that an appropriate permit and order should be issued authorizing such operations, subject, however, to general conditions which are necessary to carry out, with respect to such operations, the requirements of part III of the act and the orders, rules, and regulations of the Commission thereunder.

An appropriate permit and order will be issued.

COMMISSIONER JOHNSON dissents.

285 I. C. C.

FINANCE DOCKET No. 16866 1

UPPER COLUMBIA RIVER TOWING COMPANY
PURCHASE, ETC.

Submitted April 21, 1952. Decided October 10, 1952

1. On further hearing in Finance Docket No. 16866, purchase of a portion of the water-carrier operating rights of Allman-Hubble Tug Boat Co. by The Upper Columbia River Towing Company and, through that carrier, acquisition of control of such operating rights by A. Leppaluoto, R. S. Whaley, and H. A. Dent approved and authorized, and provision made for issuance of superseding certificate to the vendee. Conditions prescribed. Previous report, 265 I. C. C. 759.

2. In No. W-18 (Sub-No. 3) public convenience and necessity found to require extension of operations by The Upper Columbia River Towing Company as a common carrier by non-self-propelled vessels with the use of separate towing vessels in the transportation of commodities generally, and by towing vessels in the performance of general towage, to include service between ports and points along the Pacific coast and tributary waterways (not including local services between ports and points on Puget Sound or along the Columbia River and its tributaries), except to the extent such operating rights are authorized to be transferred in Finance Docket No. 16866. Issuance of second amended certificate withheld, and application in all other respects denied.

Appearances in Finance Docket No. 16866 as shown in prior report, and John F. McCarthy for intervener in opposition.

John M. Hickson and Howard Dent, Jr., for applicant in No. W-18 (Sub-No. 3).

Thomas J. White, Joseph O. Earp, and John F. McCarthy for the protestants in No. W-18 (Sub-No. 3).

REPORT OF THE COMMISSION ON FURTHER HEARING

DIVISION 4, COMMISSIONERS MAHAFFIE, JOHNSON, AND MITCHELL BY DIVISION 4: Exceptions to the report on further hearing proposed by the examiner, and replies thereto, were filed by applicants and certain protestants. Our conclusions differ from those recommended by the examiner. Exceptions and requested findings not discussed in this

1 This report also embraces No. W-18 (Sub-No. 3), The Upper Columbia River Towing Company Extension-Coastwise, and for the purpose of giving effect to the determination herein, No. W-18, Upper Columbia River Towing Company Applications, and No. W-584, Hubble Towing Co. Applications.

report nor reflected in our findings or conclusions have been given consideration and found not justified.

By order of January 24, 1951, entered with the prior report in the title proceeding, 265 I. C. C. 759, the joint application of The Upper Columbia River Towing Company, hereinafter sometimes called applicant or vendee, and Allman-Hubble Tug Boat Co., called the vendor, seeking authority under section 5 (2) of the Interstate Commerce Act, as amended, for purchase by the vendee of the operating rights of the vendor, and for approval, under section 312 of the act, of the transfer to the vendee of the amended certificate dated October 20, 1947, issued to the vendor in No. W-584, was denied. In the report it was found, among other things, that operations under vendor's certificate had been abandoned; that applicants had failed to make the requisite showing under section 306.9 of the rules and regulations governing transfers of certificates and permits of water carriers that suspension of operations was caused by circumstances over which vendor had no control; and that no evidence had been introduced to show a public need for the proposed service. A supplemental application by A. Leppaluoto, R. S. Whaley, and H. A. Dent for authority under section 5 (2) to acquire control of the operating rights involved through the proposed purchase was dismissed.

Upon petition of applicants in Finance Docket No. 16866 for reconsideration, or in the alternative that it be reopened for the taking of additional testimony, the proceeding was reopened for further hearing.

By application No. W-18 (Sub-No. 3), filed May 11, 1951, under section 309 (c) of the act, the Upper Columbia River Towing Company seeks a revised certificate of public convenience and necessity authorizing extension of its present operations as a common carrier to include service by towing vessels in the performance of general towage, and by non-self-propelled vessels with the use of separate towing vessels in the transportation of commodities generally, between ports and points along the Pacific coast and tributary waterways, but not including local service between points on Puget Sound or along the Columbia River above Longview, Wash. Hearing on the extension application was had on a consolidated record with the further hearing in Finance Docket No. 16866, at which Foss Launch & Tug Co., Shaver Transportation Co., Wilbur J. Smith-Longview Tugboat Company, Northwest Towboat Association, and Columbia Basin River Operators, hereinafter called protestants, appeared in opposition to the granting of the applications.

Applicant's principal office is located at Vancouver, Wash., and it has a repair yard and operating office at The Dalles, Oreg. Its corpo

rate organization and relationship with Inland Navigation Company, Columbia-Snake River Towing Company, River Terminals Company, and Columbia Marine Shipyards Co., all of which together with applicant are under the common control of A. Leppaluoto, R. S. Whaley, and H. A. Dent, are detailed in the prior report. The purchase by applicant, a carrier subject to part III, of vendor's operating rights is a transaction within the scope of section 5 (2) of the act; and Leppaluoto, Whaley, and Dent as persons controlling two water carriers through stock ownership are necessary party applicants in the instant case. Compare Refiners Transport & Term. Corp.—Purchase-Marshall, 39 M. C. C. 271, affirmed in United States v. Marshall Transport Co., 322 U. S. 31. In addition, the three named individuals are jointly interested in a partnership, the Rogue River Timber Company, which is engaged in the purchase and sale of lumber and timberlands, and in the conduct of these operations purportedly engages in private transportation by tug and barge.

Applicant holds an amended certificate issued April 27, 1951, in No. W-18, which authorizes it to operate as a common carrier by towing vessels in the performance of general towage, and by non-selfpropelled vessels with the use of separate towing vessels in the transportation of grain, between ports and points along the Columbia River from Longview to Pasco and Kennewick, Wash., and along the Willamette River from Portland, Oreg., to its confluence with the Columbia River, including the ports named.

Inland Navigation Company has authority to operate as a common carrier by self-propelled vessels and by non-self-propelled vessels with the use of separate towing vessels in the transportation of commodities generally in the same territory in which applicant is authorized to operate. Inland Nav. Co. Application, 218 I. C. C. 393, and Inland Nav. Co. Applications, 250 I. C. C. 703. Neither applicant nor any of its affiliates has authority from the Commission to operate between Longview and the mouth of the Columbia River. All of their operations in that territory are of an exempt nature.

Applicant and its affiliates own a total of 10 towboats ranging from 165 to 4,050 horsepower, 28 barges ranging from 500 to 4,000 tons' capacity, and 1 derrick barge of 25 tons' capacity at 50 feet radius. For the most part this equipment is suitable for coastwise service. The equipment described which is not owned by applicant is available to it on a rental basis when not otherwise occupied. Applicant's principal operations have for some time consisted of the transportation of petroleum products in bulk from Portland to up-river ports, and the transportation of grain in the reverse direction. Since the construction of a pipeline from Salt Lake City, Utah, refineries to Pasco,

the volume of petroleum products transported has declined about 50 percent, resulting in idle equipment. For this reason certain of the operating equipment was sold to the Rogue River Timber Company.

Vendor's certificate, issued October 20, 1947, authorizes operation as a common carrier (1) by towing vessels in the performance of general towage between ports and points along the Pacific coast and inland waterways in California, Oregon, and Washington, except the Willamette River above Portland, and the Columbia River above the mouth of the Willamette River, and (2) by non-self-propelled vessels with the use of separate towing vessels in the transportation of commodities generally between ports and points along the Pacific coast and inland waterways in Oregon and Washington north of and including Coos Bay, Oreg., but not including points on the Willamette River or the Columbia River above Astoria, Oreg. Vendor's corporate history and the extent of its operations were discussed in the prior report. For some time it engaged in towing and freighting operations along the Pacific coast, but in 1941 and 1942 the Government took over its oceangoing equipment, and such operations were discontinued except that occasional tows were performed apparently with other operators' equipment from Portland to Grays Harbor and Willapa Harbor, Wash., and between San Francisco, Calif., and Coos Bay, in 1949. Vendor, however, contends that since the war it has never abandoned operations; that it has held out to transport all traffic offered consistent with its ability for performance; and that tariffs covering operations under the certificate were filed with the Commission. The evidence indicates, however, that vendor's operations for many years, except those indicated above, have been confined to movements in Grays Harbor and Willapa Harbor and that its present equipment is not practical for general towing and freighting operations along the Pacific coast or the Columbia and Willamette Rivers.

Under the agreement of transfer, applicant agreed to purchase vendor's operating rights for $3,000, payable in cash, which has been deposited in escrow pending our approval herein. The proposed transaction does not involve any equipment, good will, or other tangible or intangible assets of vendor. If the application is approved, vendor expects to retain its equipment and employees and continue its towing operations in Grays Harbor and Willapa Harbor.

Applicant's balance sheet as of September 30, 1950, shows the following: Current assets, $21,744, property and equipment, less depreciation, $177,052, other assets, principally notes and accounts receivable, $190,219, and prepaid expenses and deferred charges, $2,167;