[Federal Register Volume 61, Number 177 (Wednesday, September 11, 1996)]
[Notices]
[Pages 48001-48002]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-23216]


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DEPARTMENT OF TRANSPORTATION
Surface Transportation Board 1
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    \1\ The ICC Termination Act of 1995, Pub. L. No. 104-88, 109 
Stat. 803 (1995) (ICCTA), abolished the Interstate Commerce 
Commission and transferred certain functions to the Surface 
Transportation Board (Board) effective on January 1, 1996. This 
notice relates to a motor carrier passenger acquisition of control 
and merger transaction that is subject to Board jurisdiction under 
49 U.S.C. 13541 and 14303.
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[STB Finance Docket No. 33007]


Laidlaw Transit, Inc., et al.-Control and Merger Exemption-
National School Bus Service, Inc., Charterways Transportation Limited, 
Enterprise Transit Corp., and MCS Interstate, Inc.

AGENCY: Surface Transportation Board.

ACTION: Notice of filing of petition for exemption.

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SUMMARY: Laidlaw Transit, Inc. (Laidlaw Transit), a noncarrier, and its 
direct and indirect corporate affiliates (collectively petitioners) 
2 seek an exemption under 49 U.S.C. 13541 from the prior approval 
requirements of 49 U.S.C. 14303(a)(1) and (a)(4) for Laidlaw Transit to 
acquire control of, and subsequently merge with, four motor carriers of 
passengers. Expedited action has been requested.

    \2\ Laidlaw Transit is a wholly owned subsidiary of Laidlaw 
Transportation, Inc., a noncarrier and wholly owned subsidiary of 
Laidlaw Investments Ltd., a noncarrier and a wholly owned subsidiary 
of Laidlaw Inc. (Laidlaw). A controlling interest in Laidlaw is held 
by Canadian Pacific Railway Company (CP Rail), a wholly owned 
subsidiary of Canadian Pacific Limited, a publicly held noncarrier 
holding company. CP Rail operates as CP Rail System, a Class I rail 
carrier, on the lines of the former Soo Line Railroad Company.
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DATES: Comments must be filed by September 26, 1996. Petitioners may 
file a reply by October 1, 1996.

ADDRESSES: Send an original and 10 copies of comments referring to STB 
Finance Docket No. 33007 to: (1) Surface Transportation Board, Office 
of the Secretary, Case Control Branch, 1201 Constitution Avenue, N.W., 
Washington, DC 20423; and (2) Petitioners' Representative: Mark J. 
Andrews, Barnes & Thornburg, 1401 Eye Street, N.W., Suite 500, 
Washington, D.C. 20005.

FOR FURTHER INFORMATION CONTACT: Beryl Gordon, (202) 927-5660. [TDD for 
the hearing impaired: (202) 927-5721.]

SUPPLEMENTARY INFORMATION: Laidlaw Transit holds a 100% beneficial 
interest in the stock of two of the carriers it seeks to acquire: 
Enterprise Transit Corp. (ETC), a motor common carrier of passengers 
(MC-161299) 3; and MCS Interstate, Inc. (MCSI), a motor common and 
contract carrier of passengers (MC-200701). The stock of ETC and MCSI 
is currently held in separate, independent voting trusts that are to 
terminate when this exemption is granted.4
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    \3\ According to the records of the Federal Highway 
Administration, Office of Motor Carrier Records (FHWA), ETC's 
authority under this docket was revoked on April 26, 1996.
    \4\ Petitioners state that, as a CP Rail affiliate, Laidlaw 
Transit was barred from acquiring or becoming a regulated motor 
carrier unless the special rail-motor acquisition criteria of former 
49 U.S.C. 11344(c) could be satisfied. Under the criteria, it had to 
be shown that the rail carrier could use the acquired motor carrier 
``to public advantage in its operations.'' Thus, the stock of ETC 
and MCS had to be held in separate, independent voting trusts 
because they primarily engaged in non-regulated school bus 
transportation and, as a consequence, Laidlaw Transit was unable to 
make the required showing. Because the intermodal acquisition 
restrictions of former 49 U.S.C. 11344(c) were repealed by the 
ICCTA, petitioners state that the proposed exemption will remove the 
final impediment to terminating the voting trusts.
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    Laidlaw Transit seeks to acquire control of the other two carriers, 
National School Bus Service, Inc. (NSBS) (MC-69623), and Charterways 
Transportation Limited (Charterways) (MC-102189), and has purchased 
more than 99% of the stock of their corporate parent, Scott's 
Hospitality Inc. (Scott), a noncarrier.5 According to petitioners, 
NSBS primarily provides school transportation services within the 
United States and holds both interstate authority as a motor common and 
contract carrier of passengers in regular route service and charter and 
special operations and intrastate authorities to transport passengers 
in eight states. Charterways primarily provides school transportation 
services within Canada and holds interstate authority as a motor common 
carrier of passengers in regular route service and charter and special 
operations.6
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    \5\ NSBS's stock is owned indirectly by a wholly owned 
subsidiary of Scott, and Charterways' stock is owned directly by 
Scott. Scott also has subsidiaries that are engaged in food 
services. The food service businesses are to be sold to third 
parties.
    \6\ According to petitioners, Charterways does not operate from, 
to, or within the United States. FHWA records indicate that the 
authority under this docket was revoked on September 1, 1995. 
Petitioners also state that, through a special division, Charterways 
holds inactive authority to transport property (MC-134301).

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[[Page 48002]]

    After the acquisition is completed, the four carriers will be 
wholly owned subsidiaries of Laidlaw Transit, and will subsequently be 
merged upstream into Laidlaw Transit.7
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    \7\ Petitioners state that Laidlaw has two other motor carrier 
affiliates that hold common and contract property authority: Corsan 
Trucking, Inc. (Corsan) (MC-200565); and PPM Canada Inc. (PPM) (MC-
241369). They assert that the stock of Corsan is 100% beneficially 
owned by Laidlaw Environmental Services, Inc., a wholly owned 
Laidlaw subsidiary, and legal title is currently held in an 
independent voting trust. PPM is described as inactive; it does not 
currently provide motor carrier service within the United States. 
Petitioners state that they intend to terminate the voting trust for 
Corsan, but, before they do, they request that continued control of 
Corsan and PPM be included within the requested exemption or that 
jurisdiction over these affiliations be disclaimed.
    Although petitioners acknowledge that it is not within our 
jurisdiction, they request that the MC number currently assigned to 
ETC (MC-161299) be assigned to Laidlaw Transit after the merger is 
completed. They contend that this would be more economical because 
the ETC number appears on the great majority of vehicles that will 
be designated for use in regulated operations, and, as a 
consequence, repainting costs would be minimized.
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    Petitioners state that the proposed transactions will have only an 
incidental effect on regulated transportation because they primarily 
concern carriers providing non-regulated school transportation 
services. Laidlaw Transit is the largest provider of school 
transportation in North America; 8 only 5% of its revenues 
allegedly are derived from regulated operations. Petitioners anticipate 
that the acquisition of NSBS and Charterways will not appreciably 
change this percentage.9
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    \8\ According to petitioners, Laidlaw Transit holds intrastate 
operating authority as a motor carrier of passengers in 17 states; 
it holds no interstate operating authority.
    \9\ Because Laidlaw Transit holds no interstate operating 
authority, its regulated revenues presumably are derived from the 
regulated operations (charter and special operations) of its 
affiliates, but MCSI is described as inactive, and ETC's authority 
appears to have been revoked.
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    Petitioners state that the proposed transaction will permit the use 
of their buses to perform regulated charter and special operation 
services when the buses would otherwise be idle (i.e. during the school 
day, in the evenings, and on weekends and vacations). Additionally, 
they state that the proposed exemption will also reduce their 
administrative burdens, including those associated with duplicative 
regulatory filings for multiple corporate entities, and those related 
to unnecessary trustee arrangements and fees.
    Petitioners certify that they plan no significant changes in 
operations or employment levels as a result of the transaction. 
Moreover, they assert that the validity of all collective bargaining 
agreements to which the involved carriers are party will be recognized.
    Additional information may be obtained from petitioners' 
representatives.

    Decided: August 28, 1996.

    By the Board, Chairman Morgan, Vice Chairman Simmons, and 
Commissioner Owen.

Vernon A. Williams,
Secretary.
[FR Doc. 96-23216 Filed 9-10-96; 8:45 am]
BILLING CODE 4915-00-P