Mr. BRIDWELL. Yes, sir. Senator LAUSCHE. Proceed. Mr. BRIDWELL. So that there will be equal application. Under this bill the motor carrier industry, State authorities, and the Interstate Commerce Commission could act cooperatively to maintain the integrity of common carrier services. Procedures which now hamper such cooperative action would be eliminated by the bill. Four other bills before your committee would also deal with enforcement and reparations. S. 1728 would enable the commission to apply for enforcement to a district court and permit the joining of other parties in an enforcement suit. The bill is similar in intent to the first part of section 4 of S. 1727. S. 1731 has no counterpart in S. 1727. It would enable the Commission to revoke motor carrier operating authorities for willful violation of Commission rules, orders, or regulations. Such a procedure is necessary for more effective law enforcement. Senator LAUSCHE. S. 1731 has no counterpart in 1727, is that correct? You so state in the paragraph just before. I think yesterday testimony was given that too broad a power is vested in the Commission by S. 1731 when it states that the Commission shall have authority to revoke certificates for all willful violations regardless of their gravity. Am I correct? Mr. SENDER. Regardless of willfulness. Senator LAUSCHE. Oh, yes. Mr. BRIDWELL. Regardless of willfulness. Mr. BRIDWELL. Mr. Chairman, the granting of a certificate by the ICC on a showing of public convenience and necessity bestows upon an individual a very important right granted by the public, and it is our position that the authority which grants this public right, also should have the authority to remove it upon a reasonable showing that this right was not exercised in the public interest. Senator LAUSCHE. What about situations where inadvertently there has been a failure to obey an order, as distinguished from a willful disobedience? Mr. BRIDWELL. If it were inadvertent, Mr. Chairman, I do not believe that the ICC would act in such a manner as to cause a revocation. Senator LAUSCHE. Well, if it would not act in such a manner why give it the power to act? Mr. BRIDWELL. The problem, of course, is adequately and legally determining and providing the evidence of a willful violation. Senator LAUSCHE. Well, in any event, the Department of Commerce through its officials is of the opinion that the right to revoke ought to exist without the necessity of the Commission finding that there was a willful violation? Mr. BRIDWELL. Yes, sir. Senator LAUSCHE. Proceed. Mr. BRIDWELL. S. 1732 is similar to sections 5 and 6 of S. 1727 in that it would make motor carriers and freight forwarders liable for reparations. There are some differences in detail between the two bills. S. 1732 reflects the ICC's own views on the handling of reparations. A complaint could be brought before the Commission, whereas under S. 1727 only the courts could consider reparations. The Commission's bill is consistent with procedures now applicable to rail and water carriers, and our preference is for this approach. Both bills, however, accomplish the same objectives. S. 1733 is similar to section 3 of S. 1727 in providing civil penalties for economic and safety violations by motor carriers, in line with the Kennedy message and previous administration bills on this subject. Penalties provided by S. 1732 are not so large as in S. 1727 or in the administration bills. We prefer the larger $500 initial payment with a $250 daily payment for continued violation in place of the $200 initial payment and $100 daily payment provided in S. 1733. Senator LAUSCHE. What is your understanding of what the House approved? Mr. BRIDWELL. It is my understanding that the House approved the $500 initial payment and the $250 daily payment. Senator LAUSCHE. We have just checked the House bill, and with respect to the penalty that might be imposed for violation it provides that the penalty shall not exceed $500 for the first day of violation and thereafter not to exceed $250 for each additional day. Mr. BRIDWELL. Yes, sir. Perhaps I was not clear on this, Mr. Chairman. The $500 and the $250 become maximums, and it is a scale, anything up to those maximum amounts. Senator LAUSCHE. Proceed. Mr. BRIDWELL. The other 11 bills before your committee at this time deal with a variety of matters in the legislative program of the Interstate Commerce Commission. We will not offer detailed comments on each of them. The Department will include in the record letters on each bill for offering more detailed comments. Generally we favor all of the bills. We believe that they move in the direction desired by the administration in regulation. Outmoded provisions are repealed or modified. More initiative is left in some instances with the carriers. Other provisions improve the processes of regulation itself by streamlining procedures and eliminating cumbersome requirements. At this time I will mention each bill and state briefly our general position. S. 1142 Amend the Interstate Commerce Act to exempt the Federal Government and the District of Columbia government and their instrumentalities, States and their political subdivisions, and municipal corporations from ICC regulation with regard to the issuance of securities or the assumption of liabilities or obligations. The bill would eliminate an unnecessary procedural step by the Commission when Federal Government, the District of Columbia government, State, or local governments provide assistance to carriers in furtherance of their own public policies. S. 1143 Amend part III of the act to provide for revocation of water carrier certificates or permits for nonuse. This would install the "use-it or lose-it principle" with respect to water carrier certificates. It seems unreasonable that dormant certificates should be available for the asking when the original conditions governing their issuance may have long since disappeared. S. 1144 Repeal the (transportation) Medals of Honor Act. The Medals of Honor provisions are no longer necessary in view of the more comprehensive program afforded by the Carnegie Hero Fund Commission Awards. At present the Commission's program is duplicative of a large program more suitable for encouragement of safety practices. S. 1145 Amend section 1(22) to exempt from the Commission's jurisdiction construction, acquisition, operation, abandonment, and joint ownership or joint use of spur, industrial, team, switching, or side tracks, and terminals incidental thereto. Only local factors are involved in adjustments of industrial spurs and team tracks. No purpose is served by keeping them under regulation. S. 1146 Amend section 5(1) to exempt contracts, agreements, or combinations affecting transportation of household goods to which any common carrier by motor vehicle may be a party with other such carrier or carriers for the pooling or division of traffic, service, or earnings. Regulation of the household goods' carrier industry under the pooling provisions has not proven practical. Elimination of this provision would enhance the flexibility of household goods' transportation and might bring better service to the public. S. 1147 Amend section 5(10) to make gross operating revenue, instead of the number of vehicles owned or operated, the basis for determining whether a proposed unification or acquisition of control is exempt from the provisions of section 5. Number of vehicles have lost their significance as measurements of motor carrier size. A monetary measure, as suggested by the Commission, is more appropriate. S. 1148 Amend section 17(2) to authorize the Commission to delegate to qualified individual employees, including transportation economists and specialists, those matters which have not involved the taking of testimony at a public hearing or the submission of evidence by opposing parties in the form of affidavits. Delegation of very detailed matters would greatly improve the efficiency of regulation. S. 1149 Amend section 19a to eliminate the requirement that the Commission determine the present value of the land and property held by carriers for purposes other than for use in common carrier service. This is a rather technical amendment which would eliminate a reporting requirement that has lost its regulatory significance. The Commission would still have information concerning noncarrier properties through its regular financial reports. S. 1150 Amend section 20a (12) to eliminate the necessity for prior Commission approval for a person to hold the position of officer or director of more than one railroad where the carriers are part of a single inte grated system, lawfully operated system, lawfully operated under common control. Management of integrated railroad operations often requires that a person maintain positions as an officer or director in several companies. This is a common device in the railroad industry to insure integrated operations and where it is so used, no useful purpose is served by restricting it. Senator LAUSCHE. With respect to S. 1150, this would only be applicable where there is a common control and ownership? Mr. BRIDWELL. Yes, sir. Senator LAUSCHE. And therefore the interests of the two entities that are served by the same director are identical? Mr. BRIDWELL. That is correct, if the two properties are operated as an integrated system. Senator LAUSCHE. Would S. 1150 at all affect the present laws prohibiting directorships where interests are conflicting? Mr. BRIDWELL. No, sir; this eliminates only the necessity of obtaining prior approval by the Commission where there is common control and ownership. Senator LAUSCHE. Proceed. Mr. BRIDWELL. S. 1152. Restrict factual testimony by ICC investigators to cases where factual evidence is not reasonably available from other sources and prohibit use in a damage suit of (1) reports submitted by carriers under the Locomotive Inspection Act; (2) ICC accident investigators' reports; and (3) expert opinion testimony of investigators. This is a matter pertaining to the internal management of the Commission and we have no special knowledge on this subject. S. 1153 Eliminate the mandatory oath requirement for certain documents at the discretion of the Commission. This would streamline the paperwork of the Commission in its conduct of cases. Senator LAUSCHE. For the purpose of documenting your statement on S. 1153 there is in existence now a statute which makes a person who gives a false report on matters required by law subject to criminal prosecution whether that statement is under oath or not. Is that a fact? Mr. BRIDWELL. That is my understanding, Mr. Chairman. Senator LAUSCHE. And so deceit and fraud would still be reachable under the existing statutes separate and apart from the right that would exist if an oath were actually administered? Mr. BRIDWELL. Yes, sir; that is my understanding. Senator LAUSCHE. All right, proceed. Mr. BRIDWELL. Mr. Chairman, this concludes the Department's testimony. Senator LAUSCHE. All right, thank you very much. Mr. SENDER. Are you prepared today or would you prefer to comment at a later time on the provisions of H.R. 5401 concerning water carriers and their revocation? Mr. BRIDWELL. Mr. Chairman, I can comment upon this if it is agreeable with the committee. I can comment upon this, subject perhaps to further communication from the Department to the committee. Section 8 of H.R. 5401 would grant free entry to water carriers over any route where no certificate is in effect. Rate regulation would remain in force. In other words, any carrier operating on such a waterway would have to file his rates and be subject to all of the procedures attendant thereto, but it would not require a finding by the ICC of convenience and necessity in order for the operator to start service, nor could the Commission suspend the initial rate filing of a carrier. It is my position that the "use it or lose it" principle in effect applies here, although granted it is a somewhat unusual situation in that a direct "use it or lose it" philosophy is not fully applicable. It is therefore my feeling that on any waterway where there now is no carriage that the certificated operators who have the potential of operating on such a waterway as a part of a related system should have that opportunity. However, in the event that after a reasonable period of time such service is not afforded and there is no valid attempt by a certificated operator to provide such service, then I believe that it is reasonable to throw open for free entry the opportunity for any carrier to provide such service. Mr. KENNEY. If I may, the bill, however, does not do that, does it? Mr. BRIDWELL. The bill provides complete free entry, as I understand its terms. Mr. KENNY. Therefore, it is not in accord with the concept you have just Mr. BRIDWELL. What I have stated would certainly be a modification of what is provided in the House bill. Senator LAUSCHE. Is that the position of the Department of Commerce that you have just stated? Mr. BRIDWELL. Yes, sir; subject to any refinement of that on the part of the Secretary. This particular provision has not been called to his attention because of the very recent enactment of H.R. 5401, so I would like to make that statement subject to revision. Senator LAUSCHE. Would you have your legal experts prepare a draft of language that would embody what your version of it is! Mr. BRIDWELL. Yes, sir; in the form of language for a bill? Senator LAUSCHE. Yes. Mr. BRIDWELL. For a bill. (The subsequently received information follows:) GENERAL COUNSEL OF THE DEPARTMENT OF COMMERCE, Hon. FRANK J. LAUSCHE, Chairman, Subcommittee on Surface Transportation, Committee on Commerce, U.S. Senate, Washington, D.C. DEAR MR. CHAIRMAN: This letter is in response to your inquiry for suggested legislative language dealing with the modification of the Interstate Commerce Act with respect to water carrier certificates. You will recall that in a session of your subcommittee on Tuesday, May 11, you requested the views of this Department with respect to section 8(b) of H.R. 5401 as it passed the House. Mr. Lowell Bridwell, Deputy Under Secretary for Transportation, of this Depart |