Los Angeles herald., 1908-03-13
LUCE TELLS
SYSTEM OF
REFUNDLNG
SOUTHERN PACIFIC IS JUST
VOUCHERING," SAYS HE
FREIGHT AGENT GIVES A LUCID
VIEW OF METHODS
State Railroad Commission Keeps
Official All Day on Witness
Stand-Denies Rebates
Have Been Given

BY Associated Pres.
SAN FRANCISCO, March 12.-"Re-
batting is a term used for refundins
below legal rate We are not in that
business. We have done no rebating
on state or Interstate business. We are
vouchering between class rate and a
legitimate commodity rate
This was the statement made today
by G. w. Luce, general freight agent
OF the Southern Pacific railroad, dur
inG the investigation of the state rail-
read commission into the charges of
rate discrimination against that COM
pany, which was resumed this morning.
MIR. Luce was ON the stand all day
and was i'm turn interrogated by At
to1ney General Webb, o. K. Gushing,
tns attorney of record for the cali
fornia Traffic association, and Peter b.
Dunno, representing the railroad COM
pany.
1t was established that the Pacific
Hardware and Steel company and
Baker & Hamilton of this city had
been granted a half rate to Los An
geles to fill orders from branch houses
in competition with Los Angeles firms.
Mr.. Luce said any other firm having
branches in that city would have been
given the same rates.
Why 1t Is Done
Asked by Webb why the z. B. & l..
Stone Co. had been granted rate on
the basis of one-half cent per ton per
mile on crushed rock from the stations
OF Sather and Thomasson to all points
on the Pacific system Mr.. Luce said
it was done to encourage the industry
and with the understanding that the
firm shin 100000 tons during the year,
or 1000 tons day.
The general freight agent. however,
would not say that refunds" We're
made on shipments of less than 1000
tons a day, explaining that during
1906 when this rate was in effect. the
railroad was often short of equipment
and could not furnish the necessary
cars.
Mr.. Luce then explained that the
Southern Pacific was mot in the re-
bate business, but vouchering between
a class rate and a legitimate commod-
ity rate"
Special Rate Granted
Il developed that Simon Newman, a
grain, buyer and owner of warehouses
alcng the San Joaquin river, had been
given a special rate from points along
ths river to San Francisco, Port Costa
and Sacramento, approximately 8 per
C6nt lower IIldH TIE IcS toiAil
rates. which Mr.. Luce explained had
been done to meet water transporta-
zion competition. He admitted, how
ever. that no one else at those, points
enjoyed the special rate given to New
man.
Don't you believe in encouraging
the farmer?" asked Attorney General
Webb.
"Yes, sir; we do that all along our
lires," answered Luce
The attorney general then endeav-
ored to establish the fact that the en-
joyment of the special rate gave New
man a decided advantage over all other
buyers and shippers from those points,
ard that the farmers. believing the
price of wheat based upon published
tariffs, were being injured just that
much. The freight agent explained
that. so far as he knew. Newman vas
the only buyer and shipper from those
points and that any other shipper
would have been given the same low
rate to prevent him from shipping by
water
The hearing will be resumed tomor-
row morning.