Appendix — Washington Metropolitan Area Transit Commission v. D. C. Transit System, Inc.

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Ynited States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

No. 20,188

D.C. Transrr System, Inc., PETITIONER

v.

Wasutxcrow METROPOLITAN pm Transit Commission,

RESPONDENT ~

W.M.A. Transtr CoMPaNy, INTERVENOR.

, Petition to Review Orders of the

Washington Metropolitan Area Transit Commission

Decided March 7, baad

Mr. is M. Spear, with cba Mr. Manuel J. Davis

was on the brief, for petitioner.

_ Mr. Russell W. Cunningham for respondent.

Mr. Stanley H. Kamerow, with whom Mr. Allan L.

Kamerow was on the brief, for intervenor.

Before Fany, McGowan and Tamm, Circuit Judges.

McGowan, Circuit Judge: This is an invocation of the

power vested in us by Congress to review orders of the -

Ww ashington Metropolitan Area Transit Commission. This

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review authority is byt one facet of the Waghington Metro-

politan Area Transit Regulation Compact, Public Law

86-794, 74 Stat. 1031 (1960), which brought ‘the Commis-

sion into being as .part of a comprehensive scheme,

transcending state lines, for. the regulation of mass transit."

The orders under review. directed two bus companies—

Alexandria, Barcroft and Washington Transit \Company,

Inc.'(ABW), and W.M.A. Transit Company (WMA)—to

extend their routes from their present terminals at 11th

and 12th Streets and Pennsylvania Avenue, N. W., to the

vicinity of 18th and. L Streets, N.W. The complainant

here is D.C. Transit System, Inc. (Transit), which provides

bus service within the District of Columbia generally and,

in particular, along the route extensions of ABW and -

WMA ordered by the Commission. WMA has intervened

here in support of the Commission’s action. We have con-

cluded, for the rea%ons hereinafter appearing, that that

- action must be set aside. ) :

Geen |

Transit has pressed upon us a number of respects in

which it asserts the Commission has erred. We do not

1The regulatory provisions are contained in a Compact

entered into by Virginia, Maryland, and the District of

Columbia. The Compact is set forth in a statute wherein |

Congress has, as required by the Constitution, given its.

consent to it. Other provisions of the statute,. as distinct

from the Compact, provide among other things that .(1)

. the powers of the Public Utilities Commission of the District

of.Columbia with respect to transportation shall be suspended

during the life of the Compact, and (2) the rights, duties,

and obligations created by the Act of July 24, 1956, Public

Law 757, 70 Stat. 598, granting a franchise to D.C. Transit

System, Inc., shall not be impaired or affected by anything

_ in the Compact or in the statute consenting to it. The statute

_ consenting to and embodying the Compact is set forth in

1 D.C. Code $§ 1410-16 (1961 ed.).* ewan

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need. to address ourselves to more than ‘the essential

premise upon which the Commission proceeded. This was

_ that the grandfather certificates held by ABW and WMA

encompassed the routes as extended, and that all that the -

Commission had to consider, before ordering ABW and

WMA to provide the additional service, was whether there -

was any significant demand for it. As the Commission put —

the matter in its order under review, if what it termed:

the “crucial issue” of the scope of the grandfather cer-

tifieates-be decided in favor of an expansive reading of -

them, then the. “secondary “issue” of the public interest

“can largely be determined by an inquiry into the demand

for the proposed service.” Thus it was that upon evidence

designed to show that ABW and WMA riders would be

convenienced, by the route extensions and would make use

of them, and without reference to the adequacy of the

existing service being provided by Transit or the impact

upon Transit and its riders of the resulting loss of rev-

enue, the Commission commanded the enlarged service to

be supplied. In so deciding, the Commission, in our view,

unacceptably departed from the authority conferred upon

it by the Compact.

(When Congress consented to the Compact in 1960, it

elected to treat the metropolitan area of Washington as

a geographical unit,.with the Commissién as the central

licensing and rate-making authority. No one could engagé

in the transportation covered by the Compact except upon

its terms; and these included the issuance by the Com-

_ mmission of a certificate of public convenience and necessity. /

Recognizing the equities underlying the familiar “grand-

father” approach, the Compact expressly contemplated -

the issuance of certificates, without new or further proof

of public convenience and necessity, to those “bona fide “~

engaged in transportation” on the \effective date of the

statute. ABW and WMA sought and were given such

grandfather certificates. we were sa to any proof A

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of public convenience and necessity. ‘The transportation

they were providing on the effective date of the Compact

extended from various points in Virginia“and — Maryland;

respectively, to their terminals. at 11th and 12th Streets

and Pennsylvania Avénue, N. W., in the District: Their

‘grandfather certificates, by statutory definition, could

cover no more, and, as issued, they do not purport to.?

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The Commission may, like most regulatory bodies,

require existing certificate holders to extend their services

beyond those previously authorized. This power is reposed

in Section 4(e) of the Compact, the full text. of which is

set forth’ in the margin.’ It will he observed that, in

2 It is familiar law that the grandfather principle in public

utility licensing is founded upon actual—and not potential—

operations. United States v. Carolina Freight Carriers Corp.,

815 U.S. 475. (1942). And see Holiday Tours, Inc. v.

WMATC, 122 U.S.App.D.C. 196, 352 F.2d 672 (1965), and

Gadd v. WMATC, 121 U.S.App.D.C. 7, 347 F.2d 791 (1965).

There ts no reason to suppose that Congress read the Compact

language of “bona fide engaged in transportation .. . on the

effective date of this Act” in any manner contrary to this

principle. See also Nashua Motor Express, Inc. v. United

States, 230 F. Supp. 646 (D.N.H. 1964).

’“The Commission may, if it finds that the public con-

venience and necessity so require, require any person subject

to this Act to extend any existing service or provide any

additional service over additional routes within the Metro-

oe District; provided, however, that no certificate shall

issued to operate over the routes of any holder of a

certificate until it shall be proved to the satisfaction of the

Commission, after hearing, upon reasonable notice, that the

service rendered by-sttch certificate holder, over such ‘route,

is inadequate to the requirements of the public necessity _

and convenience; and provided, further, if the Commission

shall be. of opinion that the service rendered by such certifi-

cate holder over such route is in any respect inadequate to

. *

‘

=o

————————oeeeeeererereereerrerrrrrrrroorrrrere

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addition to a general finding of public convenience and .

necessity as a condition of such extension, there are preeise .

limiting provisos applicable to those cases where the

service extension is over the routes of another certificate

holder. These are (1) that, the latter’s service is found

to be inadequate, and (2) that,.if so found, he be given

a chance to’ remedy it. The Commission made no such

: finding i in ‘respect of Transit in this case.‘

Before the advent of the Compact, a carrier coming 2,

into: the District of Columbia from Maryland or Virginia’

needed: certificate. authority for this -interstate service . |

from the Interstate Commerce Commission. It was: the —

. practice of that agency to specify only the District of

Columbia as the terminus of the service, leaving it to .

local regulatory authority to control the street routings

-, and’termini. within the District. This latter authority for

_ years was. exercised by a Joint Board made up of the

Public Utilities Commission of the District and the ‘District

the requirements of the satis: necessity and convenience,

such certificate holder shall be given reasonable time and

‘opportunity to remedy such inadequacy before any certificate

shall be granted to operate over such route; and further.

provided that no person subject to this Act may be required

to extend any existing service-or. provide any additional

_- service over additional routes within the Metropolitan Dis- »

‘trict unless the carrier is currently earning a reasonable

return on its operation as a whole in performing transporta-

tion subject to this Act.”

‘Transit intervened in the proceedings instituted ‘by. the

Commission looking toward an extension of the services of |

ABW and WMA; and it participated in the hearing. As

the Commission’s decisional order notes, Transit urged in - .

opposition that it would lose “a great amount of traffic which '

it now handles via a transfer arrangement,” and that new .

certificate authority could not, under Section 4(e), be given

ABW and WMA without a finding as ‘to inadequacy of

Transit’s service and the affording of dn opportunity: to

Transit to repair any -inadequacy found.

—_—— OOO OOOO Ee

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Commissioners. It was from this source that ABW and

WMA originally received the authority te traverse certain

streets from the District line. to the terminal points at

11th and 12th Streets and Pennsylvania Avenue. Prior to

fhe Compact, they had no authority to extend their opera-

tions beyond these points. | 8

The Commission now appears‘ to assume that, sinee it

has in effect succeeded to the authority of both the Inter-

state Commerce Commission and the Joint .Board of the

District of Columbia, it may treat ABW and WMA as _—

heing already clothed-with certificate authority to go any-

where in the District that the Commission thinks desirable.

On this theory, the protections of Section 4(e) of the

Compact for existing certificate holders are not applicable,

“sand the Commission need not regard route extensions of

the ‘kind here ordered as ‘néw and competitive grants of

certificate authority. We think this assumption is clearly

at’ odds with the Congressional purposes to be discerned |

from the Compact and the statute approving it. What.

5 As remarked above, Note 1, Congress was. careful to make

clear that no rights of Transit under its franchise were to

be impaired by the Compact. Section 3 of the franchise

statute is as follows: _ ees ; oe

No competitive street railway or bus. line, that is,

bus or railway line for the transportation of passengers

of the character which runs over a given route on a4

fixed schedule, shall be established to operate in the

‘District, of Columbia without the prior issuance of a

certificate by the Public Utilities Commission of the

District of Columbia (referred to in this part as the

“Commission”) to the effect that the competitive line

ig necessary for the convenience of the’ public.

We need not decide whether this adds anything to the

more specific protections contained in’ Section 4(e) of the

Compact, but it emphasizes a Congressional concern that

Transit was to be. protected against competition except as

_ such competition was found to be necessary to the public

ca

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the Joint Board or the Public Utilities Commission of the

‘ District of Columbia might have done before the 1956

franchise statute and the 1960 Compact are not the

‘measure of the. Commission’ 8 authority now.

Transit has been given no exclusive and permanent

monopoly. The Commission can, with due observance of

the réquirements of the statute and upon proper findings,

grant certificate authority competitive with that held by

Transit. What the Commission cannot do is to extend

the routes in the District of ABW and WMA in a manner

competitively adverse to Transit without taking into

account the limiting conditions ‘contained in Section 4(e),

and that involves a concept of the public convenience and

~ necessity which goes far beyond that of the riders of ABW

and WMA alone. | ,

There is no serious dispute owe that the route exten-

sions ordered will have a substantial financial impact

upon Transit. The Virginia resident who formerly had

to continue his journey from 12th and Pennsylv ania to

18th and L on Transit now can complete that journey on

ABW without the need of using Transit. This may be a

fine thing for him, but his convenience is not, under the

convenience. The latter concept would seem to embrace a

broader view of the public interest than the Commission

thought was involved in this case.

¢ There was testimony by Transit that it would lose 171A¢

from the joint-fare arrangement previously in effect for each

passenger from Virginia. or Maryland who desired to con-

tinue by bus to the 18th and L Streets area. This was esti-

mated as entailing a revenue loss of from $130,000 to $600,000

per year. The Commission’s ‘Staff witness, although not

accepting the accuracy of. these: estimates, did not regard

the differences as important because he would recommend .

the route extension in any event.

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to provide good. transportation service to the residents of .

the District of Columbia at reasonable rates is intimately

related to the degree of utilization of its service. In

transportation, as elsewhere, volume critically affects .

‘¢apacity to provide the best service at the lowest rates.

~ Te, take away a part of Transit’s volume by putting new

competition on its routes may conceivably have a signifi-

cantly adverse impact upon those bus riders in the District

who must look to Transit for intra-District service.

We do not say that the Commission could under no

circumstances do what it has done.’ What we do say is

that such action must be taken in conformity with the

statutory requirements and by reference to the statutory

standards. ‘That was clearly not done here; and accord-

ingly, the route extensions for ABW and WMA ordered

‘by the Commission must be set aside.

It is so ordered.

y

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BEFORE THE

WASHINGTON METROPOLITAN AREA |

* ‘TRANSIT COMMISSION -

WASHINGTON, D. C.

ORDER NO. 581

IN THE MATTER OF: re 4 A

aks Served

Order Instituting Investigation to March 25, 1966

. Determine Whether WMA Transit .

Company and Alexandria, Barcroft; Docket No. 91

and Washington Transit Company, :

Should Extend Bus’ Routes in — ;

ington, D. C. ees ao

_ APPEARANCES:

STANLEY H. KAMEROW. 1025 Vermont, Avenue, N. W.,

Washington, D. C., appearing on } ne of WMA Transit

Company, Respondent.

S. HARRISON KAHN, ‘and ROBERT T. MITCHELL, JR.,

733 Investment Building, Washington, D. C., appearing on

behalf of Alexandria, Barcroft and Washington Transit ?

Company, Respondent.

MANUEL J. DAVIS, 1629 K Street, N. W., Washington,

.D. C., appearing on behalf of Washington, Virginia and

Maryland Coach Company, Inc., Intervenor.

JOHN R. SIMS, JR. and HARVEY M. SPEAR, 3600 M

Street, N. W., Washington, D. C., appearing on behalf of

D. C. Transit System, Inc., Intervenor.

RUSSELL W. CUNNINGHAM, 1815 North Fort Myer

Drive, Arlington, Virginia, appearing on behalf of the

- Washington Metropolitan Area Transit Commission.

This matter came before the Commission upon the recom-

_mendations of the Engineering staff to require A. B. & W.

Transit Company (“A. B. & W.”), and WMA Transit Company

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(“WMA”), to extend their routes to an area in the vicinity

of 18th and L Streets, N.W., Washington, D. C. At the

present time the service of these carriers generally terminates

in the vicinity of 11th and 12th Streets and Pennsylvania

Avenue, N.W., Washington, D. C. Under the staff proposal,

_ A. B. & W. and WMA would establish additional terminal |

points in the vicinity of 18th and L Streets, N:W.

_ By Order No. 482, served May 25, 1965, the Commission -

ordered that an investigation be made and hearing held :con-

cerning the propriety and reasonableness of the staff's rec- _

‘ommendations discussed above.

A. B. & W. and WMA were made respondents and D. C.

Transit System, Inc., (“D.C. Transit” or “Transit”), and Wash-

ington, Virginia and Maryland Coach Company, Inc. (“W. V.

& M.”), were permitted to intervene in the proceeding. Pub-

lic hearings were held on June 22, August 10, 11, 13 and ©

17, 1965. In addition to the voluminous oral testimony, |

. ‘some one hundred eighty-six (186) exhibits were’ offered

into evidence, of which four (4) were not received. The

Commission also had the benefit: of briefs. -

‘ Prior’ to and during the course of this proceeding, several

motions were filed, including a motion to terminate the pro-

ceeding, a motion for proposed report and‘a motion for oral

arguments, the latter of which was filed subsequent to the

filing of briefs. The examiner: properly denied some of. these

motions, and those motions which were not denied are

hereby denied. The Commission is of the opinion that the

' evidence adduced at the hearings and briefs of counsel are

more than adequate to enable the Commission to reach a

fair and equitable decision in this matter, and that oral argu-

ments would not contribute materially to the cociten ate

ing process.

The staff presented the testimony of Mr. Charles W. Over-

house, the Commission’s Chief Engineer; Mr. Paul W. Fore-

man, Defense Coordinator for the General ‘Services Admin-

istration; Mr. William D. Heath, Executive Director, Motor

Vehicle Parking Agency of the District of Columbia; Mr.

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Daniel J. Hansen, Deputy Director of Traffic Engineering

and Operations for the D. C. Department of Highways and

Traffic; and Mr. Edwin L. Kesler, a resident of North

Springfield, Virginia. .

Respondent, A. B. & W., presented the testimony of Mr.

Richard F. Lawson, its Operations Manager, and Mr. George

R. Snyder, a Certified Public Accountant employed by

A.B.&W: A.B. & W., while admitting it held appropriate |

authority to serve the area proposed by the staff, opposed

_the proposed route extensions on the ground that the pro-

posed service would be uneconomical, contending that the

proposed service would ‘result in additional expenses without

_ an attendant increase in revenues. ; os

Intervenor, D. C. Transit, presented the testimony of Mr. |

William E. Bell, its Assistant Vice President, Research and:

- Development; Mr. Gordon Phillips, its Associate General

Counsel; Mr. John R. Sims, Jr., its Associate General Coun-

sel; and Mr. Parker C. Peterman, its Vice President and

Comptroller.. D. C. Transit opposed the proposed route

extensions on two grounds, namely: (1) that the proposed

service would lure away from it a great amount of traffic it

now handles via a transfer arrangement. and (2) that the

respondent-carriers’ certificates do not authorize the pro-

‘posed transportation, and, because of this fact, are not: en-

titled to such authority until the Commission finds that the

existing service is inadequate and D. C. Transit is given the

opportunity to correct any deficiencies found to exist in

the present service.

Intervenor, W. V. & M., presented the testimony of Mr.

S. A. DeStefano, its President, in er to the proposed

route extension.

Respondent, WMA, presented rebuttal. Satanic of its

Controller, Mr. Samuel A. Sardinia. WMA agreed with the

staff’s position that it holds appropriate authority from the

Commission to operate the proposed service, and is willing

to institute the proposed service if ordered by the Commis- —

sion.

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The staff recommended that the Commission require

A.B.& W. and WMA to extend their present service to the

. vicinity of 18th and L Streets, N.W., by route authorizations .

since in the staff’s view, the certificates of public conven-

ience and necessity of both carriers already authorize such |

operations. | 7

There are two basic issues involved in this, proceeding.

The crucial issue is whether or not A. B. & W. and WMA

- presently have the authority by virtue of their existing cer-

tificates of public convenience and necessity to perform the

_ proposed transportation. If the present certificates of these

carriers authorize such transportation, D. C. Transit and —

W. V.& M. cannot be heard to complain; the Commission will

be. merely requiring A. B. & W..and WMA to do what they

are by law required to do under their existing certificates of

public convenience and necessity. If A. B. & W. and WMA

already hold appropriate authority to perform the proposed

transportation, the secondary issue becomes ‘one of deter-

mining whether or not it would be in the public interest to

require such transportation. The public interest question

can be.largely determined by an inquiry into the demand

- for the proposed ‘service.

The answer to the crucial question as to whether or not the

certificates of A. B. & W. and WMA authorize the subject

transportation appears to lie in the certificates themselves.

Before looking to the actual language of the certificates, how-

ever, it is necessary to consider the circumstances surrounding

their issuarice. Both certificates were granted pursuant to ,

the “grandfather” provisions of the Washington Metropoli-

tan Area Transit Regulation Compact (“Compact”). In the

case of WMA, it had, before the creation of the Commission, -

operated within Prince Georges County, Maryland, under

authority granted to it by the Maryland Public Service Com-

mission; within the District of Columbia, by virtue of the |

authority granted by the District of Columbia Public Utili-

ties Commission ?(“PUC”); and in jnterstate commerce be-

: es

Now the District of Columbia Public Service Commission.

/

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tween points in Maryland and points in the District of Co-

. lumbia, under certificates of public convenience and necessity

granted by the Interstate Commerce Commission (“ICC”).

In this latter franchise, as was its custom, the ICC“ specified

the terminal service (i.e., between: Maryland points, Washing-

ton, D. C.), and specified the routes in Maryland over which

the service was to be operated, to the District of Columbia —

line. Treating the District of Columbia as a city, the ICC

‘did not specify the street routings or terminal locations. All-

of these pre-compact authorities, plus exempt operations,’ _

formed the basis for the WMA “grandfather” claim, and the

resulting certificate. issued by this Commission combined all

of them into one document.

In the case of A. B. & W., the above described background .'’

is applicable, except that its operations are. between Wash-

ington, D: C., and the Northern Virginia area, comprising

Alexandria and parts of Arlington and Fairfax Counties. Its

ICC authority, similarly, provided for regular-route, common

carrier service between Washington, D. C., and points in Vir-

ginia.° The-“grandfather”’ certificate issued by the Commis-

sion encompassed all of A. B. & W.’s prior authority.

D. C. Transit .was a similar recipient of a “grandfather”

certificate, which was based on pre-compact authority, namely

a franchise from the Congress to operate a mass transporta-.

tion system within the District of Columbia and between

points within the Metropolitan area, subject “to the rights

to render service within, the Washington Metropolitan Area

possessed, at the time 4this section takes effect, by other .

common carriers of ‘passengers . . ,”° and certificates and

permits ‘issued by the ICC and the Maryland Public Service

2 Exhibit 84, 1.C.C. Certificate of Public Convenience and Necessity,

= M.C. 3677, dated February 24, 1954.

3 Exhibit 83, 1.C.C. Certificate of Public Convenience and Necessity, |

- M.C. 1800, dated August 7, 1951.

r * july 24,1956. «

5 b C. Transit Franchise, Title I, Part 1, Section 1, P.L: 757.

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Commission. It is readily iin that the iiiiieiadailed

authority antecedes Transit’s franchise by several years,Sand —

the authority granted by said franchise was anne to the

rights contained. in the certificates.

The ICC certificates do not include any restrictions on

. the rights of the respondent carriers to serve any area of

- Washington, D. C. in interstate transportation. They were,

therefore, authorized to transport passengers in interstate

transportation to any point in the District .of Columbia,

subject to local traffic and routing regulations imposed by

the District of Columbia. The District of Columbia, through

a Joint Board, composed of the PUC and the Commission-

__ ers of the District of Columbia, ’ had entered many directive

orders of this nature, some of which are exhibits in this pro-

ceeding. These.routing orders served the same function as

this Commission’s route authorization. | See, for example,

Exhibit 86, which is a compilation of orders® ‘of the PUC deal-

ing with re-routing, institution of new terminals, and estab-

lishment of fringe parking lots. It should be noted that appar-

ently the PUC recognized that the carrier had the necessary

certificate operating rights, as there is'‘no mention of certifi-

cates of public convenience and necessity - the only criterion

being the “public interest.”

In 1955, ‘the PUC hada ee before’ it in which

_ similar issues were involved. ‘WMA had requested an exten-

sion of a route within the District of Columbia. Transit’s _

predecessor Capital Transit, appeared in opposition, alleging

that the change of route would make it competitive with

Capital Transit’s service, and that under the terms of Section

by The certificates referred to herein are-revised. The respondents

have been so engaged in interstate operations for many, years preceding

) - dates on the revised certificates. ,

: ,D. C. Code 40-603(e), 1961 Ed.

| 8 including: D. C. Public Utilities Commission Order No. 2377, dated

September 9, 1942;-Order No. 4224, dated October 7, 1955.

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4 of the Merger Act (Section 44-201, D.C. Code, 1951), the

PUC could not:permit the extension in route without: a find-

ing that public convenience required the extension. The

PUC held that a certificate of public convenience and neces

sity was not required under Section 4 of the Merger Act.?

The language of that section is almost identical with that in

the Franchise. | Gee ee eat

As previously discussed, the pre-compact operating rights

of these carriers were consolidated under a “grandfather”

claim, and appropriate certjficates were issued by this Com-

_ mission. The A. B. & W. Certificate (No. 11), provides, in

part, as follows:!° = - | ,

REGULAR ROUTE eae ee

Passengers and their baggage . . .. over regular routes.

Between Washington, D. C., and Virginia, between’

Washington, D. C., Maryland and Virginia, sérving.

all intermediate points; restricted’ however unless

otherwise specifically provided, against the trans-

portation of intrastate passengers in Virginia, Mary-

land, and the District of Columbia, as follows:

No. 1 From Fort Belvoir, Virginia, over U.S. Highway

No. 1, to junction Virginia Highway’No. 617, thence -

over Virginia Highway No. 617 to junction Virginia

Highway No. 350 (Shirley Memorial Highway), thence .

over Virginia Highway 350 to Washington, D. C.,and « ~

return over the same route.

The WMA Certificate (No. 8) provides, in part, as follows:

_ REGULAR ROUTE | |

Passengers and their baggage, and express, in the same

vehicle with passengers.

? f ¥ : y a

__ ° Exhibit 87, Public Utilities Commission Order No. 4158, dated

"January 28, 1955. Sn ae .

0

Exhibit No. 2.

11 Exhibit No, 3.

AAA STA i iS TONE a i OR eS a cn Mak et A a a al nk A a AE

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ot ’

Between Washington, D. C., and points in Maryland;

and between points in Maryland, serving all interme-

diate points; restricted, however, against the transpor-

tion of intrastate passengers in the District of Colum-

bia. ° thar

No. 1 From Washington, D. C. over city streets to South-

ern Avenue, thence over Business Maryland Route 4,-

_ 56th Avenue, Maryland Routes 214, 389, 704, Green-

leaf Road, 82nd Avenue, Barlowe Road, Maryland

° Route 202, Prince Georges Avenue, Hawthorne Street,

\ + «© °73rd° Avenue, Forest Road, 74th Avenue. to Kent

ste Village, and return over the same route. %

In not designating, specific streets within the District of.

Columbia, this Commission clearly followed the procedure

of the ICC. .Years ago, the ICC adequately answered the

charge similar to that raised by Transit herein. In refuting a

claim that city streets must be designated, the ICC said:

. To the contrary, in authorizing operation over a route

: traversed within municipalities or with. the routes

between adjoining municipalities, it has not been our —

general policy to specify or designate the streets over

_ which operations may be conducted except in some

- few instances. Ini such instances, however, the streets

have been specified or named in the authority granted

and a carrier holding such authority of course may not

‘operate within the municipalities authorized over streets |

~ other than those specified. For an example of where

we ‘have specified certain streets in the issuance of a

certificate, see Lincoln mae 5 geomet 12-M.C.C.

184. But where the streets within a municipality have

not been designated by us, and we have authorized op-

erations over city streets, it seems.clear that the carrier

is authorized to operate over any city street within the

municipality or between adjoining municipalities, and a

review of the cases involving this question confirms

Moreover, it is to be noted that in authorizing the

transportation of passengers between Manhattan and

points in the so-called’ short haul, mass transportation

area, city streets are not designated within Manhattan.

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If a carrier’s certificate does not specify the city streets

over which it may conduct operations, it seems obvious

‘that it may conduct such operations over any city street,

_ '» otherwise it is doubtful whether changes in operations

within Manhattan could be made subject only to the

approval of the police department ofthe City of New

. York as is now true, in view of the certificate provi- .

sions of the Act. Hudson Bus Transportation Co., Inc.,

Passenger Service, 5 Fed. Car. Case 31, 197 (1946).

In another proceeding before the ICC, A. B. & W. had

requested authority to serve the Washington National Air- .

port. At.that time it held a certificate authorizing regular

route operations between Washington, D.C. and Mt. Vernon,

Virginia, serving all intermediate points. The ICC pointed

out that A. B. & W.’s existing authority accorded it the right:

to serve said airport. The ICC then said:

Such operations would be no different, insofar as regu-

lation. under the act is concerned, from operations by

- applicant over the highways and’ streets of Alexandria, ~

another intermediate point on the same route. Appli- .

cant’s right. to operate over any public highway or’ |

street within the municipal limits of Alexandria, sub-

. ject to all lawful requirements of that city, could not

+» well be questioned by anyone.: A. B. & W. Transit

Company, Extension of Operation — Washington Na-

_ tional Airport, 30 M.C.C. 618, at Page 620.

The Commission can only conclude that the certificates

held by A. B. & W. and WMA already authorize the proposed

service extensions, and these carriers-may be required to pro-

vide the proposed service, ‘through route authorizations,

under the terms of théir certificates.

The Commission will now discuss the issue of whether or

not it would ‘be in the public inferest to require’ A. B. & W.

and WMA to extend their routes as proposed pursuant to

their certificates of public convenience. and necessity.

The primary basis for the Engineering staff’s recommen-;

dation that the present service of A. B. & W. and WMA be ,

extended to the ay of 18th and L Seapets, N. W., ‘was \

A-18

an extensive origin-destination survey of the present patrons

of these two companies. .The Commission’s Chief Engineer

testified at length concerning this survey. The record shows

that in February of 1965, A. B. & W. and WMA were con-

tacted by the Commission in an effort to seek their coop-

eration in conducting the aforementioned survey. The Com- .

panies agreed. to bear all expenses incurred in connection

with the survey. On March 22, 1965, during the morning

peak period, between approximately 6:00 A.M. and 9:30

A.M., postal card questionnaires were distributed to all A.

B. & W. and WMA patrons traveling inbound to points in

Washington, D. C. The postal cards could be returned to

the driver or dropped in the mail, postage free.

A total of 22,000 cards were printed; 16,000 for A. B. &

W. and 6,000 for WMA. Approximately 11,000 cards were

distributed by A. B. & W. and 1,500 by WMA. According -’

to the testimony of Mr. Overhouse, excellent results were

- obtained from the survey. Mr. Overhouse stated as follows:

Of the cards distributed, approximately 6;000 were

returned. Some of these could not be used because

they were illegible, ambiguous, blank, etc.

A:total of 5,166 cards were usable; 4,366 from the pa-

trons of A. B. & W. and 830 from the patrons of WMA.

The destinations expressed on the cards were analyzed,

and it was the Engineering Department’s view that a

_ patron. who could ride a bus to within three blocks of

his ultimate destination without transferring was being

served conveniently and adequately. Conversely, it

- was considered that if a.through route would not take

him within three blocks (approximately ‘ mile) of his.

' “downtown destination,” his service was inconvenient:

and inadequate. — : . ?

Using the above as a guide, it was noted that approxi-

mately 41% of present patrons were not being served

satisfactorily because their destinations were farther into

the northwest section of the city than the present ter-

_minals of their companies would permit them to ride.

Analysis of the total sample disclosed the following:

ate

A. B. & W. TRANSIT COMPANY

PSGRS %

Total Usable Sample 7 4336 100.0

Presently Served Adequately -. ' 2645 61.0

Additional That Would Be Served

by Route to 18th & L, N.W. - 1110 . 25.6

Remainder Served Inadequately 581 13.4

| WMA TRANSIT COMPANY

Total Usable Sample . | 830 100.0

Presently Served Adequately 394 47.5

Additional That Would Be Served :

By Route to 18th & L, N.W.. 303 37.0

Remainder Served Inadequately 133 15.5

Based on the survey, the Engineering Department has

concluded that at present, 39% or 1,691 A. B. & W. pas-

sengers who ride on a normal weekday. during the A.M.

commute period, and who responded to the survey, are

not being adequately served at their destinations in

Washington, D. C., and that this number could be re-

duced .to 13.4% or 581 passengers, by extension of that

Company’s routes to 18th & L Streets, N.W. Likewise,

§2.5% or 436 patrons in the WMA sample are not be-

ing served adequately, and that an extension of that -

-Company’s routes to 18th & L Streets, N.W., would

reduce the number to 15.5% or 133 passengers.

Other smaller concentrated areas of inadequate service.

were also pointed up by the survey, but we found that

extensions into the largest of these areas would only

adequately serve a minimal percentage of present riders.

In each case, extension of service into these smaller

_ areas only produced additional satisfactory service to

less than 5% of either Company’s patrons. . '

It was felt that the major service-problem area was to

the northwest of the present terminals of A. B. & W.

A-20

and WMA, and that the round-trip extensions of 2.15

miles of A. B. & W. lines, and 2.80 miles of WMA lines

would serve, at the absolute minimum, an additional

1,400 of these Companies’ present daily peak commute

period passengers at a satisfactory level.

The -thrust of Mr. Overhouse’s testimony was ‘that the

patrons of A. B. & W. and WMA are not being adequately

served under the present scheme of operations. According

to the results of the survey, up to 25% of A. B. & W.’s patrons

whose destinations are Washington, D. C., would be directly

benefitted by route. extensions of A. B. & W. into the vicin-

ity of 18th and L Streets, N.W.; up to 37%. of WMA’s patrons

would be benefitted.

. The testimony. of the other witnesses testifying on behalf

of the staff, including Mr. Foreman, Mr. Heath, Mr. Hansen,

and Mr. Kesler, corroborates and substantiates the results of

the survey, that the 12th Street and Pennsylvania Avenue

Terminal of A. B. & W. and the 11th Street and Pennsyl-

_ yania Avenue Terminal of WMA no longer adequately serve

the needs of a substantial number of the patrons of these

carriers since their present destinations are in the vicinity

of 18th and L Streets, N. W.

Mr. Paul Foreman, Defense Coordinator for the General

Services Administration, is uniquely qualified to recommend

solutions to transportation problems as they relate to Fed-

eral employees in the: Nation’s Capital. Mr. Foreman testi-

fied that since 1962 there has been a tremendous increase in

_ the number of federal employees located in the mid-town,

18th and L Streets area. He concluded that the proposed

extension was needed, and in addition to benefitting exist-

ing riders, would attract those now using other modes “

transportation.

Mr. William D. Heath, Executive Director, District of Co-

lumbia Motor. Vehicle Parking Agency, testified in relation

‘to further growth of the downtown area. Mr. Heath stated

that in 1955 the employee population in the area of 18th

and L Streets, N.W., was approximately 26,000. By. 1965,

the employee population in this area had increased to ap-

‘asad hd

A-21

proximately 45,000, or an increase of about 70%. When

buildings under construction are completed. and occupied

they will have approximately 56,000 — or a gain:

of over 100% since 1955. .

Mr. Daniel J. Hansen, Deputy. Director of Traffic Engineer-

ing Operations, D. C. Department of Highways and Traffic,

testified that his department had reviewed the staff proposal

and had conducted a number of field studies relative thereto. °

These included personal.interviews, pedestrian counts and |

traffic studies. Mr. Hansen concluded that the proposed

extension of bus service would encourage people to use pub-

lic transportation and thereby reduce the number of private

passenger cars that enter the: District of Columbia daily,

" solely .for the purpose of bringing commuters to work in the

morning and returning them home in the evening.

Mr. Edwin L. Kesler; a public witness who appeared at

the hearing voluntarily, testified that his wife formerly

worked in the area to be served by the proposed extension.

Her travel pattern was from home to 18th and Constitution

Avenue, thence by foot. to 18th and M Streets, N.W.; trans-

fer to Transit was too tinie consuming, which prompted her

to walk. Mr. Kesler corroborated Mr. Hansen’s testimony

and stated that in foul weather he would drive his wife to

work; because her quitting time varied from day to day, he

frequently had to circle the block several times. It was Mr.

Kesler’s opinion that the existing service is also unsatisfac-

tory to persons similarly situated.

__ As previously noted, both A. B. & W. and WMA: agree that

their present certificates authorize the proposed route exten-

sions. WMA is not only willing to render the proposed serv-

ice, but tendered a definite scheme of operations which it °

_ felt would be profitable. In addition to providing better

service for existing patrons, it was stated that additional

patrons would be attracted. The thrust of A. B. & W.’ oppo-

sition is directed toward the economic feasibility of the pro-

posed transportation. A. B. & W.’s objection is easily over-

come by pointing out that at any time when the demand

*

CY shih capitate vin oetiarsi sir spastic dialona tiie: Sediie ied aa aes ia aaads sa totealin ee Re ee eae ee oe =e

—A-22

' for the service no longer justifies the cost involved, appropri-

- ate adjustments in service will be made commensurate with

the demand, and such action will be taken administratively

consistent with the present practice.

The Commission can give little weight to W. V. & M.’s

_ objection to the proposed route extensions. W. V. & M. and

A. B. & W. operate primarily between adjacent areas in

Northern Virginia and the District of Columbia. Since A. B.

'&'W. serves an area comprised of Alexandria and the eastern

portions of Arlington and Fairfax Counties, and W. V. & M. .

serves an area to the north and west of the A. B. & W. area,

- there is only minimal:competition ‘between the two carriers —

where their.areas meet. Any siphoning of traffic by, the

proposed service from W. V. & M. operations would be de

minimis. W. V. & M. already serves the present terminal

area in Washington, D. C., served by WMA and A. B. & W.,

ané addition, serves the 18th and L Streets area.

‘The Commission has carefully considered the evidence -

adduced by D.C. Transit in this proceeding. The testimony

of D. C. Transit to the effect that it stands to lose gross rev-

enues in excess of $600,000 annually, if the staff's recom-

mendations are effectuated, was predicated: on the premise

that every person now taking advantage of the joint-fare

" arrangement between respondents and D. C. Transit would -

no longer use the service of D. C. Transit: Such a supposi-

tion is not only contrary to the record, but is invalid on its

face. The survey conducted by the:staff—which was the only

_ real evidence of probative value on the issue—did not provide

any basis for such a premise. D. C. Transit’s contention that

the proposed route extensions will have ah adverse economic

effect on its present operations must be related to the con-

veniences which will result to the traveling. public if the

service is extended. In viewing the economic impact the |

proposed route extensions may have upon D. C. Transit,

: the Commission cannot overlook the possibility, and in fact,

the probability, that the improved service might very well

generate additional bus patronage to ‘such an extent that *

‘there will be no substantial adverse effects on D. C. Transit.

. NOE PERSO RA ae RNG AAG EGR EEL A EFS AP MEL AL LIEU te COOLS 5 ENE AEY TENA NS LE PEE AR MB

‘A-23

- In providing a direct service for bus patrons trom points in

Virginia and Maryland, discussed herein, a substantial num-

_ ber of automobiles may be eliminated from the downtown

area, which will be of direct economic benefit to a

Transit. It is the Commission’s considered judgment that |

. there will be no substantial economic effect upon D. C.

Transit if the proposed transportation is performed.

One of the basic purposes for the creation of this Com-

mission was to provide for the regulation and improvement

of mass transit and the alleviation of traffic congestion in

the Washington area without regard to political boundaries.

If the maximum results are to be obtained, it is most essen-

tial that the maximum benefits be. derived from the flexibil-

ity inherent in our all-bus system. All of the carrier-parties

- to this proceeding have been articulate exponents of the

' flexibility inherent in a bus system. The staff proposal is a

vivid demonstration of this principal.

Greater-use of public transportation is one of the impor-

tant keys to the alleviation of traffic congestion on the down-

- town city streets. This record is very clear that a substantial

number of daily commuters will be greatly convenienced if

the proposed route extensions are effectuated, since a large

segment of the public will have the benefit of a single ride.

in a single vehicle from origin to destination. If the four

major transit operators are. to’ continue to meet their pub-

lic service responsibility and provide the standard of serv-

ice required; situations involving minimal overlapping of serv-

ice and minimal competition among the carriers cannot be~

avoided. If adequate and convenient methods of operations

and arrangements among the carriers which are needed in or-

der to meet the demands for public transportation cannot be

accomplished voluntarily, then the Commission has‘no other -

course in the performance of its responsibilities under the

law but to take the necessary action to compel such opera-

tions and arrangements. With reference to the case at hand,

the Commission does not feel that it is doing any violence

to the. operations of any carrier involved; to the contrary,

°

RI AD DMG BE NEE GT AICTE BEC ER EEE 2 AIEEE ELE IEP ELE IIS ORD INTEL er”

A-24

the action taken will represent a major transit improvement

for numerous daily bus riders. The service to be extended

by A. B. & W. and WMA is largely)” interstate in scope.

D. C. Transit does not operate interstate, nor does its certif-

icate authorize interstate operations, between the District of .

Columbia and those portions of Maryland and Virginia

affected by the extension proposal.

The holding by the Commission to the effect that the

existing certificates of A. B. & W. and WMA -authorize the

proposed route extensions removes the major objections of

all parties to the proceeding. Obviously, under the ruling

of the Commission, D. C. Transit is not entitled to an op-

portunity to improve its service under Section 4(e) or Sec-

tion 4(g), Article XII, Title II of the Compact, since no

certificates of public convenience and necessity are being

issued. D. C. Transit’s contention that the new service, if

authorized, will be competitive with its service, is without

‘merit But; even if it were construed to be competitive,

it is nevertheless authorized by certificates of public con- .

venience and necessity, issued pursuant to the provisions

-of the Compact and with full knowledge and consent of

all parties to this proceeding. ~

_ The Commission finds and concludes that the public

interest will be served if A. B. & W. and WMA are. required ©

~ . to extend their routes so as to provide bus service to the

. 18th and L Streets area of Washington,D.C.

The Commission will issue herewith appropriate: route

| Pe authorizations directing A. B. & W. and WMA to extend

their present service to include the vicinity of 18th and L

3

iia See ; ee

The certificate of WMA authorizes limited intra-District of Columbia

service and those persons using such service will be benefitted by the

route extensions. :

-” The President of W. V. & M., a subsidiary of D. C. Transit, freely

.. admitted that its service between Northern Virginia and the District of

Columbia via: the 18th and L Streets area, while being parallel to the

service of D.C. Transit, is not a competitive service.

-

.

a

.

G . .

. ? .

ee ae et te hh ee ~ PLE LU OL LG LI OO LOE ETE AI EA ISG GEE ON

A-25

Streets, N.W., in substantial compliance with the recom-

mendations of the Commission’s Engineering staff.

THEREFORE, IT IS ORDERED:

1. That A. B. & W. Transit Company and WMA Transit

Company be, and they are hereby, authorized and directed

to extend their service to the vicinity of 18th and L Streets,

7 N.W., Washington, D. C.

_ 2. That A. B. & W. Transit Company and WMA Transit

Company be, and they are hereby, required to extend their

service referred to in paragraph 1 above, in accordance with

route authorizations issued-in compliance with the established

procedures of the Commission and attached hereto.

3. That the’ service authorized and directed to be oper-

ated herein be instituted forthwith, but in no event later

than sixty (60) days from the date of this Order.

BY DIRECTION OF THE COMMISSION: ,

-DELMER ISON

Executive Director

WASHINGTON METROPOLITAN AREA

TRANSIT COMMISSION .

Route Authorization No. 1 — 66

IN THE MATTER OF: =. March 25, 1966

Establishment of Bus Routes

for Alexandria, Barcroft and

. Washington Transit Company

in Washington, D. C.

. By Order No. 581, served March 25, 1966, ‘Annies

Barcroft and ‘Washington Transit Company was granted

authority to extend its bus routes in arn D. C., to

A-26__

the vicinity of 18th and L Streets, N. Ww. To establish such

routes within the District of Columbia, authority is hereby

granted to Alexandria, Barcroft' and Washington Transit -

Company to operate in the following manner:

Over regular route to 14th Street and -Pennsylvania

Avenue, N. W., continue north on 14th,Street, west on

- H Street, north on 17th Street, east on main roadway.

of K Street to 17th Street, continue on south service —

roadway of K Street to 16th Street, south on "16th

Street, east on Eye Street, south on 14th Street to Cc. |

’ Street, S. W., thence over regular route.

Over regular route to 12th Street and Pennsylvania

Avenue, N. W., thence northwesterly on Pennsylvania

Avenue, north on 14th Street, west on H Street, north.

on 17th Street, east on main roadway of K Street to

17th Street, continue on south service roadway of K

Street to 16th Street, south on 16th Street, east on

» Eye Street, south on 14th Street to C Street, S. W.,

* . thence over regular route.

FOR THE COMMISSION

: DELMER ISON

Executive Director

WASHINGTON METROPOLITAN AREA

: TRANSIT COMMISSION

‘ian Authorization No. 1 — 66

IN THE MATTER OF: _ March 25, 1966

Establishment of Bus Routes

for WMA Transit Company in

Washington, D. C. © car,

By Order No. 581, " served March 25, 1966, WMA Transit.

Company was granted authority to extend its bus routes in

Washington, D. C., to the vicinity of 18th and L Streets,

got

} TR epegseamvre. dency. PUR ag saci gr aE GT

‘ Sa. 6 a

A-27

-. N.W. To establish such routes within the District of Colum-

bia, authority is’ hereby granted to WMA Transit Company —

“to operate in’ the following manner:

. Over regular route to-11th Street and Pennsylvania -

Avenue, N. W., thence northwesterly on Pennsylvania

Avenue, north on 14th Street, west on H Street, north

on 17th Street, east on main roadway of K Street to

17th Street, continue on south service roadway of K

’ Street to 16th Street, south on 16th Street, west on

°

Eye Street, south on 14th Street, southeasterly on

Pennsylvania Avenue to Third Street, N. W., thence

over regular: route.

Over regular route to Lith Street and —— York ae

nue, N. W., thence southwesterly on New York Ave-

nue, west on H Street, north on 17th Street, east on

main roadway of K Street to 17th Street, continue |

on south service roadway of K Street to 16th Street,

south on @6th Street, east on Eye Street, south on

llth Stre@, thence east on Eye Street over ened

route.

- FOR THE COMMISSION -

DELMER ISON

Executive Director