Discussion
When the Commission grants operating authority to a vessel (or any other) common carrier, it includes a standard condition that the authority must be exercised, and service commenced, within a specified time. Operating authority is granted in recognition of public convenience and necessity, which depends upon the circumstances prevailing at the time of the order. These circumstances change over time, and it does not serve the public interest to allow a lengthy period for the carrier to commence service. If we find that public convenience and necessity permit or require a service, it is implied that the service should be instituted presently. We also disfavor the creation of a franchise that could be wielded by the holder as a tool to thwart aspiring competitors from commencing operation of a needed service.
Ordering Paragraph 2 of D.97-11-027 afforded Island Navigation and two other carriers a period of two years in which to commence their services. At the time it issued the order the Commission was fully informed about the problems each of the carriers was experiencing in making docking and parking arrangements in Long Beach and Dana Point, and fully cognizant of the lead times and uncertainties of purchasing vessels. These facts were developed on the record through our formal hearing procedure. That the Commission recognized these difficulties is reflected in the two-year period allowed by its order for the carries to exercise their operating authority, an extraordinarily lengthy period for a transportation franchise.
The problems presented by Island Navigation's incomplete licensing, permitting, and leasing arrangements are best handled by treating such items as contractual contingencies. We cannot extend operating authority indefinitely to enable a carrier to perfect its business arrangements. At some point the circumstances giving rise to public convenience and necessity are presumed to have changed. That point has now been reached. If Island Navigation desires to secure operating authority when it has the foreseeable ability to perform, it may file a new application.
The petition is denied.
The draft decision of Administrative Law Judge Ryerson in this matter was mailed to the parties in accordance with Pub. Util. Code § 311(g)(1) and Rule 77.7 of the Rules of Practice and Procedure. Comments were filed on ___________, and reply comments were filed on ______________.
An extension of the time for Island Navigation to exercise the operating authority granted in D.97-11-027 beyond the two years allowed by Ordering Paragraph 2 would be unreasonable in relation to the facts and circumstances reflected in the record.
Island Navigation's petition for modification of D.97-11-027 is denied.
IT IS ORDERED that:
1. The petition of Island Navigation Company, Inc., for modification of Decision 97-11-027 is denied.
2. This proceeding is closed.
This order is effective today.
Dated , at San Francisco, California.
