1. An order of the Interstate Commerce Commission, under § 13(4)
of the Interstate Commerce Act, authorized railroads in North
Carolina to establish and maintain intrastate passenger coach fares
at levels not lower than interstate fares, which in effect
increased the state-prescribed basic fare of 1.65 cents per mile to
the interstate level of 2.2 cents per mile.
Held: that the order was not based on adequate findings
supported by evidence, and that the District Court should have
enjoined its enforcement. Pp.
325 U. S. 509,
325 U. S.
520.
2. The Interstate Commerce Commission is empowered to nullify a
state-prescribed intrastate rate only when the Commission, after
full hearing, finds that such rate causes (1) undue or unreasonable
advantage, preference, or prejudice as between persons or
localities in intrastate commerce, on the one hand, and interstate
commerce, on the other, or (2) undue, unreasonable, or unjust
discrimination against interstate commerce, and the Commission is
without authority to set aside a state-prescribed intrastate rate
unless there are clear findings, supported by evidence, of each
element essential to its exercise of that power. Pp.
325 U. S.
510-511.
3. A mere finding that interstate passengers paid higher fares
than intrastate passengers for the same service does not adequately
support a statewide order nullifying a state-prescribed rate as
unduly prejudicial to interstate passengers and requiring all
intrastate passengers to pay the higher intrastate rate. Pp.
325 U. S. 512,
325 U. S.
514.
4. The findings of the Commission that the 2.2 cents interstate
rate was just and reasonable; that the same trains in general
carried both interstate and intrastate passengers, and that the
railroads affected would have received $525,000 more annual income
from the passengers they carried had the 2.2 cents rate been
applied, did not support the conclusion that the intrastate traffic
was not contributing
Page 325 U. S. 508
its fair share of the revenue required to enable the railroads
to render adequate and efficient transportation service, and did
not support the order on the ground that the intrastate rates
discriminated against interstate commerce. P.
325 U. S.
514.
5. The power of the Commission to require a State to raise
intrastate rates depends on whether the intrastate traffic is
contributing its fair share of the earnings required to meet
maintenance and operating costs and to yield a fair return on the
value of property directed to the transportation service, both
interstate and intrastate. P.
325 U. S.
520.
6. The Commission cannot require intrastate rates to be raised
above a reasonable level. P.
325 U. S.
520.
7. Where, as here, there is evidence from which the Commission
could have found that a rate of 2.2 cents was far above a
reasonable rate level for the intrastate coach traffic of the
railroads, the Commission must make findings on that issue, which
findings are supported by evidence, before entering an order
supplanting the state authority. Without such findings supported by
evidence, the Commission was not authorized to find that the
intrastate rates discriminated against interstate commerce. P.
325 U. S.
520.
56 F. Supp.
606, reversed.
Appeals from a decree of a district court of three judges
denying an injunction and dismissing the complaint in a suit to
enjoin and set aside an order of the Interstate Commerce
Commission.
MR. JUSTICE BLACK delivered the opinion of the Court.
The North Carolina State Utilities Commission brought suit to
enjoin enforcement of an order of the Interstate
Page 325 U. S. 509
Commerce Commission. 258 I.C.C. 133. The Federal Economic
Stabilization Director, acting through the Price Administrator,
sought and was granted the right to intervene as a party plaintiff.
A federal district court of three judges denied the injunction,
56 F. Supp.
606, and the case is here on direct appeal under § 210 of the
Judicial Code.
This clash between state and federal agencies came about because
the State Commission and the Interstate Commerce Commission each
claimed the paramount power to fix railroad rates in North
Carolina. The North Carolina Commission ordered railroads doing
business in the state to charge no more than 1.65 cents per mile
for carrying intrastate coach passengers from one point in the
state to another. Despite this State Commission order, the
Interstate Commerce Commission authorized the same railroads to
charge 2.2 cents per mile for the same type of carriage. [
Footnote 1]
The Interstate Commerce Commission asserted its power to
prescribe these purely intrastate rates under § 13(4) of the
Interstate Commerce Act. 49 U.S.C. § 13(4). That section, which is
set forth below, [
Footnote 2]
empowers
Page 325 U. S. 510
the Interstate Commerce Commission to prescribe intrastate
railroad rates under certain conditions, despite conflicting state
orders as to the same rates. The conditions that Congress imposed
as a prerequisite to Commission action are that the Commission
shall hold a "full hearing" and find that the state-prescribed
rates either caused (1) undue or unreasonable advantage,
preference, or prejudice as between persons or localities in
intrastate commerce, on the one hand, and interstate commerce, on
the other hand, or (2) undue, unreasonable, or unjust
discrimination against interstate commerce. The Commission held
hearings which are challenged on various grounds as falling short
of "full" hearings. It made findings, and concluded that the 1.65
state rate was unduly prejudicial to interstate passengers, and
that the state rate constituted an undue and unjust discrimination
against interstate commerce. These conclusions are attacked on the
ground that they are supported neither by findings nor evidence.
The crucial question involved in all these contentions is whether
the indispensable prerequisites to the exercise of the Federal
Commission's power over intrastate rates have been shown to exist
with sufficient certainty. Before making any detailed reference to
the hearings, findings, or evidence, it would be helpful to set out
certain guiding principles which lead us to a resolution of the
crucial question.
Section 13(4) does not relate to the Commission's power to
regulate interstate transportation as such. As to interstate
regulation, the Commission is granted the broadest powers to
prescribe rates and other transportation details.
See United
States v. Pennsylvania R. Co., 323 U.
S. 612. No such breadth of authority is granted to the
Commission over purely intrastate rates. Neither § 13(4)
Page 325 U. S. 511
nor any other congressional legislation indicates a purpose to
attempt wholly to deprive the states of their primary authority to
regulate intrastate rates. Since the enactment of § 13(4), as
before its enactment, a state's power over intrastate rates is
exclusive up to the point where its action would bring about the
prejudice or discrimination prohibited by that section. When this
point -- not always easy to mark -- is reached, and not until then,
can the Interstate Commerce Commission nullify a state-prescribed
rate.
Intrastate transportation is primarily the concern of the state.
The power of the Interstate Commerce Commission with reference to
such intrastate rates is dominant only so far as necessary to alter
rates which injuriously affect interstate transportation.
American Express Co. v. South Dakota, 244 U.
S. 617,
244 U. S. 625.
A scrupulous regard for maintaining the power of the state in this
field has caused this Court to require that Interstate Commerce
Commission orders giving precedence to federal rates must meet "a
high standard of certainty."
Illinois Central Railroad Co. v.
Public Utilities Commission, 245 U. S. 493,
245 U. S. 510.
Before the Commission can nullify a state rate, justification for
the "exercise of the federal power must clearly appear."
Florida v. United States, 282 U.
S. 194,
282 U. S.
211-212.
See also Yonkers v. United States,
320 U. S. 685. And
the intention to interfere with the state's ratemaking function is
not to be presumed,
Arkansas Commission v. Chicago,
274 U. S. 597,
274 U. S. 603; nor
must its intention in this respect be left in serious doubt.
Illinois Commission v. Thompson, 318 U.
S. 675,
318 U. S.
684-685. The foregoing cases also stand for the
principle that the Interstate Commerce Commission is without
authority to supplant a state-prescribed intrastate rate unless
there are clear findings, supported by evidence, of each element
essential to the exercise of that power by the Commission. We hall
now take up the two grounds upon which the Commission set aside the
state order.
Page 325 U. S. 512
Prejudice Against Interstate Passengers. On this aspect
of the case, the Commission's findings were that the interstate 2.2
cents rate was just and reasonable; that the accommodations
afforded interstate and intrastate passengers in North Carolina
were "substantially similar;" that, in general, these passengers
traveled in the same trains and in the same cars, and from these,
it concluded that, since interstate passengers were forced to pay
higher fares than intrastate passengers, there was an undue and
unreasonable disadvantage and prejudice of interstate passengers.
On these findings, it issued the statewide order requiring all
intrastate passengers to pay 2.2 cents per mile. We think these
findings failed to give adequate support to the order.
In effect, the Commission's holding was, and its argument is
here, that § 13(4) automatically requires complete uniformity in
intrastate and interstate rates. That argument is, in short, that,
under our national transportation system, interstate travelers and
intrastate travelers use the same trains; for a state to fix a
lower intrastate rate than the interstate rate is therefore an
undue advantage to the intrastate passengers and an unfair
discrimination against the interstate passengers. If Congress
intended to permit such an oversimplified form of proof to
establish "unjust discrimination," then its requirement of a "full
hearing" was mere surplusage. In fact, it need have provided for no
hearing at all, since it could have easily stated in its
legislation that intrastate rates shall never be lower than
interstate rates. The argument of the Commission in this regard
runs counter to the language of § 13(4), and would call for a
declaration by us that Congress intended by this section to reverse
the entire transportation history of the nation. The clause about
"persons" and "localities" is, as the legislative history shows, a
practical enactment into law of a decision of this Court in the
Page 325 U. S. 513
"
Shreveport" case. [
Footnote 3]
Houston, E. & W.T. R. Co. v. United
States, 234 U. S. 342. In
the "Shreveport" case, the Commission found from evidence that
certain Texas intrastate rates to Texas points were far below the
interstate rates charged to carry the same types of freight from
Shreveport, Louisiana. The distances and conditions of both
transportations were found to be substantially the same. The Court
sustained the Commission's conclusion that the Texas intrastate
rates constituted an unfair discrimination against Shreveport and
persons doing business there. The Commission's order was not
statewide, but only required removal of the discrimination against
the particular localities and business groups affected by the
discrimination.
In
Railroad Commission v. Chicago, B. & Q. R. Co.,
257 U. S. 563,
257 U. S.
579-580, this Court refused to sustain a Commission
order nullifying all state passenger rates because of a
discrimination against interstate travelers and against localities.
The Commission had found there, as here, that state and interstate
passengers rode on the same trains in the same car, and perhaps in
the same seats. It had found there, as it did here, that this
constituted an undue discrimination against interstate passengers,
and it issued a general sweeping order against all intrastate
Page 325 U. S. 514
passenger rates. This Court pointed out that the order went far
beyond the principles announced in the
Shreveport case,
and declined to sustain the statewide order on this phase of the
case.
See also Florida v. United States, 282 U.
S. 194,
282 U. S. 208.
So here, the finding that interstate passengers paid higher fares
than intrastate passengers for the same facilities is an inadequate
support for nullifying state rates on the ground that they
constitute unjust discrimination against interstate passengers.
Discrimination Against Interstate Commerce. One ground
of the Commission's order was that the intrastate rates
discriminated against interstate commerce as such. The findings of
the Commission on which this conclusion rested were that the 2.2
cents interstate rate was just and reasonable; the same trains in
general carried both interstate and intrastate passengers; the
North Carolina railroads to which the intrastate rates were applied
would have received $525,000 more annual income from the passengers
they carried had the 2.2 cents interstate rate been applied; from
this, the conclusion was reached that intrastate traffic was "not
contributing its fair share of the revenue required to enable
respondents to render adequate and efficient transportation
service."
This conclusion of the Commission, if based on findings
supported by evidence, would justify its order. For, in
Florida
v. United States, 292 U. S. 1,
292 U. S. 5, we
said that § 13(4) authorized the Commission
"to raise intrastate rates so that intrastate traffic may
produce its fair share of the earnings required to meet maintenance
and operating costs, and to yield a fair return on the value of
property devoted to the transportation service, both interstate and
intrastate."
We sustained the Commission's order there because it was based
on findings supported by evidence that the intrastate rate
"was abnormally low and less than reasonably compensatory . . .
insufficient under all the circumstances and conditions to cover
the full cost of the
Page 325 U. S. 515
service."
Neither in its formal findings nor in its discussion of the
facts did the Commission indicate that the North Carolina railroad
rates here involved were less than compensatory or insufficient to
cover the full cost of service. Nor did they find that maintenance
of these rates was necessary to the operation of a nationally
efficient and adequate railway system. [
Footnote 4]
Page 325 U. S. 516
But the question posed by the Commission's conclusion was
whether the particular North Carolina railroads were obtaining from
North Carolina's intrastate passenger rates their fair part of such
funds as were required to enable these particular railroads to
render adequate and efficient service. The Commission made no
findings as to what contribution from intrastate traffic would
constitute a fair proportion of the railroad's total income. It
made no finding as to what amount of revenue was required to enable
these railroads to operate efficiently. Instead, it relied on the
mere existence of a disparity between what it said was a reasonable
interstate rate and the intrastate rate fixed by North Carolina. It
thought this action was justified by this Court's opinion in
Illinois Commerce Commission v. United States,
292 U. S. 474,
292 U. S. 485.
[
Footnote 5] Aside from the
fact that
"The mere existence of a disparity between particular rates on
intrastate and interstate traffic does not warrant the Commission
in prescribing intrastate rates,"
Florida v. United States, 282 U.
S. 194,
282 U. S.
211-212;
Utah Edible Livestock Rates and
Charges, 206 I.C.C. 309, there is reasonable doubt as to
whether the Commission had ever fixed 2.2 cents as the only
reasonable interstate rate.
The whole argument that it had done so rests primarily on an
order made in 1936. At that time, the Commission made a
comprehensive investigation of rates throughout the nation, and,
after elaborate discussion, made findings
Page 325 U. S. 517
of fact. It concluded that any rate over 2 cents per passenger
mile would be unreasonable and unlawful. But it also declared that
a rate of 1.5 cents, then commonly charged throughout the Southern
states, would not be "unreasonable or otherwise unlawful." 214
I.C.C. 174, 257. Railroads in the South continued to charge 1.5
cents most of the time from then until 1942. March 2, 1942, upon an
application of the American railroads, the Commission, in
Ex
parte 148, granted a general 10% increase on all rates then in
existence. This increase, it found, was necessary to enable the
railroads "to continue to render adequate and efficient railway
transportation service during the present emergency." 24 I.C.C.
545, 565. The Commission specifically stated, p. 606, that its
conclusion was not based on "individual, sectional, or particular
industrial desires or needs." Four months later, on July 14, 1942,
certain railroads operating in the South, including the railroads
involved in the
North Carolina case, filed a petition with
the Commission asking that it modify its 1936 order so as to permit
them to charge 2.2 cents per mile. Two weeks later, without a
hearing, without evidence, and without discussion, the Commission
entered an order declining to amend its 1936 order, but modifying
its 10% rate increase order, "so as to
authorize" the
petitioning railroads to charge 2.2 cents per mile. It made no
finding that the railroads needed this increase in order to
maintain adequate railroad systems, and, of course, could not have
done so unless it relied upon the old 1936 evidence. There was no
issue of this nature raised by any of the parties in the 10% rate
increase proceedings. Neither before nor since these Southern
railroads were authorized by the Commission to increase their
interstate rate to 2.2 cents has any hearing been held on the
subject. Petition of North Carolina for a hearing was denied. Nor
has there been any finding based on evidence that the 1.65 cents
rate which the Commission
Page 325 U. S. 518
found adequate, and neither "unreasonable nor unlawful" has
ceased to be such. We are unable to find from any of the various
orders that the Commission has ever yet made findings supported by
evidence, and upon them set aside its 1936 conclusions that a 1.5
cents rate for Southern territory was reasonable and lawful, except
to the extent that it held that a 10% increase was justifiable.
Furthermore, even assuming that the Commission had previously
made a valid 2.2 cents per mile general order broadly applicable to
all railroads in the Southern territory or throughout the nation,
it does not follow that such a general order must permanently stand
as to each and every separate railroad or railroad system. The very
nature of such a broad general order requires that it contain a
saving clause for future modification and adjustment of particular
rates. This Court declared that such a saving clause was essential
even at the time that all surplus railroad profits were pooled for
the common good of the national system.
Railroad Commission v.
Chicago B. & I. R. Co., 257 U. S. 563,
257 U. S. 579;
Georgia Commission v. United States, 283 U.
S. 765,
283 U. S. 772;
United States v. Louisiana, 290 U. S.
70,
290 U. S. 76-77,
290 U. S.
79.
Such a saving clause left to the state its power to bring about
particular changes in the internal intrastate rate structure
necessary to keep intrastate revenues as a class in harmony with
interstate needs.
Railroad Commission v. Chicago B. & I. R.
Co., 257 U. S. 563,
257 U. S. 580.
For the Interstate Commerce Commission was "without jurisdiction
over intrastate rates except to protect and make effective some
regulation of interstate commerce."
Illinois Comm'n v.
Thomson, 318 U. S. 675,
318 U. S. 684.
Consequently, no one but the state had power to readjust its
internal intrastate rate structure. This it undertook to do by a
hearing focussed upon the state railroads individually and
collectively. Four railroads were denied the increase,
Page 325 U. S. 519
and they are the only ones now affected by the interstate
Commerce Commission order. Other roads were granted the increase.
Its order to this effect rested on evidence as to the differing
qualities of intrastate and interstate accommodations afforded, as
well as the net revenues of different roads. The State Commission
found as to the four roads which it denied an increase that their
profits from passenger revenues, even on a 1.65 cents rate, were so
great that continuance of that rate would be reasonable and just to
them.
In the proceedings before the Interstate Commerce Commission,
the state and the Price Administrator presented these issues which
the State Commission had considered. Both the railroads and their
adversaries offered evidence on the points. There was evidence that
the four railroads were carrying more passengers and more freight,
and were more prosperous, than they had ever been in their history.
This evidence showed that they were in the highest excess profit
tax brackets, and that somewhere between 80 and 90% of all their
profits were subject to be paid for federal taxes.
There was evidence offered by the railroad which indicated that
their 1942 per mile net cost of carrying coach passengers was under
or about 1 cent. The Commission had found facts in the 1936 report,
214 I.C.C. at pp. 216, 266, which indicated a mileage coach
passenger cost of 3.25 cents. Evidence of the four railroads also
showed their average revenue increase since 1936 had been
approximately 250%. This great revenue increase transformed a 1936
$16,426.00 deficit of six North Carolina roads, including the four
here involved, into a 1942 $26,699,988 profit. Most of this
increased profit was shown to have been derived from passenger
revenues.
All of this evidence, and much more to which we might advert,
was sufficient to show that the Commission might have found, had it
made any findings on the subject at all,
Page 325 U. S. 520
that a 1.65 cents rate for these four North Carolina railroads
would have been a fair coach passenger contribution to revenues
required to enable them to operate profitably and efficiently. But
it made no findings on this subject at all. The purpose of the
National Transportation Law is to assure railroads a fair net
operating income, and no more.
Dayton-Goose Creek Railway v.
United States, 263 U. S. 456. The
power of the Commission to require states to raise their intrastate
rates depends upon whether intrastate traffic is contributing its
fair share of the earnings required to meet maintenance and
operating costs and to yield a fair return on the value of property
directed to the transportation service both interstate and
intrastate.
United States v. Louisiana, 290 U. S.
70,
290 U. S. 75.
But the Commission cannot "require intrastate rates to be raised
above a reasonable level."
United States v. Louisiana,
supra, 290 U. S. 78.
And where there is evidence, as here, from which the Commission
could have found that a rate of 2.2 cents was far above a
reasonable rate level for the intrastate coach traffic of these
four railroads, the Commission must make findings on that issue,
which findings are supported by evidence, before entering an order
supplanting the state authority. Without such findings supported by
evidence, the Commission was not authorized to find that the
intrastate rates discriminated against interstate commerce.
Because the order of the Commission was not based on adequate
findings, supported by evidence, the District Court should have
declined to enforce its order. The judgment of the District Court
is
Reversed.
* Together with No. 561,
Davis, Economic Stabilization
Director, by Bowles, Price Administrator v. United States et
al., also on appeal from the District Court of the United
States for the Eastern District of North Carolina.
[
Footnote 1]
There is a corresponding conflict which involves round trip
coach rates. The questions presented are the same with regard to
one way and round trip rates, and we shall therefore consider both
of them by reference to the one way rate.
[
Footnote 2]
"Whenever, in any such investigation, the commission, after full
hearing, finds that any such rate, fare, charge, classification,
regulation, or practice causes any undue or unreasonable advantage,
preference, or prejudice as between persons or localities in
intrastate commerce, on the one hand, and interstate or foreign
commerce, on the other hand, or any undue, unreasonable, or unjust
discrimination against interstate or foreign commerce, which is
hereby forbidden and declared to be unlawful, it shall prescribe
the rate, fare, or charge, or the maximum or minimum, or maximum
and minimum thereafter to be charged, and the classification,
regulation, or practice thereafter to be observed, in such manner
as, in its judgment, will remove such advantage, preference,
prejudice, or discrimination. Such rates, fares, charges,
classifications, regulations, and practices shall be observed while
in effect by carriers parties to such proceeding affected thereby,
the law of any State or the decision or order of any State
authority to the contrary notwithstanding."
49 U.S.C. § 13(4).
[
Footnote 3]
The House Committee reporting this bill said with reference to
the provisions of Sec. 13(4):
"After such hearing, the Commission shall make such findings and
orders as may in its judgment tend to remove any undue advantage,
preference, or prejudice as between persons or localities in state
and interstate or foreign commerce. The provision practically
enacts into law the decision of the Supreme Court in the so-called
'Shreveport' case. Any undue burden upon interstate or foreign
commerce is forbidden, and declared to be unlawful. It is believed
that the provisions of this section will have a beneficial and
harmonizing effect, and will tend to reduce the number of so-called
'Shreveport' cases, while at the same time recognizing the
regulatory bodies of the several states."
Report No. 456, 66th Cong., 1st Sess., p. 20.
[
Footnote 4]
In
Railroad Commission v. Chicago, B. & I. R. Co.,
257 U. S. 563,
this Court sustained a statewide Commission order raising
intrastate rates. Section 13(4), in the context of the 1920
Transportation Act, 41 Stat. 456, as it then existed, was construed
as requiring the Commission to prescribe rates sufficient
"to enable the carriers, as a whole or in groups selected by the
Commission, to earn an aggregate annual net railway operating
income equal to a fair return on the aggregate value of the railway
property used in transportation."
257 U. S.
584-585. The 1920 Act, however, treated the national
railway system as a unit. The net returns for any particular
railroad were limited by the Act. . . . All above this limitation
went into a common pool to be distributed for the use of weak
railroads. In this way, all railway income inured to the benefit of
all the railroads, individually and collectively, to aid in
"maintaining an adequate railway system." This Court has said that
Congress adopted the pooling provisions because
"it was not clear that the people would tolerate greatly
increased rates (although no higher than necessary to produce the
required revenues of weak lines), if thereby prosperous competitors
earned an unreasonably large return upon the value of their
properties."
New England Divisions Case, 261 U.
S. 184,
261 U. S. 191.
But Congress, in 1933, 48 Stat. 211, repealed this part of the 1920
Act; the income pooling system was abandoned; the rule of
ratemaking was rewritten, and while the Commission was to give
consideration to the need of adequate and efficient railway
transportation service at the lowest cost consistent with the
furnishing of such service, and to the need of revenue sufficient
to enable the carriers under honest, economical, and efficient
management to provide such service, the rates were no longer to be
treated on a national basis as though all railroads constituted one
system. House Report No.193, 73rd Cong., 1st Sess., pp. 30-31.
Railroads were to be treated on an individual basis. Abandonment of
the profit pooling system made this necessary to carry out the
continuing Congressional purpose to prevent "an unreasonably large
return upon the value of their properties." The Commission
recognized this legislative change in ratemaking policies by its
reference to "revenues required to enable respondents to render
adequate and efficient transportation service." The "respondents"
referred to were the individual railroads to which North Carolina's
order applied.
[
Footnote 5]
This case did not involve a sweeping statewide order based on
general railroad revenue needs. It related to a problem like that
considered in the
Shreveport case. The rates involved
applied to switching movements in a single "Switching District,"
"essentially a unit, so far as switching movements are concerned."
This Court's holding in that case does not support the statewide
order here.
MR. JUSTICE REED, dissenting.
The Court has set aside an order of the Interstate Commerce
Commission which was entered May 8, 1944, on a Commission report of
the preceding March 25th. 258 I.C.C. 133. The order covered
investigations instituted
Page 325 U. S. 521
upon separate petitions of carriers in North Carolina, Kentucky,
Alabama, and Tennessee to determine whether the maintenance of
intrastate fares in these states at levels below fares and charges
established for application to interstate traffic in respective
states on October 1, 1942, caused undue or unreasonable advantage,
prejudice, or preference between persons or localities in
intrastate commerce, on the one hand, and interstate commerce, on
the other, or any such discrimination against interstate commerce.
49 U.S.C. § 13(4). The petitions sought, too, prescription of fares
and charges by the Commission to remove any preference, advantage,
prejudice, or discrimination found to exist.
See also Alabama
v. United States and
Davis v. United States, post, p.
325 U. S. 535.
This dissent is applicable both to this and that opinion.
Without summarizing the entire report, we call attention to a
finding which it contains that traffic moving under these lower
intrastate fares is not contributing its fair share of the revenues
required to enable appellees (the interstate carriers) to render
adequate and efficient transportation service, and that this
"unlawfulness should be removed by increasing" the intrastate fares
to the level of the interstate fares. 258 I.C.C. 154, 155, Findings
5 and 6. This finding, if supported by evidence, is in our opinion
sufficient to justify the applicable order of May 8th which is
under review in this appeal. That order required the carriers to
maintain and apply intrastate fares on bases no lower than those
applied by the carriers in interstate transportation to, from, and
through the four states.
The Interstate Commerce Commission has the power to make this
order on a valid finding of such discrimination against interstate
commerce. 49 U.S.C. § 13(4). It has long been established that this
section delegates a valid power of regulation of intrastate rates
to the Commission.
Railroad Commission v. Chicago, B. & Q.
R. Co., 257 U. S. 563.
Cf. 230 U. S. 230
U.S.
Page 325 U. S. 522
352,
230 U. S. 432,
and
Houston E. & W.T. R. Co. v. United States,
234 U. S. 342,
234 U. S. 351.
It gives authority to the Commission to raise intrastate rates so
that that traffic may produce its fair share of the required
earnings.
United States v. Louisiana, 290 U. S.
70,
290 U. S. 75.
And that authority does not depend upon the recapture, in whole or
in part, of excess earning of individual railroads under the
requirements of the Transportation Act of 1920, 41 Stat. 488, Sec.
15a, now repealed, Emergency Railroad Transportation Act, 1933, 48
Stat. 220, Sec. 205, for creation of a general railroad contingent
fund for financing the national transportation system of railways.
Section 13(4) was not changed by the Act of 1933. This section, in
conjunction with the revised and reenacted Section 15a of the
Interstate Commerce Act, now empowers the Commission, in accordance
with the statutory provisions, to remove the discrimination against
interstate commerce by prescribing intrastate fares. [
Footnote 2/1]
Florida v. United
States, 292 U. S. 1,
292 U. S. 4,
First.
Cf. Illinois Commerce Comm'n v. Thomson,
318 U. S. 675,
318 U. S. 682.
This Court today recognizes this rule. The four states attack the
finding of discrimination against interstate commerce, which
finding is essential to the validity of the present order to
maintain intrastate fares at the level of interstate fares, on the
ground that there is neither finding nor evidence that the
intrastate rates are
Page 325 U. S. 523
not producing a proper proportion of the carriers' needed
revenue. This Court sustains the attack as sufficient to invalidate
the Commission order. We think the argument, which the Court has
sustained, has its source in a misconception of the purpose of this
present proceeding.
The petitions were filed by the carriers, the investigation was
made, and the order under dispute here was entered to coordinate
the intrastate passenger fares in these four states with the
passenger fare structure of the entire country. 258 I.C.C. 133.
There had been a number of recent proceedings involving the
national structure. The evidence, which will be referred to later,
presented in those proceedings is, we think, properly to be
considered in this investigation, and the power of the Commission
to require intrastate fares to conform to interstate fares in the
four states is to be appraised, in the light of a purpose to
establish a national passenger rate structure. The Court apparently
accepts as a premise the contention of the states that the present
proceeding is an isolated investigation by the Commission into an
application by the respective carriers in the four states to have
their intrastate fares raised to the level of their interstate
fares because the intrastate earnings were below a fair proportion
of the carriers' total required income. [
Footnote 2/2] Instead, we think that
Page 325 U. S. 524
these proceedings are but another step in the comprehensive
regulation by the Commission of the general passenger fare
structure.
Basic Interstate Fares. The basic passenger fares were
first investigated on a national scale by the Commission in
Passenger Fares and Surcharges, No. 26550, decided
February 28, 1936. In this proceeding, carrier coach and pullman
fares, respectively, were fixed at not to exceed 2 and 3 cents per
passenger mile. 214 I.C.C. 174, 256. [
Footnote 2/3] The order,
see paragraph 3, page
257, left these respondent roads in the southern territory free to
continue certain experimental fares, which were as low as 1.5 cents
per mile in coaches. A ten percent increase, applicable to both the
basic 2 and 3 cent fares and the experimental fares, was allowed on
January 21, 1942, in a proceeding before the Commission, docketed
as
Ex parte No. 148, Increased Railway Rates, Fares, and
Charges, 248 I.C.C. 545, 549, 564, 566, 612. A reference to
the Commission's
Page 325 U. S. 525
decisions in the above proceedings will indicate the full
hearing which was given the fare problems in those cases. In the
Passenger Fares case, the report of the Commission, 214
I.C.C. at 175, shows that all carriers by railroad subject to the
act were made respondents, and that a committee of the State
Commissioners cooperated with the Commission in determining the
issues. In the
Increased Railway Rates case, all the
states were notified of the pendency of the proceeding and a
committee of the state commissions also attended the hearing and
oral argument and conferred as to the determination of the issues.
248 I.C.C. at 549. All rail carriers were again before the
Commission.
After the ten percent increase, the railroads of southern
passenger association territory filed, on July 14, 1942, a petition
in
Passenger Fares and Surcharges, No. 26550, seeking a
modification of paragraph 3 of the conclusions, 214 I.C.C. at 257,
to enable them to file tariffs increasing their coach fare to 2.2
cents (2 cents plus 10 percent). The Commission rules that its
former decision in No. 26550, 214 I.C.C. at 256, permitted all
railroads, respondents therein, which included applicants, to
charge a basic fare of 2 cents, and that a general increase of 10
percent on these rates had been authorized in
Ex parte No.
148, and that therefore the Commission could and it did
authorize the application of the 2.2 cent basic rate to interstate
rates in southern territory. The Commission, by order of August 1,
1942, directed that the petition in No. 26550 be denied, evidently
because the order in that number had been superseded by the
"Increased Rates" proceedings,
Ex parte No. 148, and that
its order in
Ex parte No. 148 be modified to effectuate
this increase and that it be left otherwise unchanged. [
Footnote 2/4] The participating
Page 325 U. S. 526
carriers then approached the separate state authorities to
obtain their consent to the increase for intrastate passenger
traffic in accordance with the recitation in the order of January
21, 1942, in
Ex parte No. 148. [
Footnote 2/5] On the refusal of the rate, regulatory
authorities of North Carolina, Alabama, Tennessee, and Kentucky to
authorize the application of the increased interstate basic coach
fare of 2.2 cents, with corresponding adjustments for Pullmans, to
all intrastate fares, this present proceeding was initiated by the
carriers to secure the Commission order of May 8, 1944, here
involved, which requires the application of a basis no lower than
their present interstate basis to intrastate fares, notwithstanding
the refusal of the state rate authorities to authorize a similar
application. The commissions of the respective states, and the
Price Administrator for himself and the Director of Economic
Administration, intervened.
The foregoing references make plain that, beginning with the
comprehensive investigation on passenger fares, which was
instituted by Commission order of June 4, 1934, and resulted in the
order of February 28, 1936, 214 I.C.C. 174, the state regulatory
authorities have not only been advised of the rate proceedings, but
have participated in
Page 325 U. S. 527
them. The record specifically shows this participation except in
the supplementary proceeding under docket No. 26550, which was
filed July 14, 1942, and resulted in the order of August 1, 1942,
in docket
Ex parte No. 148. This August 1, 1942, order,
325
U.S. 507fn2/4|>note 4,
supra, permitted increasing
the carriers' interstate fares of 1.65 cents per passenger mile
(the 1.50 cents of the 1936 experimental southern district fares,
then adjudged by the Commission to be "not unreasonable or
otherwise unlawful," 214 I.C.C. 257, par. 3, and the ten percent
increase thereon of
Ex parte No. 148, 248 I.C.C. 545,
564-566) to 2.2 cents. There was no occasion or requirement for
hearing or report by the Commission or notice to the states of the
petition of the southern passenger association carriers for
permission to apply this 2.2 cents basic passenger rate to their
interstate traffic.
The southern railroad passenger rate problem was stated in the
terms of "what reasonable fare basis will meet with the greatest
revenue response from the public?" 214 I.C.C. at 201. The
conclusion of the Commission is thus summarized at 255, finding of
fact No. 11:
"Giving appropriate consideration to all of the evident
circumstances and conditions which are likely to affect the
ultimate revenue result to respondents, a maximum fare basis, one
way and round trip, for general application, of 2 cents per mile in
coaches and 3 cents per mile in Pullmans would be most likely to
lessen the transportation burden of respondents, and to harmonize
with present day economic conditions, with consequent fuller
assurance to the respondents of realizing a fair return upon their
property investment. There is doubt whether, at least in the
southern district, a coach fare of 1.5 cents per mile is not
producing better revenue results for those respondents than would
any higher fare, and it may also be that round-trip fares on both
coach and pullman traffic at a lower rate per mile than the one-way
fares herein prescribed
Page 325 U. S. 528
would bring to respondents better revenue results than the
higher fares. These matters are left to the discretion of
respondents."
This resulted in the following provision by the Commission at
257:
"3. The present experimental fares in the southern and western
districts and on the Norfolk & Western are not unreasonable or
otherwise unlawful."
Obviously this provision was to make clear that the current
lower rates of the southern carriers were not disapproved. It
cannot properly be read, even though entirely isolated from its
context, as a requirement that the southern carriers should
continue to apply this lower basis to their passenger fares. The
preceding provision limited the regular passenger fare structure of
all railroads, including, of course, the southern carriers now
appellees, to a maximum of 2 cents per passenger mile in coaches,
without prejudice to lower fares. Lower fares were "discretionary"
with the company. The accompanying order limited maximum interstate
fares generally to 2 cents, and contained no reference to the lower
experimental fares. Thus, a national interstate basis schedule,
universally applicable, [
Footnote
2/6] was established by the report and order in docket No.
26550, the
Passenger Fares and Surcharges decision, and
this basis was increased to 2.2 cents per mile by the January 21,
1942, order in
Ex parte No. 148, 248 I.C.C. 545.
Consequently when the southern carriers, appellees here, petitioned
on July 14, 1942, seeking a modification to permit the publication
of interstate passenger tariffs in conformity with the previous
conclusions in No. 26550 and
Ex parte No. 148, no further
investigation, report, or notice to anyone was needed.
The interstate basis had been fixed at 2.2 cents a few months
before. Carriers and states alike had acquiesced. The carriers now
wished to exercise the discretion to raise
Page 325 U. S. 529
fares, which discretion had been reserved to them in No. 26550,
214 I.C.C. at 255, and subsequent conclusions 2 and 3 at 256. All
that was necessary was to modify the order in
Ex parte No.
148 of January 21, 1942, which had approved, "as proposed," a
requested ten percent increase in fares "as published in passenger
tariffs," 248 I.C.C. 550, 565, and the order,
325
U.S. 507fn2/5|>note 5,
supra, so that the
limitation "as published in passenger tariffs" would be removed.
The appellee carriers had outstanding published tariffs of 1.50
cents when the January 21, 1942, order was entered. The August 1,
1942, order removed the limitation.
See 325
U.S. 507fn2/4|>note 4,
supra.
The preceding paragraphs under "Basic Interstate Fares"
demonstrate, we think, that no further hearings or findings by the
Commission were necessary to enable the Commission to authorize the
application of the national basis of 2.2 cents to their interstate
fares by the appellee carriers, instead of the 1.65 cents in effect
prior to the order of August 1, 1942.
Discrimination Against Interstate Commerce. The Court
holds, however, that even if it is assumed that the order
permitting the interstate basic fare of 2.2 cents is valid, it does
not follow that the intrastate passenger traffic earnings on the
1.65 cent rate are not contributing a fair proportion of the
required total earnings of the road. The Court points to evidence
from which the Commission might have found that the 1.65 cent
basis, or a lower basis than 2.2 cents, would produce sufficient to
meet the intrastate contribution. Evidence is set out in the
Court's opinion showing greatly increased passenger earnings. The
Court concludes that, as such evidence is presented in this record,
the Commission must make finding that no lower fare will produce
intrastate traffic's proportion of revenue before requiring the
application of the interstate 2.2 cent rate to intrastate
fares.
This argument, we think, flows from another phase of the same
misconception to which we earlier referred as
Page 325 U. S. 530
the source of the Court's erroneous conclusion. These
proceedings ought not to be treated as isolated efforts to secure
higher intrastate rates, because the present intrastate rates are
not producing their fair share of the total required income. To the
Court's requirement, which it reads into Sections 13(4) and 15a, of
a specific finding on the issue of whether the present 1.65 cent
intrastate rate produces now the proper intrastate proportion of
revenue, there seems to us a conclusive answer. The interstate
maximum was adopted by the Commission on the assumption that the
intrastate rates would be adjusted to the same level. Therefore,
revenue from intrastate rates at the interstate fares is required
to produce the needed income.
In this present proceeding, the validity of the interstate rate
of these carrier appellees was reexamined. [
Footnote 2/7] Evidence as to each appellee carrier of
former deficits from its entire passenger traffic prior to 1942 was
noted. Evidence as to their passenger operating ratios, their
increased expenses, their net earnings on passenger business, and
other operations also, was received and appraised. Attention was
called, 258 I.C.C. 142, to the fact that the previous investigation
into passenger rates,
Ex parte No. 148, had anticipated
the earnings during war years, page 142, and their need for
deferred maintenance and war service, page 148. The interstate
basic rate was found just and reasonable.
See Alabama
Intrastate Fares, 258 I.C.C. 133, 137.
The figures used were aggregate figures for past passenger
receipts and expenses. Audits for representative periods showed the
estimated amount of additional
Page 325 U. S. 531
revenue from the increased intrastate fares. [
Footnote 2/8] The statistics for the net railway
operating income were introduced which covered all receipts and
expenses. The evidence of train service in the respective states
led the Commission to find that travel conditions were
"substantially similar," 258 I.C.C. 154. If the Commission's
conclusion as to carrier revenue needs assumed equal intrastate and
interstate fares, and if the present interstate rates were held
"just and reasonable," it follows that the finding that the lower
intrastate rates were not contributing their fair share of the
"revenues required to enable respondents to render adequate and
efficient transportation service" was proper. This logically led to
the finding 6, that this failure of intrastate traffic to
contribute its part discriminated against interstate commerce.
The determination of the necessary basic interstate rate in all
these proceedings was made on the supposition of intrastate rates
of equal level. When general basic rates, fares, or charges are
fixed by the Commission, the Commission necessarily gives
consideration "to the need of revenues sufficient to enable the
carriers, under honest, economical, and efficient management to
provide" railway transportation at the lowest cost. Section 15a.
Therefore, when interstate rates are fixed with the supposition of
an equal level for intrastate rates for substantially similar
service, it requires a contribution on that basis from intrastate
rates to avoid intrastate discrimination against interstate
traffic. If it appears that interstate fares have been fixed with
the supposition of an equal level for intrastate
Page 325 U. S. 532
fares, then it is clear that intrastate rates are not producing
their expected revenue. The Commission thus would have manifested
its consideration of the statutory requirements of Section 13(4)
and 15a that due consideration be given revenue and efficient
management in finding unjust discrimination against interstate
commerce and in prescribing the intrastate rate which would remove
the discrimination.
See United States v. Carolina Freight
Carriers Corp., 315 U. S. 475,
315 U. S.
489.
In the proceeding in which these southern interstate carriers
were permitted to apply the general basic interstate coach rate of
2.2 cents, the order therein of August 1, 1942, by adopting the
order of January 21, 1942, in
Ex parte No. 148, 248 I.C.C.
545, required the appellee carriers to make application to the
state authorities for similar intrastate increases.
See
325
U.S. 507fn2/5|>note 5,
supra. The required
applications led directly to this litigation.
Both in
Passenger Fares and Surcharges, 214 I.C.C. 174,
257, par. 5 and
Increased Railway Rates, Ex parte No. 148,
248 I.C.C. 545, 565-66, which are the two investigations which
brought interstate coach fares to a maximum of 2.2 cents per
passenger mile, the Commission itself ordered the numerous
intrastate fares which were under its direction because regulated
by the Commission through previous Section 13 proceedings, modified
in accordance with the interstate fares. As pointed out in the
preceding paragraph, the order in
Ex parte No. 148
required application to state rate regulatory bodies for authority
to increase the intrastate passenger rates to the same level.
Specific consideration was given to various objections raised by
state commissions to the proposed new fares and rates, all with an
eye to securing future compliance by the states with the interstate
rates to be set by the Commission.
See 248 I.C.C. at 560,
565, 574, 580, 582. In the
Passenger Fares investigation,
the figures on passenger traffic reflect the aggregate use of
trains without consideration of a division of the traffic between
inter- and intrastate. 214
Page 325 U. S. 533
I.C.C. 174, 176, 179, 180, 185, 200, 209, 221, 230, 231. The
Commission said at 187:
"At the time the 1920 increase was authorized, many of the
States prohibited passenger fares above certain amounts per mile,
most of them 2 cents or 2.5 cents, and section 13 orders by us
became necessary in order to bring the intrastate fares in those
States up to the interstate basis."
The tables of passenger statistics in the appendices do not
separate the traffic. Revenue from all passenger traffic was the
dominant motive.
See "Fact Findings," page 253. Evidence
in
Ex parte No. 148 likewise related to aggregate revenue.
So did the expected increases.
"On the basis of traffic, both interstate and intrastate, moved
during 1941 and moving when the petition was filed, allowing for
readjustments required by commercial and traffic conditions,
petitioners estimate that the proposals will yield increased
revenue for all class I railroads of about $356,956,000 per
year."
248 I.C.C. 552.
The interstate increase of
Ex parte No. 148 "became
effective on intrastate traffic in all of the States" by state
order. 258 I.C.C. at 136. The general considerations on the decline
in railroad passenger traffic which motivated the Commission in
establishing the new interstate rate applied to both intrastate and
interstate traffic. 214 I.C.C. at 176; 248 I.C.C. at 551. As a
matter of fact, separation of interstate and intrastate income is
not required by the Commission in its annual reports. 49 C.F.R. §
120.11
et seq. These proceedings convince us that the
Commission reached its conclusion as to the proper interstate rate
with the understanding that the interstate rate would be applied to
intrastate traffic, and that such revenue as might result from that
application were needed by the carriers involved to furnish
adequate service.
Under Section 13(4) of the Interstate Commerce Act, in
proceedings as to unjust discrimination against interstate
commerce, the issue is not the earnings from intrastate
Page 325 U. S. 534
traffic, but the appropriate proportion of those earnings as
compared with earnings from interstate commerce. Section 15a
requires consideration of costs, economy, and adequate
transportation service. Section 13(4) requires a finding of
discrimination against interstate commerce as a basis for
regulation of intrastate commerce, 258 I.C.C. 154-155, pars. 5 and
6. It may be that the earnings from intrastate commerce may
sometimes be one percentage of aggregate earnings, and at another
time another percentage. The Commission may conclude that the
carriers' required revenue may best be obtained from intrastate
passenger fares, rather than from freight rates. The reverse was
once true.
Cf. 214 I.C.C. at 227. These are matters for
Commission decision.
The language of 15a has been modified from its original form in
the Transportation Act of 1920 so that it no longer specifically
empowers the Commission to deal with fares and rates of carriers as
a whole for the nation or as a whole in designated territories or
rate groups. We think, however, that the present statute, "[i]n the
exercise of its power to prescribe just and reasonable rates," the
Commission shall give consideration to various named factors, is
adequate to permit general rate regulation under 15a and Section
1(5). This power has been unquestioned.
See Passenger Fares and
Surcharges, 214 I.C.C. 174, and Class Rate Investigation No.
28300 and Consolidated Freight Classification No. 28310. It is the
only practicable approach to the problem.
See discussion
in
New England Division Case, 261 U.
S. 184,
261 U. S. 196.
We cannot treat the present proceeding as disassociated from the
general investigation into passenger fares.
United States v.
Louisiana, 290 U. S. 70,
290 U. S. 76-79.
We think it is adequately shown that the orders in the general
investigations were predicated upon the assumption that intrastate
passenger traffic would have an equal basis with interstate traffic
for fares.
Page 325 U. S. 535
Unjust or Unreasonable Intrastate Fares. It may be that
the intrastate fares prescribed by the Commission are unjust or
unreasonable in certain items. The report of the Commission
provides a remedy for such a situation:
"The foregoing findings are without prejudice to the right of
the authorities of the affected States, or of any interested party,
to apply for modification thereof as to any specific intrastate
fare on the ground that such fare is not related to interstate
fares in such a way as to contravene the provisions of the
Interstate Commerce Act."
258 I.C.C. at p. 155.
The remedy for a readjustment of the basic interstate fare or
for a separation of the levels of interstate and intrastate fares
is by application to the Commission for reopening of Passenger
Fares and Surcharges, 214 I.C.C. 174.
We do not consider the other points which are raised by the
appeal.
THE CHIEF JUSTICE, MR. JUSTICE ROBERTS and MR. JUSTICE
FRANKFURTER join in this dissent.
[
Footnote 2/1]
The present Section 15a, reads as follows:
"(1) When used in this section, the term 'rates' means rates,
fares, and charges, and all classifications, regulations, and
practices relating thereto."
"(2) In the exercise of its power to prescribe just and
reasonable rates, the Commission shall give due consideration,
among other factors, to the effect of rates on the movement of
traffic by the carrier or carriers for which the rates are
prescribed; to the need, in the public interest, of adequate and
efficient railway transportation service at the lowest cost
consistent with the furnishing of such service, and to the need of
revenues sufficient to enable the carriers, under honest,
economical, and efficient management to provide such service."
[
Footnote 2/2]
Compare the following excerpt from the opinion of the
Court:
"But the question posed by the Commission's conclusion was
whether the particular North Carolina railroads were obtaining from
North Carolina's intrastate passenger rates their fair part of such
funds as were required to enable these particular railroads to
render adequate and efficient service. The Commission made no
findings as to what contribution from intrastate traffic would
constitute a fair proportion of the railroad's total income. It
made no finding as to what amount of revenue was required to enable
these railroads to operate efficiently. Instead, it relied on the
mere existence of a disparity between what it said was a reasonable
interstate rate and the intrastate rate fixed by North Carolina. It
thought this action was justified by this Court's opinion in
Illinois Commerce Comm'n v. United States, 292 U. S.
474,
292 U. S. 485."
[
Footnote 2/3]
States made the earliest efforts to limit passenger fares.
E.g., Kansas, 1901, § 66-1 7, Revised Statutes of Kansas
(1923); North Dakota, 1907, § 4796, Compiled Laws of North Dakota
(1913); Illinois 1907, Smith-Hurd Stats. c. 114, § 154; c. 114, §
170, Callaghan's Illinois Statutes Annotated (1924); Iowa, 1913, §
8126, Code of Iowa (1924). Such limitations were, of course, not
uniform. On May 25, 1918, by General Order No. 28, the United
States Railroad Administration, in order to increase the operating
revenue, fixed the national basic passenger fare in coaches,
interstate and intrastate, at not less than 3 cents per mile, with
a surcharge for Pullmans. This produced a considerable degree of
uniformity. An increase of 20% or to 3.6 cents was made as of
August 26, 1920. In the depression of the 1930s, certain carriers
operating in southern territory experimented with fair success on
revenues with fares as low as 1.5 cents per mile in coaches.
Alabama Intrastate Fares, 258 I.C.C. at 134.
Approximate uniformity before 1936 was maintained by the
Commission's use of 13(4) orders to bring intrastate fares into
line with interstate fares. The Commission found it more convenient
later to secure state adoption of its rates by cooperation through
agreement.
See Sharfman, The Interstate Commerce
Commission II, pp. 287-344.
[
Footnote 2/4]
"
It is further ordered that the order of January 21,
1942, in
Ex Parte No. 148, be, and it is hereby, further
modified so as to authorize the aforesaid petitioners to apply the
increase of 10 percent approved in said order to a basic coach fare
of 2 cents per mile on the lines of said petitioners, subject to
the rule for the disposition of fractions as modified by order of
July 6, 1942, in said proceeding, and that, in all other respects,
said order of January 21, 1942, shall remain in full force and
effect."
[
Footnote 2/5]
The portion of the order referred to reads as follows:
"
It appearing . . . that the proper authorities of all
States have been notified of this proceeding, and similar
application has been or will be made to the regulatory authority of
the respective States for permission to increase similarly
petitioners' intrastate rates, fares, and charges;"
"
* * * *"
"
It is ordered, That the increased passenger fares as
proposed by the said petitioners be, and they are hereby, approved.
. . ."
[
Footnote 2/6]
There were certain specified exceptions. 214 I.C.C. at 244.
[
Footnote 2/7]
The national investigation,
Ex parte No. 148, has also
been reopened and reexamined as late as December 12, 1944, but the
passenger rates were left unchanged. 259 I.C.C. 159. This report
discussed intermediate reexaminations of the national passenger
rate structure.
[
Footnote 2/8]
Alabama Intrastate Fares, 258 I.C.C. 133, 154, 155,
Finding 5:
"Respondents' revenues under the lower intrastate fares are less
by at least $725,000 per annum in Alabama, $500,000 in Kentucky,
$525,000 in North Carolina, and $525,000 in Tennessee than they
would be if those fares were increased to the level of the
corresponding interstate fares, and traffic moving under these
lower intrastate fares is not contributing its fair share of the
revenues required to enable respondents to render adequate and
efficient transportation service."