REGULATIONS GOVERNING THE SALE OF MILK, CREAM, AND ICE CREAM IN THE DISTRICT OF COLUMBIA WEDNESDAY, MAY 24, 1939 HOUSE OF REPRESENTATIVES, SPECIAL SUBCOMMITTEE OF THE COMMITTEE ON THE DISTRICT OF COLUMBIA, Washington, D. C. The committee met at 10:30 a. m., Hon. Harry Sandager (acting chairman) presiding. The CHAIRMAN. The committee will come to order. We will take testimony on H. R. 6316. I might say, so far as possible, if you can avoid a duplication of the testimony and bring out some new ideas it will be appreciated. Of course, I realize the attitude of most of you will probably be the same, but so far as possible try to avoid a repetition of the testimony. STATEMENT OF HORACE L. GREGG, HAMILTON, LOUDOUN The CHAIRMAN. Will you give your name and address to the stenographer? Mr. GREGG. Horace L. Gregg, Hamilton, Loudoun County, Va. The CHAIRMAN. How far is that from the District of Columbia? Mr. GREGG. Approximately 40 miles. The CHAIRMAN. How much milk do you produce a day? Mr. GREGG. You mean right now? The CHAIRMAN. Well, in the average production. Mr. GREGG. Oh, 70 gallons-70 or 80. The CHAIRMAN. And of that production how much is base pro-duction? Mr. GREGG. Approximately 60. The CHAIRMAN. Are you opposed to this Schulte bill, Mr. Gregg? Mr. GREGG. I have not had an opportunity to read the bill. From what I gather the purpose is to allow milk to come in from outside sources with State inspection. Naturally, I am opposed to the bill. The CHAIRMAN. You are a member of this association, are you? Mr. GREGG. I am. The CHAIRMAN. How long have you been a member? Mr. GREGG. You mean the blended price for the whole thing? 55 Mr. GREGG. That depends on how much surplus I am shipping. At the present time we are shipping, last month we shipped very little surplus. Our prices-you mean the net price to me after haulage? The CHAIRMAN. The net price after haulage and brokerage is deducted. Mr. GREGG. Around 24 or 25 cents. If I increase my surplus that amount is decreased. The CHAIRMAN. You have a herd of how many cows? Mr. GREGG. Between 30 and 35. The CHAIRMAN. What is your observation as to the spread between what you get-you are getting about 6 cents a quart for yourself— what is your observation as to the spread between the price you get and the retail price of 14 cents? Mr. GREGG. On that question I am not prepared to give anything definite, and it seems right large. But it is dangerous talk unless you know what you are talking about. The CHAIRMAN. In other words, you have no fixed convictions except just a general impression that the spread seems large? Mr. GREGG. That's right. The CHAIRMAN. I see. Have you anything else you want to say, any other comments, except to express general opposition to the bill? Mr. GREGG. Well, my attitude is this: That the people of Washington, at the present time, are getting a high grade of milk with a comparatively low bacteria count. There is plenty of milk in the adjacent milkshed in Washington to supply all the milk that the people need. I cannot see how a change in this law as proposed in this bill would benefit anybody. If the western shipper were to ship in here he would find the market was not the same. The price would not be the same when he got here as it is now, because the shippers in this territory are not going to relinquish their market. The only person that would be benefited would be, possibly in the price range, to the consumer, and he would suffer because he would not get as high grade a product as he is getting at the present time. And it would not be a uniform product. And there is another thing I want to bring out. The milk that would get in from the West would be inspected by inspectors who are not going to use that milk. At the present time the District of Columbia Health Department inspects my premises, and that milk is to be used by the city whose health department inspects it. And that naturally makes more thorough the inspection. I feel very strongly that our present set-up of inspection and high-grade equipment and thorough care is essential to the making of high-grade milk, and I do not believe it is possible to have a poor inspection and not as frequent inspection and produce milk of a good quality. I think Dr. Ashworth brought out in the testimony at the other hearing since this bootleg proposition was started and inspections have been less frequent because he had been forced to keep his inspectors in the plants, there was a poor grade of milk being shipped because of that. The farmers have spent money in preparing for this thing to ship high-grade milk. We are equipped to do it. There is plenty of milk here, and I cannot see that it would benefit anyone to have these regulations lowered. The CHAIRMAN. At 6 cents a quart do you consider the dairy business profitable? Mr. GREGG. I do not think the farmer can produce it for any less. It is very doubtful if he is making expenses at that. The CHAIRMAN. Is this your sole business, or do you have some other business? Mr. GREGG. That is practicaly my sole business. The CHAIRMAN. You are not a farmer in addition to that? There is one thing I think should be mentioned. Dairy farming is a highly specialized business. We do not keep a few cattle and a few land sheep and that sort of thing. We center all our attention on farming, and whenever you make regulations that break down the dairy proposition, why, you are breaking the income, the entire income of the farmer. The CHAIRMAN. Do you have a local output? Are you in the retail business? Mr. GREGG. No, sir. The CHAIRMAN. You ship it all? Mr. GREGG. We occasionally have a few people come in and maybe get a gallon of milk. But we have no retail business. The CHAIRMAN. Thank you, Mr. Gregg. STATEMENT OF GILES H. MILLER, JR., CULPEPER, VA. The CHAIRMAN. Will you give your name and address to the reporter? Mr. MILLER. Giles H. Miller, Jr., Culpeper, Va. The CHAIRMAN. How far is that from the District of Columbia? Mr. MILLER. About 67 miles. The CHAIRMAN. How much milk do you produce? Mr. MILLER. None, sir. The CHAIRMAN. None? Mr. MILLER. No, sir. The CHAIRMAN. You are here in what capacity? Mr. MILLER. Well, I happen to be the cashier of the bank there, sir. The CHAIRMAN. I see. What bank is that? Mr. MILLER. The Culpeper National Bank. The CHAIRMAN. You are here in opposition to this bill? Mr. MILLER. No, sir. The CHAIRMAN. All right, Mr. Miller, suppose you go ahead. Mr. MILLER. As I understand, sir, the bill will at the present time allow cream to be shipped into the District and perhaps possibly milk that is not to be inspected according to the requirements as now in effect of the District of Columbia Health Department. The CHAIRMAN. By the way, have you read the bill? Mr. MILLER. I have read a synopsis of it, sir. I just this minute got in. The CHAIRMAN. Have you a copy of it? Mr. MILLER. I have not. But I think I know what it provides. In my position as cashier of the bank we have principally a dairy section, a section that has been built up around the dairy. It means its principal source of income is from the dairies through that particular section. It is my feeling, sir, that these men who have been in that work for some time have been constantly called upon because of the regulations to expend quite large sums of money for them in order to meet these requirements and to keep them shipping milk into the District. They feel that the requirements are sound. They feel that the requirements-I mean they understand why they are. At the same time it has been necessary for them to expend quite a little money to meet those requirements in many cases. In one, just recently, we loaned a man $8,000 to repair or practically build a new barn because the score that he received on his old barn endangered his shipping, continuing to ship into the District. Should this bill pass it would seem to me that it would allow products to come into the District, of course, in competition with these people who have made a specialty at that dairy business and who have expended these sums of money. At the same time it would allow products to come in that are not of the quality of the products that are now being received into the District. And it seems to the people of my section that while these requirements are rather stringent and rather strict, that they realize the necessity for them. I think that may be shown by the fact there are two dairies supplying our particular town, both of whom have practically adopted the same requirements, because they realize it is for the good of the consumer consuming these products. The CHAIRMAN. About how many dairymen who supply the Washington district are customers of your bank, roughly? Mr. MILLER. I would say perhaps 40. The CHAIRMAN. Forty? Mr. MILLER. Yes, sir. The CHAIRMAN. Some of them are men who are comparatively small operators? Mr. MILLER. Yes, sir. The CHAIRMAN. And what do you say as to the general condition of their business? Of course, I do not want you to divulge anything confidential, but you can make a general statement. Mr. MILLER. I would say this, sir: In practically two-thirds of the cases, that these dairymen are still in debt considerably, due to improving their facilities for shipping milk brought about by the increased requirements in order to ship milk into the District. I would say they felt that as long as things were going to go as they were they felt justified in making that substantial investment, and, as I say, they realize the fairness of it because they, too, have children and they realize the dangers that can accrue from a dairy not properly handled and supervised. The CHAIRMAN. Do any of these men come to you looking for loans because they are going to join this association? Has that happened recently, or would you say that the association seems to be more or less: of a closed corporation? Mr. MILLER. No, sir. We have had one or two, I think three, that have gone into the association and built barns recently. The CHAIRMAN. How recently would you say? Mr. MILLER. One of them, within the year, I happen to know particularly. The other one, I think this one man has been shipping perhaps 6 months now. And we have others that come in. But the |