The general balance sheet of the Tucson & Nogales as of July 31, 1933, shows investment (a) in road and equipment $1,756,094.87, and (b) in miscellaneous physical property $100, capital stock $66,000, nonnegotiable debt to affiliated companies $704,748.96, and total corporate surplus $985,445.91. The tentative valuation of division 1 of this Commission of the properties of the Tucson & Nogales, as of June 30, 1916, is $1,100,000. The present amount of that company's indebtedness to the Southern Pacific Company, in open account, is stated as $686,000. Testimony is that the major part of the railroad operated in Arizona by the Southern Pacific Company, apart from the various properties formerly a part of the El Paso & Southwestern system, is owned by the Southern Pacific Railroad Company, and that the executive committee of the Southern Pacific Company has adopted a policy to dispose of these minor companies and get all properties into the larger companies, which will simplify the corporate structure; that it is considered that it would be better to have the applicant acquire the Tucson & Nogales than to have the Southern Pacific Company acquire the New Mexico & Arizona; and that if the application is approved, the next step will be the filing of an application by the Southern Pacific Railroad Company to acquire the properties of the Tucson & Nogales and the New Mexico & Arizona, and the dissolution of both companies, thus resulting in a saving in accounting and other incidental expenses, which would be in the public interest. In our consolidation plan the properties of the Southern Pacific Railroad Company, the Tucson & Nogales Railroad Company, and the New Mexico & Arizona Railroad Company are included with those of the Southern Pacific Company in system no. 16, Southern Pacific, as subsidiary-owned lines, without specific mention. Consolidation of Railroads, 159 I.C.C. 522. We find that the acquisition by the Southern Pacific Railroad Company of control of the Tucson and Nogales Railroad Company, by purchase of capital stock, upon the terms and conditions set forth in the application, which terms we find to be just and reasonable, will be in harmony with and in furtherance of the Commission's plan for the consolidation of railroad properties, and will promote the public interest. An appropriate order will be entered. 193 I.C.C. FINANCE DOCKET No. 10199 CHEAT HAVEN & BRUCETON RAILROAD COMPANY ET AL. ABANDONMENT Submitted December 13, 1933. Decided December 28, 1933 Certificate issued permitting (a) the Cheat Haven & Bruceton Railroad Company to abandon a branch line of railroad in Monongahela County, W.Va.. and (b) the Baltimore & Ohio Railroad Company to abandon operation thereof. W. D. Owens for applicants. REPORT OF THE COMMISSION DIVISION 4, COMMISSIONERS MEYER, BRAINERD, AND MAHAFFIE BY DIVISION 4: The Cheat Haven and Bruceton Railroad Company, and the Baltimore & Ohio Railroad Company, on October 26, 1933, jointly applied under section 1 (18) of the Interstate Commerce Act for permission (a) to the former to abandon a branch line of railroad extending from Morgan Run Junction to the end of the branch at Laurel Furnace, 1.18 miles, all in Monongahela County, W.Va., and (b) to the latter to abandon operation thereof. No representations have been made by any State authority, and no objection to the application has been offered. The Cheat Haven & Bruceton Railroad extends from a connection with the Baltimore & Ohio Railroad at Cheat Haven, Pa., to Canyon Mine, W.Va., 5.194 miles, with the branch line sought to be abandoned. The branch connects with the logging road of the Kendall Lumber Company. It was constructed to develop contiguous timber lands. All the timber has been removed. The branch has not been operated since 1928, as there has been no available traffic. The Baltimore & Ohio owns all the capital stock of the Cheat Haven & Bruceton, and operates its railroad as lessee. The estimated population in the territory within 2 miles of the branch is 15. There are no industries in the territory. The applicants state that the branch is valueless as an income producing unit, that there is no possibility of future developments that would justify its operation, and that it has deteriorated to the point where its only value consists of whatever scrap material may be recovered. The facts of record show that the branch has served the purpose for which it was constructed, that its operation would impose an undue burden on interstate commerce, and that the proposed abandonment would not result in public inconvenience. We find that the present and future public convenience and necessity permit the abandonment (a) by the Cheat Haven & Bruceton Railroad Company of the branch line of railroad in Monongahela County, W.Va., described in the application, and (b) by the Baltimore & Ohio Railroad Company of operation thereof. An appropriate certificate will be issued, effective from and after 30 days from its date. Suitable provision will be made therein for the cancelation of tariffs. 193 I.C.C. INDEX DIGEST [Numbers in parentheses following citations indicate pages on which subjects are considered] In General: The Commission's accounting classification provides that capital A new company organized to take over the assets of another corporation should In the consideration of a particular case the Commission may depart from or ACQUISITION. See also CONTROL; CONVENIENCE AND NECESSITY (ACQUISI- Individual Applications: Baltimore & Ohio R. Co., of Coal & Coke Ry. Co., AIDS, GIFTS, GRANTS, AND DONATIONS The fact that a railroad has received municipal aid in the construction of its APPLICATIONS In General: Assuming that the law deals with substance rather than form, ASSUMPTION. See SECURITIES (ASSUMPTION OF OBLIGATION AND LIABILITY) BRANCH LINES. See CONVENIENCE AND NECESSITY (BRANCH LINES) CAPITALIZATION In General: The capitalization by a carrier of only those assets that have In dealing with capitalization consisting entirely of securities having a par Capitalizable assets and assets that cannot properly be so classified under a A new company organized to take over the assets of another corporation should Having required a carrier to set up on its balance sheet as the liability for its CERTIFICATES. See CONVENIENCE AND NECESSITY; SECURITIES (INTERIM) CARRIER: Diversion of traffic from a railroad to its competitors because of In a sense each railroad competes with every other railroad in the country, but Duplication of facilities or service is not justified when reasonable efforts on the CONNECTING TRACKS. See CONVENIENCE AND NECESSITY (CONNECTING CONSOLIDATION OF RAILWAYS In General: Acquisition of control does not constitute a consolidation within The Commission assumes that the law deals with substance rather than form. Actual independence of systems of railroads is not promoted by permitting the |