Opinion
No. 1285 C.D. 2012
04-30-2013
Airlines Acquisition Co., Inc., t/d/b/a Airlines Transportation Company; Airport Limousine Service, Inc., t/d/b/a Checker Cab; Pittsburgh Cab Company, Inc., t/b/a Metro Taxi; Ray Ray Cab Company, LLC; and Yellow Cab Company of Pittsburgh, Petitioners v. Pennsylvania Public Utility Commission, Respondent
BEFORE: HONORABLE DAN PELLEGRINI, President Judge HONORABLE BONNIE BRIGANCE LEADBETTER, Judge (P.) HONORABLE MARY HANNAH LEAVITT, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY PRESIDENT JUDGE PELLEGRINI
Airlines Acquisition Co., Inc., t/d/b/a Airlines Transportation Company; Airport Limousine Service, Inc., t/d/b/a Checker Cab; Pittsburgh Cab Company, Inc., t/b/a/ Metro Taxi; Ray Ray Cab Company, LLC; and Yellow Cab Company of Pittsburgh (collectively, Protestants) petition for review of the order of the Pennsylvania Public Utility Commission (Commission) denying Protestants' exceptions to the Initial Decision of the Commission's Administrative Law Judge (ALJ) and granting the application of Cranberry Taxi, Inc., d/b/a Veterans Taxi (Applicant) to amend its certificate of public convenience to include the right to provide call and demand service in Allegheny County. We affirm.
Section 1103(a) of the Public Utility Code, 66 Pa. C.S. §1103(a), states, in pertinent part:
(a) General Rule.—Every application for a certificate of public convenience shall be made to the commission in writing, be verified by oath or affirmation and be in such form, and contain such information, as the commission may require by its regulations. A certificate of public convenience shall be granted by order of the commission, only if the commission shall find or determine that the granting of such certificate is necessary or proper for the service, accommodation, convenience, or safety of the public...
Pursuant to Commission Certificate No. A-00119935, Applicant operates its call and demand service in all of Butler County and in the Marshall Township, Pine Township, Franklin Park Borough and Bradford Woods Borough, areas of northern Allegheny County. On February 22, 2010, Applicant filed the application with the Commission to amend its certificate to expand its call and demand service to include all of Allegheny County. On May 6, 2010, Protestants filed a timely protest to the application and served Applicant with discovery requests seeking, inter alia, Applicant's federal tax returns with schedules. Applicant filed objections to the interrogatories and Protestants filed a motion to compel answers. The ALJ ordered Applicant to provide a copy of its state returns for the tax years 2008, 2009 and 2010, excluding the attached schedules and denied Protestants' request for Applicant's federal and local tax returns.
At the ALJ's hearing, Robert DeLucia (DeLucia), Applicant's sole shareholder and officer, testified regarding Applicant's financial and technical fitness to provide the requested additional service. (Reproduced Record (R.R.) at 190a-305a.) DeLucia stated that he has worked in the taxicab, limousine and para-transit industries since 1985 and that he also owns Star Limousine, Classy Cab and Air Star Transportation, which also provide transportation services in Allegheny County. He testified that Star Limousine operates approximately 25 limousines and that he has not had any difficulty in obtaining financing when purchasing new vehicles. He stated that Classy Cab provides premium-cost taxi service that uses 15 stretch vehicles that cost up to three times more than the cost of a standard taxi and that he has not had any difficulty in obtaining financing when purchasing new vehicles. DeLucia testified that Air Star Transportation uses approximately 30 vehicles, including 15 wheelchair accessible vehicles, six conversion vans, and ten Crown Victoria sedans for its para-transit services and that he bought all 30 vehicles based on Air Star Transportation's credit and his guarantee on the loans.
DeLucia stated that Applicant currently shares a garage and maintenance facility with Star Limousine and that Applicant would share the use of a facility in Pittsburgh that is currently used by DeLucia's other transportation companies on the application's approval. He testified that Applicant currently uses seven taxicabs, five of which are paid for in full, and that he intends to purchase an additional 25 alternative fuel vehicles in the first year of operation of its extended service. DeLucia stated that he has approached financial institutions and received verbal pre-approvals to purchase the new vehicles. He testified that the seven vehicles in Applicant's current fleet are all driven by self-employed individuals who lease the vehicles. He stated that Applicant intends to give hiring preference to veterans and it is already affiliated with the Veterans Outreach Center and the Disabled American Veterans. Applicant also presented the testimony of 24 witnesses, including 23 public witnesses, regarding the public demand or need for Applicant's proposed additional service.
During his testimony, Protestants sought to cross-examine DeLucia regarding Classy Cab's balance sheet and Applicant objected on the basis that Classy Cab's financial fitness was not at issue in these proceedings. The ALJ sustained Applicant's objection and precluded Protestants from questioning DeLucia regarding Classy Cab's balance sheet. (R.R. at 283a-285a.)
Michael Morasca, the Westin Hotel's director of engineering, testified regarding the demand or need for downtown service because Yellow Cab drivers refuse to take shorter fares around downtown for hotel guests, preferring the longer, more lucrative fares to the airport, and that he would personally use Applicant's taxi service from his home in Bridgeville to the airport two or more times a month. (R.R. at 310a, 312a-315a.) Robert LaPore, the Wyndham Grand Hotel's general manager, testified that the hotel guests have difficulty getting a cab for local trips at least ten times a week, and that the hotel staff has had to transport guests in a manager's car. (Id. at 334a-337a.) Girard Longo testified that he had difficulty obtaining local taxi service and that he would personally use Applicant's service for trips downtown or to the airport from his home in Bridgeville up to two times a week. (Id. at 344a-346a.) Derek DeLucia, Applicant's general manager, testified that Applicant logged 19 calls for service to or from points within Allegheny County from April 6, 2011, through April 30, 2011. (Id. at 352a-358a.) Katherine Collins testified that she lives downtown, that she uses Classy Cab's premium local taxi service for social engagements two to three times per month, and that Yellow Cab has not been dependable every time she has called for service. (Id. at 363a-366a.) Mary Weatherbee testified that she lives downtown and uses taxis two to three times per week in addition to trips to the airport, but that she has been turned down by Yellow Cab drivers for local trips and was told by its dispatch that she can't get a cab on Pittsburgh's North Side after midnight. (Id. at 374a-377a.) Nicholas Geanopulos, owner of Nicky's Grant Street Restaurant, testified that he uses DeLucia's Classy Cab premium taxi service four times per week for patrons and 20 times per year himself, and that he would use Applicant's new service because of difficulties either finding Yellow Cab service or its timeliness and because Applicant's drivers would be veterans. (Id. at 384a-388a.) Todd Palcic testified that he lives downtown, that he used Yellow Cab's service up to ten times per month until it became too unreliable, that he will use Applicant's airport service for his out-of-town business guests four times weekly, and that he personally plans to use Applicant's service ten to 15 times per month, especially because Applicant intends to use "green" vehicles. (Id. at 392a-398a.) Robert Gigliotti testified that he operates Tri-State Valet providing service to downtown restaurants and hotels, that one party waited two hours for a Yellow Cab taxi to arrive, and that there are Yellow Cab drivers that will refuse a fare from downtown to Pittsburgh's South Side. (Id. at 405a-406a, 410a-411a.) Tom Martini, the Westin Hotel's general manager, testified that he has been pleased with Classy Cab's premium service and that he would use Applicant's service for local trips and to the airport on a daily basis. (Id. at 420a-421a.) Joyce Ardolino testified that she lives on Mt. Washington, that she uses taxi services once a week to go to restaurants or the airport, and that she prefers Classy Cab's premium service to Yellow Cab because its taxis are not clean at times and they are slow in arriving or do not show up at all. (Id. at 428a-430a.) Ernest Baugh, Jr. testified that he lives on the North Side, that he uses local taxi service ten to 15 times per year, and that he prefers Classy Cab's premium service because he has had to wait 20 minutes to an hour for Yellow Cab to arrive and its drivers will refuse to make a short trip. (Id. at 436a-439a.) Michael Lozer testified that he lives in the North Hills and uses taxi service two to three times each month within downtown or to Shadyside, and that he uses both Classy Cab and Yellow Cab but that Yellow Cab is not satisfactory with wait times of an hour or longer. (Id. at 452a-455a.) Michael Hamwey, general manager of Lydia's Restaurant in the Strip District, testified that the restaurant uses taxis frequently, from three or four to 15 to 20 daily, and that he uses Classy Cab's service most often because Yellow Cab's service is too inconsistent and often late. (Id. at 461a-464a.) John Matthews, the Fairmont Hotel's director of operations, testified that the hotel makes more than a dozen daily calls for service, that Yellow Cab's timeliness was a problem until a cab stand was established across from the hotel, and that Classy Cab is well received by its guests, quotes an estimated pick-up time, and has a good fleet of drivers. (Id. at 476a-477a, 481a-482a.) Christine Griffel testified that she lives in Mt. Lebanon and works in Aspinwall, that she uses taxi service a few times a month when relatives visit, that Yellow Cab's service is inadequate due to unavailability and long waits, that she uses Classy Cab because the service is better, and that she would use Applicant's service a few times a month if it is similar but cheaper. (Id. at 487a-494a.) Charles Casto, the general manager of the Original Fish Market restaurant in the Westin Hotel, testified that he resides in Ambridge, Beaver County, that he has difficulty finding taxi service particularly in the evening and when the destination is a short trip from the restaurant, that, on one occasion, four patrons took a Yellow Cab to the North Side but called when they were unable to get transportation back downtown, and that he would personally use Applicant's service. (Id. at 497a-502a.) Richard Portis, the coordinator of the Virtual Veteran Institute of Robert Morris University, testified that he lives on the North Side and uses taxi service four to five times a month to or from downtown, that he uses the premium Classy Cab service most often because the service is exceptional, that he used Yellow Cab at times but had to deal with attitude from its drivers when requesting a short trip, that additional suppliers would help to mitigate that attitude, and that he supports the application because it highlights the role of veterans as part of the community. (Id. at 506a-510a, 514a-515a.) Robert "Rocky" Bleier testified that he lives in Mt. Lebanon, that he supports the application as a wounded veteran and as an advocate for veterans to promote veteran-owned businesses, that he personally uses taxi service to the airport one to two times a month, and that, although he typically uses Yellow Cab, he expects to use Applicant's service if the application is granted. (Id. at 516a-521a.) Charles McHugh, Amtrak's district manager, testified that most patrons call Yellow Cab due to lower fares and have wait times from 40 to 60 minutes, and that he noticed problems with taxi drivers who won't transport a patron if the destination is a short distance. (Id. at 523a-526a.) Robin Fernandez, Bossa Nova Restaurant's co-owner, testified that he usually calls for taxi service four to ten times a week late at night for patrons who have had too much to drink, that he has problems getting through to Yellow Cab, while they are sometimes timely, it can take 40 to 60 minutes for a taxi to arrive which frustrates his patrons, and that he usually calls Yellow Cab first, but he will call Classy Cab if the customers are in a hurry or if there's no response from Yellow Cab. (Id. at 533a-538a.) Jeffrey Driscoll, Greyhound Line's station manager, testified that he makes 15 to 24 requests per day for taxis, that every couple of days there are problems with service where the driver takes an hour to arrive or refuses to drive a patron to the Hill District or to a local destination, and that he would use Applicant's service for approximately one-third of the trip requests if the service is satisfactory. (Id. at 540a-542a, 544a-545a.) James Sacco, Pittsburgh Steeler Sports, Inc.'s (PSSI) executive director of Heinz Field, testified that he uses taxis for reporters and visitors in town for shows, meetings, or concerts, that it is difficult to get Yellow Cab taxis to transport people from the stadium on the North Shore to downtown because the drivers want longer runs, and that he personally uses Yellow Cab when travelling from home or the airport, but guests use Classy Cab more often because it is more reliable. (Id. at 550a-557a.) Robert Thompson, PSSI's events coordinator, testified that his employer has an "Alert Cab" on game day for any patrons that cannot drive home, that he makes calls for two or three taxis per game, and that he uses Classy Cab because it is more reliable, but he would use Applicant's service if it was available. (Id. at 561a-564a.)
Protestants presented the report and testimony of John Holt (Holt), a certified public accountant. (R.R. at 567a-626a.) Holt testified that he reviewed Applicant's balance sheet, income statements, corporate tax forms and DeLucia's deposition testimony, and analyzed Applicant's financial strength. He opined that more information was needed from DeLucia's related companies because of the inter-activity between them and that some costs were reflected in Applicant's financial statements in some years but not in others. Holt stated that Applicant's net income was either marginally profitable or sustained significant losses in most years except for a significant profit in 2010. Holt testified that in some years, Applicant's obligations were met through the infusion of cash from the other companies and noted some liquidity concerns in transactions with DeLucia when money was either paid out to him or paid in by him. He stated that he used a program to consider financial ratios and to produce a Z-score to test Applicant's viability and likelihood to go bankrupt. He explained that the program is used by banks and financial institutions to determine a company's liquidity and how able it is to meet its financial obligations, and that a ratio greater than one indicates there is more cash than liabilities, while a ratio less than one indicates there are more liabilities than cash. He testified that the industry standard is 1.9 and that he calculated Applicant's ratio to be 0.24 in 2010.
Protestants also presented the testimony of James Campolongo (Campolongo), Yellow Cab's president and chief executive officer. (R.R. at 627a-698a.) Campolongo stated that Yellow Cab uses 333 taxis with approximately 260 leased out which is sufficient to serve the entire service area. He said that Yellow Cab uses an automated call center which is installed at high-volume sites that request it. He stated that he used to have a serious problem with drivers who refused to take short trips and that some pick-up points were especially difficult. He noted that the Commission docketed six to ten complaints against Yellow Cab in 2010, out of approximately 1.8 million trips, involving both service and need issues.
Importantly, Protestants waived any claim regarding the negative impact of Applicant's expansion upon their operations as a basis for the protests. (R.R. at 632a).
Finally, Applicant also presented the report and testimony of Peter Ferraro (Ferraro), an employee of Applicant's accountant, KRMR. (R.R. at 699a-714a.) Ferraro testified that he disagreed with Holt's assessment of Applicant's financial viability and dismissed the importance of the transactions between Applicant and DeLucia's other transportation companies. He stated that he disagreed with Holt's calculation of Applicant's negative Z-score because it was based on an outdated version that related to manufacturing companies and that he calculated Applicant's Z-score to be 4.49. He testified that he did not think that Applicant will go into bankruptcy based on its positive Z-score and knowing what he knows about the other related companies. He stated that some expenses were not properly allocated between the related companies for common expenses such as dispatch fees and rent, but that the over-allocation was not in Applicant's favor.
Holt testified that Applicant had a Z-score of -3.67. (R.R. at 579a.)
On October 17, 2011, the ALJ issued an Initial Decision granting the application. The ALJ found credible the testimony of the 23 public witnesses regarding the current problems faced when attempting to secure taxi service in downtown Pittsburgh, including excessive wait times and taxis that fail to show or refuse fares, especially for traveling short distances. The ALJ also found credible DeLucia's testimony regarding his operation of taxi services for over 20 years without financial difficulty, without default, without insurance troubles, without major safety issues, and without problems financing for new vehicles. The ALJ found that DeLucia maintains a couple of garages with staff which has maintained his vehicles in a safe operating condition as evidenced by the lack of compliance complaints. The ALJ further found that DeLucia knows how to dispatch drivers to where transportation is needed and already has in place a driver safety and training program with criminal background checks, safe driving records and safety training. The ALJ also noted that because Applicant's ability and fitness were established by the authorization to operate in its existing territory and, in the absence of any contrary proof, it must be concluded that these elements still exist. Finally, the ALJ determined that Protestants failed to show that the expansion of service would not be in the public interest because Applicant's entry would benefit the public by making it more likely that fares originating in downtown would be picked up more timely and shorter fares will be provided service. Accordingly, the ALJ granted the application and amended Applicant's certificate of public convenience to include call or demand service in all of Allegheny County based on her determination that there was a public demand or need for the proposed service and that Applicant possessed the technical ability and financial fitness to provide such service.
On November 23, 2011, Protestants filed exceptions to the ALJ's Initial Decision alleging that the ALJ erred in finding that there was public demand or need throughout the entire area for which authority was sought and that Applicant was financially and technically fit to provide the additional service. On June 21, 2012, the Commission filed an order denying Protestants' exceptions; adopting the ALJ's decision; granting the application; and amending Applicant's certificate of public convenience to include the right to provide call or demand service in Allegheny County. Protestants then filed the instant appeal.
On July 30, 2012, Applicant filed a Notice of Intervention in this Court.
In this appeal, Protestants claim that there is not substantial evidence to support the Commission's determinations that Applicant had proven public demand or need throughout the entire area for the proposed additional service or that Applicant is technically and financially fit to provide such service.
This Court's scope of review of the Commission's order is limited to determining whether a constitutional violation, an error of law or a violation of Commission procedure has occurred and whether the necessary findings of fact are supported by substantial evidence. Elite Industries, Inc. v. Pennsylvania Public Utility Commission, 574 Pa. 476, 481, 832 A.2d 428, 431 (2003). Substantial evidence is that quantum of evidence which a reasonable mind might accept as adequate to support a conclusion. Norfolk & Western Railway Co. v. Pennsylvania Public Utility Commission, 489 Pa. 109, 127, 413 A.2d 1037, 1046 (1980). Where the facts support the Commission's findings, this Court may not make an independent judgment in substitution of the Commission's judgment and we may not indulge in the process of weighing the evidence. Lancaster Yellow Cab & Baggage, Inc. v. Pennsylvania Public Utility Commission, 432 A.2d 1143, 1144 (Pa. Cmwlth. 1981).
We consolidate and reorder Protestants' claims in the interest of clarity.
Protestants also claim that the Commission erred in adopting the ALJ's decision because the ALJ erred in partially denying their discovery request and in limiting their cross-examination of DeLucia at the hearing. (See ALJ Initial Decision at 24 n.2 ("[P]rotestants sought to discover extensive financial statements and documents of Applicant as well as Applicant's related transportation companies. Most requests for the records of other companies were denied on the grounds Applicant's financial viability stands or falls upon its own strength, as evidenced by its own financial statements and documents. Applicant can neither benefit from nor be harmed by the financial condition of separate corporations.")).
However, Protestants did not raise this claim in their exceptions to the ALJ's decision, and while they referenced the ALJ's rulings in their brief filed with the Commission, Protestants did not raise any argument before the Commission regarding the ALJ's purported error in this regard. (See Main Brief of Protestants at 4-5.) Accordingly, we will not address the ALJ's rulings for the first time in this appeal. Pa. R.A.P. 1551(a); Met-Ed Industrial Users Group v. Pennsylvania Public Utility Commission, 960 A.2d 189, 198-99 (Pa. Cmwlth. 2008); Springfield Township v. Pennsylvania Public Utility Commission, 676 A.2d 304, 309 (Pa. Cmwlth. 1996); Pennsylvania Power Company v. Public Utility Commission, 561 A.2d 43, 52 (Pa. Cmwlth. 1989), aff'd per curiam, 526 Pa. 453, 587 A.2d 312 (1991), cert. denied, 502 U.S. 821 (1991).
The Commission has broad statutory authority to grant certificates of public convenience. Seaboard Tank Lines, Inc. v. Pennsylvania Public Utility Commission, 502 A.2d 762, 764-65 (Pa. Cmwlth. 1985). In order to amend its certificate of public convenience, Applicant was required to comply with Section 1103(a) of the Public Utility Code, 66 Pa. C.S. §1103(a), which provides that a certificate should only be granted if the Commission finds that it "[i]s necessary or proper for the service, accommodation, convenience or safety of the public." Lehigh Valley Transportation Services, Inc. v. Pennsylvania Public Utility Commission, 56 A.3d 49, 55 (Pa. Cmwlth. 2012). Applicant was also required to satisfy the requirements of Section 41.14 of the Commission's regulations regarding a public demand or need for the expanded service and its technical and financial fitness to provide such service. Id. As the party seeking to amend its certificate, Applicant had the burden to prove by a preponderance of the evidence that the requirements of Section 1103(a) and Section 41.14 were met. Id. at 55-56. Thus, it was Applicant's burden to prove the required public demand or need for the expanded service. Id.
Specifically, 52 Pa. Code §41.14 states, in pertinent part:
(a) An applicant seeking motor common carrier authority has a burden of demonstrating that approval of the application will serve a useful public purpose, responsive to a public demand or need.
(b) An applicant seeking motor common carrier authority has the burden of demonstrating that it possesses the technical and financial ability to provide the proposed service. In addition, authority may be withheld if the record demonstrates that the applicant lacks a propensity to operate safely and legally. In evaluating whether a motor carrier applicant can satisfy these fitness standards, the Commission will ordinarily examine the following factors, when applicable:
(1) Whether an applicant has sufficient capital, equipment, facilities and other resources necessary to serve the territory requested.
(2) Whether an applicant and its employees have sufficient technical expertise and experience to serve the territory requested.
(3) Whether an applicant has or is able to secure sufficient and continuous insurance coverage for all vehicles to be used or useful in the provision of service to the public.
(4) Whether the applicant has an appropriate plan to comply with the Commission's driver and vehicle safety regulations and service standards contained in Chapter 29 (relating to motor carriers of passengers).
(5) An applicant's record, if any, of compliance with 66 Pa. C.S. (relating to the Public Utility Code), this title and the Commission's orders.
(6) Whether an applicant or its drivers have been convicted of a felony or crime of moral turpitude and remains subject to supervision by a court or correctional institution.
"A preponderance of the evidence means only that one party has presented evidence that is more convincing, by even the smallest amount, than the evidence presented by the other party." Lehigh Valley Transportation Services, Inc., 56 A.3d at 56 n.6 (citation omitted).
Protestants argue that Applicant failed to demonstrate the required demand or need because all of the testimony presented established a limited need in downtown Pittsburgh and not in all of Allegheny County. What constitutes a public demand or need for service depends upon the locality involved and the particular circumstances of each case. Warminster Township Municipal Authority v. Pennsylvania Public Utility Commission, 138 A.2d 240, 243 (Pa. Super. 1958). However, the mere existence of adequate service does not preclude granting a certificate of public convenience to other applicants. Morgan Drive Away, Inc. v. Pennsylvania Public Utility Commission, 515 A.2d 1048, 1049 (Pa. Cmwlth. 1986). In addition, an applicant is merely required to show that a demand or need exists within the area generally served and not at every point within the proposed territory. Morgan Drive Away, Inc. v. Pennsylvania Public Utility Commission, 512 A.2d 1359, 1361 (Pa. Cmwlth. 1986).
As outlined above, Applicant presented the testimony of 23 public witnesses who described various difficulties with the existing service including taxi drivers' refusal to accept short fares or to travel to specific areas, and long wait times or the nonappearance of taxis, which occurred in a number of areas of the proposed service area of Allegheny County, including downtown Pittsburgh, the North Side, Mt. Washington, the Strip District, the North Hills, Bridgeville, and Mt. Lebanon. Clearly, Applicant presented substantial evidence demonstrating the public demand or need for additional service as required by 52 Pa. Code §41.14(a). See Lehigh Valley Transportation Services, Inc., 56 A.3d at 57 (holding that evidence of public need was sufficient where witnesses who did not previously use the call and demand service stated that they would in the future; witnesses stated that they use the service or would use the service because they were dissatisfied with current providers; and the provider was receiving calls for service that were referred to another provider); Limelight Limousine, Inc. v. Pennsylvania Public Utility Commission, 570 A.2d 1378, 1379-80 (Pa. Cmwlth. 1990) (holding that evidence of public need was sufficient where hotel representatives testified that their current service needs exceeded the present supply); Lancaster Yellow Cab & Baggage, Inc., 432 A.2d at 1144 (holding that evidence of public need was sufficient where 15 witnesses described various difficulties with existing service including long wait times and nonappearance of taxis; circuitous trips, suggesting overcharging; no service on Sundays for Rabbis returning from New York; and communication problems with non-Spanish-speaking drivers and dispatchers serving an area including a large number of Spanish-speaking employees).
Protestants also argue that Applicant's evidence is not sufficient to show the required technical and financial fitness to provide service to the larger area. Technical and financial fitness means that Applicant has "[s]ufficient technical and operating knowledge, staff and facilities to provide the proposed service and sufficient financial ability to provide reliable and safe service." Yellow Cab Company of Pittsburgh v. Pennsylvania Public Utility Commission, 673 A.2d 1015, 1019 (Pa. Cmwlth. 1996). As noted above, Applicant is an existing certificate holder and is, therefore, entitled to a continuing presumption regarding its technical and financial fitness to operate with respect to its application to expand its service area. Lehigh Valley Transportation Services, Inc., 56 A.3d at 58; South Hills Movers, Inc. v. Pennsylvania Public Utility Commission, 601 A.2d 1308, 1310 (Pa. Cmwlth. 1992). Thus, it was Protestants, as the parties challenging the application, who bore the burden of rebutting the presumption that Applicant is technically and financially fit to provide service in the expanded service area. Lehigh Valley Transportation Services, Inc.
To the extent that Protestants' argument is an invitation to reweigh the evidence presented to the Commission, we will not accede to Protestants' request. Lancaster Yellow Cab & Baggage, Inc., 432 A.2d at 1144.
In overruling Protestant's exceptions and granting the instant application, the Commission stated the following, in pertinent part:
We additionally agree with the ALJ that the Applicant is technically and financially fit to provide the proposed service, particularly because the Applicant's ability and fitness were established when it was authorized to operate in its current service territory, and in the absence of contrary proof, it must be concluded that those elements continue to exist. As noted by the ALJ, the Applicant is a certificated carrier in good standing with the Commission and has provided sufficient evidence to show it is able and likely to secure the necessary financing in addition to operating in compliance with the Commission's Rules and Regulations.... We do not believe that the Protestants have presented enough evidence to overcome this presumption of fitness, particularly in light of the evidence the Applicant has presented.... For example,
the Applicant provided testimony to show that its owner and President has operated taxicab services for over twenty years without financial difficulty, without failure to timely make insurance premium payments, without problems obtaining financing for new vehicle purchases, and without major safety and compliance issues. The Applicant has also provided sufficient evidence to demonstrate that it has established procedures in place for operating the authority it is seeking, which procedures
are similar to the procedures it has used since it first secured authority in 2003....(R.R. at 834a). Our review of the record of this case shows that the Commission did not err in determining that Applicant is technically and financially fit to operate in the expanded service area. Lehigh Valley Transportation Services, Inc., 56 A.3d at 58; Yellow Cab Company of Pittsburgh, 673 A.2d at 1019-20; Yellow Cab Company of Pittsburgh v. Pennsylvania Public Utility Commission, 524 A.2d 1069, 1071 (Pa. Cmwlth. 1987).
The Commission summarized the evidence regarding Applicant's financial fitness as follows. Applicant has earned a profit in five of the past seven years. None of the four companies that DeLucia owns and the Commission licensed has ever filed for bankruptcy; ceased operations due to financial problems; been sued for failing to make payment on a loan; or been unable to buy a vehicle, provide service, properly maintain vehicles, or unable to operate vehicles because of financial problems. DeLucia will guarantee any loans Applicant requires and he has done so in the past because he has a very good credit rating. Protestants' own expert admitted that the shareholder and inter-company loans involving Applicant were "basically a wash." Protestants' expert backed off his conclusion that Applicant was a prime candidate for bankruptcy and admitted that he was not aware of how long Applicant had been in business; was not present when DeLucia testified; and that he does not know what DeLucia testified to. Protestants' witness also admitted that he did not review any of Applicant's tax returns other than the state returns which had very little information. DeLucia testified that he had discussions with financial institutions about buying 25 vehicles and there has been no indication that there will be a problem with financing those vehicles. Applicant's accountant has been an accountant for 30 years and works with a firm in Pittsburgh, and Applicant's attorney prepared and introduced Exhibit 8 which is a financial analysis that sets forth the expert's conclusions that Applicant would be able to provide the additional service based on his review of Applicant's financial statements. (R.R. at 830a-831a.) (citations to record omitted).
The Commission also summarized the evidence regarding Applicant's technical fitness as follows. DeLucia testified that Applicant shares facilities with one of its related companies; uses mechanics and dispatchers employed by one of its related companies; and pays a management fee to the related company. DeLucia stated that Applicant does not have any employee drivers because it uses independent contract drivers in the same manner that Yellow Cab uses such drivers. DeLucia testified that Applicant's vehicles are dispatched from the location it shares with Star Limousine; that it has a nearby maintenance facility in Cranberry Township which it uses for vehicle maintenance; and that it will also be conducting its expanded operations from a facility in Pittsburgh which it will share with its related companies. Furthermore, Applicant asserts that its plan for operating in the expanded service area will be the same as its plan and procedures for operating under its existing authority; and that it has well-established procedures that it has used since it was first licensed in 2003. Applicant provided the following examples of its procedures which are part of the record: it runs motor vehicle reports on all prospective drivers and also does criminal background checks on its drivers; all of its drivers are required to do pre-trip and post-trip inspections on their vehicles; it has a maintenance program in place that involves changing the oil and rotating the tires every 3,500 miles and doing a more extensive service every 5,000 miles; and it has maintained insurance coverage since it was first licensed in 2003 and will maintain insurance coverage in the future using the same company that it presently uses. Applicant also states that it is in compliance with the Commission's regulations and has not had any safety violations with the Commission in the past three years. (Id. at 832a) (citations to record omitted).
Finally, as a corollary to this claim, Protestants assert that the Commission erred in failing to fix, set or determine a specific test, formula, guideline or meaningful criteria for evaluating whether an applicant has "sufficient capital" as required by 52 Pa. Code §41.14(b)(1). As noted above, under Section 1103(a), the General Assembly conferred broad authority to the Commission to grant certificates of public convenience. Seaboard Tank Lines, Inc., 502 A.2d at 764. However, the General Assembly did not provide a definition of what specific criteria were to be used in determining the propriety of granting a certificate leaving the formulation of such criteria to the Commission. Id. at 764-65. Thus, the Commission promulgated 52 Pa. Code §41.14 to set forth the evidentiary criteria necessary for granting a certificate, including the requirement of "sufficient capital" in Section 41.14(b)(1) "when applicable," pursuant to its statutory authority and administrative discretion. Id. The fact that the Commission has chosen within its authority and discretion to not further define "sufficient capital," applying that criterion on a case-by-case basis is not clearly erroneous under the Public Utility Code and, therefore, is not a basis for reversal by this Court. See Elite Industries, Inc., 574 Pa. at 483, 832 A.2d at 431 ("[A] court, in reviewing such a regulation, is not at liberty to substitute its own discretion for that of administrative officers who have kept within the bounds of their administrative powers. To show that these have been exceeded in the field of action involved, it is not enough that the prescribed regulations shall appear to be unwise or burdensome or inferior to another legislative scheme. Error or lack of wisdom in a ruling is not per se equivalent to abuse. A regulation must appear to be so entirely at odds with fundamental principles as to be the expression of a whim rather than an exercise of judgment.") (citation omitted). See also Philboro Coach Corp. v. Pennsylvania Public Utility Commission, 446 A.2d 725, 727 (Pa. Cmwlth. 1982) ("It is not the duty of this Court to ensure that the [Commission] follows [Commission] precedents as to evidentiary sufficiency. The duty of this Court is to review this case to determine if there is substantial evidence in the record to support the [Commission]'s determination. The weight of the evidence presented is for the [Commission] to determine in each case and it is quite outside our power to make comparison 'weighings' of prior [Commission] decisions to see if this case 'follows' those prior rulings. Any failure by the [Commission] to follow its prior evidentiary standards, if in fact there is a failure, is not an error of law subject to our review.") (citation omitted and emphasis in original).
Accordingly, the Commission's order is affirmed.
/s/_________
DAN PELLEGRINI, President Judge ORDER
AND NOW, this 30th day of April 2013, the order of the Pennsylvania Public Utility Commission, dated June 21, 2012, at No. A-2010-2168756, is affirmed.
/s/_________
DAN PELLEGRINI, President Judge