costs of operation, whereas their principal competitors, the railroads, gave much weight to the value of service in fixing their rates. Because the motor carriers maintain truckload minimum weights generally lower than the rail carriers' carload minimum weights, include pick-up and delivery in their less-than-truckload and truckload rates, and provide more rapid and flexible service, it is not necessary in all cases for them to maintain rates at the exact level of the rail rates in order to compete. Yet, under the guise of meeting rail competition, they have continued to maintain commodity rates, less than truckload and truckload, actually lower than the rail rates.

Respondents do not require authority from us to increase their commodity rates since only reasonable minimum rates have been prescribed. It is clear, however, that the refusal of a small number of motor carriers to observe any increase would substantially nullify the efforts of the carriers generally to improve their financial condition, and if remedial steps are to be taken they must be in the form of increased rates prescribed by us for all respondents.

We have in contemplation further hearings into all commodity rates in New England after the completion of the rehearings respecting class rates now in progress. In the meanwhile, some necessary improvement in the rate structure would be brought about rapidly by the increase of unduly low commodity rates now below the level of the competitive rail rates. The Eastern Conference favors this action.

Upon consideration of the record presented at the further hearing, we are of the opinion, and find, that the petition seeking the prescription of increased class rates should be denied. The respondents, however, are hereby directed to supply to this Commission, within 60 days from the date hereof, statements of commodity rates maintained by them from and to the points embraced in this proceeding applicable on less-than-truckload shipments which are lower than the railroad less-than-carload rates on the same commodities from and to the same points, and commodity rates applicable on truckload shipments which are lower than the railroad carload rates on the same commodities from and to the same points. These statements shall be accompanied by any reasons the respondents may have for the continued maintenance of any of the commodity rates lower than the rates of their railroad competitors. If respondents desire, they may file these statements individually or jointly through the tariff-publishing bureaus or associations of which they may be members. Shippers and other parties may also file statements containing reasons in justification for the continued maintenance of any of these commodity rates.

An order denying the petition is entered herewith.

APPENDIX

Motor fifth-class rates, except as noted

[The rates from and to Boston, Mass., and New York, N. Y., apply from and to Boston group 1 and New York group 1, respectively; rates and increases are in amounts per 100 pounds]

Motor fifth-class rates, except as noted-Continued

[The rates from and to Boston, Mass., and New York, N. Y., apply from and to Boston group 1 and New York group 1, respectively; rates and increases are in amounts per 100 pounds]

No. MC-72955

W. J. FOSTER BROKER APPLICATION

Submitted March 1, 1940. Decided February 11, 1941

Operation by applicant at Westerly and Watch Hill, R. I., and Stonington, Conn., as a broker of transportation by motor vehicle, of passengers and their baggage, between those points, on the one hand, and other points in the United States with certain exceptions, on the other, found consistent with the public interest and the national transportation policy. Issuance of a license approved upon compliance by applicant with certain conditions, and application denied in all other respects.

W. J. Foster for applicant.

F. X. Masterson for interveners.

REPORT OF THE COMMISSION

DIVISION 5, COMMISSIONERS LEE, ROGERS, AND PATTERSON

BY DIVISION 5:

Exceptions to the order recommended by the joint board were filed by official-territory rail carriers, which were permitted to intervene subsequent to the hearing, and applicant replied thereto. Our conclusions differ somewhat from those recommended.

By application filed February 10, 1936, W. J. Foster, of Westerly, R. I., doing business as Rhode Island Coach Lines, seeks a license authorizing operation as a broker in arranging for the transportation by motor vehicle of passengers and their baggage, in interstate or foreign commerce. No one opposed the application at the hearing. On February 7, 1939, the Commission, division 5, entered an order in No. MC-59594, granting to applicant a certificate as a common carrier by motor vehicle of passengers and their baggage, and of express and newspapers in the same vehicle with passengers, between Westerly and Providence, R. I., over Rhode Island Highway 3 (also over Rhode Island Highway 3A), serving all intermediate points, and in charter service from Stonington and North Stonington, Conn., and Charlestown and Kingston, R. I., to points in Massachusetts, Rhode Island, and Connecticut, and return, over irregular routes.

Since 1933, applicant also has arranged for transportation of passengers by motor vehicle. He maintains an office at Westerly and has arrangements with stores in Westerly and Watch Hill, R. I., and

Stonington for the sale of tickets for him upon a commission basis. In addition to transporting passengers over his bus line jointly with other motor carriers, applicant sells tickets for transportation from his agency points, in interstate or foreign commerce, over other motor carriers, no part of which transportation is performed by him. Passengers purchasing such tickets are routed by applicant over lines competing with each other and with his common-carrier operation. He selects in his discretion the carrier whose time of departure best suits the convenience of the traveler, and he shows no preference to his own line. These tickets, issued in the name of Rhode Island Coach Lines, are honored by the carriers designated thereon.

Applicant also sells tickets from and to points throughout the United States and Canada, in connection with which he performs no part of the transportation. Illustrative of this part of the operation, applicant referred to an instance where he had arranged, through his office in Westerly, for the transportation of a party from Los Angeles, Calif., to a point in Florida. His practice in such cases is to issue the ticket and send it to the party for whom intended. In some instances, he will communicate with a motor carrier and arrange for the issuance of the ticket. He collects the transportation charges, collects for other expenses incurred, and remits to the carrier at point of origin of the movement, retaining a commission für his service. Applicant stated that this portion of his operations constituted approximately 1 to 2 percent of his total business.

On all tickets sold in the manner above described, applicant receives a 10 percent commission from the motor carrier or carriers performing the transportation. No one else is conducting the same type of business at Westerly. To continue the operations hereinbefore described, applicant requests authority to conduct the business cf a broker in arranging transportation of passengers and their baggage in interstate and foreign commerce, between all points in the United States and to Canada.

Interveners contend that applicant failed to show a public need for the proposed operation; that his service in arranging transportation of passengers from points in the United States, other than in the territory immediately served by him, is a small and insignificant part of applicant's operation; and that operation by applicant as a broker and common carrier in the same territory would be inconsistent with the public interest.

Applicant arranges and sells transportation subject to the act over other motor carriers, for compensation, without himself participating in the transportation. He is a carrier in his own right, does not occupy the status of an employee or agent of such other carriers,