rates referred to also cast a similar revenue burden on interstate

commerce.

Transportation conditions are not substantially similar throughout southern territory. In our prior report on further hearing we specifically found that the circumstances and conditions surrounding the transportation of these logs intrastate in Florida were not on the whole as favorable as the circumstances and conditions surrounding the interstate movement of logs over defendant's lines. Therein we also pointed out that the less favorable operating conditions in the Florida peninsula than in the remainder of southern territory have given rise to the general practice of permitting the addition of arbitraries to the rates on interstate traffic to and from points in that territory. We referred to Southern Class Rate case in which we prescribed class rates for that part of the hauls within the Florida peninsula that were 15 per cent higher than the basis prescribed for the remainder of southern territory. In that proceeding we stated that if and when we were called upon to fix maximum reasonable commodity rates to and from Florida, we would not be bound by what had been done with respect to the class rates. Since then we have in several cases prescribed commodity rates with relatively higher arbitraries for the hauls within Florida than were prescribed in the Class Rate case. In Rates on Chert, Clay, Sand, and Gravel, 140 I. C. C. 85, and Petroleum and Its Products, 171 I. C. C. 286, the rates prescribed for the hauls in Florida were approximately 40 per cent higher than for the remainder of southern territory.

Even if transportation conditions were similar in Florida as on the lines of the carriers that have established the per car rates, competitive conditions are not similar, as has been pointed out. The carriers that have established the per car rates have done so voluntarily as an experiment in an endeavor to regain traffic that was moving by truck and thereby increase their revenues, not only on the logs to the mills but on the outbound manufactured products from the mills, their per car rates being conditioned upon an outbound movement of the manufactured products in nearly all instances.

In Florida, on the other hand, the movement of logs has not been shown to have gone to the trucks to any substantial extent where the hauls are over 25 miles and this record warrants the conclusion that truck-competitive rates for distances under 25 miles would regain little, if any, traffic, and that to require defendant to continue to maintain the Cummer scale to meet what little truck competition could be met would greatly decrease the revenues of defendant and would not be warranted. Logs in single carloads are now

moving by rail over defendant's lines throughout Florida in substantially the same volume as at the time of the previous hearing and for the six months prior thereto, and the movement has not decreased to as great an extent as the outbound movement of lumber from Florida. The monthly movement since April 10, 1931, when the Cummer scale was reestablished, has been substantially the same as from the latter part of 1930, when the main depression in the lumber business in Florida began, to April 10, 1931, indicating that the reestablished substantially lower Cummer scale has had no effect on the volume of rail movement.

Generally we do not approve of rates published in amounts per car regardless of weight and nothing contained herein should be considered as an approval of rates so published on logs. These per car rates on logs are not here in issue and no one has complained to us in any other proceeding that they are unreasonable, unduly preferential, or otherwise unlawful.

We affirm all of the findings in our prior report on further hearing and will vacate our order suspending the operation of our order of July 5, 1932, as amended.

Our findings herein and in our prior report on further hearing are without prejudice to the right of the authorities of the State of Florida or of any other interested party to apply in the proper manner for a modification of our findings and order as to any specified intrastate rate on the ground that it is not related to interstate rates in such a way as to contravene the provisions of the interstate commerce act.

190 I. C. C.

No. 24608 1

SEWERAGE COMMISSION OF CITY OF MILWAUKEE ET AL. v. ABERDEEN & ROCKFISH RAILROAD COMPANY ET AL.

Submitted June 11, 1932. Decided January 11, 1933

Rates on tankage n. o. i. b. n., in carloads, from Milwaukee and Carrollville, Wis., to southern territory found unreasonable. Reasonable rates prescribed and reparation awarded.

John A. Amundson for complainants.

Ross D. Rynder, G. F. Tally, Frank G. Moore, Harry C. Ames, Paul E. Blanchard, and L. A. Newell for interveners.

Joseph P. Cook, W. L. Grubbs, C. A. Waggener, Joseph Marks, L. A. Kienzle, M. W. Thomas, F. A. Burke, and Harry Gillies for defendants.

REPORT OF THE COMMISSION

DIVISION 2, COMMISSIONERS AITCHISON, PORTER, AND TATE BY DIVISION 2:

Exceptions were filed by complainants, interveners, and defendant southern carriers to the report proposed by the examiner, and the case was orally argued. Our conclusions differ slightly from those recommended by him.

Complainants in the title case are the Sewerage Commission of Milwaukee, Wis., a public body disposing of the sewage of that city; and the United Fertilizer Company, a corporation manufacturing tankage at Carrollville, Wis. By complaint filed July 13, 1931, they allege that the rates on tankage, in carloads, from Milwaukee and Carrollville to southern territory were and are unreasonable to the extent that they exceeded and exceed joint rates made on the basis approved in Fertilizer and Fertilizer Materials, 151 I. C. C. 613, and unduly prejudicial to them and unduly preferential of competitors who manufacture sulphate of ammonia and ammoniacal liquor at Milwaukee, Waukegan and Chicago, Ill., and certain other points. Armour Fertilizer Works, a corporation, intervened on October 8, 1931, in support of the complaint. Swift & Company and the Davison Chemical Company, corporations, intervened on

1 This report also embraces No. 25239, International Agricultural Corporation et al. v. Chicago & North Western Railway Company et al.

September 8 and October 8, 1931, respectively, in support of the complaint as to unreasonableness. Lawful rates for the future and reparation are sought by complainants and interveners. Rates are stated in amounts per net ton, and do not include the present authorized emergency charges.

Complainants in No. 25239 are the International Agricultural Corporation, the Catawba Fertilizer Company, and the Swainsboro Fertilizer Company, corporations. They allege by complaint filed April 7, 1932, that the rates charged on tankage, in carloads, from Milwaukee and Carrollville to certain destinations in Georgia, Alabama, and South Carolina during the statutory period were and are unreasonable. Rates for the future and reparation are sought. The parties agreed to submit this case on the record made in the title case, except that if reparation is awarded the parties entitled thereto must establish such fact by oral hearing or by other process agreeable to defendants.

The Sewerage Commission produces a commercial fertilizer, known as tankage, which is shipped in bulk or in bags weighing from 100 to 200 pounds. Bulk shipments are made in box cars, paper lined, with grain doors installed. Complainant United Fertilizer Company produces tankage from animal waste products received from stockyards, tanneries, etc. Many southern fertilizerproducing plants buy this tankage, as well as tankage, including import tankage and nitrogenous materials, from complainants' competitors. Transportation risks in the handling of tankage are negligible. Complainants have filed no claims for loss or damage. The shipments on which reparation is sought by complainants were sold on the basis of freight charges allowed to destination. Interveners seek reparation on certain shipments purchased by them f. o. b. Milwaukee and Carrollville, on which they paid and bore the freight charges.

Tankage, in bags or in bulk, minimum 40,000 pounds, is rated sixth class in official and southern classifications and class E in western classification. Carrollville, which is about 12 miles south of Milwaukee, generally takes Milwaukee rates to the South.

Complainant Sewerage Commission shipped to southern territory in 1929 and 1930, respectively, 409 and 331 carloads, averaging 64,062 and 67,500 pounds. The United Fertilizer Company shipped to the same territory during the same period 279 and 356 carloads, averaging 66,653 and 67,380 pounds. The average carload weight of shipments made to points in southern territory outside of the Mississippi Valley by complainants during these two years was 66,275 pounds, and the hauls ranged from 527 miles to 1,355 miles.

Commercial needs and not the weight of the material or the ability to load govern the minimum weights of tankage. In bulk the loads range from the minimum to over 90,000 pounds per car, and in bags, from the minimum to 80,000 pounds or more.

The average value of tankage shipped to southern territory by the Sewerage Commission in 1929, was approximately $19 per ton; in 1930, it was $16; and for August, 1931, the average value was slightly under $10 per ton, all values being f. o. b. Milwaukee. The average price per ton, f. o. b. Carrollville, of tankage sold in southern territory by the United Fertilizer Company for 1929, was $37.41; for 1930, $30.07; and for August, 1931, $14.19. From a manufacturing standpoint the various nitrogenous materials are competitive inasmuch as they are used in the making of complete fertilizers. The principal use of tankage is to supply the nitrogen content. Complainants' tankage contains a lower percentage of nitrogen than the other principal nitrogenous materials, and the price it brings is lower than that brought by other materials of a higher ammonia analysis.

Rates on tankage between points in central and Mississippi Valley territories, approved in Fertilizer and Fertilizer Materials, supra, hereinafter termed the Interterritorial case, have been in effect since September 15, 1929, and are satisfactory to complainants and interveners. Rates to southeastern and Carolina territories are made generally on the basis of Ohio River cities combinations, composed of proportional rates to and from the river. Combinations lower than those based on Ohio River cities apply to Birmingham and Bay Minette, Ala. These combinations are based on Tupelo, Miss., and Mobile, Ala., respectively. Birmingham and Bay Minette are close to Mississippi Valley territory, to which the rates from the North were and are lower than from the same origin territory to the Southcast and the Carolinas. The rates to Memphis, Tenn., Vicksburg, Miss., Mobile, Ala., New Orleans, La., and Pensacola, Fla., are joint rates lower than the contemporaneous combinations. The rates in effect prior to September 15, 1929, reflect the rates approved in Rates to, from, and between Points South of Ohio River, 64 I. C. C. 306. For many years rates on all classes and commodities from the North to the Southeast and the Carolinas were made on the basis of the Ohio River, Mississippi River, or Viriginia cities combinations. Since January 15, 1928, rates from the North to the South have been revised as rapidly as possible in conformity with the southern classrate revision. Carriers have not yet made a general revision of the rates on fertilizer between the North and the South so that, generally speaking, the old basis of applying combinations on the Ohio River