[Federal Register Volume 63, Number 224 (Friday, November 20, 1998)]
[Notices]
[Pages 64536-64537]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-31093]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board
[STB Docket Nos. S. MC-F-20937 and MC-F-20939] \1\


Coach USA, Inc., and Coach USA Northeast, Inc.--Control--Bonanza 
Bus Lines, Inc. and Coach USA North Central, Inc.--Control--Central Cab 
Company and Mountaineer Coach, Inc.

AGENCY: Surface Transportation Board.
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    \1\ These proceedings are not consolidated. A single decision is 
being issued for administrative convenience.

ACTION: Notice tentatively approving finance transactions.

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SUMMARY: Coach USA, Inc. (Coach), a noncarrier, and its wholly owned 
noncarrier subsidiaries, Coach USA Northeast, Inc. (Northeast), and 
Coach USA North Central, Inc. (North Central) (collectively, 
applicants), filed an application \2\ under 49 U.S.C. 14303 for 
Northeast to acquire control of Bonanza Bus Lines, Inc. (Bonanza), a 
motor passenger carrier, and for North Central to acquire control of 
Central Cab Company (Central Cab) and Mountaineer Coach, Inc. 
(Mountaineer), both motor passenger carriers. Persons wishing to oppose 
the applications must follow the rules under 49 CFR 1182.5 and 
1182.8.\3\ The Board has tentatively approved the transactions, and, if 
no opposing comments are timely filed, this notice will be the final 
Board action.
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    \2\ Applicants filed a single pleading. Although the proposed 
control transactions are unrelated, applicants sought approval in a 
single application which embraced both transactions. Each 
transaction has been separately docketed.
    \3\ Revised procedures governing finance applications filed 
under 49 U.S.C. 14303 were adopted in Revisions to Regulations 
Governing Finance Applications Involving Motor Passenger Carriers, 
STB Ex Parte No. 559 (STB served Sept. 1, 1998).

DATES: Comments must be filed by January 4, 1999. Applicants may file a 
reply by January 19, 1999. If no comments are filed by January 4, 1999, 
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this notice is effective on that date.

ADDRESSES: Send an original and 10 copies of any comments referring to 
STB Docket No. MC-F-20937, et al. to: Surface Transportation Board, 
Office of the Secretary, Case Control Unit, 1925 K Street, NW, 
Washington, DC 20423-0001. In addition, send one copy of comments to 
applicants' representatives: Betty Jo Christian and David H. Coburn, 
Steptoe & Johnson LLP, 1330 Connecticut Avenue, NW, Washington, DC 
20036.

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

SUPPLEMENTARY INFORMATION: In Coach USA, Inc., and Coach USA North 
Central, Inc.--Control--Nine Motor Passenger Carriers, STB Docket No. 
MC-F-20931, et al. (STB served Nov. 19, 1998), we approved, subject to 
comments, Coach's transfer of direct control of Coach-controlled motor 
passenger carriers to six noncarrier subsidiaries: North Central, 
Northeast, Coach USA South Central, Inc., Coach USA Southeast, Inc., 
Coach USA West, Inc., and Yellow Cab Service Corporation. While Coach 
will remain the sole owner of all of the stock of the subsidiaries, and 
will indirectly control the operating carriers, the subsidiaries will 
directly control the existing and future operating carriers of Coach.
    Coach currently controls 73 motor passenger carriers. In STB Docket 
No. MC-F-20937, Coach and Northeast seek control of Bonanza.\4\ In STB 
Docket No.

[[Page 64537]]

MC-F-20939, Coach and North Central seek control of Central Cab \5\ and 
Mountaineer.\6\ The acquisitions of control will be accomplished 
through the acquisition of all of the stock of each carrier. According 
to applicants, the stock is currently held in independent voting trusts 
to avoid any unlawful control pending disposition of this proceeding.
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    \4\ Bonanza is a Rhode Island corporation. It holds federally 
issued operating authority in Docket No. MC-13028, which authorizes 
it to provide regular-route operations between various points in New 
England and between points in New England to points in New York, and 
charter and special operations between points in the United States. 
It also holds authority issued by the Rhode Island Division of 
Public Utitilies and Carriers, the Connecticut Department of 
Transportation, and the Massachusetts Department of Public Utilities 
to conduct intrastate operations. It operates 54 buses; employs 
approximately 150 persons; and earned gross annual revenues in 
fiscal year 1997 of approximately $19 million. Prior to the transfer 
of its stock into a voting trust, it was owned by George M. Sage.
    \5\ Central Cab is a Pennsylvania corporation. It holds 
federally issued operating authority in Docket No. MC-133058, which 
authorizes it to provide regular-route common carrier charter and 
special operations between points in the United States (except 
Hawaii). It also holds authority issued by the Pennsylvania Public 
Utility Commission, the Public Service Commission of West Virginia, 
and the Public Utilities Commission of Ohio to conduct intrastate 
operations. It operates approximately 34 motorcoaches, 11 school 
buses, and 9 vans; employs 96 persons; and earned gross annual 
revenues in fiscal year 1997 of approximately $4.7 million. Prior to 
the transfer of its stock into a voting trust, it was owned by John 
L. McNelly.
    \6\ Mountaineer is a Pennsylvania corporation. It holds 
federally issued operating authority in Docket No. MC-229627, which 
authorizes it to provide charter and special operations between 
points in the United States (except Alaska and Hawaii). It also 
holds authority issued by the Public Utilities Commission of West 
Virginia to conduct intrastate operations. It operates 6 
motorcoaches and 2 vans; employs 28 persons; and earned gross annual 
revenues in fiscal year 1997 of approximately $1.1 million. Prior to 
the transfer of its stock into a voting trust, it was owned by John 
L. McNelly.
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    Coach submits that there will be no transfer of any federal or 
state operating authorities held by any of the carriers to be acquired. 
Following the consummation of the control transactions, each of these 
carriers will continue operating in the same manner as before and, 
according to Coach, granting the applications will not reduce 
competitive options available to the traveling public. Coach asserts 
that the carriers to be acquired do not compete to any meaningful 
degree with one another, are relatively small, and each faces 
substantial competition from other bus companies and transportation 
modes.
    Coach also submits that granting the application will produce 
substantial benefits, including interest cost savings from the 
restructuring of debt and reduced operating costs from Coach's enhanced 
volume purchasing power. Specifically, Coach claims that each carrier 
to be acquired will benefit from the lower insurance premiums 
negotiated by Coach and from volume discounts for equipment and fuel. 
Applicants indicate that Coach or the relevant subsidiary will provide 
each of the carriers to be acquired with centralized legal and 
accounting functions and coordinated purchasing services. In addition, 
applicants state that vehicle sharing arrangements will be facilitated 
to ensure maximum use and efficient operation of equipment and that 
coordinated driver training services will be provided. Applicants also 
state that the proposed transactions will benefit the employees of each 
of the carriers to be acquired and that all collective bargaining 
agreements will be honored by Coach and the subsidiaries.
    Coach plans to acquire control of additional motor passenger 
carriers in the coming months. It asserts that the financial benefits 
and operating efficiencies will be enhanced further by these subsequent 
transactions. Over the long term, Coach states that it will provide 
centralized marketing and reservation services for the bus firms that 
it controls, thereby enhancing the benefits resulting from these 
control transactions.
    Applicants certify that: (1) the jurisdictional threshold has been 
met with respect to the transactions that are the subject of the 
applications; \7\ (2) none of the carriers to be acquired holds an 
unsatisfactory safety rating from the U.S. Department of 
Transportation; \8\ (3) each of the carriers to be acquired has 
sufficient liability insurance; (4) none of the carriers to be acquired 
is domiciled in Mexico or owned or controlled by persons of that 
country; and (5) approval of the transactions will not significantly 
affect either the quality of the human environment or the conservation 
of energy resources. Additional information may be obtained from the 
applicants' representatives.
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    \7\ See 49 CFR 1182.2(a)(5).
    \8\ Bonanza and Central Cab each hold a satisfactory rating; 
Mountaineer has not been rated.
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    Under 49 U.S.C. 14303(b), we must approve and authorize a 
transaction we find consistent with the public interest, taking into 
consideration at least: (1) the effect of the transaction on the 
adequacy of transportation to the public; (2) the total fixed charges 
that result; and (3) the interest of affected carrier employees.
    On the basis of the applications, we find that the proposed 
acquisitions of control are consistent with the public interest and 
should be authorized. If any opposing comments are timely filed, this 
finding will be deemed vacated and, unless a final decision can be made 
on the record as developed, a procedural schedule will be adopted to 
reconsider the applications.\9\ If no opposing comments are filed by 
the expiration of the comment period, this decision will take effect 
automatically and will be the final Board action.
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    \9\ Under revised 49 CFR 1182.6(c), a procedural schedule will 
not be issued if we are able to dispose of opposition to the 
application on the basis of comments and the reply.
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    Board decisions and notices are available on our website at 
``WWW.STB.DOT.GOV.''
    This decision will not significantly affect either the quality of 
the human environment or the conservation of energy resources.

It Is Ordered

    1. The proposed acquisitions of control are approved and 
authorized, subject to the filing of opposing comments.
    2. If timely opposing comments are filed, the findings made in this 
decision will be deemed as having been vacated.
    3. This decision will be effective on January 4, 1999, unless 
timely opposing comments are filed.
    4. A copy of this notice will be served on: (1) the U.S. Department 
of Transportation, Office of Motor Carriers-HIA 30, 400 Virginia 
Avenue, SW, Suite 600, Washington, DC 20024; and (2) the U.S. 
Department of Justice, Antitrust Division, 10th Street & Pennsylvania 
Avenue, NW, Washington, DC 20530.

    Decided: November 12, 1998.
    By the Board, Chairman Morgan and Vice Chairman Owen.
Vernon A. Williams,
Secretary.
[FR Doc. 98-31093 Filed 11-19-98; 8:45 am]
BILLING CODE 4915-00-P