strongly that the problem of building efficient marketing facilities for the wholesale distribution of food is of national consequence. Our farmers in Florida are concerned and affected by the facilities of the market in Philadelphia, New York, and Boston. Farmers in California and Connecticut have an interest in the facilities that exist in Richmond, Va; Baltimore, Md; St. Louis, Mo; Milwaukee, Wis; or Columbus, Ohio.

Therefore, we feel that your committee in this effort to remove the major obstacle to obtaining a system of modern wholesale markets is making a decided step forward in the direction of attaining efficient food distribution in our country.

The CHAIRMAN. We thank you very much. .

STATEMENT OF DOMINIC A. DI VITO—Resumed

Mr. DI VITO. Mr. Chairman and members of the committee, my name is Dominic A. Di Vito. I reside in New Haven, Conn. I am vice president of the National Association of Produce Market Managers and a former member and secretary of the Connecticut Marketing Authority.

The remarks and comments I will make on the bill before you are predicated not only upon my experience with the National Association of Produce Market Managers and the Connecticut Marketing Authority, but also from my more than 14 years experience as secretary and manager of the New Haven Market Exchange. The New Haven Market, a private enterprise, is the largest in the State. It serves more than 40 wholesalers, 300 farmers, and approximately 750,000 consumers, and does a gross business of approximately $20,000,000 a year.

The need for adequate marketing facilities for perishable fruits and vegetables, particularly in the larger consuming areas, was never greater than it is today. And it will be still greater in the future unless some broad plan is set up to assist and to correct this urgent need.

What would better marketing facilities under this bill mean? This is what I believe would be accomplished and I speak for the big majority of my colleagues when I say:

1. Distribution costs would be cut through more efficient handling and transportation.

2. Farmers could sell their produce faster and with greater advantage.

3. Operation of market facilities would continue in hands of those who know this field best.

4. It would discourage Government on any level from entering in direct competition with private operators, without making a selfsupporting project.

5. It would mean a smoother flow of products, particularly when an abundance is available.

6. The farmers and wholesalers would be encouraged to work out their own problems, and I assure you they are many.

7. It would permit a better regulation of markets for the mutual benefit of all.

8. An important one, gentlemen, a challenge would be flung at every market man to participate in the ownership of market facilities, to make his business self-supporting and an asset to his community as well as to himself.

9. Labor relations and conditions would be improved.

Savings-real savings of many dollars—are hiding behind the nine direct benefits I listed. These savings could and should be shared by the farmer, the wholesaler, and the consumer.

These savings would come in reduced spoilage as well as greater efficiency. Spoiled food is expensive. You and I and everyone else

Few of the wholesale fruit and produce markets in the Nation today are adequate. Most of them are old with the buildings antiquated for today's methods, or set in crowded surroundings, a pattern followed long before the appearance of refrigerated highway trucks and trailers and cold-storage warehouses.

While Government officials have been advocating broader housing, health and social security measures, nothing was done until your chairman, Congressman Cooley, acted, about improving the distribution of food. It was like water. Everyone took it for granted until the drought or poor planning hit New York City.

A drought of food due to ill equipped, situated, administered, or financed wholesale distributing markets would have consequences

pays for it.

many times more serious than the crisis in which New York finds itself.

It could conceivably be that we even might have foodless Thursdays. Then we wouldn't have to save all of the day's soiled dishes for one washing at night.

The military leaders here and in London and Paris have joint plans on what to do in line of battle should another war break. A-bombing of American cities by long-range bomber or rocket is an admitted possibility. Well-organized food distributing centers scattered in key areas could become a valuable wartime asset. The advantages of such markets would be without limit in a national emergency. The emergency use would not have to be limited to fruits and vegetables. All other grocery store items could be distributed from these strategic points.

After talking with men in all levels of the produce industry, I am convinced that they will use the law, if passed, to the fullest extent. They know that something must be done, and this bill, I think, will do it.

As we see it, this bill is not another appropriation which will give something for nothing. It is developed on a sound business basis and makes loans possible from accredited lending institutions to be repaid with interest and I am certain that said loans will be properly evaluated before they are approved.

It is noted, however, that municipalities or other political subdivisions are entitled to borrow under the same privilege as a private corporation, cooperative, or other type of individual group. This, I believe, should be omitted for two reasons.

1. They can borrow on their own credit, and Federal guarantee is not needed particularly if a market is to be a self-supporting project.

2. The municipality or other political subdivision should be the last resort before they become involved in the market business. Usually such ventures resolve in political expediency and not for the service which it will ultimately render.

And just one suggestion, gentlemen. The law must keep Government administration to the bare minimum necessary to guarantee that its loan power is not abused. Good horse sense, unfortunately, cannot be written into laws. You have, however, gone a long way toward assuring competent administration by the high type of men now placed in the Marketing Facilities Branch, who are surveying market needs.

I have discussed the intent of this bill with the sponsors before it was presented. I say the farmers and distributors owe Congressman Cooley and his committee a debt of gratitude for drafting this proposed legislation. If all legislators are made to understand the seriousness of the problem, I am certain it will be enacted.

I am for this bill with the minor objection mentioned, and urge approval because I believe it offers a solid businesslike solution of the problems which plague this industry.

Government has given its help and advice to agriculture along every point of the line until the products are grown. This bill, I believe, will be a rejl benefit to everyone, from farmer to consumer, and will place greater emphasis on better markets, which in my opinion is the price-making function of the day.

Thank you for the privilege of allowing me to express my views.

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The CHAIRMAN. May I ask you a question? Do I understand that you propose to amend the bill so as to eliminate the loans to municipalities and political subdivisions, and restrict it to only private enterprise?

Mr. DiVito. It is an observation, Mr. Chairman, that I made, because I feel that the municipalities, if they have an interest in building a market, they can borrow their own credit, and I do not believe they need the credit of the Government.

The CHAIRMAN. I am inclined to agree with that. If the municipality is sufficiently interested, it might issue its own bonds.

Mr. DiViTo. Yes.

The CHAIRMAN. If it does not have authority to issue bonds, it may go to the legislature and obtain that authority.

Mr. DiVito. That is the only observation I made.

The CHAIRMAN. Even though they have the authority and the credit available, I do not see how it could hurt anything to make this loan available to them, because they certainly will get the most favorable interest rate. If they can float their own bonds and sell them at less than the interest rate, which they would have to pay for their Joan, naturally they would go the cheapest route.

Mr. DiViTo. I would feel that would be the case.

The Chairman. There is some advantage in having the market managed and controlled by the municipality, because it then becomes a public institution rather than private, and it seems to me that might have some advantages because you would have a public market authority to supervise it, to see that it does not become monopolistic, and get into the hands of a few powerful men.

Mr. DiVito. In my observation of the bill, I found it pretty well defined that if the private corporation or cooperative uses the advantages which the bill provides, the regulations it seems to me are pretty well defined that no abuse can be taken.

Mr. PoAGE. May I observe here that while I know this bill is intended primarily for the larger municipalities, rather than the smaller ones, many of the smaller municipalities over the country are faced with the proposition that they have reached their bonding limit and that their bonding limit is not fixed by legislature but by State constitutions. At least that is true in my State, and it is true in many other States, that you have a constitutional limitation which your municipality can issue bonds to, and while their bonds are selling today far below this interest rate, when they are able to issue them, if you

reach the constitutional limit, they might be just as well selling at 10 or 15 percent. You still cannot issue the bonds.

Mr. DiVito. May I simply state this. In reading the bill, there was only an observation which I have made, and I want to call that to your attention, I feel that probably you gentlemen that have studied the situation by far better and greater than I, may have had very good reason to incorporate it in the bill, and I will not argue the point to any degree.

The CHAIRMAN. You are in charge of the New Haven Market, are you?

Mr. DiVito. Yes. But, Mr. Chairman, if I may, Mr. Meyers is to speak following my comments.

71578—50-ser, 99-10

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