Background and Procedural History
On January 5, 1999, the applicant1 filed an application for interim and permanent operating authority to establish and operate scheduled vessel common carrier service, under a contract with sponsoring governmental agencies, between Alameda and Oakland on one hand and San Francisco on the other, and between San Francisco and Angel Island. The reason the applicant filed this application was that at the time it anticipated it would succeed Blue & Gold Fleet, L.P. (Blue & Gold) as the operator of the ferry service.2 The application was initially unopposed.3
On July 15, 1999, the ALJ conducted the first prehearing conference (PHC). Because the status of the Oakland/Alameda Ferry contract was unsettled at the time of this PHC, the applicant raised for the first time the possibility of applying for "blanket" operating authority, enabling it to compete for San Francisco Bay Area ferry contracts without first seeking specific Commission operating authority. Typically the timeline for bidding such contracts is relatively short, and often does not permit a prospective operator to obtain operating authority from us before submitting its bid or being required to commence operation of the service.
On October 18, 1999, the applicant filed its First Amendment to Application to formalize its proposal for such authority. This document explained that the Alameda City Council had changed its contracting procedure after the applicant's original application was filed with the Commission. The applicant was the losing bidder for the Oakland/Alameda Ferry. The circumstances for requesting the operating authority in the original application had accordingly ceased to exist. However, the applicant changed its proposal to a request for authority to establish and operate scheduled service between any points on San Francisco Bay whenever and wherever that service would be operated under a public agency or private entity contract. In support of its request applicant cited the existence of growing public interest in new ferry services, the recent creation of an interagency Bay Area Water Transit Initiative Task Force, and legislation4 providing preliminarily for the establishment of new ferry services.
Blue & Gold filed a protest to the Amendment, objecting on grounds, among others, that the amended application does not contain the requisite showing of public convenience and necessity, and that it is premature, overbroad, and not in conformity with the requirements of Rule 21 of our Rules of Practice and Procedure (Rules). The ALJ held a second PHC on June 1, 2000, to discuss the revised proposal and the regulatory issues it raised. Although Blue & Gold objected to granting the amended application in favor of Marine Services in view of the companies'competitive relationship, both parties agreed in concept that it was desirable to make blanket authority available to all San Francisco Bay ferry operators, and that doing so would address Blue & Gold's concerns. In light of their basic agreement in principle, the parties were encouraged to explore the possibility of reaching a negotiated resolution of their differences. They were also encouraged to invite the assigned advisory staff member from the Commission's Rail Carrier and Safety Division to their discussions, with the hope that any agreement would also be workable from the regulatory standpoint.
On August 10 the parties filed a joint motion to apply our settlement rules to this proceeding,5 and a joint motion for approval of a written settlement agreement that they had signed. Their settlement agreement contains the following terms:
1 The application was originally filed under the name of Hornblower Marine Services East Bay Express. An amendment to the application later advised the Commission that the applicant had changed its name to Marine Service Express, Inc., and on May 5, 2000 the assigned administrative law judge (ALJ) issued a ruling acknowledging this change and revising the caption of the proceeding. We refer to the applicant throughout this decision by its new name, or simply as "applicant," for the sake of simplicity 2 We refer to this service throughout as the Oakland/Alameda Ferry, the name used by the sponsoring agencies and Blue & Gold. 3 A letter from the Inlandboatmen's Union of the Pacific requested an extension of time to protest under Rule 48 of our Rules of Practice and Procedure (Rules), but the ALJ ruled that the request was untimely. 4 Senate Bill (SB) 428. 5 Our settlement rules, Rule 51 et seq, normally apply only in formal proceedings involving gas, electric, telephone, and class A water utilities, but may also be applied in vessel cases on grounds that doing so would be in the public interest, if a motion to that effect is made under Rule 51.10.(1) Marine Services will be issued a blanket certificate to establish and operate scheduled and on-call vessel common carrier services between designated points and places in San Francisco Bay and its tributary waters under contract(s) with governmental agencies or private entities.
(2) This blanket certificate would be subject to the following conditions:
(a) The contract for the services to be performed must require continuous vessel common carrier service for minimum of five days per week.
(b) Each contract must be subject to prior registration pursuant to procedures described below.
(3) The Commission will establish streamlined registration for the services under the blanket certificate, which will include the flexibility to preserve the contract terms relative to pricing and termination of service.
(4) Upon application, any other vessel common carrier meeting the threshold financial and operational fitness requirements may also be issued a similar blanket certificate.
(5) This proceeding may be resolved in accordance with this Settlement with all appropriate orders and authorizations to effectuate it including the issuance of the blanket certificate to Marine Services.
(6) The Commission will take all such actions as may be necessary to implement the Settlement.
