[?]

Ludington Daily News Feb. 17, 1939

Manistique Tug Freed from Ice

MANISTIQUE, Feb. 17 – (AP) – The fishing tug Bob S. returned to its home port here Thursday night after being caught in an ice pack since last Monday.

It was freed by an Ann Arbor railroad car ferry about 25 miles southeast of Manistique.

The tug crew was tired and glad to be home again but said they had not felt they were in danger at any time. Supplies had been put aboard the tug during the period in which it was helpless.

The tug came back under its own power. Mayor William Sellman, of Manistique, who owns the tug, and two fisherman, were aboard. The fourth member of the crew boarded the ferry Thursday morning.

The ferry took on cargo here and with the added weight had no trouble smashing through the ice as it started out on another trip.

In the matter of the application of the Michigan State Highway Department for authority to install flashing light signals in lieu of the present protection now afforded at the crossings of The Ann Arbor Railroad Company (1) On US-27A in the Village of Shepherd, and (2) on M-61 in the Village of Marion. File No. R-524.39. April 6, 1939.

The Owosso Argus-Press July 5, 1939

William Garvin, engineer of Mt. Pleasant, formerly of Owosso, and C. Crawford, fireman, Mt. Pleasant, are dead, and Franklin Foss, head brakeman, of Owosso, is badly injured as the result of the wrecking of an Ann Arbor freight train, west of Cadillac, yesterday morning. Victor Parvin, general manager of the road, estimated damage at between $40,000 and $50,000.

Application having been filed under date of April 4th, A. D. 1939 by L. W. Millard, Bridge Engineer, Michigan State Highway Department, for authority, in accordance with the provisions of Act 336, Public Acts of 1931, to install side-of-the-street flashing light signals in lieu of the protection now afforded at the following crossings of The Ann Arbor Railroad Company:

1. US-27A in Section 8, Town 13 North, Range 3 West, Isabella County, in Shepherd (which is presently protected by center-of the-street flashing light signals);

2. M-61 in Section 22, Town 20 North, Range 7 West, Osceola County, in Marion (which is presently protected by bell),

and for the approval of an agreement entered into under date of March 1st, A. D. 1939 between the Michigan State Highway Department and The Ann Arbor Railroad Company and Norman B. Pitcairn and Frank C. Nicodemus, Jr., Receivers, covering the installation of said flashing light signals.

The Commission is advised in said agreement in part as follows:

“WHEREAs, of the funds allocated to it from the several recent Federal appropriations, the Highway Department is permitted to utilize a portion for the protection of railroad grade crossings, and

“WHEREAs, under existing State Law, mandatory crossing protection in the State of Michigan is limited to side-of-the-street flashing light signals, and definite specifications for such construction are included in Act No. 336 of the Public Acts of 1931; and

“WHEREAs, the parties hereto have reached an understanding with each other respecting the installation and maintenance and the division of cost thereof * * *”.

The Commission is also in receipt of copies of letters addressed by the Michigan State Highway Department to the respective municipalities involved, to which letters were attached blue prints covering the type of installation of said flashing light signals .

After due consideration of said application, agreement and blue prints, the Commission has determined that the installation of side-of-the-street flashing light signals at the locations herein before referred to will provide improved protection and warning to highway traffic passing over said crossings of the approach of engines or trains, and that an order should be issued, authorizing such installation and the approval of said agreement and blue prints;

THEREFORE, IT IS HEREBY ORDERED by the Michigan Public Utilities Commission that authority shall be, and the same is hereby granted to The Ann Arbor Railroad Company and Norman B. Pitcairn and Frank C. Nicodemus, Jr., Receivers, to substitute side-of-the-street track circuit flashing light signals in lieu of the protection now afforded at the following crossings of The Ann Arbor Railroad Company:

1. US-27A in Section 8, Town 13 North, Range 3 West, Isabella County, in Shepherd (MPUC File No. D-27);

2. M-61 in Section 22, Town 20 North, Range 7 West, Osceola County, in Marion (MPUC File No. D-68),

   PROVIDED :

(1) That said flashing light signals shall be installed in accordance with the blue prints hereinbefore referred to, which blue prints are hereby approved and made a part of the files and records of the Michigan Public Utilities Commission in the respective files hereinbefore enumerated, and in accordance with the provisions of Act 336, Public Acts of 1931, and specifications of the Michigan Public Utilities Commission for flashing light signals, a copy of which is hereto attached and made a part hereof;

2. That the cost and expense for the installation and future maintenance of said flashing light signals shall be in accordance with the terms of the agreement entered into under date of March 1st, A. D. 1939 by the Michigan State Highway Department, by Murray D. Van Wagoner, State Highway Commissioner of the State of Michigan, and The Ann Arbor Railroad Company and Norman B. Pitcairn and Frank C. Nicodemus, Jr., Receivers, by Norman B. Pitcairn, one of the Receivers, a copy of which agreement is hereby approved, attached hereto and made a part hereof;

   (3) If, at any time, the flashing light signal system at either of the points hereinbefore referred to shall become inoperative, The Ann Arbor Railroad Company shall immediately cause a watchman to be stationed at said crossing, to warn highway traffic in advance of the approach of engines or trains until such flashing light signal system has been restored to working order.

It is FURTHER ORDERED that nothing in this order shall be construed so as to interfere with any agreement which now exists between the parties in interest

IT Is FURTHER ORDERED that this Commission reserves unto itself jurisdiction of this matter, and the right to issue such further order or orders herein which, in its judgment, may be deemed necessary in the interests of the traveling public.

MICHIGAN PUBLIC UTILITIES COMMISSION.

In the matter of the application of The Ann Arbor Railroad Company for an order of this Commission confirming the protection by watchman at the South Washington Street crossing of its tracks in the City of Owosso, Michigan. File No. 7077-145. June 9, 1939.

Application having been filed on August 3rd, A. D. 1938 by The Ann Arbor Railroad Company for confirmation by this Commission of the protection now afforded at the South Washington Street crossing of its tracks in the City of Owosso, Michigan.

In said application the Commission is advised in part as follows:

“Your petitioners represent that for many years they have been furnishing protection by flagman at the South Washington Street crossing at Owosso, Michigan, during the hours between 7:00 A. M. and 7:00 P.M. daily, except Sundays; that such protection has been done voluntarily, without any order of the Commission or of any ordinance or statute of the City of Owosso, Michigan”.

The Commission is in receipt of a letter from the Michigan State High way Department, by L. W. Millard, Bridge Engineer, under date of March 3, 1939, to the effect that under its 1940 program flashing light signals will be installed at the M-47 (South Washington Street crossing of the Ann Arbor Railroad Company in the City of Owosso

The Commission, after due consideration of said matter, has deter mined that, pending the installation of modern, side-of-the-street flashing light signals, the protection now provided at said crossing should be confirmed, The Commission, after due consideration of said matter, has determined that, pending the installation of modern, side-of-the-street flashing light signals, the protection now provided at said crossing should be confirmed, The Commission, after due consideration of said matter, has determined that, pending the installation of modern, side-of-the-street flashing light signals, the protection now provided at said crossing should be confirmed,

THEREFORE,IT IS HEREBY ORDERED by the Michigan Public Service Commission that the protection now afforded by watchman from 7:00 A.M. to 7:00 P.M. daily, except Sundays, at the South Washington (M-47) Street crossing of The Ann Arbor Railroad Company in the City of Owosso, Michigan shall be, and the same is hereby confirmed.

IT IS FURTHER ORDERED that this Commission reserves unto itself jurisdiction of this matter, and the right to issue such further order or orders herein which, in its judgment, may be deemed necessary.

MICHIGAN PUBLIC SERVICE COMMISSION.

Greater Muskegon Chamber of Commerce, vs. Ann Arbor Railroad Company, et al. D-3178. July 20, 1939.

Great Lakes Steel Corporation, vs. Ann Arbor Railroad Company, et al., Rates on scrap iron. D-3135. July 20, 1939.

The Great Lakes Steel Corporation, organized under the laws of Delaware, and engaged in the manufacture and sale of semi-finished and finish ed iron and steel articles, with its principal offices and plants located at Ecorse (Detroit), Michigan, filed its complaint on March 8, 1938, alleging, among other things:

1. That the rates on scrap iron or steel (hereinafter referred to as scrap), from points in Michigan, to Detroit, Michigan, are generally higher than the rates on the movement of scrap, under similar circum stances and conditions, between points within the State of Illinois, and also between points within the State of Indiana.

2. That the present rates on scrap between all points in the State of Michigan are on no definite or uniform basis, and are generally higher than the rates on scrap, assessed by defendants in interstate traffic, to points in Michigan.

3. That these rates subject complainant to undue and unreasonable disadvantage and prejudice, and that for the future they will be unjust, unreasonable, unduly discriminatory, and prejudicial.

4. That the aforesaid rates are being charged in violation of Act 300, P. A. 1909, as amended, being Sections 11020, 11025, 11026, 11032 and 11033 C. L. 1929.

   The Greater Muskegon Chamber of Commerce, a Michigan Corporation, is a voluntary organization of firms, manufacturers, merchants and individuals engaged in the business of buying, selling, and shipping scrap iron. The principal office of the Muskegon Chamber of Commerce is located in the City of Muskegon, Michigan. This Corporation filed its complaint on June 21, 1938, with the predecessor of this Commission, alleging in substance, the same complaints as listed in paragraphs numbered 1 to 4 above.

   Both complaints request this Commission to make an investigation for the purpose of establishing a reasonable, just, non-discriminatory and non-prejudicial basis of rates for the future. The complaint of the Great Lakes Steel Corporation also seeks reparation insofar as such investigation affects the rates on the movement of scrap to Detroit.

   On August 25, 1938, the Flint Chamber of Commerce filed its petition asking leave to intervene in Greater Muskegon Chamber of Commerce vs. Ann Arbor Railroad Company et al., and on October 6, 1938, the Michigan Manufacturers' Association filed its petition asking leave to intervene in Greater Muskegon Chamber of Commerce. The Commission being of the opinion such petitions were meritorious, granted permission to intervene by its orders of September 6, 1938, and October 10, 1938, respectively

5. That complainant, Greater Muskegon Chamber of Commerce, and the intervenors request an alternative minimum weight for rates on scrap iron while the Great Lakes Steel Corporation is principally inter ested in a higher minimum than 44,800 pounds at a lower rate for the reason that scrap purchased by them is prepared especially for their consumption in the process of making steel.

Defendants filed separate answers to each of above complaints (some defendants joining in the answers of others). By their answers, defend ants admit the formal parts of the complaints, but deny all the material allegations.

These complaints being so similar and involving the same commodities, the Commission consolidated both cases and heard them upon one record for disposition at the same time.

or disposition at the same time. The consolidated complaints were brought on for hearing October 29, 1938, and continued on December 8 and 9, 1938. Briefs were filed April 15, 1939, and oral argument was heard before the entire Commission on April 26, 1939.

The Commission believes that a brief discussion of the testimony presented at the hearings held on the Consolidated cases will be helpful. We do not undertake to discuss all of the testimony in detail in this decision

The record discloses that the main plant of the Great Lakes Steel Corporation is located at Ecorse, Michigan. They also have a smaller plant at Ecorse and a blast furnace located at River Rouge, Michigan. The main plant and the blast furnace are located on the Detroit River and receive freight by water. All three plants are equipped with facilities for shipping by motor truck. The main plant was completed in 1930 and made its first shipments of steel in August of that year. It was the first large steel mill to be constructed in Michigan and brought to this State a new basic industry. There are no other steel mills of comparable size located in this State. The plant as originally constructed had a production capacity of 600,000 tons of finished steel annually. Its capacity has been gradually increased until now it is capable of producing 2,000,000 tons annually. The principal competitors of this complainant are located in Chicago, Illinois, Gary, Indiana, at Cleveland and Youngstown, Ohio, Wheeling, West Virginia, Pittsburgh, Sparrows Point and Bethlehem, Pennsylvania. All of these competitors sell steel in the Michigan market.

The market for the products of the Great Lakes Steel Corporation is located throughout the United States and the World. A steel mill, to operate successfully, must have diversified outlets for its manufactured products to avoid the extreme peaks and valleys in production. Its largest customer is the automotive industry, but it is always seeking other markets, and at the present time has fifteen district offices, located throughout the United States, serving twenty two thousand customers, and is selling steel here and abroad in active competition with other steel mills in all markets.

The Greater Muskegon Chamber of Commerce, one of the complain ants, has represented its members in proceedings affecting rate adjustments since 1921. Several members of this Association, being manufacturers of iron and steel articles and brokers dealing in scrap iron and steel, testified before this Commission in this proceeding. One witness testified his company manufactured iron and steel articles for the auto motive trade, and that it had plants in operation in Muskegon Heights, Lansing and South Haven, all being purchasers and users of scrap. These plants are now operating at about 45 percent capacity, employing approximately sixteen hundred men but that in normal production the would have between twenty five hundred and three thousand employees. Other members of the Chamber of Commerce have a comparable number of employees, according to the size of their plants, and are all producers of iron and steel articles, with the exception of the brokers. They are all purchasers of scrap from various points in Michigan, as well as from points in other States, their purchases running from forty thousand to one hundred thousand tons annually.

The principal source of scrap used by the Great Lakes Steel Corporation is the Detroit switching district but the supply of scrap in this area has not increased proportionately to the demand. This is largely due to the fact that the predominant source of scrap in this territory is from the automobile factories, and the tendency toward decentralization in that industry has reduced the supply of scrap to such an extent that it is necessary to seek a source of supply elsewhere. It is true that complainant does not purchase all of the scrap produced in Detroit for the reason that some producers do not sort and prepare their scrap for the specific use of complainant in its production of steel.

Scrap iron and steel are basic materials, used in making steel, and iron and steel articles, along with iron ore, fuel, flux and air. Ore has, to a large extent, been replaced by scrap, and the annual consumption of scrap in the United States has increased to about twenty eight million tons. This scrap is produced everywhere in plants, alleys, broken down buildings and on the farms in agricultural communities.

Scrap is shipped in open top railroad equipment and is not susceptible to damage. There are several kinds of scrap known to the trade, such as industrial, agricultural, prepared and unprepared. Industrial scrap, as the name implies, results from mechanical processes. Agricultural scrap consists usually of worn out implements. Prepared scrap is that which is prepared by the producer or broker for specific use of the purchaser, while unprepared scrap is a mixture of all kinds, not sorted for any par ticular use. Prepared scrap is generally heavy and the average load is fifty tons or more per car, while unprepared scrap is lighter and aver. ages only twenty tons per car. This disparity in weights prompted the complainant's proposal of two scales of rates at alternative minimum weights, which would permit a free movement of scrap to all consuming points. Before prepared scrap can be shipped to the market, it must be conditioned in accordance with specifications adopted by the consumers. It is usually necessary, therefore, that it be consolidated at comparatively few points, where dealers possess the necessary equipment for preparing it, although whenever possible it has become the practice to condition it at point of production. It can be sorted to better advantage and more economically at the consolidation point. There are several such points in this State. Complainants claim that, owing to the high freight rates, they are unable to avail themselves of Michigan scrap, except that which is produced locally. The record indicates that the relationship of freight rates to the cost of scrap is a very important factor in complainant's production of iron and steel articles, and this is especially true with regard to the particular type of scrap used by the Great Lakes Steel Corporation. As the demand increases beyond the supply of the Detroit area, it becomes necessary to seek other sources. Scrap has been purchased by them from New York and shipped by water, because the level of freight rates on movements from scrap producing points in Michigan is so high that the cost of this raw material is prohibitive. Complainants claim that competitors who can draw scrap from a radius of two hundred miles from their plants, have complainants at a disadvantage. The greater the area from which scrap can be drawn, the more beneficial it is to the industry in preserving a balanced posi tion in source of raw materials. Some of the complainants can draw scrap by means of water from other than Michigan sources, and have done so in order to maintain a favorable price at their plants, but their ability to receive shipments by water is no greater than that of their present competitors.

One of the principal complaints, in this proceeding, as pointed out by complainants and intervenors, is that the rates on scrap in Michigan are not on a uniform level and are on a higher basis in the aggregate in interstate traffic and intrastate traffic now prevailing in adjoining States.

Exhibits were introduced purporting to show that the range of scrap rates in this State is from 14 to 27 percent of the first class rate, from 50 to 98 percent of the sixth class rate, and from 70 to 149 percent of the manufactured iron and steel rates, while Indiana, the scrap rates range from 10 to 19 percent of first class, from 37 to 68 percent of sixth class rate, and from 40 to 85 percent of the manufactured iron and steel rates. The class rates in Michigan and Indiana are on the same level, but the manufactured iron and steel rates are on a higher level in Michigan, as these rates are on the 17,000 Part 6 scale authorized by the Interstate Commerce Commission, while in Indiana these rates are on the so-called Jones-Laughlin Scale prescribed by the Public Service Commission of Indiana in its docket 8607, dated January 14, 1927, and increased under Exparte 123. The Indiana Commission did not permit Exparte 115 in creases on scrap iron, while in Michigan the Commission allowed this increase concurrently with the increase on interstate traffic permitted by the Interstate Commerce Commission. The Indiana Commission prescribed in docket 9017, September 14, 1938, 6.5 percent of the first class rate for the movement of scrap iron and steel in carloads between all points in the State of Indiana, but due to the heavy movement of scrap to the larger consuming centers, it prescribed lower specific commodity rates to enable the users of this material to receive shipments from the more important producing and concentrating points, at rates which are generally comparable with the rates in contiguous western territory for similar distances.

The Illinois Commission has not as yet prescribed a scale of rates for the movement of scrap in Illinois, but the general level, voluntarily established by the carriers, is somewhat lower than the prevailing level of rates in Michigan. The Illinois rates range from 9 to 16 percent of the first class rates and from 34 to 62 percent of the sixth class rates

The class rates in Illinois and in Michigan are on the same level, but the manufactured iron and steel rates are the same as in Indiana, on the Jones-Laughlin Scale, and are lower than the prevailing rates on such articles in Michigan.

The Interstate Commerce Commission in many proceedings has prescribed 70 per cent of the 17,000 Part 6manufactured iron and steel rates as maximum reasonable rates for the movement of scrap in Inter state Commerce, for application between points in Central Freight Association territory. We do not think it necessary to cite these cases, as both complainants and defendants are familiar with all decisions of the Interstate Commerce Commission in suit proceedings. The results of these decisions authorize and permit carriers to establish rates on scrap iron higher than the rates now established on manufactured iron and steel on certain short hauls. The carriers have voluntarily established in this territory the so-called Pittsburgh Scale on these articles and commodities to cover short haul points, which scale is somewhat lower than that prescribed by the Interstate Commerce Commission in 17,000 Part 6.

Several exhibits were introduced in this proceeding showing comparisons of rates on scrap to steel producing points in Pennsylvania, Ohio and New York which show that these steel producing points are able to draw scrap from a larger number of points on a lower level than can the Michigan consumers of scrap. In the Pittsburgh district, the level ranges from 7 to 16 per cent of first class; the Youngstown district 6 to 17 per cent of first class; the Cleveland district, 10 to 17 per cent of the first class rate; and the Buffalo district, 9 to 10 per cent of the first class rate. Pittsburgh, one of the largest steel producing points in the United States, and Cleveland, Youngstown and Buffalo, have access to water transportation.

Exhibit 48, rates on scrap to Pittsburgh, Pennsylvania, from various intrastate points, shows rates of 84 cents per ton for distances comparable to the distance from Pontiac to Detroit (27 miles), while the present rate from Pontiac to Detroit is 152 cents per ton. This rate was established by the carriers as a motor truck competition rate, to expire at a given date, when a rate of 208 cents per ton would become effective. A number of other rates are shown in this exhibit all lower than 152 cents for greater distances.

The testimony also discloses the fact that all larger carriers, operating in Michigan, participate in the movement of scrap in adjoining states on a lower level of rates. It is our view that state lines do not divide diverse transportation conditions, as the conditions in Michigan, Ohio, Indiana and Illinois are essentially similar in character. The Interstate Commerce Commission has made numerous decisions under similar circumstances. Therefore, we are of the opinion that rates on scrap in Michigan should not be on a level considerably higher than those prevailing in States adjoining Michigan, having similar transportation conditions.

The testimony also discloses the fact that all larger carriers, operating in Michigan, participate in the movement of scrap in adjoining states on a lower level of rates. It is our view that state lines do not divide diverse transportation conditions, as the conditions in Michigan, Ohio, Indiana and Illinois are essentially similar in character. The Interstate Commerce Commission has made numerous decisions under similar circumstances. Therefore, we are of the opinion that rates on scrap in Michigan should not be on a level considerably higher than those prevailing in States adjoining Michigan, having similar transportation conditions.

The record also shows that, from the same sources of supply, the Chicago area can draw scrap on a lower level than can Detroit. Rates between points in the Upper Peninsula of Michigan are on a lower basis than those in the Lower Peninsula. There is a general basis of rates prescribed for application on scrap from points in the Upper Peninsula of Michigan to Chicago of 12% per cent of first class, minimum weight 75,000 pounds and 15 per cent of the first class, minimum weight 50,000 pounds. There is now a proposal before the Western Trunk Line Association for a reduction in rates on scrap from important sources in the Upper Peninsula. This record, however, does not indicate that there is any volume movement of scrap by rail from points in the Upper Peninsula of Michigan to points in the Lower Peninsula. Only the Great Lakes Steel Corporation requests rates to be prescribed, and only for application to Detroit, Michigan. Therefore, it is our view that the interested carriers should voluntarily adjust their rates on scrap from the Upper Peninsula to Detroit comparable with rates on scrap to other points, distance considered, without the issuance of a specific order by this Commission. No further mention will be made of this particular part of the complaint.

The rates on scrap in Southwest territory are based on 12% percent of the first class rate, minimum weight 75,000 pounds, and 15 percent of the first class rate, minimum weight 50,000 pounds.

The Greater Muskegon Chamber of Commerce proposes this basis of rates for application uniformly on intrastate transportation of scrap in the Lower Peninsula of Michigan but in the Southwest Territory the class rates are approximately 150 percent of the class rates in Official Territory. Therefore, if the rates on scrap in Michigan are made 12% percent and 15 percent of the first class rate, they will be substantially lower than the actual rates in the south or southwest. In other words, the proposed rates for application in Michigan would be only about 66 percent of the rates in the Southwest. This Commission has never considered the lowest basis of rates in any one territory as a reasonable maximum basis for rates in this State.

The Great Lakes Steel Corporation, acknowledged as the largest consumer of scrap in Michigan, proposes a scale of rates with a minimum weight of 44,800 pounds related in some respects to the rates on manu factured iron and steel articles. While this proposed basis is lower than some of the prevailing rates within Official Territory, it follows in principle the rates established by the Interstate Commerce Commission previously referred to herein. This Commission believes in this principle except that in prescribing rates on scrap, such rates should not be higher than the published rates on manufactured iron and steel articles.

Defendants, in their brief, state that the present rates on scrap iron and steel between points in Michigan were established to meet the needs of the industry. The competitive conditions surrounding the movement of the traffic were given due consideration, with the result that the rates between certain points are lower, distance considered, than rates between other points. For this reason, the present rates in Michigan are not on a mileage scale. The defendants are strongly of the opinion that the present adjustment should be continued and that the establishment of a mileage scale for uniform application will tend to localize ship ments and discourage the establishment of competitive rates that are necessary to the movement of certain types of this traffic. We do not agree that a uniform mileage scale will localize shipments, but believe that it will develop more single line traffic to the carriers, thereby pro ducing more revenue than if shipments were consigned outside the State so such carriers would have to divide their revenues. Defendants offered testimony to show that the original basis was 85 percent of the sixth class rate, but the present rates were established from time to time to meet needs of the industry in the light of existing competitive conditions. The rates are not related to class rates nor to any uniform scale of mileage rates. A witness for defendants testified that the present rates are inconsistent and that the present adjustment of scrap rates in Official Territory, which includes Michigan, is replete with inconsist encies. He also testified that it was possible by judicious selection of competitive rates to support almost any conclusion that may be desired. Defendants also stressed their financial condition, but the evidence does not show that the financial condition of carriers is directly chargeable to rates on scrap as applied to intrastate traffic.

That neither the financial condition, nor the revenue needs of carriers will excuse unlawful situations or prevent readjustment of rates has been held by the Interstate Commerce Commission in the following Cases :

“Revenue needs of carriers cannot excuse the continuation of unlawful situations or prevent proper readjustment of rates on individual commodities.” (Standard Oil Co. of Indiana v. C & NW Ry., 197 ICC 325, 334).

“That the fact that a carrier’s financial condition is acute constitutes no basis for a denial of an award of reparation, since shippers are entitled to reasonable rates notwithstanding the financial condition of a carrier.” (Montana-Dakota Power Co. v. C & NW Ry., 198 ICC 557, 563).

“Lack of adequate revenue from operations as a whole affords no reliable measure of the reasonableness of rates on individual commodities.” (Atlantic City Coal Dealers Credit Bureau v. AC & Y. RR., 203 ICC 470, 479).

Defendants refer to the many Interstate Commerce Commission decisions wherein they have prescribed 70 percent of the manufactured iron and steel articles scale for application on movement of scrap, and in their oral argument state, if the Commission decides that there must be a scale, then the rates should be no lower than those prescribed by the Interstate Commerce Commission for the transportation of scrap in interstate traffic. Without further reference to defendant's testimony, this Commission can well assume that the carriers themselves are defending the view of the Interstate Commerce Commission and are suggesting 70 percent of the manufactured iron and steel scale as a reasonable scale 'for application in Michigan. We do not believe that rates based upon such a scale would bring any undue burden upon the carriers but will serve to promote increased tonnage resulting in increased revenue. So far as could be determined from exhibits filed by defendants showing revenues on 1,507 carloads of scrap moving between points in the State of Michigan, charges that would accrue on the same shipments under rates based on 70 percent of the iron and steel scale, minimum weight 44,800 pounds would produce an increase in revenue.

Complainants urge uniformity in rates and, while this Commission favors a uniform rate structure, it should not prescribe one that would result in discrimination against nor cause serious injury to Michigan shippers or receivers of scrap.

The evidence before the Commission shows that a large part of the scrap produced in Michigan is consumed locally in this state. It is clearly the duty of the Commission to protect the shipping public from discrimination resulting from preferential rates.

As heretofore stated, there are principally two kinds of scrap; prepared and unprepared, or country scrap. In many cases the unprepared scrap moves into concentration points, to be prepared and consigned to points beyond. However, complainants, in most cases, receive scrap prepared for their special use. This scrap can be loaded in excess of 44,800 pounds. We think it may be fairly said that from a transportation standpoint, the prepared and unprepared scrap are essentially different commodities. The difference in loading and the economic desirability of encouraging the movement of scrap by establishing a lower rate on a higher minimum weight are sufficient reasons for and should justify the establishment of an alternative basis.

It clearly appears from the record that a large part of the scrap accumulated at points within the State would not be moved on the present basis of rates. Any basis of rates which discourages traffic will result in a direct loss to the carriers. In the interests of uniformity, an alternative scale of rates should bear a direct relationship to the basic scale.

Complying with the request of both complainants in this matter, the Commission has made a careful investigation and study of the rate situation in Michigan and in other comparable territory in the United States for the purpose of establishing a reasonable, just, nondiscriminatory and non-prejudicial basis of rates for the future.

After having carefully considered the records and files in the combined cases, the testimony adduced at the hearing and the adjournments there. of, the briefs filed by the respective parties, the oral arguments of counsel, and giving due regard to its own investigation, the Commission HOLDS AND FINDS :

1. That the rates on scrap from points in Michigan to Detroit, Michigan, are generally higher than the rates on the movement of scrap under similar circumstances and conditions, between points within the State of Illinois and also between points within the State of Indiana; and

2. That the rates on scrap between all points within the State of Michigan are on no definite or uniform basis and are generally higher than the rates on scrap, assessed by defendants in interstate traffic, to points in Michigan; and

3. That these rates subject complainant to undue and unreasonable disadvantage and prejudice, and that for the future they will be unjust, unreasonable, unduly discriminatory and prejudicial; and

4. That for the future, the rates now being charged will be in violation of Act 300 of the Public Acts of 1909 as amended, being sections 11020, 11025, 11026, 11032 and 11033 C. L. 1929; and

5. That inasmuch as prepared scrap may be loaded to greater ad vantage than unprepared scrap, there should be an alternative mini mum weight fixed for rates on scrap iron; and

6. That the basis sought by the complainant, Greater Muskegon Chamber of Commerce and intervenors is too low; that the rates assailed covering a carload minimum weight of 44,800 pounds, for the future will be unreasonable to the extent that they may exceed the rates determined by the distance scale of rates set forth in Appendix A hereto, and application between points in the Lower Peninsula of Michigan; the distances to be found by using the mileage now used to determine class rates between the same points; and

7. That reasonable alternative rates on scrap, in carloads, between points in the Lower Peninsula of Michigan, subject to a minimum weight of 89,600 pounds, for the future will be unreasonable to the extent that they exceed 80% of the rates found reasonable in Appendix A and as specifically set forth in Appendix B hereto. The distances are to be found by using the mileage now used to determine class rates between the same points; and

8. That there is nothing in this record to indicate that the rates complained of were irregular or exorbitant, and therefore the Commission finds that the record will not sustain an award of damages on ac count of past shipments made by the Great Lakes Steel Corporation, which is the only party seeking reparation in this matter.

NOW THEREFORE, IT IS HEREBY ORDERED :

That the defendants in this proceeding shall cease and desist on and after October 1, 1939, from any attempt to collect or charge the present rates for the transportation of scrap iron and/or steel in carloads from, to or between points in the Lower Peninsula of Michigan and shall in lieu thereof publish, file and put into force and effect on or before October 1, 1939, upon notice to this Commission and the general public by not less than 30 days filing and posting, in the manner prescribed by law, rates not to exceed the rates herein found reasonable and as specifically set forth in Appendix A hereto subject to a minimum weight of 44,800 pounds and as specifically set forth in Appendix B hereto subject to a minimum weight of 89,600 pounds.

FURTHER, That the Commission hereby reserves unto itself full jurisdiction of this matter and the right to make any other or further order or orders herein as it shall hereafter deem just, fitting and proper.

MICHIGAN PUBLIC SERVICE COMMISSION.

APPENDIX A

Scale of reasonable maximum rates prescribed for the transportation of scrap iron and/or steel, minimum weight 44,800 pounds.

(Rates in cents per ton of 2,240 pounds)

APPENDIX B

Alternative Scale of reasonable maximum rates, prescribed for the transportation of scrap iron and/or steel, minimum weight 89,600 pounds.

(Rates are in cents per ton of 2,240 pounds)

The Owosso Argus-Press July 22, 1939

Oldest Ann Arbor Shop Employe on Retired List

John McClellan, Who Has Served 49 Years, Lys Down His Tools Wednesday

John McClellman, veteran machinist of the Ann Arbor Railroad and the oldest employe of the Ann Arbor shops in point of service, has retired from his work for the railroad and has applied for the retirement pension.

He left his work for the last time Wednesday and today, unable to accustom himself to free time, is busily engaged in working at things around his home at 327 West Williams street – things he never had time to do before. He expects to paint his house and work in his garden which looks out upon the Shiawassee River and Curwood's studio, and then, later, with his wife, take a few pleasure trips.

McClellan served the railroad

as a machinist and machinist's apprentice for 49 years. He began work for the Ann Arbor on July 15, 1890, as an apprentice and four later became a machinist, a job which he has held continuously since.

Only 20 Employed

When he went to work for the railroad there were only 20 employed in the shops and the shops themselves were considerably smaller than they are at present. The first master mechanic under whom he worked was Walter Galloway, long since deceased, and he has worked for every master mechanic since including W. F. Brandley who was associated with James Ashley, builder of the road.

At the Railroad banquet held on May 25, 1938, he was honored for being the oldest employe in point of service in the shops here. He is the only living charter member of the machinists' union, and will be 70 years old in February.

One of the trips the veteran machinist plans to make will be to Charleston, S. C. where he will visit his son, Joe. His son, who followed in his father's footsteps by serving as a machinist apprentice in the Ann Arbor shops here is now a machinist in the Navy yard at Charleston.

Basic Dolomite, Incorporated, et al., Complainants, vs. The Ann Arbor Railroad Company, et. al., Defendants. D-2702. September 15, 1939

The Basic Dolomite, Incorporated, Construction Materials Corporation, Detroit Slag & Dock Company, The Lake Ports Supply Company and Sturgeon Bay Company, all of which are producers of crushed stone, sand, gravel, dolomite, slag and other concrete aggregates and highway materials filed their complaint March 18, 1932 alleging, among other things:

1. That the rate charged by defendants on sand, gravel, stone, and other concrete aggregates and highway materials in carloads within the State of Michigan are less than reasonable based upon mileage scale prescribed by this Commission;

2. That the rates so charged are unscientific in their measure, progression and relationship to the disadvantage and damage to complainants;

3. That said rates are unjust and unreasonable, unduly preferential to complainants' competitors and unduly prejudicial to complainants and discriminatory, all in violation of Act 300 of the Public Acts of 1909, and acts amendatory thereto and supplementary thereof.

There was pending before the Interstate Commerce Commission its Docket No. 25156 and 25.156 sub 1 involving similar issues and, upon request, these proceedings were heard jointly under the cooperative plan with the Interstate Commerce Commission.

A number of producers were permitted to intervene before the matter was brought on for hearing September 13, 1933

At the close of the hearing, request was made for time in which to file briefs but no such briefs were filed with this Commission. The Inter state Commerce Commission submitted its examiner’s report, but complainants failed to file exceptions. Therefore, that Commission's conclusions were in accord with the examiner's recommendations which were that the complaint should be dismissed as the rates under attack were not found to be unduly prejudicial.

The Interstate Commerce Commission in this matter, 203 ICC 378-382 stated:

“The record fails to support complainants' contentions. The mere existence of disparity between intrastate and interstate rates is not sufficient to warrant a finding of undue prejudice. We find that the rates assailed are not unlawful as alleged. The complaint will be dismissed.”

Upon request of complainants this Commission's decision was withheld pending the status of certain of complainants who were forced into bankruptcy

This Commission has just received a letter from counsel for complain ants indicating no further interest in this matter with the suggestion that complaint be dismissed.

The Commission finds that due to the decision of the Interstate Commerce Commission, failure of complainant to file briefs or further interest themselves in this matter the complaint be dismissed.

Now, THEREFORE, IT IS HEREBY ORDERED, that the complaint be and it is hereby dismissed without prejudice of any party of interest;

FURTHER, that the Commission hereby reserves unto itself full jurisdiction of this matter and the right to make any other order or further order or orders herein as it shall hereafter deem just, fitting and proper.

MICHIGAN PUBLIC SERVICE COMMISSION.