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Mr. BLACKMAN. We have not found that to be the case. Our association has appeared on behalf of the dump truck industry in California before the Public Utilities Commission advocating rates.

Similar associations also appeared as groups. We don't consider, of course, any antitrust violations or has that ever been suggested in California. Certainly without such approved representation, it would be difficult for the Commission to get all of the necessary facts and points of view relative to the establishment of rates based on the costs throughout the State.

Mr. HUNGATE. I suppose if you banded together and set a permissible minimum rate, you would have an antitrust problem, but you don't think so?

Mr. BLACKMAN. If we did that outside of the Commission, I believe we would, yes. But we do it through a constitutional body which after hearing all the evidence, ours is only part of it. Then it sets a minimum rate.

Mr. HUNGATE. But if you were on a job as a dump truck operator and you're through some organization determined to be an employee, but you have to be determined an employee and then you find yourself under NLRB, I guess?

Mr. BLACKMAN. There is an eye difference of opinion as to whose jurisdiction you really are under. I think if experience tells us anything, we will be under the jurisdiction of the teamsters because some of the contracts that they provide and have negotiated provide not only for the establishment of minimum wages for the independent owner-operators that they be on payrolls, but in addition they also establish rates for their trucks.

Mr. HUNGATE. My confusion is that I think first if you're an employee and you have in some cases been so determined to be; is that right? You don't have to agree with the decision, but had that decision been made ?

Mr. BLACKMAN. No, sir. The NLRB made such a decision with respect to construction work.

Mr. HUNGATE. It did make a decision with respect to construction work that you were employees?

Mr. BLACKMAN. Yes.

Mr. HUNGATE. If you're employees, you would have the right to band together to bargain for wages and certain prices?

Mr. BLACKMAN. The unions would assume and have assumed that responsibility, yes.

Ñr. HUNGATE. But if you did that same thing in another area I am convinced you would have an antitrust problem. Maybe it wouldn't arise.

Pardon me, this gentleman.

TESTIMONY OF WILLIAM T. HAYES, NATIONAL INDEPENDENT

TRUCKERS UNITY COMMITTEE, CHICAGO, ILL. Mr. HAYES. Sir, I think there should be a distinction made that he is talking about trucks that operate solely in California. Intrastate action, not interstate.

Mr. HUNGATE. Intra?
Mr. Hayes. Intrastate. Operate solely in the State.
Mr. HUNGATE. What's your name?
Mr HAYES. Bill Hayes.
Mr. HUNGATE. You're from where?

Mr. Hayes. The National Independent Truckers Unity Committee, Chicago.

Mr. HUNGATE. Thank you, sir. Thank you for your help.

[Mr. Hayes prepared statement and attachment follow:] PREPARED STATEMENT OF WILLIAM T. HAYES, NATIONAL INDEPENDENT TRUCKERS

UNITY COMMITTEE Members of Congress and this Subcommittee, let me thank you for affording us this opportunity to testify before you and renewing our faith, that after two hundred years, this country is still governed by the people and for the people.

We hope that by our testimony and the previous testimony, and future testimonies yet to be heard, will make you and the Federal and State governments realize that a grave injustice is being done to one of the last independent businessmen (independent truckers) in this nation. The injustices are being committed by Federal and State regulatory agencies and by the trucking companies, hereafter called Carriers.

One of the most flagrant abuses is called the Lease Purchase Plan, used by many Carriers to entice new independent truckers into business.

Several companies (North American, Mayflower, Ringsby, Midwest Distributor, Sullivan Truck Lines, International Transport, and especially Midwest Emery Freight Systems) use the Lease Purchase Plan through a complicated series of transactions. I have here copies of titles and assignments of one company. Midwest Emery-Lowery Trucking), whose Vice President is listed as owner of the trucks financed by International Harvester and a second lien and recourse is signed by the trucking company (Midwest Emery), so they can repossess the truck when the owner-operator rebels or when payments are late, so the truck can be resold again several times. Whenever the owner operator is late on payments or wants to go to another company, he is informed he cannot because the truck is not his. One Carrier required two hundred sixty weeks of truck payments and then a written notice from the independent trucker stating he wants to buy the truck plus make a pay off to the Carrier for the truck. Their pay statements prove that the independent trucker in this transaction is in no way able to pay off a worn out truck. He operates his truck on advances received at the start of the trip. His weekly statement, which is usually three to four weeks after the trips are completed, comes to his home with usually the following deductions :

1. Penalty for late delivery regardless of why, but no bonus for early delivery.

2. Products damaged or in improper condition.

3. Pickup and delivery charges that were not mentioned in the lease. Another method used to bilk the owner operator in the lease purchase plan is the Carrier will really work the new independent trucker for two or three years until a year or two is left to pay on the truck, and then all of a sudden work slows down or he is being dispatched on one poor paying load after another. When he can't make his payments, the truck is repossessed and sold to another independent owner operator by the Carrier. One form of this injustice was transacted by a Carrier (Midwest Emery) in Omaha within the last couple of years on many independent truckers. When the owner buyer wished to remodel his truck or haul for a different Carrier, he was informed that his truck was involved in a bankruptcy case of the previous owner who happened to be a Vice President of the Carrier, and could be used only by this Carrier who had signed recourse so he could sell the truck again, if the owner buyer didn't like it.

The owner operator, after securing a load sometimes is required to make several pickups requiring several hundreds of miles in travel, before starting to his destination which then requires him to make several deliveries. This the owner operator knows before he starts, but the charges he is hit with at each pickup and delivery, he isn't informed of when he accepts the load. When he arrives at the pickup or delivery point, he is told he must pay loading charges or unloading charges. Sometimes he is required to take a teamsters union man along with him, who doesn't touch a piece of freight, but collects a full days pay from the independent owner operator trucker. Many times you are told if you slip the foreman or fork lift operator five or ten dollars, you will get loaded or unloaded faster.

In many instances, the owner operator hauling perishables has to use his trailer to keep the products at proper temperature while the shipper and consignee haggle over the price of the product. The owner operator has no way of knowing if the shipper is sending the product in the condition the consignee ordered it. He finds this out when there is a deduction from his settlement for too ripe or not ripe enough condition of the product. In dry freight, he is sometimes subject to the improper loading or pallet size of his load, which then requires him to restack the entire load according to consignee's wishes. Many times when a shipper loads an owner operators trailer, they will stack damaged or wet cases inside the pallet load. When consignee inspects the load and finds damages, he doesn't try to determine who is at fault for the condition, he just contacts the Carrier or Broker and it is taken off the owner operator truckers settlement. The owner operator trucker upon paying this claim still does not receive the products he paid for. The consignee will repackage the product and sell it. Thus, his only loss is the cost of repackaging against the already paid claim. Selling the produet is 100 percent profit to him.

Another rip-off committed against independent truckers is commonly referred to as skimming. There are many ways to skim in the trucking business.

1. One is off the top—the Carrier or broker agrees on a fixed amount of money to move a load from one point to another. The Carrier or broker will then quote a price to the independent trucker several hundred dollars less and pocket the difference plus his commission which ranges from ten to thirty eight per cent.

2. Another way is the two advance check method. The Carrier or broker will advance the independent trucker a check for part of his share to operate on and then issue another check in his name, forge his signature and keep the money.

3. Still another way is to deduct several phoney pick up and delivery charges on the final settlement to the independent trucker.

I strongly urge an amendment to the ICC rule pertaining to skimming, (Ex Parte No. MC-43 (Sub-No. 4)) that a copy of the revenue bill sent to the shipper for every load by Carrier or hrol:er, he included in the final settlement made to the independent trucker. As the ICC rule now stands, the copy of revenue bill is available to the independent trucker only upon his demand. Then he is terminated or black balled on a list which surprisingly turn up at many of the new places he tries to get a load.

It is next to impossible for independent truckers to obtain authorities to haul finished products, even if the shipper knows he will deliver his product faster, in better condition, and probably cheaper, if the middle man commissions are eliminated. Due to this situation the independent trucker must solicit his load from a Carrier or broker. In many instances, the Carrier will publish a commodity rate at a reduced rate to get business from a shipper and then hire an independent trucker to haul it or form a special division in his company to handle this freight. But he won't haul it on his own trucks because it is too low a rate to make any money.

For example; 25 percent of the independent truckers pay for use of the Carriers authority is better than nothing if the Carrier had to publish a rate high enough to haul it on his own trurks and make a profit or lose the business. If the Carrier is unable to find an independent trucker or doesn't have a special products division, he will in turn call a broker or truck stop and have them lorate an independent trucker to haul the load. But this again takes another percentage off the revenue that goes to the broker or truck stop. (Prime example: Rubes Jersey City Truck Stop).

One of our members solicited two loads of freight from Chicago, Ill., to California. As he didn't have authority to haul this freight, he went to a Carrier to obtain a lease, (Pacific Intermountain Express, Special Products Division, called

All States). Upon securing the lease, (which was illegal), he was on his way to California. For the use of their authority and least, he gave the second load to the carrier who obtained another independent trucker to haul it to California. The class rate in the published tariff for this commodity was about $5.08 a hundred at this time. This brought the revenue for a 40,000 pound load to about $2,000. The carrier deducted 27 percent for his share, leaving about $1,460 for the independent trucker on the first load. The second independent trucker was only paid $1,000 for his trip. This resulted in the Carrier making about $1,500 to $1,600 on a $4,000 haul for the use of his authority.

Solution to this problem possibly could be that a carrier could only publish a commodity tariff rate if a certain percentage of the commodity is hauled on his own trucks. The carrier usually publishes a class tariff rate for products he hauls on his own trucks at a much higher rate. Some carriers even publish lower tariff rates when they set up special products division or start using independent truckers.

Many shippers have their own trucks, (private carriers), but only haul the highly profitable loads and use independent truckers for the less profitable loads. If the independent trucker, with his associations, could enjoy immunity from the anti-trust laws, like the Carriers, he could negotiate with the shippers and Carriers a proper lease with fair return to him for the use of his equipment and labor. It would eliminate a problem that just occurred on 6/3/76-a trucker secured a lease from a carrier's agent in their special products division (PIE/All States), to haul twelve loads from the midwest to the west and return. This took fifteen weeks—he received payments for the six westbound loads, but not for the exempt loads hauled from the west coast to the midwest. The trucker asked the carrier why he wasn't paid for the east bound loads. He was informed that the shinner had not naid them yet, so the trucker called the shipper and was informed that they had already paid the carrier in full. This is just another examp.e how carriers and agents improve their cash flow at the independent owner operator truckers expense.

Suggested solution: All carrier agents should be bonded so that the independent owner operator trucker could enact recourse against the carrier.

Another injustice that we think should be corrected, is the Federal High Way Use Tax on Form 2290 (Exhibit Attached). The trucker is required to pay this tax one year in advance knowing that if he goes out of business or his truck is totally demolished, he will not receive a rebate for the unused portion of this tax. The year in advance, we can live with, but truckers should receive a rebate for the unused months in which he doesn't operate the truck. There should also be a decal or some visible proof displayed on the truck to show this tax has been paid, for the operating year. As it is now, no one kuows who has paid and who has not, and a few supporting all involved, will not pay for the Interstate Highway System for which this tax was originally enacted. When a person buys a used truck, he doesn't know if the Federal Use 'Tax has been paid until he is billed for the tax by the Internal Revenue Service for every year the truck has been in use since new.

In conclusion, again let me stress, we the independent owner operator truckers of the United States, beseech you to act in our behalf to try to correct some of these injustices so that we may be able to carry on interstate commerce and realize a fair return for our investment.

As related to me by a Congressman on this Suncommittee, your constituents will go on with their profession until they run into trouble and then they come to the Federal Government for help. With this thought in mind, I'd like to dedicate the following verse to this Subcommittee.

MY JOB

It's not my job to drive the truck,
The air horn, I can't blow.
It's not my job,
To say how far, the trucks allowed to go.

It's not my job to shoot off smoke,
Nor even change the jell,
But let the damn thing run off the road ...
And see who catches hell !

2290

FOR IRS USE ONLY

Form
(Rev. June 1975)
Department of the Treasury
Internal Revenue Service

Name
Please

Federal Use Tax Return on Highway Motor Vehicles
For the taxable period July 1, 1975 through June 30, 1976
(File a separate Form 2290 for EACH MONTH in which a vehicle is FIRST USED IN THIS TAXABLE PERIOD.)

Employer identification

number

Type or Print

T
FF
FP
1

T
If your address is
now different from
previous return,
check here

Address (Number and street)

[blocks in formation]

Yes

1. During this period (7/1/756/30/76), the first taxable use of vehicles reported on this return was in the month of 2. Have you filed a Form 2290 for any previous month of THIS TAXABLE PERIOD?

Single Units

Tractor-trailer Combinations

No 3. Are all vehicles owned by you registered in the State indicated in your address above?

Yes O No (If "No," attach a statement identifying such vehicles and showing where and by whom such vehicles are registered.)

Annual rate Rate of tar if
Type of Vehicle

(For vehicles first used after

Amount of tax

Number of Cate

used during

(Col. (1) or (2) If your vehicle falls within one of the categories shown below, you are required to file this return.

July (See table gory

vehicles The tax in column (1) is based on the taxable gross weight.

times Col. (3))
July)
(See definitions and instructions.)

on page 4)
(2)

(3)
2 axled truck equipped for use as a single unit with actual unloaded weight of 13,000
A

$81.00 pounds or more

3 axled truck equipped for use as a single unit with actual unloaded weight of 13,000 B

90.00
pounds or more and less than 16,000 pounds
3 axled truck equipped for use as a single unit with actual unloaded weight of 16,000

120.00
pounds or more

4 axled truck equipped for use as a single unit with actual unloaded weight of less than D

165.00 22,000 pounds

4 axled truck equipped for use as a single unit with actual unloaded weight of 22,000 E

204.00 pounds or more and less than 30,000 pounds

4 axled truck equipped for use as a single unit with actual unloaded weight of 30,000 F

240.00 pounds or more G More than 4 axled truck equipped for use as a single unit (see instructions)

Attach Schedule 2 axled truck-tractor with actual unloaded weight of 5,500 pounds or more and less than H

90.00 7,000 pounds

2 axled truck-tractor with actual unloaded weight of 7,000 pounds or more and less than 1

120.00
9,500 pounds
2 axled truck-tractor with actual unloaded weight of 9,500 pounds or more and less than

150.00
11,000 pounds
к 2 axled truck-tractor with actual unloaded weight of 11,000 pounds or more

180.00 L 3 or 4 axled truck-tractor with actual unloaded weight of less than 13,000 pounds

195.00 3 or 4 axled truck-tractor with actual unloaded weight of 13,000 pounds or more and less M

210.00 than 17,000 pounds N 3 or 4 axled truck-tractor with actual unloaded weight of 17,000 pounds or more

222.00 o More than 4 axled truck-tractor (see instructions)

Attach Schedule 2 axled truck with actual unloaded weight of 9,000 pounds or more and less than 12,000 P

120.00 pounds and equipped for use in combinations

2 axled truck with actual unloaded weight of 12,000 pounds or more and equipped for Q

165.00 use in combinations

3 or 4 axled truck with actual unloaded weight of less than 14,000 pounds and equipped R

195.00 for use in combinations

3 or 4 axled truck with actual unloaded weight of 14,000 pounds or more and less than S

222.00 19.000 pounds and equipped for use in combinations

3 or 4 axled truck with actual unloaded weight of 19,000 pounds or more and equipped T

228.00
for use in combinations
U More than 4 axled truck equipped for use in combinations (see instructions)

Attach Schedule
Tax applies to a bus having a taxable gross weight of more than 26,000 pounds. Taxable $3.00 per

See
V gross weight is actual unloaded weight plus 150 pounds for each unit of seating capacity

1000 lbs. or

instructions

fraction provided for passengers and driver. Attach schedule showing tax computation.

thereof

on page 4 4. Total amount of tax on vehicles reported on this return. Pay in full with this return if the installment privilege is not

elected, or if this return reports vehicles first used in April, May, or June. 5. Amount due if installment privilege is elected. See specific instructions on page 2

You may elect the installment privilege only if your return is filed when due. Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete.

Truck-trailer Combinations

Buses

Signature

Title (Owner, etc.)

Date

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