Consolidated Rail Corporation. Also, for many years prior to the April 1971 decision, SIRT had operated passenger service on three rail lines on Staten Island. In 1953 it discontinued such service on two lines, and continuation of such service on the third line, being the line involved in this proceeding, was assured by virture of a prior lease arrangement between SIRT and the city. That agreement granted the city an option to purchase the line from SIRT. The option was subsequently exercised by the city, resulting in the filing of the applications in Finance Dockets Nos. 26342 and 26343.

Through the years SIRT's freight operations have steadily declined. Currently SIRT's freight operations consist of the movement of one 5-car freight train per day 5 days a week in service to one regular customer, Nassau Smelting Co. The dominant portion of traffic on the line, however, is intrastate passenger traffic of approximately 21,500 passengers per week day.

The Federal Railroad Administration continues to inspect signals, devices, and cars.

CONTENTIONS OF COMPLAINANTS

Complainants refer to the agreements previously discussed. They contend that all actions taken by the city, which obtained the certificate in Finance Docket No. 26343, and all actions by the city's agent SIRTOA up through 1976, were wholly consistent with the fact that SIRTOA was and is subject to the Interstate Commerce Act and RLA. As of the present time SIRTOA acknowledges that labor relations on SIRTOA's premises are governed by the RLA, with one significant exception: SIRTOA employees are classified as public employees of New York for the purposes of application of State laws prohibiting strikes by public employees. Public employees, for example, have benefits not available to SIRTOA employees; such as night differentials, bereavement pay, paid holidays and, sick days, pensions after 20 years of service, one and one-half times regular pay for overtime, and a 40-hour week. SIRTOA employees, on the other hand, must work any of the 7 days a week at straight-time and only receive 2 days of paid holidays. It is thus complainants' position that the Railway Labor Act and all relevant interpretations of that act should be held to apply in its entirety, or not at all. They have brought this complaint as expressly provided in the RLA to resolve once and for all whether SIRTOA is a carrier as defined in the RLA.

CONTENTIONS OF SIRTOA

SIRTOA contends that it is not a carrier within the definition advanced for such term under 45 U.S.C. 151 in the first instance, and that in any event it falls within the provision exempting it from coverage under that act. Its position is that application of the RLA to it arises solely by virtue of an agreement between SIRT and the city and that therefore when the procedures under that act are exhausted, the contractual requirements are met. Thereafter, pertinent provisions of the laws of the State of New York might apply, unencumbered by Federal laws and regulations.

SIRTOA presently operates an exclusively passenger and essentially commuter service over the line entirely within the Borough of Staten Island. It carries no freight and connects with no other passenger line. It has an operating deficit of approximately $5 million annually and the city and State of New York provide all of its capital costs. It asserts that the relationship with interstate commerce is tenuous and results solely from the granting by the city to SIRT of trackage rights for the latter's freight operation, which is minimal at the present time. SIRTOA points out that the applications for acquisition of the line by the city and for trackage rights by SIRT over that line were filed after a July 15, 1970 meeting between the parties to those applications and certain staff members of this Commission. At that time it was determined that no application had to be filed by SIRTOA for approval of its "control" of SIRT's interstate freight service, since the "control" SIRTOA had over SIRT was restricted to limiting the times SIRT's freight operations could be conducted over the line.

Moreover, SIRTOA argues, it is neither directly nor indirectly owned or controlled by or under common control with any carrier by railroad within the meaning of 45 U.S.C. 151. It argues that the LIRR is a stock corporation purchased by the MTA in 1966. LIRR operates as an independent carrier and files its own tariffs. In contrast SIRTOA is a public benefit corporation created by State law and functions as an operating agent for the city of New York, which holds the certificate of public convenience and necessity. Furthermore, LIRR is predominantly involved in intrastate commuter operations with passenger service producing the bulk of its revenues.

Finally, argues SIRTOA, even if it were deemed a carrier within the first sentence of section 1 of RLA, it would be exempted from coverage under the proviso to that section, citing Piedmont & N. Ry.

Co. v. Interstate Commerce Commission, 286 U.S. 299, 307 (1936); North Coast Transp. Co., 286 I.C.C. 691 (1952); and Philadelphia & W. Ry. Co., 255 I.C.C. 521 (1943).

DISCUSSION AND CONCLUSIONS

At the time the city applied to this Commission to acquire the electrified line in Finance Docket No. 26343, the certificated line was operated by SIRT as part of a general system of transportation subject to the Interstate Commerce Act. Neither the city nor any authorized representative of the city then concurrently sought and obtained dismissal of that application on the basis of any exemptions which might have been available to it. Nor did it then or thereafter seek to abandon or discontinue in whole or in part any services on the line previously rendered by its predecessor. We must conclude therefore, that the city received an unqualified certificate of public convenience and necessity to acquire the line and to have the line operated in the same manner as it was operated by its predecessorowner SIRT."

Included in the common carrier duties in that certificate, and assumed by the city, is the obligation to furnish and maintain adequate transportation and transportation facilities, including rail, ties, and equipment for the movement of property in interstate commerce. See 49 U.S.C. 11101 (formerly embraced in former section 1(4) of the Interstate Commerce Act).

The concurrent acquisition by SIRT of trackage rights to permit the latter to effect freight train service on the line at best might be viewed as relieving the city from effecting the same service to that extent, but only so long as the authorized trackage rights arrangement remains in effect. See Norfolk S. R. Co. Receivers Abandonment, 221 I.C.C. 258 (1937) and Hoboken Rail Road

"The fact that the decision in Finance Docket No. 26343 exempted the city from the securities provisions of the Interstate Commerce Act and from the reporting and accounting provisions. except as to matters relating to its railroad operations is immaterial to the resolution of its status as a certificated carrier. Initially, former section 20a (2) expessly exempted securities issued and obligations assumed by any State or by any political subdivision or municipal corporation of any State, or by any instrumentality of a State, or of a political subdivision of a municipal corporation. Moreover these exemptions would have been irrelevant unless carrier status had been affirmatively established in the first instance. Also the fact that neither the city nor any representative of the city has ever filed any reports with the Commission is not significant. Such railroad operations as would otherwise have required compliance with reporting and accounting provisions were effected by SIRT pursuant to trackage rights in Finance Docket No. 26342. As noted below this latter operation by SIRT serves as relief for similar operations under the certificate issued the city in Finance Docket No. 26343, but only so long as such latter operations continue to be adequate.

Whse. & S.S. Connecting Co. Operation, 257 I.C.C. 739 (1944). Moreover SIRT as holder of trackage rights permitting it to operate on the line jointly with the city or the city's authorized representative had and now has no implicit obligation to maintain the trackage either under historical Commission precedent or under the agreement effected between the city and SIRT, as approved by the Commission. Indeed that agreement is conditioned to require prior execution of the trackage rights arrangement attached as an exhibit to that agreement. This arrangement commits the city to maintain, repair, and renew the trackage facilities and maintain them in a reasonable good condition for the operation of freight trains (by SIRT). Were the city or its authorized operator not otherwise a carrier subject to the Interstate Commerce Act, members of the shipping public would have no direct recourse before this Commission in the event of track inadequacy, resulting in deterioration of freight train service. They clearly must not be denied this right, especially in the light of the fact that no authority ever has been issued by this Commission which would permit abandonment of common carrier services on the line. Compare Winnebago Farmers Elevator Co. v. Chicago & N. W., 354 I.C.C. 859 (1978).

It is apparent on review of the May 29, 1970 agreement between SIRT and the city that although the city was to acquire ownership of the line, control, and functional operation of the line was at all times to be effected by an unidentified public benefit corporation. It is unfortunate that the city's lease and operating agreement with SIRTOA, dated July 20, 1970, was not submitted with or otherwise incorporated into the September 17, 1970, filed application in Finance Docket No. 26343. Under the July 20, 1970 dated agreement the city gave SIRTOA complete and exclusive control of the 14.5 mile line, including full authority and responsibility not only of operating railroad passenger service in accordance with State law (otherwise exempt from this Commission's regulation) but also over maintenance and repair of the line.

This agreement, together with SIRTOA's functions as expressly identified in its articles of incorporation, would have clearly established that the city was to be the absentee "owner" of the line. SIRTOA, as the party controlling operation of the line, was to be the entity functionally responsible for actively discharging any duties. incumbent on the holder of the certificate issued in Finance Docket No. 26343. In this posture SIRTOA would have been the proper

repository of the certificate. Compare State of Vt. and Vermont Ry., Inc., Acquisition and Op., 320 I.C.C. 609 (1964).

In any event, SIRTOA's present argument that it is not a common carrier subject to the Interstate Commerce Act is unpersuasive. It is true that its primary function is to effect and carry out local passenger service on the line which is otherwise exempt from Commission regulation. However, it is also currently responsible for maintaining the line adequately to permit common carrier freight service. As such it is a "person" inextricably and functionally engaged in "transportation" by "railroad" within the meaning of former section 1(3)(a) of the Interstate Commerce Act. This maintenance obligation, coupled with the implicit duty under the certificate of furnishing adequate freight service in interstate commerce (which duty lies latent so long as substitute freight service is being fulfilled by SIRT under a trackage rights arrangement) is sufficient to establish that it is now engaged in such transportation as a carrier by railroad subject to the Interstate Commerce Act.

But even if it were not a carrier by railroad, subject to the Interstate Commerce Act, we still must find that it is a "carrier" under the definition of that term as declared in Section 1, First of the RLA. The term carrier is also defined as any company which meets both of the following criteria: (1) a company which is directly or indirectly owned or controlled by or under common control with any carrier by railroad, and (2) a company which operates any facilities or performs any service in connection with the transportation, receipt, delivery, and handling of property transported by railroad.

SIRTOA, undisputedly operates and physically maintains the line, which is necessary to effect the freight transportation in interstate commerce currently performed by SIRT pursuant to its trackage rights arrangement. Hence it comes within the second of the two criteria.

Moreover, despite the concern of SIRTOA over an extension of the principle of "common control," we are constrained to give the

'Former section 1(3)(a) of the Interstate Commerce Act has been recodified as 49 U.S.C. 10102. We shall refer to section 1(3)(a), since that section was in effect at the commencement of operations by SIRTOA. The term "person" includes a "corporation" and the term "transportation" includes all instrumentalities and facilities of shipment or carriage, irrespective of ownership or contract and all services in connection with the handling of property transported. The term "railroad" includes all the road in use by any common carrier operating a railroad. whether owned or operated under a contract, agreement or lease, and also all switches, spurs. tracks, terminals, and terminal facilities necessary in the transportation of property.