Mr. FRELINGHUYSEN. He was a vice president of our firm. He is no longer with us.

Mr. MALETZ. He is no longer with your firm, or is he deceased?
Mr. FRELINGHUYSEN. NO.

Mr. MALETZ. In summary, is it not correct that the port authority, your concern, and Mr. Mallory Stephens, worked out a plan whereby Mr. Mallory Stephens' firm was to be paid for a period of 5 years the brokerage commissions on certain port authority insurance on the Columbia Street pier?

Mr. WOLF. May we have the question reread?

(The question was read by the reporter.)

Mr. FRELINGHUYSEN. May I explain?

Mr. MALETZ. Yes, sir.

Mr. FRELINGHUYSEN. The answer is substantially "Yes." wouldn't phrase it that way myself. I wouldn't want to quibble on the language. We didn't actually pay them the commission. They deducted the commission and paid us.

Mr. MALETZ. I am going to come to that in a moment.

And these commissions, assuming a 15-percent brokerage, would be close to $13,000; is that right?

Mr. FRELINGHUYSEN. If that is the figure; yes.

Mr. MALETZ. And is it not also correct that to accomplish this plan, what was done first was to cancel $975,000 of port authority insurance policies on the Columbia Street pier? That was that memorandum I read to you of December 20, 1949, Mr. Frelinghuysen.

Mr. FRELINGHUYSEN. May I see it again?

Mr. MALETZ. Yes, sir.

Mr. FRELINGHUYSEN. Yes; your statement is correct.

Mr. MALETZ. So that the record will be clear, may I repeat the question?

Is it correct to accomplish this plan, what was done first was to cancel $975,000 of port authority insurance policies on the Columbia Street piers?

Mr. FRELINGHUYSEN. I am not sure whether they were the policies or the binders, Mr. Maletz.

Mr. HOLTZMAN. Do you know how long they were in force at the time?

Mr. FRELINGHUYSEN. No, sir; I don't recall.

Mr. HOLTZMAN. Can you tell us whether the cancellation was pro rata or short rate?

Mr. FRELINGHUYSEN. I would assume it was pro rata.

Mr. HOLTZMAN. I would prefer that you would get us that information.

Mr. FRELINGHUYSEN. We will include that in the letter, sir.
Mr. HOLTZMAN. Please.

Mr. MALETZ. I am sorry-I was distracted for just a minute.

(The reporter read from his notes as requested.)

Mr. MALETZ. And as part of this plan, was it not decided that the J. S. Frelinghuysen Corp., the port authority's broker, would continue to service these new policies in their entirety?

Mr. FRELINGHUYSEN. Yes; as stated in the letter.

Mr. MALETZ. And as a part of this plan, was it also decided that Frelinghuysen would deliver the policies on the Columbia Street

pier to Mr. Stephens, who would then transmit the policies to the port authority, together with the premium invoices?

Mr. FRELINGHUYSEN. If I can correct that to read to Knickerbocker Associates, I would answer "Yes," because we didn't deliver them

to

Mr. MALETZ. I beg your pardon. I will rephrase the question.

And as part of this plan, was it decided, by Mr. Tobin, on behalf of the port authority, that the Frelinghuysen concern would deliver the policies on the Columbia Street nier to Mr. Stephens' firm, Knickerbocker Associates, which would then transmit the policies to the port authority, together with the premium invoices?

Mr. FRELINGHUYSEN. Yes, sir.

Mr. MALETZ. And the port authority, on Mr. Tobin's instructions, agreed, did it not, to pay the premiums to Mr. Stephens' firm, Knickerbocker Associates, which was then to transmit the premiums to Frelinghuysen?

Mr. FRELINGHUYSEN. That is my understanding.

Mr. MALETZ. But in transmitting the premium payments to the Frelinghuysen concern, Mr. Stephens' firm, Knickerbocker Associates, was to deduct for itself the standard brokerage commission? Mr. FRELINGHUYSEN. Yes, sir.

Mr. MALETZ. And Frelinghuysen concern would then transmit the premiums less Mr. Stephens' firm Knickerbocker Associates brokerage commission to the appropriate insurance carriers; is that correct? Mr. FRELINGHUYSEN. Yes; that is correct.

Mr. MALETZ. I will repeat the question.

The CHAIRMAN. He said yes.

Mr. MALETZ. All right.

In short, although the Frelinghuysen concern was to service the policies, the Frelinghuysen concern, under the plan, was to relinquish its commissions on the Columbia Street pier to Mr. Stephens' concern, Knickerbocker Associates; is that correct?

Mr. FRELINGHUYSEN. Yes.

Mr. MALETZ. And the only work that Mr. Stephens' firm, Knickerbocker Associates, was to do, was to transmit the policies which Frelinghuysen obtained to the port authority, and then to transmit the premium payments to Frelinghuysen, deducting the standard brokerage commission.

Mr. FRELINGHUYSEN. That is the only work that I recall, Mr. Maletz.

Mr. MALETZ. All right, sir.

Mr. HOLTZMAN. Do you know of any other work that they might have had to do? Do you know of any other work that the Knickerbocker people had to do in connection with the Columbia Street pier insurance?

Mr. FRELINGHUYSEN. Well, it is possible that they might have sat in on some conferences and discussed the policy form, or accompanied one of our men on an inspection of the facility. But I don't recall it, sir.

Mr. HOLTZMAN. You don't recall. As a matter of fact, the memo indicates that the full servicing of this insurance was to be done by the Frelinghuysen Corp.

Mr. FRELINGHUYSEN. Yes, sir; the memo so indicates.

Mr. MALETZ. Was this arrangement to pay Mr. Stephens' firm, Knickerbocker Associates, these brokerage commissions, approved by the board of commissioners of the port authority at a regular meeting of the board; if you know?

Mr. FRELINGHUYSEN. I do not know, sir.

Mr. MALETZ. Mr. Chairman, for the record-I take it the subcommittee can take judicial notice of this may I include a list of bills affecting the Port of New York Authority introduced by Mr. Mallory Stephens between 1945 and 1952, at a time when he was a member of the New York Assembly, and chairman of the ways and means committee of the assembly. We have the original bills, Mr. Chairman. We have also a summary of all bills enacted in the New York State Legislature pertaining to the Port of New York Authority, 1945 through 1952 indicating which of these bills was sponsored in the assembly by Mr. D. Mallory Stephens.

The CHAIRMAN. Read them briefly.

Mr. MALETZ. Bills introduced by Mr. D. Mallory Stephens, member, New York Assembly, chairman, ways and means committee, pertaining to Port of New York Authority, 1945–52.

On January 29, 1945, he introduced a bill providing, subject to approval by New Jersey, that bonds or other obligations of the New York Port Authority issued for any union terminal, freight station, or steamship, or marine terminal purposes, shall be legal for savings banks. The assembly introduction number was A-765. The assembly print number was A-786, A-1135. The bill passed the assembly February 28; passed the senate March 7; and was enacted March 14, 1945, as chapter 163.

On February 6, 1946, Mr. Stephens introduced a bill, assembly introductory No. A-1286, assembly printed No. A-1364, providing that the States of New York and New Jersey agree that obligation of the Port of New York Authority to pay back moneys advanced for studies of interstate vehicular bridges, Outerbridge Crossing, Goethals Bridge, and Bayonne Bridge, may be satisfied by delivery to the two States of bonds or moneys or both equal to appropriations. This bill was referred to the ways and means committee of the assembly, reported March 6, third reading March 7, stricken from calendar March 12, 1946.

A companion bill was introduced in the Senate by Senator Wicks as senate introductory No. 1049, senate printed No. 1129; introduced February 5, 1946, and referred to finance committee; reported February 26; passed senate March 4; to assembly ways and means committee, March 5; passed assembly March 26; enacted April 1, 1946, chapter 352.

February 6, 1946. Mr. Stephens introduced assembly introductory No. A-1287, assembly printed No. A-1365. This bill provided for the financing of a motorbus terminal by the port authority, and for agreement with State of New Jersey relative thereto. This bill passed the assembly March 20, passed the senate March 25, enacted April 4, 1946, chapter 443.

The companion bill was Senate printed Nos. 1130, 2401, Senator Wicks.

And digressing, Mr. Chairman, I will introduce for the record a speech made on January 27, 1949, by Mr. Howard Cullman, at a

luncheon commemorating the groundbreaking ceremonies of the Port Authority Bus Terminal on Thursday, January 27, 1949, at the Hotel Statler. I offer this speech for the record and quote just one paragraph, at page 2.

Senator Arthur Wicks and Chairman Mallory Stephens of the ways and means committee of the assembly, in New York, and Senator Dave Alstyne and Assemblyman Walter H. Jones, of New Jersey, were the legislative leaders who introduced this amendment to the port treaty, and who saw it through the two Legislatures.

(The speech referred to appears at p. 1232.)

On February 18. 1947, Mr. Stephens introduced assembly introductory No. A-1923, assembly printed No. A-2056. This bill provided for joint action of the State of New York and the State of New Jersey for development by Port of New York Authority of Marine Terminals, and authorizes municipality to transfer any such terminals to the port authority for control, operation, maintenance, rents, tolls, and other revenues. This bill was referred to the ways and means committee and reported March 6. It was stricken from calendar March 12, 1947.

The companion bill was S.I. 1719, senate printed No. 1909; introduced February 18; passed senate March 3; to assembly ways and means committee March 4; passed assembly March 18: enacted April 5. 1947, chapter 631. Author of the companion bill was Senator Wicks.

On February 18, 1947, Mr. Stephens introduced assembly introductory No. A-1921, assembly printed No. A-2054. That bill provided that any bond, note, or instrument issued by the Port of New York Authority to be exchanged for or converted into general and refunding bond shall be negotiable if New Jersey agrees thereto. This was referred to the ways and means committee and reported out March 6; stricken from calendar March 12.

The companion bill introduced by Senator Wicks was S.I. 1718; senate printed No. 1908; introduced February 8: to finance committee, and reported February 26; passed senate March 3: to assembly ways and means committee March 4; passed assembly March 18; enacted April 5, 1947.

Also on February 18. 1947. Mr. Mallory Stephens introduced assembly introductory No. 1922 which provided for financing, construction, and operation of air terminal by the Port of New York Authority; cooperating with the State of New Jersey.

This bill was referred to the wavs and means committee; reported March 6: stricken from calendar March 12.

The companion bill, introduced by Senator Wicks, was S.I. 1716; senate printed No. 1906; introduced February 18; to the finance committee; reported March 6; passed the senate March 11; to assembly rules committee, March 12; passed assembly, March 18; enacted April 11. 1947 as chapter 802.

Also on February 18, 1947, Mr. Stephens introduced a bill establishing optional procedure for the Port of New York Authority to exercise eminent domain or condemnation, when authorized by legislative enactment, to acquire real property within the State. Assembly introductory No. A-1920; assembly printed No. A-2053.

The bill was referred to ways and means committee, and reported on March 6; stricken from the calendar March 12, 1947.

The companion bill was S.I. 1717, senate printed No. 1907; introduced senate February 18; reported by finance committee February 26; passed senate March 3; to assembly ways and means committee on March 4; passed assembly March 12, 1947, chapter 819. Senator Wicks was the author.

On February 17, 1948, Mr. Stephens introduced A.I. 2108, printed No. A-2234.

Would you like, Mr. Chairman-all these bills were passed-
The CHAIRMAN. Just give the nature of the bill.

Mr. MALETZ. On February 17, 1948, Mr. Stephens introduced a bill to strike out reference to the Long Dock Co., in provisions relating to contract between State Bridge & Tunnel Commission, Erie Railroad Co., for grants and other matters incidental to operation of Holland Tunnel.

The CHAIRMAN. That bill passed?

Mr. MALETZ. Yes, sir.

All these bills have passed, Mr. Chairman.

On February 24, 1948, Mr. Stephens introduced A.I. 2478, authorizing the Port of New York Authority to rehouse persons displaced from sites acquired for terminal or transportation facilities, and to issue bonds for cost of housing projects.

On February 24, 1948, he introduced A.I. 2476, specifying types of relief and purposes for which the States of New York and New Jersey may consent to action against the Port of New York Authority, and providing that New York State may authorize the Port of New York Authority to acquire land for marine terminal purposes.

On February 17, 1948, he introduced A.I. 2109, amendments specifying type of relief and purposes for which States of New York and New Jersey may consent to action against the Port of New York Authority, and providing that local laws of municipality where air terminal is situated shall apply thereto subject to agreement between the Port of New York Authority and municipality.

On February 17, 1948, he introduced A. 2074, providing for amendment to State finance law, including sections providing for the legality for investing State funds in the Port of New York Authority.

On February 8, 1949, he introduced A.I. 1532, including street purposes as amendment to park and playground purposes for which the Port of New York Authority may convey portion of pier properties in 12th ward of Brooklyn and providing that where conveyance has been made for any such purpose, it may be amended to include any or all of the other purposes.

On February 21, 1950, he introduced A.I. 2714, providing for an agreement between New York and New Jersey as to suits and proceedings against the Port of New York Authority, including appeals and reviews.

On February 21, 1950, Mr. Chairman, Mr. Stephens introduced a bill providing for an agreement between New York and New Jersey for rules and regulations governing traffic at vehicular crossings operated by the Port of New York Authority.

I might again stress, Mr. Chairman, each of these bills was passed.