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The CHAIRMAN. If they do not report for six months it it not likely that you will get any action before that time.
Mr. SHERMAN. The minute they report our responsibility begins.
Mr. Sisson. The funds carried by the next bill will not be available for use until next July.
Mr. SHERMAN. This commission was appointed in October, and they must report by April.
The CHAIRMAN. How many months do you provide for here?
The CHAIRMAN. If they do not report until the 1st of April or May vou would not have over two months to run.
Mr. KITCHEN. They may report by the 1st of January.
The CHAIRMAN. They will have to move faster than any Government institution I know of, if they do.
Mr. SHERMAN. You must remember that this is not a Government institution, but they are business men called into this thing. There is not a Government employee on the commission.
Mr. ANTHONY. Are they local business men?
Mr. SHERMAN. No, sir; there is only one local man or resident of the District of Columbia. There is one gentleman from Delaware, and a cold-storage engineer, Mr. Franklin Horne, from New York.
The CHAIRMAN. This is submitted in contemplation of the completion of the work of the commission?
Mr. SHERMAN. The moment they report we become responsible, and at that minute we must begin to function by paying freight on incoming shipments consigned to the market company for cold storage, and all that sort of thing. The Government will have to do a great many things that it has never done before. Congress placed that obligation upon us.
Mr. Sisson. We have been bordering on socialism for a long time, but this is the first time we have actually embarked upon a scheme that is purely socialistic. This is as purely socialistic as anything erer engaged in by Lenin and Trotski. The only difference is that this is a small thing.
Mr. SHERMAN. We might say, however, that we could go further if we were to actually buy and sell stuff.
Mr. Sisson. This involves the renting of property for private use or benefit.
Mr. KELLEY. Does not the law require the Secretary of Agriculture to take some steps incident to this sort of transaction? It does not mean that the thing will go into effect automatically without some action on his part !
Mr. SHERMAN. I do not think the law requires the department to take any further steps. The Secretary has sent these gentlemen to inquire into the whole situation.
Mr. KELLEY. If the report were made in the middle of the month they would not be likely to take hold in the middle of the day, but they would have to procure possession. When the commission makes its report the Secretary of Agriculture would probably look over the report, and that would take some little time. In other words, it would not be necessary to do it at once.
Mr. SHERMAN. I presume the Secretary of Agriculture will have an opportunity to look over that report before it is made public, and the exact date of its submittal may be agreed upon.
Mr. KELLEY, It would be a matter of executive discretion?
Mr. SHERMAN. It would be within a matter of a few days or a few weeks, of course, but as soon as that report is made public, as I understand it, under the law the transfer is automatic.
Mr. Sisson. Have you used or are you using the $35,000 provided by section 6 of this act?
Mr. SHERMAN. That is not for ourselves, but that is for the commission.
Mr. Sissox. Is that money being used?
Mr. FRANKLIN. Yes, sir; until they bring in the awards. This pays for their salaries, the court-reporting expenses, and any other expense that may be incurred. Records have to be made of every session.
Mr. KITCHEN. Section 2 covers the date when we take it over. Mr. KELLEY. This reads: Upon its payment to the said market company of an amount equal to 75 per cent of the amount of the award.
Mr. KITCHEN. " Which said payment shall be made upon the filing of the award by the commission.” That makes it practically automatic.
Mr. BYRNs. Following up the suggestion of the Chairman, if an appropriation was made for, say, two months, to carry the work along, that would afford ample time for the department to come to Congress and get whatever additional amount might be needed to carry on the work during the balance of the fiscal year.
Mr. SHERMAN. If the committee prefers to consider it as two deficiency items instead of one.
Mr. Byrxs. There may be some doubt, and I expect a very reasonable doubt, as to when the commission will report. This commission might not report until in the spring.
Mr. Sisson. Suppose this commission takes the market over, there will be certain rentals for the use of space and income from other sources. It is contemplated by the commission that that fund shall go into the Treasury and that Congress shall appropriate for the administration of the market, or will that be a revolving fund? .
Mr. SHERMAN. Congress made no provision in the law for a revolving fund, and, therefore, the income would go into the Treasury.
Mr. Sisson. It would be like any other income of the Government, and would be paid into the Treasury, and the activity would be appropriated for.
Mr. SHERMAN. Yes, sir.
The CHAIRMAN. You have some legislation here that provides for new rates, etc.
Mr. SHERMAN. That would be a matter for the Secretary,
The CHAIRMAN. It is a matter that requires legislation, and I do not think we have any jurisdiction over that.
Mr. KITCHEN. You refer to the increase of the rates from 10 cents to 20 cents. If you wish, I will explain that.
PERSONNEL OF COMMISSION.
The CHAIRMAN. Let us have the names of the members of the commission.
Mr. FRANKLIN. The members of the commission are Mr. Frank A. Horne, chairman. Mr. Horne is president of the Merchants Refrigerating Co. of New York and president of the American Association of Ice and Refrigeration. Another member is Mr. John A. Walker, of Hockessin, Del., and the other member is Mr. Louis Edison Dent, an attorney of the District of Columbia.
OPERATION OF COLD-STORAGE PLANT, ETC.
The CHAIRMAN. Tell us in as comprehensive a way as you can what we have obligated ourselves to do, what activities the Government is to engage in, what number of men will be needed to do this work and why, and what would be accomplished by it.
Mr. FRANKLIN. The Government has obligated itself to take over this property known as the Center Market, and in order that we may have a comprehensive view of it I would like to say that the property has the following outside measurements: Four hundred and ninety-eight feet on B Street and 204 feet on Seventh Street and Ninth Street, covering about two and a half acres. As to the Ninth Street wing, the first floor is a part of the market proper, containing stalls, and the second floor is a coliseum, which, after the secretary has been placed in charge, will be either used for office purposes or for an assembly room or auditorium. In the Seventh Street wing the first floor contains stalls for market uses ; the second floor is used as offices of the market company, for a billiard and pool room, bowling alleys, and a restaurant. The billiard and pool room will probably be done away with and offices placed in there. The part bordering on B Street, between the Ninth and Seventh Street wings, consists of the market proper on the first floor, while the upper three floors are used for cold storage, in which there are maintained temperatures ranging from 3° below zero to about 38° above, depending upon the class of products stored.
The CHAIRMAN. Is that temperature created by artificial means?
Mr. FRANKLIN. By mechanical refrigeration. That cold-storage plant has a capacity of about 500,000 cubic feet. I would like to say that that is about half the capacity of the old Chicago cold storage, that you will remember, Mr. Chairman.
Mr. ANTHONY. When was this cold-storage plant built?
Mr. FRANKLIN. In 1886. If you desire it, we can give you later on an exact history of the market from its first inception, when it was a primative market in 1802, up until the time when it was taken over by the market company, in 1872, under a charter, and then to the building of the cold-storage plant in 1886.
Mr. ANTHONY. Is the cold-storage plant a modern and up-to-date one or is it an old plant?
The CHAIRMAN. It was built in 1886, he said.
Mr. ANTHONY. I wondered whether it was up to date. It may have been modernized.
Mr. FRANKLIN. In some respects it has been modernized, I will say in fairness to the plant. Of course, in 1886 that was about the beginning of the history of cold storage, and the insulation placed in the walls was chiefly sawdust or shavings. A great deal of that has been removed and cork insulation substituted. We are taking the statements of the chief engineer on that, and we did not dig into the walls to find out what was in there. I might say that the cold storage at times has had stored in it products to the value of $750,000.
The CHAIRMAN. What will be the obligation of the Government in respect to cold storage when we take the property over?
Mr. FRANKLIN. When we take the property over this is a part of the market and it is supposed that the Government would operate the cold storage for the convenience of the market people.
The CHAIRMAN. What would that involve in the way of expense?
Mr. FRANKLIN. That would involve expenditures for electric power, for fuel, for maintenance, for engineers, and for labor.
The CHAIRMAN. What else? There must be some other obligations. For example, if you wanted to ship there for cold storage, what obligation would there be on the part of the Government in the matter of expenditures?
Mr. FRANKLIN. If you shipped to the storage in all probability the Government would have to pay the advance charges for freight, as is the common usage when perishable stuff of that nature is shipped across the country. The shipper in Chicago, for instance, or some other western point never knows exactly where it will land and when he consigns it to a specific point he may divert it as the market may change, and, when that diversion comes on, the consignee will have to advance the freight.
The CHAIRMAN. That property (an go into any cold-storage plant. Mr. FRANKLIN. Yes, sir.
The CHAIRMAN. Regardless of whether the cold-storage plant wants to take it or not?
Mr. FRANKLIN, They take it because the value of the goods will more than protect them against the advance for freight and storage charges.
The CHAIRMAN. Is the cold-storage plant one of the essential needs at this market in order to enable the Government to rent stalls. to the people who occupy them?
Mr. FRANKLIN. It is not only an essential need to the Government. but it is an essential one to the public here, because we have no other cold-storage plant in the District of Columbia that carries freezing temperatures in which butter, poultry, frozen meats, frozen fish, and some other products can be placed.
The CHAIRMAN. After they take supplies into cold storage and pay the freight on those supplies when they come in, is there a special system of charges?
can it ?
Mr. FRANKLIN. In the matter of rates for cold storage ?
Mr. FRANKLIN. They have established a system of rates now, but when it comes to the question of cold-storage rates we are considerably at sea. We have been working toward the development of a scientific basis for rates for cold storage, and we are just reaching that point with the American Warehousemen's Association where the rates can be based on the temperature needed and the space occupied. All those things are to be taken into consideration, but that has not come about yet. They have their rates that have been fixed by competition with storage houses in other places.
The CHAIRMAN. How much is the Government likely to have invested in freights at any one time?
Mr. KITCHEN. They have told us that they have advanced in freight and cartage charges as high as $15,000 at one time.
Mr. FRANKLIN. I want to say that in arriving at the estimates, we went into the books of the company and took whatever information we could get from them. I must admit that their cost systems were rather crude, but that is not a new matter in the cold-storage industry. That is another feature, the space-rate system, that we are trying to get away from. We are trying to get them to adopt a uniform cost-accounting system, by which they can justify any rate they charge.
Mr. ANTHONY. Is the classification of employees, with the rates of pay, enumerated here the same as the company now has?
Mr. KITCHEN. No, sir; the pay is less. For example, their general manager and president receives $7,500, and we are asking $4,500 for the superintendent, who will have a comparable position. They have a treasurer at $2,400, which position we are abolishing, and they have a superintendent at $3,600. We are asking for an assistant superintendent at $3,000.
Mr. ANTHONY. Is it a larger or smaller force than you are estimating for?
Mr. KITCHEN. They have 48 people on their pay roll and we are asking for 50. That is due to an increase in the watch force. We are putting on more watchmen, which we think is necessary because the Government does not carry insurance on the property.
Mr. FRANKLIN. Our total for wages and for salaries is about $8,000 less than the present pay roll of the market company.
The CHAIRMAN. Will you be kind enough to put into the record, in parallel columns, a statement showing the number of people, with the titles of the positions they are to occupy, as proposed by the Department of Agriculture, and the same information with respect to those that are now employed by the market company?
Mr. KITCHEN. We will insert that.