take a significant length of time to work out the necessary arrangements for a satisfactory regional solution. We have started-but we must establish a mechanism which can make direct Federal assistance available to the railroads while the necessary permanent arrangements are being established.

And that is why I introduced S. 325. I believe it provides a workable mechanism for channeling Federal assistance into hard-pressed passenger railroads, to enable them to continue service until more lasting solutions are put into effect. The program of assistance established by S. 325 has no terminal date. I do not believe it would be wise to establish a time limit on the act itself-for the legislation is designed to deal with more than the problems of the New Haven.

A recent report of the Interstate Commerce Commision shows 66 Class I line-haul railroads throughout the Nation engaged in passenger service. All but three of those companies are losing money on that passenger service.

Mr. Chairman, I ask unanimous consent that a table showing those railroads and their losses on passenger service be inserted at this point in the record.

The program established by S. 325 is designed to aid not only the New Haven, but any hard-pressed passenger railroad which can demonstrate to the satisfaction of the Interstate Commerce Commission that: (1) the continuance of passenger-train operations specified in the application is required by the present or future public convenience and necessity; and (2) that the granting of aid requested is necessary to carry out effectively the public convenience and necessity.

The assistance authorized by S. 325 would be granted to qualified railroads under a formula designed to limit the amount of aid to an amount appropriate both to the railroad's needs and the amount of assistance contributed by States and local political subdivisions.

The maximum amount of financial aid available to any qualified railroad for any one calendar year would be the total of: (1) the railroad's expenses incurred in the preceding calendar year in the maintenance of way and structures directly related to railroad passenger service; plus (2) the previous year's direct payments by any State or political subdivision to the railroads for the maintenance-of-way and structures which are directly related to railroad passenger service; plus (3) the railroad's expenses in the preceding calendar year for the maintenance-of-way and structures which are assignable but not directly related to railroad passenger service. The amount of Federal assistance under subsection (3) is limited further to an amount not to exceed the aid, including tax relief, extended by any State or political subdivision to the applicant.

Putting some concrete numbers in the formula, the result for the New Haven would be approximately this:

Under subsection (1), the New Haven's expenses for maintenance of way and structures directly related to passenger service in 1964 are estimated to be $2,561,348;

Under subsection (2), State of Connecticut's direct payments to the railroad in 1964 were $500,000, paid in the nature of a subsidy for maintenance of highway bridge and grade crossings. Some part of this direct payment is attributable directly to passenger service-the exact amount directly related will depend upon the application of

the ICC's apportionment formula. No state other than Connecticut granted a direct cash payment to the railroad in 1964;

Under subsection (3), the New Haven's estimated maintenance of way and structure expenses assignable but not directly related to railroad passenger service were $4,276,054. Under this subsection, Federal aid could not exceed the total aid-including tax relief, but excluding aid counted under subsection (2)-made available by any State or political subdivision. From the figures available to me, it appears that the Federal aid would be limited under this subsection to $3,618,000, representing the total of the following tax relief assistance extended by States in 1964: $725,000, New York real property tax relief; $1,340,000, the New Haven's allocated share of the New York Central's real property tax relief on New York Grand Central terminal, shared jointly by the Central and the New Haven; $1,004,000, relief from Connecticut's gross receipts tax; $149,000, relief from Rhode Island's gross earnings tax; and $400,000, relief from real property taxes in Rhode Island.

The total maximum aid which could be made available under section 604 of my bill to the New Haven, assuming that the railroad was found to be a qualified applicant and using the latest estimates shown above, would thus appear to be $6,179,348, plus whatever portion of Connecticut's $500,000 might be found directly related to passenger

service by the ICC.

No railroad passenger service can operate effectively without adequate equipment. Senator Pell summed up the condition of the New Haven's commuter equipment in his perceptive article in the February 25, 1965, issue of The Nation: "The senility of the New York commuter fleet, for example, is depressing to contemplate. Of a total of 190 cars, the 100 newest are 10 years old, and the remainder, almost half the fleet, vary in age from 30 to 50 years. None of the antiques, purchased between 1914 and 1931, is air conditioned and all are deteriorating rapidly, according to the trustees."

Section 605 of my bill authorizes the Commission to grant funds to a qualified railroad applicant to assist in the acquisition and modernization of passenger cars. The amount of the grant would be determined by the Commission on the basis of the present and future public convenience and necessity, and would be in addition to the amounts provided under section 604, estimated above.

Any realistic attempt to deal with the problems of the New Haven— or of most other threatened passenger lines-must recognize the need for aid in the acquisition of equipment. Operating subsidies alone are not enough. It does no good to subsidize the operation of inadequate equipment.

I offer my bill in the firm belief that we must establish a mechanism within the Federal Government whereby direct assistance can be provided to maintain and preserve essential passenger and commuter train service.

The Urban Mass Transportation Act of last year can provide assistance to commuter railroads, and to the New Haven, through established public authorities-like those proposed by Governors Rockefeller and Dempsey, or that proposed by Senator Pell.

But our experience has demonstrated that the limited emergency provisions of the act are not sufficient to deal on an emergency basis with a crisis like the one facing the New Haven. My bill supplements

the Mass Transit Act. It provides an interim program of Federal aid directly to railroads, administered by the Interstate Commerce Commission in close coordination with the Housing and Home Finance Agency and the States.

We must always keep in mind that as population spreads, and as our expanding automobile population inundates our roads, mass transportation becomes a necessity to save our cities.

No nation is stronger than the economic well-being of its separate parts. As we demonstrate our national concern for Appalachia—for the farmer-for those in need of irrigation projects, so I say we must have a national concern for the urban rail commuter and for the regions dependent on the trains that take him to work. Those trains are a precious national asset. Chaos would follow their disappearance. We must never permit that chaos.

Senator PASTORE. The next witness is my distinguished colleague, Senator Pell.

STATEMENT OF HON. CLAIBORNE PELL, U.S. SENATOR FROM THE STATE OF RHODE ISLAND

Senator PELL. Mr. Chairman, thank you for letting me appear here as a witness. I would like permission for my Legislative Assistant Orlando Potter, who has helped me with so much of this work to sit with me, if that is all right.

Senator PASTORE. Without objection, so ordered.

Senator PELL. Mr. Chairman, I appear here today to testify in support of my bill, S. 348, to create a northeast rail authority and also as cosponsor of S. 1289, Senator Dodd's bill, to provide special assistance to preserve essential rail service.

I must say in answer to Senator Dominick's earlier question, as to whether the States had shown any efforts themselves to get together, I read a piece in the Herald Tribune this morning indicating that the Governors of Massachusetts, Rhode Island, and Connecticut, indicated support for this concept of mine, specifically my bill. I do not know anything more than that press report, which was in this morning's Herald Tribune.

By word of general commentary on my bill, I should begin by saying that I would be much happier if there were no need for such a bill at all. I would be delighted if the problems of the New Haven could be worked out within the limits of private industry or by the States acting independently.

But the plain fact is that neither private industry nor the efforts of the States have been able to resolve the problem and now we are faced with the prospect of total abandonment of essential public service.

It is true, of course, that the individual States have made and are making substantial efforts. Connecticut and Rhode Island each has done its share-or more. New York at last has indicated a willingness to carry part of the burden, and Massachusetts, with its new Massachusetts Bay Transportation Authority, has the means for solving as much of the problem as lies within her own borders.

As laudable as these efforts are, I believe they leave unresolved a whole range of questions basic to the preservation of a coherent and efficient railroad system. Even if the efforts of the separate States could persuade the trustees to withdraw from their plan to abandon

service, the question must be asked whether the continued service could be offered on anything better than a stopgap, patchwork basis. Given the normal vicissitudes of political life, could the trustees or their successors plan and carry out a systematic, long-range plan of replacement and rehabilitation of equipment on the basis of the support programs now available or planned in the separate States?

There are, moreover, overriding geographical considerations which are even more important today than they were in the 19th century when the New Haven system became amalgamated.

We live in an area of small States, especially when they are viewed in 20th century terms of speed. Even in the commuter service, most New Haven trains are interstate carriers.

Many of the New York commuter trains must originate in Connecticut, and many of the Boston commuter trains must originate in Rhode Island. Even in the commuter service, then, the New Haven's continuance depends on interstate cooperation. One can only surmise the continuing chaos which will result if firm and binding agreements are not made now against any future paralysis of political will on the part of one of the participating States.

The need for firm long-range commitments is even more apparent in the case of the New Haven's intercity passenger service. In spite of the developments in highway and automobile traffic in recent years, the New Haven's intercity passenger service is still considerable by any standard.

It accounted for about two-thirds of the $41 million in passenger revenues generated by the line of 1963. It is still an essential public service, particularly because the climate of our northern coastal area so often makes other modes of transportation undependable.

I must add there are even hazards on the railroads. I came down yesterday on a train and had the experience of being in a car on which rocks were fired by small boys in New York.

As a result of my considerable involvement over the past 3 years in plans for development of high-speed rail service between cities, I am convinced that the intercity service of the New Haven will be even more essential in the years to come.

We are fast approaching the time when we must make important policy decisions as to the expansion of public transportation facilities to meet needs which are now almost upon us: Should we indefinitely expand our highway and airport facilities at great public cost in thickly settled areas, or should we try to offer alternative high-speed ground service to handle passenger travel over intermediate distances in our megalopolis stretching from Boston to Washington?

President Johnson has pledged his administration to a major program of demonstration, research, and development to explore and promote just such alternatives, and the 229-mile Boston-New York corridor together with its southern extension to Washington has been earmarked as the prototype area in which to conduct the study.

It would be a deplorable frustration of national policy if the New Haven's intercity passenger service were allowed to expire virtually on the eve of this exciting period of experimentation and development which may have such bearing on future transportation policy.

The point which I wish to emphasize, Mr. Chairman, is that the New Haven problem is a regional problem demanding a regional altion.

I therefore must say most emphatically on the record that I reject any and all proposals which provide anything less than a full regional approach or which would in any way balkanize the New Haven's service area into constricted commuter districts which would have no relationship to long-range development and which, in fact, could pose serious operational problems in fulfilling even their limited func

tions.

What is therefore needed, I believe, is a rational and permanent framework, organized on a regional basis, to permit an efficient resolution of the New Haven crisis. This is the intention of my bill S. 348, which would authorize the creation of a four-State public authority, by Massachusetts, Rhode Island, Connecticut, and New York, to own, lease, or otherwise acquire the right to operate the New Haven's passenger service on a fully guaranteed basis.

My assumption is that once such an agency takes over the passenger service, the existing New Haven company will be free to reorganize on whatever terms its owners prefer.

S. 348 is a somewhat unusual bill in that it spells out in detail the terms of the compact by which the States would create the authority. I want to emphasize that I submitted the bill in this form not because I believe Congress should presume to dictate terms to the States, but because I simply felt that in view of the urgent situation we face, a tentative framework had to be laid out as a basis for discussion and negotiation.

Also, I have acknowledged from the beginning that the bill is not a perfect plan. I expect that the witnesses may find fault with it in several respects, but I would hope that they would be prepared to offer constructive suggestions to make it work, rather than reject it out of hand. I offer the bill as a reasonable basis for reconciling a number of interests, and I hope all of the witnesses will examine it in that spirit. More important still, the members of your committee, Mr. Chairman.

The key operating provisions of S. 348 are article VII of the compact (title II) and the Federal bond guarantee (title III).

Article VII would commit each of the participating States to make up the operating deficits of the authority in proportion to the volume of passenger service rendered by the authority in each State. It would authorize the authority to repay the States in the same proportion in any year in which the authority's revenues exceed expenses.

It might be of interest at this point to enter into the record an estimate of annual passenger mileage for the year 1963 which has been supplied to me by the New Haven Railroad.

I will submit that for the record, Mr. Chairman. These figures indicate that New York generated 47 percent, Connecticut 39 percent, Rhode Island 5 percent and Massachusetts 8 percent.