990331vak.docx

DECISION MEMORANDUM
TO:COMMISSIONER HANSEN
COMMISSIONER SMITH
COMMISSIONER KJELLANDER
MYRNA WALTERS
TONYA CLARK
RON LAW
DAVID SCOTT
WORKING FILE
FROM:ALLAN KILLIAN
DATE:MARCH 31, 1999
RE:PROTEST TO THE APPLICATION OF O TRANSPORT FOR COMMON/ CONTRACT AUTHORITY, CASE NO. M-8432-1
On February 24, 1999, the Commission issued a Notice of Modified Procedure concerning O Transport’s Application for motor common/contract carrier authority to transfer general commodities and hazardous material within Idaho.  The Commission’s Notice required that persons protesting O Transport’s Application do so no later than March 17, 1999.  In response to the Notice, the Commission received a timely protest from Wrightway, Inc.  On March 18, 1999, the Administrator of the Motor Carrier Division advised O Transport that a protest to its Application had been received and if it desired to file a response to the protest, it must do so no later than April 1, 1999.  On March 29, 1999, a response from O Transport was received.
THE APPLICATION
O Transport’s owner, Marvin Olson, filed his Application for permanent and temporary authority on January 19, 1999.  In its Application, the carrier requested authority to transport hazardous material and indicated that it had one tank truck and tank trailer.  The Application, submitted by O Transport’s driver, Dale Fox, certified that the carrier “will abide by all regulations applicable to motor carriers as promulgated by the Idaho Public Utilities Commission. . . .”
THE PROTEST
In its Letter of Protest, Wrightway makes several allegations regarding O Transport’s conduct.  See attached Protest.  First, Wrightway alleges that O Transport has been acting as a common carrier in the state of Idaho without authority.  More specifically, the Protestant alleges that in early January 1999 O Transport started acting as a common carrier hauling “placarded product for Bob Call Oil Co. of Rexburg, Idaho without authority.  O Transport and its driver/manager have blatantly disregarded the law [in] this area.”  Wrightway further alleged that O Transport was to transport “product as a common carrier tomorrow, 3-17-99, for Independent Oil of Jackson, Wy.”
Wrightway generally alleges that authorizing too many carriers to operate in a geographic region will invariably lead to cost cutting in vehicle maintenance.  The Protestant asserts that this cost cutting invariably leads to a reduction of overall vehicle safety and consequently impairs the safety of other highway users.
In addition, too many carriers in a geographic region forces carriers to “save costs of operation.”  In an effort to reduce operating costs, carriers will employ “driving candidates that can be hired at lower levels of pay.  These types of drivers are in most all cases less experienced and qualified to be driving a truck with placarded products on board.  
Because of the lack of experience of this type of driver, they tend to drive the trucks too fast and with less control.  This is a safety problem!  Many carriers will look at having their existing Staff of drivers haul more loads each day to save the costs associated with having additional employees.  These drives, even though it is a log book violation, will haul additional loads and drive longer hours which effects their response time in times of emergency.  This is another safety issue!
Please give these important safety issues consideration before granting authority to O Transport.
Protest at 1-2.
RESPONSE
In its Response of March 29, Mr. Olson, owner of O Transport, stated that prior to January 1, 1999, he was a 50% owner in Wrightway, Inc.  Effective January 1, 1999, Wrightway purchased Mr. Olson’s shares in that company and, in turn, Mr. Olson purchased one of Wrightway’s trucks.  See, attached Response.  Mr. Olson states that he had advised his partner in Wrightway that he was going to start his own company and both men agreed at that time that Mr. Olson could operate under Wrightway’s authority until Olson had been granted his own authority.  Wrightway’s senior driver with 25 years of experience left Wrightway and became an employee for O Transport.
STAFF ANALYSIS
Rule 41 of the Commission’s Motor Carrier Rules, IDAPA 31.61.01.41 states that applicants for motor carrier permits must show that they are “fit, willing and able to perform properly the proposed service while complying with the motor carrier safety regulations and financial responsibility requirements” (i.e., the carrier will maintain adequate liability insurance.  Ref. Rule 21, Motor Carrier Rules).  Staff notes that on January 20, 1999, the Commission received a Certificate of Liability Insurance from Tandy & Wood, Inc., covering O Transport for the period 9/1/98 through 9/1/99.  Furthermore, Staff believes that the protest made by Wrightway is based upon undocumented assumptions.  Staff has no reason to believe that O Transport will not comply with the Commission’s motor carrier safety regulations.  Thus, Staff does not believe that Wrightway’s protest constitutes a sufficient basis for denying O Transport’s application.  Staff recomends that O Transport’s application for a motor carrier permit be granted.
Commission Decision:
How does the Commission wish to rule with respect to O Transport’s application for a motor carrier permit?
_____________________________
Allan Killian
(prepared with assistance from Brad Purdy)
vld/M:M-8432-1.dh