is only when we pick it out and say, "No, we think this is an important case and it should have the judgment of the full Commission."

The courts have sustained our right to make the decision of the threeman division final; that is as far as they can go, unless we just make up our mind that it ought to be heard by the full Commission.

REDUCTION IN TIME UNDER REVIEW BOARDS

Mr. SCHMID. Mr. Chairman, I would like to add one more thought to what was said here.

Before we had these review boards it took an average of 5 months to handle these cases but since we set up the review board in 1962 that average has been cut down from 5 months to 2 months.

Mr. GoFF. That is on appeal.

Mr. SCHMID. One other thought on that.

Appeals from these board decisions have only totaled 18 percent, which means that the board was upheld in the balance of these cases.

PROCEDURE ON APPEALS

Senator ALLOTT. A point I would like to clear up for my own information, if you have a decision from an appeal board, and I happen to be a person who is dissatisfied with that, then I appeal to a division. Mr. GOFF. To a division.

Senator ALLOTT. The effect of the decision of the division then in effect has the same general effect as a denial of certiorari in a court; is that right?

DECISIONS ON CASES OF GENERAL TRANSPORTATION IMPORTANCE

Mr. GOFF. Well, no, that would be where the request is filed to have it considered as a case of general transportation importance.

All cases that they take on appeal from a review board do go to a division, but that is final.

Now, the certiorarilike situation would be a request that the case be considered of general transportation importance and go to the Commission, full Commission, I mean.

Now, the full Commission need make no explanation. It just declines to find it is a case of general transportation importance.

There is no argument, nothing else. Many of these cases we select right away as cases of general transportation importance, but if the fellow is dissatisfied with a decision of the division, he can ask that it be considered by the full Commission.

We decide it in 10 days. He just files a petition, no argument or anything else. That is the certiorari part of it. Under our system, which we adopted some years ago, there is individual Commissioner responsibility for every case.

Now, what I mean by that is that when a case goes to a division or a case goes to a full division, it is assigned to an individual Commissioner. That becomes his case, he watches it, he gets out the decision and it bears his name, just like in court. We are not a court, but we do have to use courtlike procedure.

Senator ALLOTT. You say 18 percent of these are taken on?

Mr. SCHMID. That is correct, and the number of cases that are appealed to the divisions, why, the boards have been upheld in 90 percent of the cases.

EFFECTIVE OPERATION OF REVIEW BOARDS

Mr. GoFF. I want to be sure the Senator understands it. When we got the privilege of appointing these review boards it was said, "Oh, well, everybody is not going to be satisfied with the decision of

the review board.

"They are going to appeal all of them. You are not going to save anything."

What these figures show is that only 18 percent of those that are decided by the review boards, which are employee boards, below the Commission level, are appealed to the division.

It is worked out in wonderful shape to be a great help to us.

FREIGHT RATE SITUATION PROCEDURES

Senator YOUNG. Let me give an example of a freight rate situation, and may I ask what you can do about it, if anything.

For example, the freight rate on wheat moving from Minneapolis to the west coast, Portland, Seattle, is exactly the same as the rate from Minot, N. Dak., which is 550 miles closer to Portland.

Do you ever review anything like this or how do you go about changing a situation like that?

May I point out that the Canadian rate is only about a third of what ours is so it completely locks us out of the Far East market; even the freight rate from Kansas has been reduced considerably

over ours.

Mr. GoFF. Well, Senator Young, when the rate is originally announced by the carrier, under the law they must file that proposed rate with the Commission. It has to be filed here and it stays here for 30 days. They can't put it into effect for 30 days.

That gives the right of the shippers or anybody else, or competitors, to object to it or ask for suspension of the rate, or ask for an investigation of the rate.

Now, if there is no protest of the rate in 30 days it automatically goes into effect, and I would say that an overwhelming majority of rates that are filed by carriers go into effect without protest.

ACTION FOLLOWING PROTESTED RATE

Now, of course, if there is protest, it may be suspended by the Commission. This suspension is because the rate on its face looks to be unlawful or unreasonable or prejudicial to some shipper.

If on its face it looks to be unlawful, then it is suspended, doesn't go into effect until there is an investigation made of it, and there is a hearing to determine whether that rate is, in fact, unlawful.

On the other hand, suppose the rate goes into effect and nobody objects to it, and that, I would say, I don't know, maybe 98 percent of the rates filed by carriers, where there is no protest to them when they are published. But suppose someone feels injured as you do in this matter here, then the person who feels injured by it files what we call a complaint on the rate setting forth the unlawfulness of the rate and then there is a hearing on that.

NO HEARING UNLESS RATE PROTESTED

But a lot of people have the idea that all these rates are carefully worked out by the Commission. That would just be impossible, as there are so many hundreds and thousands of rates. We appear in the case only when there is a protest or where there is a complaint filed. Could you correct anything on that, Director Corbin?

Mr. CORBIN. No, sir; I think you have stated accurately what has happened in those cases.

Senator ALLOTT. There wouldn't be any hearing until there was a complaint filed?

Mr. GoFF. It doesn't have to take on any particular phraseology, but they allege this violates such and such a section of the Interstate Commerce Act. We hear those on complaint only if the rate has been permitted to go into effect, but there is still a chance there.

They have the right to go on through the whole procedure, and we would have it referred to a hearing examiner and we would go right on through. It might be referred to a review board and it might be referred directly to the rates division.

Senator YOUNG. Thank you.

Mr. GOFF. May I continue, sir?

Senator ALLOTT. Yes. The chairman is here.

DEVELOPMENT IN ILLEGAL TRUCKING

Mr. GOFF. On enforcement or compliance, one thing that has characterized recent developments in illegal trucking is the increasing sophistication of the schemes employed and the greater difficulty in reaching the essential facts.

While we have tried to draw clearer guidelines, the violators have turned to obscuring more effectively the facts by which we would judge their operations, thereby making it increasingly difficult to unravel their phony operations and build cases against them. The Commission's enforcement staff, although only modestly increased in the past 6 years, has in that time more than doubled the number of enforcement cases disposed of in the courts.

RAIL AND HIGHWAY SAFETY

In addition, we are concerned with safety on the rails and on the highway. Investigating, policing, and enforcing our safety regulations are among the principal duties of our field staff. We will receive some help if granted the three additional attorneys and six additional clerical employees, provided for in the 1965 budget and referred to on page 10 of my prior statement before the House subcommittee.

OTHER PERSONNEL NEEDS

Even though I have not specifically addressed myself to each area of concern, definite needs for additional personnel also exist in the General Counsel's Office, Bureau of Accounts, and Bureau of Transport Economics and Statistics.

As I stated at the commencement of my remarks here, this is more or less a summary of the important parts in the longer statement that I made to the House committee, and which is attached here and which is for the purpose of the record.

Now, I would be glad to answer any questions or I will be glad to explain to Senator Magnuson about this boxcar model that we brought up here.

(The statement referred to follows:)

STATEMENT OF ABE MCGREGOR GOFF, CHAIRMAN, INTERSTATE COMMERCE
COMMISSION

Mr. Chairman and members of the committee, the Commission appreciates the opportunity to come here with our staff to discuss with you our financial requirements for the fiscal year ending June 30, 1965. The President's budget for the fiscal year 1965 includes for the Commission a total of $25,850,000 and 2,508 positions, which is a net increase of $1,180,000 and 41 positions over the $24,670,000 and 2,467 positions available for the current fiscal year.

It should be emphasized at the outset that approximately three-fourths of the $1,180,000 increase requested for 1965 over 1964 is to cover costs over which we have no direct control. The major item, $548.013, approximating 46 percent of the total increase, is for a full year's cost of pay increases authorized by Public Law 87-793. In addition, $309,679 is for within-grade salary advances, overtime and accident compensation which is offset in part by savings of $73,633 due to 1 less compensable day in 1965 than in 1964. Only $283,791, or less than 25 percent, is requested for additional positions. The remainder of the increase of $112,150, while related in part to new personnel, is for objects other than personnel compensation and benefits, as I will explain at the end of my statement.

The 41 additional positions are of utmost importance to fulfillment of Commission responsibilities, as I will try to demonstrate.

INTERNAL REORGANIZATION AND PROCEDURAL ACCOMPLISHMENTS

The Commission completed a thorough study in depth of the whole fabric of its field organization and approved, effective January 1, 1964, an extensive realinement of its field establishment. Seven regions have been established, in lieu of the 13 formerly in effect, to serve as a basic geographical pattern for all ICC field activities. While responsibility for direction of operational phases of the field work remains in the technical bureaus, all field forces have been organized into a single staff, as one major organizational component for budget development and administration, personnel administration, program evaluation, manpower utilization, management improvement, and administrative supervision and support. Each region is headed by a regional manager who reports to the Managing Director and is responsible for the management activities within the region. While it is not possible, as yet, to evaluate the effectiveness of this field reorganization, increased manpower productivity is expected. In recognition of the Commission's responsibility to utilize fully the latest developments in automated data processing and related management sciences in handling its huge workload, a new organizational unit for the purpose was created in the Office of the Managing Director in April 1963 to implement useful applications. The unit was established within existing personnel ceilings. Another major advantage expected to result is the establishment of improved workload management control systems.

The following is a summarization of a number of other improvements that have been made. We have significantly reduced the paperwork burden in submission of reports by carriers. Improved procedures for handling motor carrier operating authority applications, through early determination of the appropriate method of processing, have just been installed. We are close to completing comprehensive space realinements providing for maximum utilization of staff and space. We have installed improved methods and procedures, based on modern automated equipment, in the Commission's reproduction plant. Improved case status and examiner reporting systems have been developed. Improved workflow and productivity in formal proceedings work has been accomplished. Delegations, to reduce handling of cases, have been increased. More effective use of Government-owned automobiles is continuing. The proceedings-pending load, age of cases, and time required for disposition, are getting daily attention with very favorable results. Employee work reports to provide meaningful records for work measurement, supervisory, and other administrative purposes are being developed.

In addition, we continued the active liaison program with the other transportation regulatory agencies-the Civil Aeronautics Board and Federal Maritime Commission. Meeting regularly, as requested by the President in his transportation message of 1962, the three agency Chairmen seek coordinated solutions for improvement of the regulatory process. Top-level staff groups were designated to study and develop consistency of regulatory treatment, particularly in the fields of terminal area operations, through routes and joint rates, freight forwarders, brokers and consolidators, audits and cost finding, economic analysis and statistical data, and containerization.

FORMAL PROCEEDINGS

The Commission entered the 1960's confronted with an expanding backlog of proceedings requiring decision and a workload so unwieldy that the regulatory process was in danger of becoming a barrier to progress of for-hire carriage, instead of serving the public interest by encouraging its advancement. A restructuring of the Commission's organization and streamlining of its procedures were clearly necessary to meet these challenges. A reorganization was effected early in 1961 and has been continuously updated. Procedures were modified to permit employee level boards to decide issues of relatively routine nature. Later, in 1961, pursuant to congressional authority, we established the highly effective review boards for deciding cases initially tried by hearing examiners and joint boards.

The employee review boards now fully integrated into the stream of the decisional process contribute markedly to our ability to keep pace with the heavy caseload, for they decide adversary-type proceedings at a rate of about 700 a year. As a result of the realinement Commissioners, previously confronted by an overwhelming number of cases requiring their personal review, have been able to devote more time to issues of broad public policy.

The changes in organization and the expedited procedures were evolved barely in time to meet the recently encountered variety of new and intricate issues, many involving wide economic areas and large geographical regions. Last year our Commissioners, hearing examiners, and the joint boards (whose memberships include State regulatory officials) presided 4,624 times at public hearings and oral arguments across the Nation. Many of these cases represented consolidations of dozens of proceedings embracing similar issues. Public attendance at these hearings and arguments often was in the hundreds. Half a million pages of transcript were entered into the records of these formal proceedings. Almost all of the massive array of resulting decisions and rulings was an outgrowth of applications, pleadings, complaints, and protests of individuals, carriers, and shippers, and not from actions initiated by the Commission. The broad rulemaking and investigation proceedings instituted by this agency generally were inaugurated to provide for development of definitive policy criteria in important areas such as piggyback operations and carriers' reporting requirements.

In fiscal year 1963 we reduced the average elapsed time for disposition of formal proceedings cases to 6.9 months, a 21-percent improvement over the time required 2 years ago. This reduction, with practically no increase in the formal proceedings-work staff, was accompanied by final action on 7,605 cases and was accomplished despite receipt of 10,655 new cases, the highest in our history. Much of this increase was due to the 2,880 cases the Commission received as second proviso applications seeking to register intrastate motor carrier rights issued by the States, which were filed pursuant to Public Law 87-805. In addition to the large casework resulting from Public Law 87-805, the number of regular motor carrier application cases received in 1963 increased about 5 percent over those received in 1962. During the first 7 months of fiscal year 1964, receipts of regular motor carrier applications have increased by 16.6 percent over a like period of a year ago. The number of complex cases before the Commission continues to grow. The Commission still has a number of large railroad merger cases under active consideration and it is reasonable to expect that additional applications for merger will be filed. The workload in our formal case area continues to increase, and our ability to handle this workload with the employment levels authorized is seriously challenged. The 1965 budget provides 19 additional positions, namely, 5 hearing examiners, 7 attorney-advisers, and 7 clerks to assist in handling the increased proceedings workload.