1. An order of the Interstate Commerce Commission requiring that
certain freight rates fixed by state authority be increased to
correspond with interstate rates on the same kind of traffic, fixed
by the Commission, held within the power of the Commission to
prescribe intrastate rates in place of those found unduly to
discriminate against persons or localities in interstate commerce,
or against that commerce. Interstate Commerce Act, § 13(3)-(4). P.
284 U. S.
130.
2. The evidence before the Commission is examined and is found
sufficient to sustain its action. P.
284 U. S.
132.
3. The order of the Commission fixing interstate and intrastate
rates on transportation of road material in Arkansas, Oklahoma,
Texas, and a part of Louisiana, added an allowance of eight cents
per ton for ferrying such of the traffic as crosses the Mississippi
in Louisiana to and from certain points on the east bank of the
river.
Held:
(1) That inclusion of this allowance does not violate Art. I, §
9, cl. 6 of the Constitution, even though in effect it may benefit
ports in Texas, to the incidental disadvantage of ports in
Louisiana. P.
284 U.S.
131.
(2) Neither the failure of the Commission separately to
ascertain and state, nor the absence of evidence to show, the cost
to carriers of the ferry service requires annulment of the rates in
which the allowance for that service is included. P.
284 U. S.
132.
41 F.2d 293 affirmed.
Appeals from a decree enjoining the Louisiana Public Service
Commission from interfering with application to intrastate traffic
of rates fixed for the plaintiff carriers by the Interstate
Commerce Commission, and from a decree dismissing a bill against
the United States by which the state and its commission sought to
annul the order of the federal commission establishing the
rates.
Page 284 U. S. 129
MR. JUSTICE BUTLER delivered the opinion of the Court.
The Interstate Commerce Commission, June 3, 1929 (155 I.C.C.
247), and September 30, 1929 (157 I.C.C. 498), prescribed rates for
the transportation of sand, gravel, and other named commodities,
hereafter referred to as road materials, in Arkansas, Oklahoma,
Texas, and that part of Louisiana west of the Mississippi,
including certain points on the east bank of the river. The rates
were based on straight mileage. Eight cents per ton was added for
ferrying such of the traffic as crosses the Mississippi to and from
the named points on the east bank. The rates were made to apply
alike to interstate and intrastate transportation.
The commissions of Arkansas, Oklahoma, and Texas, respectively,
adopted for application therein the intrastate rates so prescribed.
The carriers applied to the Louisiana Public Service Commission for
authority to give them effect in that state. October 12, 1929, the
Commission adopted them as to traffic between points on and north
of the Vicksburg, Shreveport & Pacific Railroad and between
that territory and points in Western Louisiana
Page 284 U. S. 130
south of the railroad. It refused to apply them on traffic
wholly within the territory south of the railroad or on the traffic
between that part of the state and the specified places on the east
bank of the river.
The first of these suits was brought by the carriers against the
Commission and its members to enjoin them from interfering with the
application of these intrastate rates. The other was brought by the
state and the Commission to annul them. 28 U.S.C. § 47. A court of
three judges heard the cases, held the rates valid, granted a
permanent injunction in the first suit, No. 36, and dismissed the
other, No. 37, 41 F.2d 293. The cases are here on direct appeal. §
345(4).
Appellants seek reversal on the grounds that the inclusion of
the allowance for ferrying the Mississippi gives preference to
Galveston, Houston, and other ports of Texas over New Orleans and
Baton Rouge in Louisiana in violation of the Constitution, Art. I,
§ 9, cl. 6; that the Interstate Commerce Commission made no
findings and had no evidence as to the cost of the ferry service,
and that there is no evidence to warrant a finding that the lower
intrastate rates in effect under state authority operate as a real
and substantial obstruction to, burden upon, or discrimination
against, interstate commerce.
The power of Congress to regulate interstate and foreign
commerce is exclusive, and has no limitations other than such as
arise from the Constitution itself.
Gibbons v.
Ogden, 9 Wheat. 1,
22 U. S. 197. The
Congress may adopt measures effectually to prevent every
unreasonable, undue, or unjust obstruction to, burden upon, or
discrimination against, interstate commerce, whether it results
from state regulation or the voluntary acts of carriers.
Shepard v. Northern Pac. Ry. Co., 184 F. 765, 795;
Minnesota Rate Cases, 230 U. S. 352,
230 U. S. 398,
230 U. S. 403,
230 U. S. 432;
Texas & P. Ry. Co. v. United States, 205 F. 380, 388,
aff'd sub nom. 234 U. S. & W.
T.
Page 284 U. S. 131
Ry. Co. v. United States, 234 U.
S. 342,
234 U. S. 353;
American Express co. v. Caldwell, 244 U.
S. 617,
244 U. S. 624;
Illinois Central R. Co. v. Public Utilities Comm'n,
245 U. S. 493,
245 U. S. 506.
And it has empowered the Interstate Commerce Commission to
prescribe intrastate rates in place of those found unduly to
discriminate against persons or localities in interstate commerce
or against that commerce, § 13(3)(4), and to require the carriers
to make and apply on intrastate transportation such reasonable
charges as will produce its fair share of the amounts needed to pay
operating expenses, provide an adequate railway system, and yield a
reasonable rate of return on the value of the property used in the
transportation service. Section 15a.
Wisconsin Railroad Comm'n
v. Chicago, B. & Q. R. Co., 257 U.
S. 563,
257 U. S. 585,
257 U. S. 588;
Florida v. United States, 282 U.
S. 194,
282 U. S.
210-211.
The clause of the Constitution invoked is:
"No Preference shall be given by any Regulation of Commerce or
Revenue to the Ports of one state over those of another, nor shall
Vessels bound to, or from, one state be obliged to enter, clear, or
pay Duties in another."
The specified limitations on the power of Congress were set to
prevent preference as between states in respect of their ports or
the entry and clearance of vessels. It does not forbid such
discriminations as between ports. Congress, acting under the
commerce clause, causes many things to be done that greatly benefit
particular ports and which incidentally result to the disadvantage
of other ports in the same or neighboring states. The establishing
of ports of entry, erection, and operation of lighthouses,
improvement of rivers and harbors, and the providing of structures
for the convenient and economical handling of traffic, are
examples.
Pennsylvania v. Wheeling &
Belmont Bridge Co., 18 How. 421,
59 U. S.
433-435.
And see Armour Packing Co. v. United
States, 209 U. S. 56,
209 U. S. 80.
The construction for which appellants contend would strip Congress
of much of the power that it long has been accustomed to exert
Page 284 U. S. 132
and which always has been held to have been granted to it by the
commerce clause. It is clear that the Constitution does not forbid
the allowance for ferrying the Mississippi at Louisiana ports.
Neither the failure of the Commission separately to ascertain
and state, nor the absence of evidence to show, the cost to
carriers of the ferry service, requires annulment of the rates
prescribed for transportation between the places on the east bank
of the Mississippi and points west of the river.
Those rates were made by adding eight cents per ton to the
mileage scale which was applied generally throughout the
above-mentioned states. No rate specifically applies to the
carriage across the river. The orders do not relate to divisions
under § 15(6) or to allowances under § 15(13). Every railroad
shipment requires two terminal services and the line haul.
Shipments moving in carloads require switching at places of loading
and unloading and frequently at intermediate points. Some require
the use of floating equipment and other special facilities. Some
are moved on stretches of line where, by reason of physical
conditions, the service is performed at costs per mile much in
excess of the average on other parts of the haul. Straight mileage
schedules appropriately may be applied where conditions affecting
transportation are reasonably uniform, but substantial additions to
rates so made are necessary to cover extraordinary costs of
service. While, in the making of reasonable rates, all the material
facts are to be regarded, it has never been deemed necessary or
practicable -- if indeed it is at all possible -- to ascertain in
advance the cost to carriers of each of the various elements
embraced in the transportation service. The Act does not require
any such determination.
There was evidence to show:
The commodities in question are used chiefly for the
construction, improvement, and maintenance of highways.
Page 284 U. S. 133
Each of the states mentioned has an extensive system of
highways, and contemplates much construction, improvement, and
maintenance work. There are more than 300 sources of supply in the
territory, and by far the larger part of the materials used in each
state is produced therein. These commodities move in great volume,
and constitute substantially more than 10 percent of the carriers'
tonnage. In Louisiana, there are many places where such materials
are produced. About 98 percent of the improved highways in that
state are constructed with gravel. There is a large part of Western
Louisiana in which no gravel is produced. Some road materials are
hauled intrastate more than 240 miles, large quantities move from
100 to more than 140 miles, and, as calculated by the Commission,
the average is from 75 to 80 miles.
In Texas, Arkansas, and Oklahoma, there is a number of places,
not far from Louisiana boundaries, where large quantities of such
materials available for use in that state are produced.
Notwithstanding the relatively low applicable Louisiana intrastate
rates, substantial quantities are shipped from these outside
sources for use on roads in various parts of the state, including
the territory as to which the state authorities refused to adopt
the scale of rates prescribed by the Interstate Commerce
Commission. The Louisiana Highway Commission constructs about 500
miles of road annually, and the parishes construct considerable
additional mileage . In each year, great quantities of road
materials are, and in the future will be, required for road work in
that state south of the Vicksburg, Shreveport & Pacific
Railroad and west of the Mississippi. At shipping points throughout
the whole territory, prices per ton range about as follows: washed
gravel, from $0.60 to $1.15; clay gravel, $0.40 to $0.60; sand,
$0.45 to $0.70; crushed stone, $1.00 to $1.50; shells, $1.20 to
$1.40; chat, $0.25 to $0.35.
Page 284 U. S. 134
The Commission found in Louisiana three scales of intrastate
rates applicable to these commodities. One applied to commercial
shipments, and is higher than that prescribed by the orders under
consideration. One somewhat lower, and on which comparatively
little moves, covers shipments to municipalities for the
construction of public buildings. The one here under consideration
is the lowest; it applies to materials used in the construction of
state and parish highways and city streets when the shipments are
consigned to and the freight charges are paid by federal, state,
parish, or municipal governments. From 80 percent to 85 percent of
all the traffic in such materials in Western Louisiana moves on
that scale. There is printed in the margin a comparison of these
rates with those ordered by the Commission.*
Page 284 U. S. 135
The latter are about 150 percent of the former. For 80 miles,
about the average intrastate haul, the prescribed rates are higher
by 30 cents per ton; for 100 miles, 40 cents; 120 miles, 50 cents;
140 miles, 40 cents, and 200 miles, 60 cents. Producers outside
Louisiana are necessarily at disadvantage in respect of the sale
and delivery within that state of such materials to the extent that
the state rates are lower than the prescribed scale. In the course
of the Commission's report, it is said that the disparity between
the two scales is bound to operate as a real discrimination
against, and obstruction to, interstate commerce, and result in
interstate shippers' being unduly prejudiced and interstate
commerce unjustly burdened. And in its ultimate findings, the
Commission states that the intrastate rates, to the extent that
they are lower, distance considered, than corresponding interstate
rates, would result in undue preference and advantage to shippers
and receivers of freight in intrastate commerce within Western
Louisiana and in undue prejudice to shippers and receivers of
freight in interstate commerce between points in Arkansas,
Oklahoma, and Texas and points in Western Louisiana, and in unjust
discrimination against interstate commerce.
The facts above stated are adequately supported by the evidence,
and are clearly sufficient to warrant the Interstate Commerce
Commission in prescribing, under § 13(3)(4),
supra, the
schedule of intrastate rates under consideration.
Fiorida v.
United States, supra,
282 U. S. 208;
Alabama v. United States,
279 U. S. 229,
283 U. S. 776.
Decrees affirmed.
* Together with No. 37,
Louisiana et al. v. United States et
al.
* Comparison of Louisiana good roads single-line scale and
interstate single-line scale approved by the Commission in this
proceeding.
----------------------------------------------------------------
1 2 3 Percent that
Louisiana column 2 is
Distance good-roads Commission's less than
scale scale column 3
----------------------------------------------------------------
10 miles . . . . . . 40 50 20
20 miles . . . . . . 40 56 29
30 miles . . . . . . 50 62 19
40 miles . . . . . . 50 68 26
50 miles . . . . . . 50 74 32
60 miles . . . . . . 50 80 38
70 miles . . . . . . 50 85 41
80 miles . . . . . . 60 90 33
90 miles . . . . . . 60 95 37
100 miles . . . . . . 60 100 40
110 miles . . . . . . 60 105 43
120 miles . . . . . . 60 110 45
130 miles . . . . . . 60 115 43
140 miles . . . . . . 80 120 33
150 miles . . . . . . 80 125 36
160 miles . . . . . . 80 130 38
170 miles . . . . . . 90 135 33
180 miles . . . . . . 90 140 36
190 miles . . . . . . 90 145 38
200 miles . . . . . . 90 150 40
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Average . . . . . . . . . . . . . . . . . 35.25
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