[Federal Register Volume 62, Number 130 (Tuesday, July 8, 1997)]
[Proposed Rules]
[Pages 36477-36480]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-17746]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

49 CFR Parts 1002, 1182, 1187, and 1188

[STB Ex Parte No. 559]


Revisions to Regulations Governing Finance Applications Involving 
Motor Passenger Carriers

AGENCY: Surface Transportation Board.

ACTION: Notice of proposed rulemaking.

-----------------------------------------------------------------------

SUMMARY: The Board proposes to establish revised procedures governing 
finance applications involving motor passenger carriers, filed under 49 
U.S.C. 14303. The proposed procedures adopt, with modifications, the 
existing procedures promulgated by the Interstate Commerce Commission 
(ICC). In addition, the regulations in parts 1187 and 1188 are proposed 
to be removed and replaced by new provisions incorporated in part 1182. 
(Accordingly, in a separate notice published today, the rulemaking 
proposed by the ICC in Ex Parte No. MC-216 is being discontinued.)

DATES: Comments are due on August 7, 1997.

ADDRESSES: Send comments (an original and 10 copies) referring to STB 
Ex Parte No. 559 to: Surface Transportation Board, Office of the 
Secretary, Case Control Unit, Mercury Building, 1925 K Street, N.W., 
Washington, DC 20423-0001.

FOR FURTHER INFORMATION CONTACT: Beryl Gordon, (202) 565-1600. [TDD for 
the hearing impaired: (202) 565-1695.]

SUPPLEMENTARY INFORMATION: The ICC Termination Act of 1995, Pub. L. No. 
104-88, 109 Stat. 803 (1995) (ICCTA), which took effect on January 1, 
1996, abolished the Interstate Commerce Commission (ICC) and 
transferred certain of its motor carrier regulatory functions to the 
Secretary of Transportation (Secretary) and to the Surface 
Transportation Board (Board). See ICCTA section 101 (abolition of the 
ICC). See also new 49 U.S.C. 13101-14914 (regulatory provisions 
applicable to motor carriers, administered in part by the Secretary and 
in part by the Board).

[[Page 36478]]

    Finance Jurisdiction. Under the new provisions of 49 U.S.C. 14303, 
the Board has jurisdiction over finance transactions'i.e., 
consolidations, mergers, purchases, leases, and contracts to operate 
properties or franchises'involving motor passenger carriers. \1\ The 
Board's jurisdiction over these finance transactions is similar to that 
of the ICC.
---------------------------------------------------------------------------

    \1\ The ICC had similar jurisdiction over such transactions 
involving motor carriers of property and water carriers as well.
---------------------------------------------------------------------------

    Since enactment of the ICCTA, the Board has continued to apply in 
motor passenger carrier cases the procedural rules that were 
promulgated by the ICC. In most instances, the former rules have 
provided adequate and appropriate guidance to applicants and other 
interested parties, and there have been no difficulties in applying 
those rules under the new statute. The rules, however, are obsolete in 
some areas.
    The Board has reviewed the regulations and has determined that 
certain modifications are required to conform them to the new statute 
and to assure expeditious processing of motor passenger carrier finance 
proceedings. Relatively few substantive modifications are required to 
the former regulations, and these are detailed in a separate decision, 
which is available to all persons for a charge by calling DC NEWS & 
DATA, INC., at (202) 289-4357.

Environmental and Energy Considerations

    This action will not significantly affect either the quality of the 
human environment or the conservation of energy resources.

Regulatory Flexibility Analysis

    The Board certifies that the rules proposed, if adopted, would not 
have a significant economic impact on any substantial number of small 
entities. The procedures established are simple and expeditious, impose 
no additional reporting requirements on small entities, and maintain 
the rapid processing time typical of such applications under the former 
rules promulgated by the ICC. The Board seeks comments, however, on 
whether there would be effects on small entities that should be 
considered.

List of Subjects

49 CFR Part 1002

    Administrative practice and procedure, Common carriers, Freedom of 
information, User fees.

49 CFR Part 1182

    Administrative practice and procedure, Maritime carriers, Motor 
carriers.

49 CFR Part 1187

    Administrative practice and procedure, Maritime carriers, Motor 
carriers.

49 CFR Part 1188

    Administrative practice and procedure, Motor carriers.

    Decided: June 20, 1997.

    By the Board, Chairman Morgan and Vice Chairman Owen.
Vernon A. Williams,
Secretary.

    For the reasons set forth in the preamble, title 49, chapter X, 
parts 1002, 1182, 1187, and 1188 of the Code of Federal Regulations are 
proposed to be amended as follows:

PART 1002--FEES

    1. The authority citation for part 1002 continues to read as 
follows:

    Authority: 5 U.S.C. 552(a)(4)(A) and 553; 31 U.S.C. 9701; and 49 
U.S.C. 721(a).

    2. Section 1002.2 is proposed to be amended by revising fee items 
(2) and (5) in the table in paragraph (f) to read as follows:


Sec. 1002.2  Filing fees.

* * * * *
    (f) * * *

------------------------------------------------------------------------
                       Type of proceeding                          Fee  
------------------------------------------------------------------------
(2) An application to consolidate, merge, purchase, lease, or           
 contract to operate the properties or franchises of motor              
 carriers of passengers or to acquire control of motor carriers         
 of passengers, under 49 U.S.C. 14303..........................   1,100.
                  *        *        *        *        *                 
(5) A request for interim approval in connection with a finance         
 application involving a motor carrier of passengers, under 49          
 U.S.C. 14303(i)...............................................     250.
                  *        *        *        *        *                 
------------------------------------------------------------------------

    3. Part 1182 is proposed to be revised to read as follows:

PART 1182--PURCHASE, MERGER, AND CONTROL OF MOTOR PASSENGER 
CARRIERS

Sec.
1182.1  Applications covered by these rules.
1182.2  Content of applications.
1182.3  Filing the application.
1182.4  Board review of the application.
1182.5  Comments.
1182.6  Processing an opposed application.
1182.7  Interim approval.
1182.8  Miscellaneous requirements.

    Authority: 5 U.S.C. 559; 21 U.S.C. 853a; and 49 U.S.C. 13501, 
13902(c), and 14303.

Sec. 1182.1  Applications covered by these rules.

    These rules govern applications for authority under 49 U.S.C. 14303 
to consolidate, merge, purchase, lease, or contract to operate the 
properties or franchises of motor carriers of passengers or to acquire 
control of motor carriers of passengers. There is no application form 
for these proceedings. Applicants shall file a pleading containing the 
information described in 49 CFR 1182.2. See 49 CFR 1002.1(f)(2) and (5) 
for filing fees.


Sec. 1182.2  Content of applications.

    (a) The application must contain the following information:
    (1) Full name, address, and authorized signature of each of the 
parties to the transaction;
    (2) Copies or descriptions of the pertinent operating authorities 
of all of the parties; (NOTE: If an applicant is domiciled in Mexico or 
owned or controlled by persons of that country, copies of the actual 
operating authorities must be submitted.)
    (3) A description of the proposed transaction;
    (4) Identification of any motor passenger carriers affiliated with 
the parties, a brief description of their operations, and a summary of 
the intercorporate structure of the corporate family from top to 
bottom;
    (5) A jurisdictional statement, under 49 U.S.C. 14303(g), that the 
aggregate gross operating revenues, including revenues of all motor 
carrier parties and all of their motor carrier affiliates from all 
transportation sources (whether interstate, intrastate, foreign, 
regulated, or unregulated) exceeded $2 million;

(Note: The motor passenger carrier parties and their motor passenger 
carrier affiliates may select a consecutive 12-month period ending 
not more than 6 months before the date of the parties' agreement 
covering the transaction. They must, however, select the same 12-
month period.)

    (6) A statement indicating whether the transaction will or will not 
significantly affect the quality of the human environment and the 
conservation of energy resources;
    (7) Information to demonstrate that the proposed transaction is 
consistent with the public interest, including particularly: the effect 
of the proposed transaction on the adequacy of transportation to the 
public; the total fixed charges (e.g., interest) that result from the 
proposed transaction; and the

[[Page 36479]]

interest of carrier employees affected by the proposed transaction. See 
49 U.S.C. 14303(b);
    (8) Certification of the U.S. Department of Transportation safety 
fitness rating of each motor passenger carrier involved in the 
transaction, whether that carrier is a party to the transaction or is 
affiliated with a party to the transaction;
    (9) Certification by the party acquiring any operating rights 
through the transaction that it has sufficient insurance coverage under 
49 U.S.C. 13906(a) and (d) for the service it intends to provide;
    (10) A statement indicating whether any party acquiring any 
operating rights through the transaction is either domiciled in Mexico 
or owned or controlled by persons of that country; and
    (11) If the transaction involves the transfer of operating 
authority to an individual who will hold the authority in his or her 
name, that individual must complete the following certification:

    I, ____________, certify under penalty of perjury under the laws 
of the United States, that I have not been convicted, after 
September 1, 1989, of any Federal or State offense involving the 
distribution or possession of a controlled substance, or that I have 
been so convicted, but I am not ineligible to receive Federal 
benefits, either by court order or operation of law, pursuant to 21 
U.S.C. 853a.

    (b) The application shall contain applicants' entire case in 
support of the proposed transaction, unless the Board finds, on its own 
motion or that of a party to the proceeding, that additional 
evidentiary submissions are required to resolve the issues in a 
particular case.
    (c) Any statements submitted on behalf of an applicant supporting 
the application shall be verified, as provided in 49 CFR 1182.8(e). 
Pleadings consisting strictly of legal argument, however, need not be 
verified.
    (d) If an application or supplemental pleading contains false or 
misleading information, the granted application is void ab initio.


Sec. 1182.3  Filing the application.

    (a) Each application shall be filed with the Board, complying with 
the requirements set forth at 49 CFR 1182.8.
    (1) One copy of the application shall be delivered, by first-class 
mail, to the appropriate regulatory body in each State in which any of 
the parties operates in intrastate commerce.
    (2) If the application involves the merger or purchase of motor 
passenger carriers (contemplating transfer of operating authorities or 
registrations from one or more parties to others), one copy of the 
application shall be delivered, by first-class mail, to:

    Chief, Lic. & Ins. Div., U.S.D.O.T. Office of Motor Carriers-HIA 
30, 400 Virginia Ave. SW, Ste. 600, Washington, DC 20004

    (b) In their application, the parties shall certify that they have 
delivered copies of the application as provided in paragraph (a) of 
this section.


Sec. 1182.4  Board review of the application.

    (a) All applications will be reviewed for completeness. Applicants 
will be given an opportunity to correct minor errors or omissions. 
Incomplete applications may be rejected, or, if omissions are 
corrected, the filing date of the application, for purposes of 
calculating the procedural schedule and statutory deadlines, will be 
deemed to be the date on which the complete information is filed with 
the Board.
    (b) If the application is accepted, a summary of the application 
will be published in the Federal Register (within 30 days, as provided 
by 49 U.S.C. 14303(c)), to give notice to the public, in the form of a 
tentative grant of authority.
    (c) If the published notice does not properly describe the 
transaction for which approval is sought, applicants shall inform the 
Board within 10 days after the publication date.
    (d) A copy of the application will be available for inspection at 
the Board's offices in Washington, DC. Interested persons may obtain a 
copy of the application from the applicants' representative, as 
specified in the published notice.


Sec. 1182.5  Comments.

    (a) Comments concerning an application must be received by the 
Board within 45 days after notice of the application is published, as 
provided by 49 U.S.C. 14303(d). Failure to file a timely comment waives 
further participation in the proceeding. If no comments are filed 
opposing the application, the published tentative grant of authority 
will automatically become effective at the close of the comment period. 
A tentative grant of authority does not entitle the applicant to 
consommate the transaction before the end of the comment period.
    (b) A comment shall be verified, as provided in 49 CFR 1182.8(e), 
and shall contain all information upon which the commenter intends to 
rely, including the grounds for any opposition to the transaction and 
the commenter's interest in the proceeding.
    (c) The docket number of the application must be conspicuously 
placed at the top of the first page of the comment.
    (d) A copy of the comment shall be delivered concurrently to 
applicants' representative(s).


Sec. 1182.6  Processing an opposed application.

    (a) If timely comments are submitted in opposition to an 
application, the tentative grant of authority is void.
    (b) Applicants may file a reply to opposing comments, within 60 
days after the date the application was published.
    (1) The reply may include a request for an expedited decision on 
the issues raised by the comments. Otherwise, the reply may not contain 
any new evidence, but shall only rebut or further explain matters 
previously raised.
    (2) The reply shall be verified, as provided in 49 CFR 1182.8(e), 
unless it consists strictly of legal argument.
    (3) Applicants' reply must be served on each commenter in such 
manner that it is received no later than the date it is due to be filed 
with the Board.
    (4) Opposing commenters may reply to a request for an expedited 
decision, within 70 days after notice of the application was published.
    (c) The Board may
    (1) Dispense with further procedings and make a final determination 
based on the record as developed; or
    (2) Issue a procedural schedule specifying the dates by which: 
applicants may submit additional evidence in support of the 
application, in response to the comment(s) in opposition; and the 
opposing commentor(s) may reply.
    (d) Further processing of an opposed application will be handled on 
a case-by-case basis, as appropriate to the particular issues raised in 
the comments filed in opposition to the application. Evidentiary 
proceedings must be concluded within 240 days after publication of the 
notice of the application.


Sec. 1182.7  Interim approval.

    (a) A party may request interim approval of the operation of the 
properties sought to be acquired through the proposed transaction, for 
a period of not more than 180 days pending determination of the 
application. This request may be included in the application or may be 
submitted separately after the application is filed (e.g., once a 
comment opposing the application has been filed). An additional filing 
fee is required, whether the request for interim approval is included 
in the application or is submitted separately, at a later time. See 49 
CFR 1002.2(f)(5) for the additional filing fee.

[[Page 36480]]

    (b) A request for interim approval of the operation of the 
properties sought to be acquired in the application must show that 
failure to grant interim approval may result in destruction of or 
injury to those properties or substantially interfere with their future 
usefulness in providing adequate and continuous service to the public.
    (c) If a request for interim approval is submitted after the 
application is filed, it must be served on each person who files or has 
filed a comment in response to the published notice of the application. 
Service must be simultaneous upon those commenters who are known when 
the request for interim approval is submitted; otherwise, service must 
be within 5 days after the comment is received by applicants or their 
representative.
    (d) Because the basis for requesting interim approval is to prevent 
destruction of or injury to motor passenger carrier properties sought 
to be acquired under 49 U.S.C. 14303, the processing of such requests 
is intended to promote expeditious decisions regarding interim 
approval. The Board has no obligation to give public notice of requests 
for interim approval, and such requests are decided without hearing or 
other formal proceeding.
    (1) If a request for interim approval is included in the 
application, the Board's decision with regard to interim approval will 
be served in conjunction with the notice accepting the application.
    (2) If an application is rejected, the request for interim approval 
will be denied.
    (3) If an application is denied, after comments in opposition are 
submitted, any interim approval will terminate 30 days after service of 
the decision denying the application.
    (e) A petition to reconsider a grant of interim approval may be 
filed only by a person who has filed a comment in opposition to the 
application.
    (1) A petition to reconsider a grant of interim approval must be in 
writing and shall state the specific grounds upon which the commenter 
relies in opposing interim approval. The petition shall certify that a 
copy has been served on applicants' representative.
    (2) The original and 10 copies of the petition to reconsider a 
grant of interim approval shall be filed with the Board, and one copy 
of the petition shall be served on applicants' representative(s).
    (f) The Board may act on a petition to reconsider a grant of 
interim approval either separately or in connection with the final 
decision on the application.


Sec. 1182.8  Miscellaneous requirements.

    (a) If applicants wish to withdraw an application, they shall 
jointly request dismissal in writing.
    (b) An original and 10 copies of all applications, pleadings, and 
other material filed under this part must be filed with the Board.
    (c) All pleadings (including motions and replies) submitted under 
this part shall be served on all other parties, concurrently and by the 
same (or more expeditious) means with which they are filed with the 
Board.
    (d) Each pleading shall contain a certificate of service stating 
that the pleading has been served in accordance with paragraph (c) of 
this section.
    (e) All applications and pleadings containing statements of fact 
(i.e., except motions to strike, replies thereto, and other pleadings 
that consist only of legal argument) must be verified by the person 
offering the statement, in the following manner:

    I, [Name and Title of Witness], verify under penalty of perjury, 
under the laws of the United States of America, that all information 
supplied in connection with this application is true and correct. 
Further, I certify that I am qualified and authorized to file this 
application or pleading. I know that willful misstatements or 
omissions of material facts constitute Federal criminal violations 
punishable under 18 U.S.C. 1001 by imprisonment up to five years and 
fines up to $10,000 for each offense. Additionally, these 
misstatements are punishable as perjury under 18 U.S.C. 1621, which 
provides for fines up to $2,000 or imprisonment up to five years for 
each offense. [Signature and Date]

    (f) If completion of a transaction requires the transfer of 
operating authorities or registrations from one or more parties to 
others, the parties shall comply with relevant procedures of State 
authorities and of the Office of Motor Carriers of the U.S. Department 
of Transportation, to accomplish such transfers.

PART 1187--[REMOVED]

    4. Part 1187 is proposed to be removed.

PART 1188--[REMOVED]

    5. Part 1188 is proposed to be removed.
[FR Doc. 97-17746 Filed 7-7-97; 8:45 am]
BILLING CODE 4915-00-P