Coach USA, Inc.ControlClinton Avenue Bus Company; Orange, Newark, Elizabeth Bus, Inc.; and Wisconsin Coach Lines, Inc.

DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

[STB Docket No. MC-F-20930]

Coach USA, Inc.--Control--Clinton Avenue Bus Company; Orange,

Newark, Elizabeth Bus, Inc.; and Wisconsin Coach Lines, Inc.

AGENCY: Surface Transportation Board, DOT.

ACTION: Notice Tentatively Approving Finance Transaction.

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

SUMMARY: Coach USA, Inc. (Coach), a noncarrier, filed an application

under 49 U.S.C. 14303 to acquire control of Clinton Avenue Bus Company

(Clinton); Orange, Newark, Elizabeth Bus, Inc. (ONE Bus); and Wisconsin

Coach Lines, Inc. (Wisconsin), all motor carriers of passengers.

Persons wishing to oppose the application must follow the rules under

49 CFR part 1182. The Board has tentatively approved the transaction,

and, if no opposing comments are timely filed, this notice will be the

final Board action.

DATES: Comments must be filed by November 9, 1998. Applicant may file a

reply by November 24, 1998. If no comments are filed by November 9,

1998, this notice is effective on that date.

ADDRESSES: Send an original and 10 copies of any comments referring to

STB Docket No. MC-F-20930 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 applicant's

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: Coach currently controls 56 motor passenger

carriers.\1\ In this transaction, it seeks to acquire control of

Clinton,\2\ ONE Bus,\3\ and Wisconsin,\4\ by acquiring all of the stock

of each of these carriers.

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

\1\ In addition to the instant application, Coach has three

other pending control applications: Coach USA, Inc.--Control--

Brunswick Transportation Company d/b/a The Maine Line; Mini Coach of

Boston; Olympia Trails Bus Co., Inc.; Stardust Tours, Inc. d/b/a

Gray Line Tours of Memphis; and Valen Transportation, Inc., STB

Docket No. MC-F-20926 (STB served Aug. 14, 1998), in which it seeks

to acquire control of five additional motor passenger carriers;

Coach USA, Inc.--Control--Chenango Valley Bus Lines, Inc.; Colonial

Coach Corp.; GL Bus Lines, Inc.; Gray Line Air Shuttle, Inc.; Gray

Line New York Tours, Inc.; Hudson Transit Corporation; Hudson

Transit Lines, Inc.; and International Bus Services, Inc., STB

Docket No. MC-F-20927 (STB served Aug. 28, 1998), in which it seeks

to acquire control of eight additional motor passenger carriers; and

Coach USA, Inc.--Continuance in Control--Salt Lake Coaches, Inc.,

STB Docket No. MC-F-20928 (STB served Sept. 4, 1998), in which it

seeks to continue in control of a new motor passenger carrier.

\2\ Clinton is a New Jersey corporation. It holds federally

issued operating authority in Docket No. MC-223062, which authorizes

it to provide charter and special operations between points in the

United States (except Alaska and Hawaii). It operates a fleet of

approximately 30 buses, primarily in transit-type services in

northern New Jersey. Clinton does not employ any persons, but uses

employees of ONE Bus, with which it shares common owners. Together

with ONE Bus, Clinton earned gross annual revenues in fiscal 1997 of

approximately $8.4 million. Prior to the transfer of its stock into

a voting trust, it was owned by Kenneth C. White, Joyce F. Revere,

William S. Revere, Norman E. Revere, Richard D. Revere, Frank P.

Gallagher, Brenda J. Gallagher, John A. Gallagher, Jr., Stephen A.

Gallagher, Alice M. Gallagher, Frank P. Gallagher as Trustee of the

Lisa A. Gallagher 1998 Trust, and Frank P. Gallagher as Trustee of

the Kathryn A. Gallagher 1998 Trust.

\3\ ONE Bus is a New Jersey corporation. It holds federally

issued operating authority in Docket No. MC-206227, which authorizes

it to provide charter and special operations between points in the

United States (except Alaska and Hawaii). It also holds authority

from the State of New Jersey to conduct intrastate operations. It

operates a fleet of approximately 18 motorcoaches primarily in

transit-type service in northern New Jersey, employs approximately

120 persons, and, together with Clinton, earned gross revenues in

fiscal 1997 of $8.4 million. Prior to the transfer of its stock into

a voting trust, it was owned by Kenneth C. White, Joyce F. Revere,

William S. Revere, Norman E. Revere, Richard D. Revere, Frank P.

Gallagher, Brenda J. Gallagher, John A. Gallagher, Jr., Stephen A.

Gallagher, Alice M. Gallagher, Frank P. Gallagher as Trustee of the

Lisa A. Gallagher 1998 Trust, and Frank P. Gallagher as Trustee of

the Kathryn A. Gallagher 1998 Trust.

\4\ Wisconsin is a Wisconsin corporation. It holds federally

issued operating authority in Docket No. MC-123432, which authorizes

it to provide charter and special operations between points in the

United States (except Alaska and Hawaii). It operates a fleet of

approximately 33 motorcoaches, 2 minibuses, and 4 vans, in charter

services in Wisconsin and other Midwestern states and intrastate

regular route services in Wisconsin; employs approximately 90 full

and part time employees; and earned gross revenues in fiscal 1997 of

$5.0 million. Prior to the transfer of its stock into a voting

trust, it was owned by Michael L. Hansen, Thomas D. Czanecki, and

John H. Osborne.

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

Coach submits that there will be no transfer of any federal or

state operating authorities held by any of the acquired carriers.

Following the consummation of the control transactions, these carriers

will continue operating in the same manner as before and, according to

Coach, although Clinton and ONE Bus already share common owners,

granting the application will not reduce competitive options available

to the traveling public. Coach submits that each of the acquired

carriers is relatively small and that each faces substantial

competition from other bus companies and transportation modes.

Coach also submits that granting the application will produce

substantial

[[Page 51398]]

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. Coach indicates

that it will provide each carrier to be acquired with centralized legal

and accounting functions and coordinated purchasing services. In

addition, Coach states that vehicle sharing arrangements will be

facilitated through Coach to ensure maximum use and efficient operation

of equipment, and that coordinated driver training services will be

provided. Coach also states that the proposed transaction will benefit

the employees of each carrier and that all collective bargaining

agreements will be honored.

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 further enhancing the benefits resulting from

these control transactions.

Coach certifies that none of the carriers to be acquired holds an

unsatisfactory safety rating from the U.S. Department of

Transportation,\5\ that each has sufficient liability insurance; that

none is domiciled in Mexico or owned or controlled by persons of that

country; and that approval of the transaction will not significantly

affect either the quality of the human environment or the conservation

of energy resources. Additional information may be obtained from

applicant's representatives.

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

\5\ Clinton and ONE Bus have no safety rating; Wisconsin holds a

satisfactory safety rating.

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

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 application, we find that the proposed

acquisition of control is 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 application.\6\ 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.

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

\6\ Under revised 49 CFR part 1182, scheduled to become

effective October 1, 1998, as adopted in Revisions to Regulations

Governing Finance Applications Involving Motor Passenger Carriers,

STB Ex Parte No. 559 (STB served Sept. 1, 1998), there will be minor

changes to the procedures involved in motor passenger finance

applications. As pertinent, a procedural schedule will not be issued

if the Board is able to dispose of opposition to the application on

the basis of the comment and applicant's reply.

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

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 acquisition of control is 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 November 9, 1998, 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: September 18, 1998.

By the Board, Chairman Morgan and Vice Chairman Owen.

Vernon A. Williams,

Secretary.

[FR Doc. 98-25599 Filed 9-24-98; 8:45 am]

BILLING CODE 4915-00-M