No. W-318 (SUB-No. 2)1

THE RIVER LINES, INC., EXTENSION-TOWAGE

Submitted December 17, 1952. Decided September 10, 1953

Applicants' proposed operations as common carriers by towing vessels in the performance of general towage between ports and points on San Francisco Bay and tributary waters found not to be transportation in interstate or foreign commerce. Applications dismissed.

Allan P. Matthew, Gerald H. Trautman, C. R. Nickerson, and John D. Conner for applicants.

John D. Conner and George A. Burroughs for protestant in Nos. W-318 (Sub-No. 2) and W-522 (Sub-No. 2).

Gerald H. Trautman and C. R. Nickerson for protestants in No. W-379 (Sub-No. 2).

Clement E. Mayo for the Navy Department.

REPORT OF THE COMMISSION

DIVISION 4, COMMISSIONERS MAHAFFIE, JOHNSON, AND MITCHELL BY DIVISION 4:

Exceptions to the report proposed by the examiner were filed by applicants in Nos. W-318 (Sub-No. 2) and W-522 (Sub-No. 2), and Bay Cities Transportation Company, protestant in those proceedings and applicant in No. W-379 (Sub-No. 2), replied thereto. Exceptions and requested findings not discussed in this report nor reflected in our findings or conclusions have been given consideration and found not justified.

By application No. W-318 (Sub-No. 2), filed April 15, 1952, under section 309 (c) of the Interstate Commerce Act, The River Lines, Inc., of San Francisco, Calif., hereinafter called River Lines, seeks a revised certificate authorizing operation as a common carrier by towing vessels in the performance of general towage, in interstate or foreign commerce, between ports and points on San Francisco, San Pablo, and Suisun Bays, the Sacremento and San Joaquin Rivers, and their tributaries, including Stockton, Calif.

By application No. W-379 (Sub-No. 2), filed April 29, 1952, under section 309 (c) of the act, Bay Cities Transportation Company, of

1 This report also embraces No. W-379 (Sub-No. 2), Bay Cities Transportation Company Extension-Towage, and No. W-522 (Sub-No. 2), Nickols Transportation Co., Extension

Towage.

San Francisco, hereinafter called Bay Cities, seeks a revised certificate authorizing it to operate as a common carrier by towing vessels in the performance of general towage between ports and points in the same territory covered by the River Lines application.

By application No. W-522 (Sub-No. 2), filed April 14, 1952, under section 309 (c) of the act, Henry J. Nickols, doing business as Nickols Transportation Co., of Stockton, hereinafter called Nickols, seeks a revised certificate authorizing it to operate as a common carrier by towing vessels in the performance of general towage between ports and points in the same territory covered by the River Lines and Bay Cities applications, except no authority is sought to serve Sacramento, Calif., and points on the Sacramento River above that port.

Bay Cities opposes the applications in No. W-318 (Sub-No. 2) and No. W-522 (Sub-No. 2), and River Lines and Nickols, in turn, oppose the application of Bay Cities in No. W-379 (Sub-No. 2). The Department of the Navy, hereinafter called the Navy, intervened in the title proceeding as its interest may appear. The applications were separately heard but were the subject of a single proposed report. They involve general towage in the same territory, present closely related issues, and will be disposed of in one report.

Applicants or their predecessors have been engaged in water-carrier operations for a number of years between ports and points in California on San Francisco, San Pablo, and Suisun Bays, the Sacramento and San Joaquin Rivers, and their tributaries, hereinafter referred to as the bay area. With minor exceptions, each holds a certificate authorizing tug-and-barge service in the transportation of commodities generally in interstate or foreign commerce between all ports and points on those waters. In addition to barging operations, applicants engage in general towage from which they derive a substantial portion of their revenues. Bay Cities, River Lines, and Nickols operate 13, 10, and 4 tugboats, respectively.

River Lines, believing its certificate authorized towing as well as freighting, has held itself out to perform the former on San Francisco Bay and the other waterways embraced in its application. In 1941, it filed a tariff naming rates for towing which remains on file with this Commission. Bay Cities has engaged in general-towing operations in substantially the same area. The filing of the instant applications was prompted by advice to the three carriers that they held no authority to engage in towage in connection with shipments moving to or from points outside California, and that certain services being provided, or to be provided, for the Navy Department probably constituted towage in interstate or foreign commerce for which authority is required under part III of the act.

In March 1952, River Lines and Nickols, respectively, were granted temporary authority under section 311 (a) of the act to perform general towage for the Navy between Oakland and Rough and Ready Island. The island, used as a naval supply depot, is within the port district of Stockton. About 3 months later, Bay Cities was issued temporary authority to engage in general towage between all points in the bay area, except between Oakland and Rough and Ready Island. These grants of temporary authorities are to continue in force until the instant applications for revised certificates are finally determined. For some time prior to issuance of the temporary authorities to River Lines and Nickols, the towage service of Bay Cities was used by the Navy in the movement of its barges in the bay area.

River Lines and Nickols are of the view that towage for the Navy in the movement of its barges between Oakland and Rough and Ready Island is transportation in interstate or foreign commerce, and that operating authority from this Commission is required to engage therein. In addition, they believe that other tows have been made by them which involved shipments moving in interstate commerce. Bay Cities contends that all towing between points in the bay area is exempt or transportation not subject to part III of the act, and that the three applications should be dismissed for lack of jurisdiction. In the event, however, it is determined that authority is required to perform towage between points in the bay area, Bay Cities desires a revised certificate which will authorize such service. The shipper barges towed by applicants do not leave the bay area and are used solely for the transportation of property between ports and points on those waters. The carriers are not concerned with the loading or unloading of shipper barges, and merely contract for the towage thereof. Outside of the immediate points of origin and destination, applicants are not aware of the actual origin or the ultimate destination of shipments moving in barges towed by them. In fact, it appears that the Navy, when using commercial towers, is reluctant to disclose the ultimate destination of the lading moving in its barges. Applicants usually make charges for towing on an hourly basis. That performed for the Navy, however, is on a tonnage basis.

Nickols has towed a number of barges loaded with steel and two shipments of piling, in rafts, which property it understood originated at points outside California. The piles were said to have been shipped by rail from an interstate origin to the owning concern at Stockton. Upon receipt of the piles, they were unloaded by the owner and made into rafts which were towed by Nickols to Mandeville Island and Mare Island, Calif., points beyond the port district of Stockton. One raft was towed in 1946 and the other in 1950.