The Birmingham age-herald., 1905-04-20
SANTA F ROAD GAVE NJ REBATES % MOraWttz Explains Matters
 to Senate Committee MIR NEWLANDS HAS AN IDEA Wants All Roads to Be Compelled to Take Out National Charter-Mo-
 rowetz Says Railroad Rates
 Have Increased.
MIR NEWLANDS HAS AN IDEA

Washington. April 19.-Victor Morawetz of the Atchison, Topeka and Santa Fe railroad again was before the Senate committee on intersate commerce today. Replying to questions by Senator Deliver, MT. Morawetz said that the executive committee and board of directors never know anything about the details of the traffic management They give directions to the president of the road and the pres- idents directs the other officers.
 Where traffic managers violate the law in granting rebates and determinations to one shipper do you not think 1t would be right to compel the road to give all the shippers the low rate?" asked Senator Dollivar.
 "In many cases 1t would be right and others unjust" replied MT. Morawetz. Tt would not be right to make stockholders suffer because some agent had commit ted a wrong"
 Senator Dollivar questioned Morawetz about the agreements between companies as to rates. The latter replied there were not agreements" The railroad he sad talked things over and reached an un- derstanding as to what rates would be from competitive points. He said these rates were fixed on remunerative basis. Senator Dollivar asked why intermediate points were compelled to pay higher rates than the competitive points. MT. Morawetz replied that the railroads were compelled to accept low rates at com petitive points. He maintained that the intermediate points were really benefited by such action.
 Explains Charge of Rebates.
 In reply to a question by Senator Dolli- var MT. Morawetz explained the changes regarding the granting of rebates by the Atchison to the Colorado Fuel and Iron company. He said that the alleged re- bates grew out of eohfuslen of the of transportation and that of coal The Atchison filed With the interstate com merce commission a rate of 40 from the mine to the point of intersection with another road which was controlled by Phelps, Dodge os Co., the coal consignees. As a matter of fact l. said the rate was s2. 290 per ton and the difference $l.15 per ton was paid to the Colorado Fuel and Iron company for the coal The road col- lected the price of the coal and the cost of transportation at the point of delivery. It was alleged that the payment of s1.15 to the Colorado company was a rebate when, as a matter of fact he said no rebate was paid. No interest, he stated, suffered by the act of the company. No body connected with the Atchson sys- tenn had any interest in the Colorado Iron and Fuel company.
 Road Leased Its Mines.
 Mr. Morawetz said that when the pres- ent management of the Atchison road took control of the system 1t included va- rious coal companies. the stock of which was owned by the origin( railroad com pany. It was doing a commercial busi- ness. The new management decided that the railroad company must go out of the coal business. The Athchison then leased all the coal mines in its district some of them to the Colorado Fuel and Iron company. There was a proviso that the Atchison should receive it's engine coal at moderate prices In 1901 there was three cornered arrangement to which the Atchi- son. the Colorado Fuel and Iron company and Phelps, Dodge & Go. were parties. The last-named controlled the Fl Paso and Southern railroad. Under the terms of the agreement the Colorado Fuel and Iron company was to furnish coal at $1.15 per ton, and the Atchison was tc haul it for $2 go per ton, the Atchison to collect the price of the coal and pay the S.i5 over to the Colorado company. The agree ment was to last five years. But in 1902 injunctions were granted restraining the various companies from continuing this business.
 These injunctions," said MT. Mora wetz were obtained largely on evidence of one of our own officials
 Instructions were sent by officials of the company to correct all violations of the law Similar instructions were sent when the Ellxins law was passed in 1903
 "As a matter of fact" said MT. Mora wetz ''the law has not been strictly com piled with, but no one was affected by the arrangement"
 Arose Over Mistake.
 The complaint arose over a mistake about the combination of the $4.05 which the road collected an allegation being made that this did not include the price of coal and that rebates were being given. But the Atchison received the exact prices neither more or less No other shipper could be effected because Phelps. Dodge &Co had to have the check which was supplied by the Colorado company. Coal was shipped by other persons at lower charge to the same points. No attempt was made to make secret of the ar rangement. The complaint was due to coal company which operated In New MeXlcO. ana lDle cOdl WdS llit hlt ti'f could be used by Phelps. Dodge x Co in their smeltng business. The whole case arose over confusion of the cost of coal with the cost of transportation.
 Senator Deliver asked about the report that the Atchson had paid the Standard oil company in rebates sl.0O0,0OO in Kan sas. MT. Morawetz said he had been ad- vised that no such evidence was given; that a garbled statement was given to the newspapers by an attorney who had suit against the road He felt authorized to deny the statement that any rebate was given by the Atchison to the Stand- ard oil company.
 Senator Clapp questioned MT. Morawetz relative to the right of committees to delegate authority to fix rates. and also about a court of review.
 Mir Morawetz said committees could dei- egate to a commission power to fix min imum reasonable rate. Congress ought 10 prescribe rules from which the commis- sion should determine what was a req sonable rate It also was brought out that court of appeal could determine what was a maximum reasonable rate. Cannot Tax Minimum Rate. Replying to Senator Carmack, MT. MO rawetz said that in order to prevent dis :