The Birmingham age-herald., 1911-07-25
FREIGHT RATES ORDERED REDUCED
 BY COMMISSION
Important Ruling Made By Interstate Commerce
 Commission
GIVES UNTIL OCT. 15
 TO ADJUST TARIFFS
Commission Wipes Out Charge for Theoretical Back Haul'-Com- mercial Conditions Regulate
 Rates Hereafter

Rates Hereafter
 Washington, July 24.--ln what ars known as the Spokane Reno Pacific Coast cases, the interstate commerce commission today ordered material re- duction in frieght rates from the east to points between Denver anG the vest ern terminals of the great trans continental railroads.
 For many years the railroads have exacted from shippers tn intermediate points such as Spokane and Reno, higher rates on eastern freights than
 were charged for the much longer hauls to Seattle San Francisco and other coast points The theory has been that the railroads must meet water compe- tition to the Pacific coast The higher rates to intermediate points, arbitrarily
 fixed. have been defended by a com; parison with the coast rates, plus theoritica back haul from the coast ts the inland stations along the lines
 The commission recognizes the right of q railroad 10 meet water competition to Pacific coast points, but practically wipes out the back Haul rates to inter, Rocky mountain territory. It lays down what it considers would be fair and Just to various freight zones in the west and gives the railroads until October IS to adjust their tariffs ac7 cordingly The commission also lays down the important principle that here after railroads will not be permitted to fix arbitrary market limits and that hereafter commercial conditions rather than the will of railway traffic man. agers shall control rates on transcon- tinental transportation.
 The decisions announced late today are of far-reachng importance. They affect directly all freight rates between the Atlantic ocean and the Pacific coast. Particularly they affect the rates in the territory lying between Denver and Pacific coast points. Hereafter the | rates paid by shippers will be governed by a strict interpretation of the long md short haul clause
 Per Cent Allowed
 The commission holds in the so-called Reno case that traffic originating at Chi cago and in Chicago territory moving under commodity rates may have rate | per cent higher to intermediate points than that imposed on freight originating in Chicago and Chicago territory destined
 to the Pacific coast terminals From
 Buffalo Pittsburg territory the rates may
 rise above those demanded from the
 same points to Pacific coast terminals to
 the extent of 15 per cent; while from New
 York and Trunk line territory the rates charged shall not exceed 23 per cent over Pacific Coast terminal rates
 These are the first decisions announced hy the commission in which definite prin- | ;,, of ba lODcr and short haul provision is laid down. While the opinions fully recognize the influence of | water competition, to marked exten. they draw a line upon indiscriminate l market competition.
 The effect of the decisions will be to mo- tify the carriers that they will be allowed | to meet water competition to a reason able extent. but that the location of mar | lSets hereafter will be left more. to the | play of commercial causes than to the will of the traffic managers of railways. 1 The cases involved are those of the | city of Spokane against the Northern Pacific Railway company, known popular lv as the Spokane Rate Case;" the Com mercial Club of Salt Lake City, against l the Atcnison, Tokepa and Santa Fe Rail way company and others; the Railroad | Commission of Nevada against the South | ern Pacific company and others, and the | Marlcopa County Commercial club. against the Santa Fe, Prescott and Phoe- nix Railway company and other carriers Two Opinions Made | Inasmuch as the cases generally dove 1 tail into one another the commission ar- nounces it's decisions In two opinions Iu 1 the brief the commission takes the view which it took in It's opinions of the same cases announced a year ago last June. 1 At that time the commission said it would | make no order respecting the rates which
 it suggested might be put into effect until | it had had opportunity to determine from | reports made to it by the carriers Of ths probable effect of the suggested rates Meantime the carriers have submitted | to the commission their earnings under the old rates and what would have been | their earnings under the rates proposed by the commission. These tabuiafed l statements have convinced the commis- sion that the rates determined upon by 1 the commission in its decisions of June | | 191O generally fair and reasonable. The | commission says that there is no reasou 1 why those rates should not now be es- l tablshed.
 "Since the promulgation of that opin. l ion," the commission says. the fourth | section (the long -and-short-haul provi- sion), has been amended Inasmuch the gravan1en of the complaint of tha city of Spokane and to some extent of | Salt Lake City was directed against tho violation of the fourth section. 1t is | necessary again to inqulIo Wnctucfs uu- der the amended fourth section, the re- 1 lief to which these communities are en- titled can now be granted.
 No Authority Contended
 "The complainants contend that tho proviso in the amended section, permit | ting the commission to authorize In particular instance the charging of a higher rate at the intermediate point is void as a delegation of legislative au- thority; that 1t should be rejected and | the section applied by the commission l as though it were an absolute long-and- short-haul prohibition. This contention l is not sustained
 1 .oThe defendants contend that the only | effect of the amendment is to cast upon i the carriers the burden of assuming the initiative in justifying the higher rate at the intermediate point. If upon in- | vestigation 1t Is found that competition | exists at the more distant point and not at the intermediate point then the | commission must without further in- l ouiry. grant the relief asked for; if no such competition exists it must deny ths
 applcation. This contention Is not sus- tained.
 | "In amending the fourth section by striking out the words similar circum- ----~-----~---~-~--~---
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