We are required by statute to examine the impact of our decisions on energy consumption, and therefore, deny petitioner's request to waive submission of exhibit 5.

Petitioner states that certain exhibits would be filed as an adjunct to the application; those are exhibit 2, Agreement, exhibit 3, Court Order, exhibit 4, Labor Impact (partial), and exhibit 23, Operating Plan.

We have been advised by the bankruptcy court that Burlington Northern, Inc. (BN) and the Milwaukee have entered into an agreement and intend to file an application under MRRA for acquisition by BN of certain Milwaukee properties, among which may be included part of the properties which Montana may seek to acquire. The bankruptcy court preliminarily approved that agreement by Order No. 295 effective on March 20, 1980. We will, therefore, grant a waiver of the requirement that Montana submit exhibits 2 and 3, only to the extent that such agreement and court order might be in conflict with those already in existence among Milwaukee, BN, and the bankruptcy court. To that extent, we will treat Montana's proposal as inconsistent with that of BN.

If BN and Milwaukee file an application concerning transfer of properties which include part of the properties which Montana may seek to acquire, the Montana and BN proposals will be handled concurrently. The bankruptcy court has ordered that the Commission must make its recommendation concerning the BNMilwaukee proposal within 90 days after the filing of that application. (Order No. 295, March 18, 1980.) Time is of the essence in any case, and we will not waive those sections of the regulations which provide that applications shall include all exhibits (49 CFR 1111.25(b)(2)(iv)) and shall include all the direct testimony of applicants (49 CFR 1111.25(n)(3)). Petitioner must submit exhibits 2 and 3 to the extent applicable, and exhibits 4 and 23, at the time of filing the application, to enable us to arrive at a timely and reasoned decision concerning the proposals contemplated by all of the parties. We will publish a schedule for the proceeding(s) upon acceptance of applications.

COMMISSIONER TRANTUM, dissenting:

Neither the pleading nor the draft decision provides us with any information as to the nature of the Montana Railway Company or the interests it seeks to represent.

It is ordered:

1. Waiver of exhibits 12, 16 through 18, 19 as stated above, and 24 through 28 as stated above, is granted.

2. Waiver of exhibits 4 through 6, 11 as stated above, and 14, is denied.

3. The parties shall comply with all provisions as stated above. 4. A copy of this decision shall be filed in Ex Parte No. 282 (SubNo. 4), Acquisition Procedures for Lines of Railroad, 360 I.C.C. 623 (1980).

5. This decision shall be effective on the date it is served. By the Commission, Chairman Gaskins, Vice Chairman Gresham, Commissioners Stafford, Clapp, Trantum and Alexis. Commissioner Trantum dissenting with a separate expression.

363 I.C.C.

AB-43 (SUB-NO. 47)

ILLINOIS CENTRAL GULF

RAILROAD COMPANY ABONDONMENT BETWEEN MILEPOST 0.0 AT CHEROKEE, IOWA AND MILEPOST 96.47 AT SIOUX FALLS, SOUTH DAKOTA, IN CHEROKEE, O'BRIEN, SIOUX, AND LYON COUNTIES, IOWA, ROCK COUNTY, MINNESOTA, AND MINNEHAHA COUNTY, SOUTH DAKOTA

Decided February 15, 1980

Upon administrative review, findings in prior decision served August 29, 1979 (not printed), authorizing the proposed abandonment affirmed. Train crew labor costs arising out of operation of a branch line which cannot be properly reallocated to other revenue producing operations must be considered avoidable costs of that branch line operation. Real property taxes which can be eliminated with reasonable certainty within a reasonable time following abandonment are properly included within avoidable cost calculations. Ad valorum real property taxes are not necessarily excluded from the category of avoidable costs. The burden of proof to which an applicant in an abandonment proceeding is subject does not impose unreasonable standards. Reasonable inferences can be drawn from evidence produced by an applicant who is in full compliance with Commission abandonment regulations, which inferences require affirmative evidence to rebut.

John H. Doeringer for Illinois Central Gulf Railroad Company. T. Scott Bannister for Iowa Department of Transportation. John C. Wiles for South Dakota Public Utilities Commission. Gordon P. MacDougall for protestants and intervenors. Marvin Wallace Miller and Thomas M. Knebel for intervenors in opposition.

DECISION

BY THE COMMISSION:

On September 18, 1979, a joint petition for leave to intervene in this proceeding as protestants was filed by the city of Cherokee, Farmer's Coop, Calumet Feed Service, K-F Motors, Rowena Elevator & Mill, Rock Rapids Community Affairs Corporation, Metz Baking Company, and Ray Halder Agg Lime Service. In

addition on the same data a separate petition for leave to intervene was filed by C.S. Agro Corp. In view of the prior participation of these petitioners as witnesses in this proceeding, we find good cause has been shown to permit these petitioners to intervene.

In a separate pleading also filed September 18, 1979, the city of Cherokee, Rock Rapids Community Affairs Corporation, Farmer's Coop, Archer Coop, Calumet Feed Service, K-F Motor, Metz Baking Company, Rowena Elevator & Mill, Ray Halder Agg Lime Service, L. C. Burkhalter, M. S. Stuckey, B. E. Hudson, and W. H. Canty filed a joint petition for administrative review of the decision of the Commission, Division 1, served August 29, 1979. C.S. Agro Corp. joined in the petition for administrative review. Illinois. Central Gulf Railroad Company (ICG) filed a reply to the petition for administrative review on October 4, 1979.

Intervenors seek a determination that this proceeding involves a matter of general transportation importance. They assert that the failure of division 1 to recognize the full impact of the "tabulated local rule" so as to exclude train and engine crew labor costs from the computation of avoidable costs was erroneous and in conflict with a prior ruling of division 2 in AB-43 (Sub-No. 42), Illinois Central Gulf Railroad Company Abandonment in Greene, Monroe, Brown, Johnson, Morgan, and Marion Counties, IN (not printed), decided December 20, 1978. They further assert that division 1 improperly included real property taxes as an avoidable cost and erroneously evaluated the propects for increased traffic on the line proposed for abandonment. They urge that the decision of division 1 which authorized the proposed abandonment be reconsidered and that the abandonment be denied.

In its reply ICG insists that the abandonment regulations of the Commission (49 CFR 1121) as they apply to this proceeding were correctly interpreted in the decision of August 29, 1979, and that the facts support the decision reached by division 1.

We have concluded that the two issues intervenors raise regarding avoidable costs, plus their general issue of burden of proof, present matters of general transportation importance justifying review by the full Commission, because of the large number of abandonment cases in which these and similar issues arise and the confusion and possible conflict between divisions and among Administrative Law Judges which appear to have developed concerning them. Upon such review, the Commission will affirm the conclusions of division 1. Intervenors' third specific issue, regarding future traffic prospects on the line, does not warrant further administrative review, and in this respect the petition for review will be denied. We also will not

disturb division 1's ultimate conclusion that abandonment of ICG's Cherokee-Sioux Falls branch, subject to specified conditions, accords with the public convenience and necessity and should be allowed.

Labor costs.-The intervenors contend that, as a result of the United Transportation Union's (UTU) local collective bargaining agreement with ICG (known as a "tabulated local rule"), the railroad will have to continue paying the wages of the two train crews in question even if it is permitted to abandon the CherokeeSioux Falls line. By their interpretation, ICG cannot require the present crews to relocate or accept other duties, and if they do so voluntarily it will still be required to assign two new crews to the line, whether operating or not. Thus, argue the intervenors, the wages and fringe benefits of these train crews are not "avoidable costs" of the branch-line operation. ICG vigorously disputes this interpretation of the agreement, contending that it will not continue to be applicable since ICG's entire Sioux Falls district is proposed to be abandoned.'

The Administrative Law Judge accepted the intervenors' argument and disallowed the wages and fringe benefits of the two train crews in her profit-or-loss calculations, thus turning the line's most recent years' operating losses of $53,000 (1976) and $117,000 (1977-9months), as calculated by ICG, into profit contributions of $184,000 and $73,000, respectively (on a capital liquidation value of $6.2 million). These adjustments, together with smaller but still significant adjustments as regards real property taxes (see below), led the Administrative Law Judge to conclude that the CherokeeSioux Falls line is profitable and that its continued operation will not be an unwarranted burden on ICG or on interstate commerce. Division 1 reversed the Administrative Law Judge's findings and conclusions on this point, holding that the Commission's regulations, 49 CFR 1121.42, expressly provide for the inclusion of train crew labor costs in calculating the profitability of branch-line operations for abandonment purposes. The division further held that the effect of the regulations cannot be overcome by a private labormanagement agreement such as the "tabulated local rule" here at issue, where the interpretation of the private agreement is in dispute, as it is here. The interpretation of such a private agreement is not within the scope of the Commission's expertise or

'A short 2-mile stretch of the 92-mile branch line will be leased to the Cherokee Industrial Corporation for use as an industrial spur line. but this in the applicant's view does not negate its argument.