works, such as the movable dams across the Mohawk and the concrete dams at various parts of the rivers canalized and the installation of hydraulic generators and other problems involved, made the construction of the barge canals of New York one of the colossal undertakings of the twentieth century.

New York realized its opportunity to connect the Great Lakes with the sea by the construction of its great waterways between them, and it did so entirely at its own expense, amounting to $154,800,000, as the initial investment, but which require an annual expenditure of five to eight millions for their upkeep, and they are entirely free. Mr. HAMILTON. Do you say that a private individual or a corporation has the right to operate boats over the Erie Canal without a permit or charter or license?

Mr. HILL. All boats can operate as freely as though they were owned by New Yorkers, permits being freely given by the superintendent of public works, except if they go outside of the State of New York they are licensed.

Mr. CLEARY. May I make a little correction? No canal boats that do not go out of the jurisdiction of the State are licensed. It is only those that go to another jurisdiction.

Mr. HAMILTON. I was surprised at the freedom with which it can be used.

Mr. HILL. Permits or something of that sort are granted by the superintendent of public works, but anyone can operate a fleet of vessels on the canals as freely as though they were residents of the State. We have a superintendent of public works, whose functions are to supervise the State canals and the operation of vessels thereon. He expected to be here and to present his views in opposition to the pending bill. I understand that he has forwarded a letter in which he voices his opposition and that of the State of New York to extending the jurisdiction of the Interstate Commerce Commission over the New York canals.

The CHAIRMAN. Do you refer to the letter of Mr. Walsh transmitted by the governor of New York five or six weeks ago?

Mr. HILL. There was to be another letter here to-day. It may not have arrived.

The CHAIRMAN. It has not arrived yet.

Mr. HILL. We hope it will reach you in time so that it may be considered.

The point we want to make is this: Judge MacLean has well stated that that great trunk line of waterways through this State was built. primarily to regulate freight rates. It does not require any argument, gentlemen, to convince you that water carriage is cheaper, inherently so, than rail carriage. The people of New York understood that to be the case and put their money into the project with the understanding that whatever rates they might be able to obtain from port to port within the State and from ports along the Atlantic seaboard and from ports along the Great Lakes to ports within the State of New York were rightfully theirs and they would never be subject to regulation by the Interstate Commerce Commission or by any other commission, because such rates were for water carriers operating entirely on natural lakes, rivers, ocean, and artificial waterways, owned by the people and made free by constitutional provision

The CHAIRMAN (interposing). Would that be your contention where the intrastate rates cast an undue burden upon interstate rates, so that the general commerce of the country would have to make good a deficiency resulting from low intrastate rates?

Mr. HILL. If that were possible, I suppose we should assent to such regulation.

The CHAIRMAN. It is not only possible, it has happened.

Mr. HILL. The fact is, Mr. Chairman, that after Federal control ceases rates over the Erie Canal and over the New York canal system are likely to be so low as not to be a burden to interstate commerce. That condition is not likely to arise, but if it were to arise, the same may be regulated by the public service commission of the State, of which I will speak later.

It is very difficult to prescribe rates for the transportation of tonnage such as cement from New York, or New Jersey to Syracuse, for the rate on such tonnage is lower than may be the rate on tonnage moving in the opposite direction, because vessels are willing to take such cargoes on their return from tidewater to Buffalo, where they are to receive their cargoes of grain for eastern ports. Such rates on westbound traffic are necessarily lower than they are on east-bound traffic and are subject to such competition that they are changing from week to week.

If this bill were to pass and it became necessary to file a schedule of rates, those would, of course, predominate and control absolutely the local rates. Although there might not be any complaint under section 13, there is always the danger that some one will raise the question and bring the matter before the Interstate Commerce Commission, and then there must be a hearing with the State Commission and others interested and thereafter the Interstate Commerce Commission may act as authorized by the proposed amendment to section 13 of the interstate-commerce law.

In New York we have a public service commission empowered to act on intrastate matters very much as the Interstate Commerce Commission may act on interstate commerce. Chapter 805 of the laws of 1917 confers that authority upon the Public Service Commission of New York. The act is a lengthy one and must be examined to understand all its provisions, but it is adequate to meet all questions growing out of the carriage of intrastate commerce by rail and water lines, acting as common carriers, but not when carried by water carriers from port to port. That service is and always has been free from all regulation.

I suggest that the pending bill be so amended as not to confer jurisdiction upon the Interstate Commerce Commission to exercise any control or to have any power to regulate rates for the transportation of tonnage over the canals and other interior waterways of New York.

Mr. SWEET. Have you any suggestion to make by way of amend

ment?

Mr. HILL. I have not at present, but will be pleased to submit such an amendment in the near future.

The builders of New York waterways, who have gone to the expense of constructing them, ask that they be left free, as they have been made free by an amendment to the State constitution, so that any shipper, whether he be a resident or a nonresident of New

York, may make free use of such canals and waterways, and that the matter of the determination of rates be left to State control and be not submitted to the control of the Interstate Commerce Commission, which is already overburdened, but that may be done in certain cases provided complaint be made as stated in section 13.

Mr. DENISON. Has the State of New York or the people of New York any objection to the provisions of the bill that put the transportation on the canal by boat, which is interstate transportation under the control of the Interstate Commerce Commission?

Mr. HILL. Interstate transportation?

Mr. DENISON. Yes.

Mr. HILL. I do not know that they could make objection under the constitution to such interstate commerce. I suppose they would be compelled to submit to it, if it were purely interstate commerce. Mr. DENISON. The canal runs from port to port all inside of the State of New York.

Mr. HILL. Yes.

Mr. DENISON. Can you state to the committee, or will you please for my information, because perhaps the other members of the committee know, the length of the canal, its width, and depth?

Mr. HILL. I will so state. They speak of the Erie Canay as though that were the only one. There are really four canals. The Erie Canal extends from Buffalo to Troy, a distance of 342.2 miles. The Cayuga and Seneca Canal extends from Seneca and Cayuga lakes to the trunk line Erie Barge Canal, a distance of 27.3 miles. The Oswego Canal extends from the Three River Point to Oswego, a distance of 22.8 miles. The Champlain Canal extends from Lake Champlain to the Hudson River and through the canalized portion of the Hudson River, a distance of 61.5 miles. These distances aggregate 453.8 miles, and the foregoing canals are of the barge-canal type with locks, as heretofore stated, with prisms 12 feet in depth and 75 feet in width on the bottom, except through canalized rivers, where the width is 200 feet and with a width of surface of 123 to 200 feet or more.

The capacity of boats utilizing the full lock width is estimated at 3,000 tons, but for vessels passing the locks in twos their capacity is estimated at 1,500 tons.

Mr. HAMILTON. What is the length of the second canal?

Mr. HILL. It is about 27 miles.

Those four trunk-line canals reach 80 per cent of the people of the State or bring them within 10 miles of the canal routes, so that trucking may bring down the traffic of 80 per cent of the people to some one of these four barge canals. They are all intrastate waterways, serving the people of that State, who have built such waterways at their own expense and made them entirely free. They ask that they be left so that is, left absolutely under local control.

We have a very enterprising and efficient department of public works, as we have had during barge-canal operation. In my opinion canal rates will not interfere with interstate commerce, because such canal rates are always lower and to get business must be lower than railroad rates.

Mr. DENISON. I am entirely ignorant about this canal

Mr. HILL (interposing). I did not tell you the depth, and I will tell you that. I did not answer fully your question. The prism is

12 feet in depth. It is 75 feet in width on the bottom and about 125 feet on the top except in some places, where it is 200 feet through the natural streams of the stream, where it is much wider. The Erie Canal is artificial for about one-third of its distance. The other two-thirds passes through natural bodies of water that have been. canalized and it connects up these natural bodies of water. The carrying capacity is known, in ordinary parlance, as a 1,000-ton barge canal, but in consequence of the enlargement of the locks, which are 328 feet long and 45 feet wide, it will allow vessels to go through 300 feet long, carrying nearer 3,000 tons than 1,000 tons. Mr. DENISON. Do any vessels use it except barges?

Mr. HILL. No; except small boats use them in addition to canal barges, but no large lake or ocean-going vessels use them.

Mr. DENISON. No lake vessels or ocean-going vessels use it?
Mr. HILL. No, sir.

Mr. DENISON. Is it used for the transportation of through shipments from the Great Lakes to the sea?

Mr. HILL. To some extent. Grain comes down from the Great Lakes and is transferred at Buffalo or Oswego onto barges and they transport the grain to the sea.

Mr. DENISON. Is that done by making through rates?

Mr. HILL. There are not through rates to any extent.

Mr. DENISON. Do they expect to use through rates on that canal? Mr. HILL. In the past an effort has been made to have through rates established by the carriers themselves between the seaboard and the ports of the Great Lakes, but there has been difficulty in doing so on account of the lack of responsibility on the part of some water carriers.

Mr. DENISON. Of course that would be regulated by the Interstate Commerce Commission?

Mr. HILL. Yes; if through rates are to be established for water earriers and the latter are to be under the supervision of the Interstate Commerce Commission, then the Interstate Commerce Commission would undoubtedly have the power to establish through rates. Hitherto neither lake nor canal carriers have been under such jurisdiction.

Mr. DENISON. It has cost how much?

Mr. HILL. There have been appropriations, which were referendum measures, amounting to $154,800,000.

Mr. DENISON. Does the State of New York maintain its canals and pay the overhead charges out of taxes on the people?

Mr. HILL. Yes; it pays for their upkeep and operating expenses

in toto.

Mr. DENISON. It charges nothing for their use?

Mr. HILL. Not a cent.

Mr. HAMILTON. I presume the effect has been to lower and regulate freight charges?

Mr. HILL. Certainly; and the Interstate Commerce Commission in some of its former reports alluded to that fact, that the new York canals not only regulated and lowered the rates within the State of New York but affected the rates as far west as Duluth and to the Mississippi River and to all points east of that river. Rates to all points in touch with water transportation have been regulated and

in some places lowered by reason of the waterways from the Great Lakes to the sea.

Mr. SIMS. Would not the State of New York have the absolute right to build an intrastate system of railways and operate them free of charge, if she saw fit to do so?

Mr. HILL. Certainly.

Mr. SIMS. Why should the National Government or any other State complain of what a State does for itself wholly within its own boundaries?

Mr. HILL. That is our position.

Mr. SIMS. Being a waterway does not make any difference. It could do just the same with the railroad.

Mr. HILL. If any of you gentlemen should desire to operate a fleet. of boats to carry freight from New York to western points within the State, it would be very difficult to fix a rate that would continue for one or more months. It would be also impossible to do so. Rates are changing from week to week and can not be scheduled for water carriers on interior waterways. Therefore the pending bill ought to be amended in such manner as to leave no doubt in the minds of transportation interests as to whether or not they are brought within the provisions of the Esch-Pomerene bill. Meritorious as are many of its provisions, may it not be so amended as not to include or rather not to extend the jurisdiction of the Interstate Commerce Commission to interior canals and other interior waterways? New York respectfully urges that it be permitted to remain out of such jurisdiction, and the governor has already communicated, as I am advised, with your honorable committee to that effect.

Mr. SIMS. If we leave out New York, it would be just as reasonable to leave out other States so far as they are similarly situated?

Mr. HILL. Certainly.

Mr. SIMS. And whether it is by water or rail or anything else, it means the same thing.

The CHAIRMAN. We do not affect intrastate business.

Mr. HILL. I know that, but the bill does permit such regulation as is provided in section 13 thereof.

The CHAIRMAN. Which is simply putting into statutory form the decision of the Supreme Court in the Shreveport case.

Mr. SIMS. Which would not apply to water, anyway.

Mr. HILL. It did not apply to water, did it?

The CHAIRMAN. No; in those cases it did not.

Mr. HILL. The bill, however, Mr. Chairman, specifically mentions water carriers and defines who they are, and also defines vessels, and seems to include them in its present phraseology. I would be pleased to submit a supplemental statement.

The CHAIRMAN. Will you also include in such a statement the tonnage on the canal?

Mr. HILL. If I may, I will include in these remarks a statement showing the total tonnage of the New York canals for the last five years. Before closing, however, permit me to say that in 1880 the total tonnage was 6,457,656 tons. In 1890 it was 5,246,102 tons, in 1900 it was 3,345,941 tons, in 1910 it was 3,073,412 tons. Such decline was due to the failure to keep up canal equipment and operation and the agitation going on for radical improvement in the State's canal system. The new barge canals of New York have a ca