49 C.F.R. Appendix I to Subpart A of Part 1139—Revenue Need and Allocation to Traffic at Issue
Title 49 - Transportation
Title 49: Transportation
PART 1139—PROCEDURES IN MOTOR CARRIER REVENUE PROCEEDINGS
Subpart A—Common Carriers of General Commodities
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Appendix I to Subpart A of Part 1139—Revenue Need and Allocation to Traffic at Issue
[Cost allocation_see part II, line 13, [squ] Method A, [squ] Method B; check one; provide both]---------------------------------------------------------------------------------------------------------------- Restated proforma year \4\ Base --------------------------------Line calendar Present Based on No. Item Source \1\ year_actual proforma Based on Based on constructed \2\ year \3\ current proposed revenue revenues revenues need \5\---------------------------------------------------------------------------------------------------------------- (1)..................... (2)..................... (3) (4) (5) (6) (7)---------------------------------------------------------------------------------------------------------------- Part I. Revenue Need---------------------------------------------------------------------------------------------------------------- 1 Operating revenue....... A.R. Sch. 2998, L. 3.... $ $ $ $ $ 2 Operating expenses...... A.R. Sch. 2998, L. 10... 3 Lease of distinct A.R. Sch. 2998, Net of operating unit (net). Ls. 12 and 13. 4 Miscellaneous deductions A.R. Sch. 2998 (L. 27 less other income. minus L. 20). 5 Interest included in A.R. Sch. 2998, L. 23... miscellaneous deductions. 6 Income taxes on ordinary A.R. Sch. 2998, L. 29... income \6\. 7 Extraordinary and prior A.R. Sch. 2998, L. 34... period items. 8 Net income or loss \7\.. A.R. Sch. 2998, L. 35... 9 Sum of money above Sum of Ls. 4, 6 and 8... operating expenses. 10 Percent owned and leased A.R. Sch. 100, Col. (c) % % % % % property to net (L. 21+L. 23)÷L. tangible property (3 26. decimals). 11 Sum of money related to (L. 9x_% in L. 10) plus transportation. L. 3. 12 System revenue need L. 2 plus L. 11......... items and projected revenue need.---------------------------------------------------------------------------------------------------------------- Part II. Allocation to Traffic at Issue---------------------------------------------------------------------------------------------------------------- 13 Constant costs and sum See Method A ( ) and of money allocated to Method B ( ), check issue traffic. one; provide both. 14 Variable expenses from From traffic and cost traffic at issue (90% study. variable excluding return on investment)\8\. 15 Operating revenues from From traffic study...... traffic at issue \8\. 16 Constant costs and sum L. 13 plus L. 14........ $ $ $ $ $ of money allocated to issue traffic plus variable expenses. 17 Revenue to cost L. 15÷L. 16........ % % % % % comparison (1 decimal).----------------------------------------------------------------------------------------------------------------See Methods A and B and footnotes on following pages.
Method A_Constant Costs and Sum of Money Allocated To Issue Traffic Based on Ton and Ton-Mile Method (See Note A)---------------------------------------------------------------------------------------------------------------- Restated proforma year --------------------------------Line Source for columns 3 and Base Present Based on No. Item 4 calendar proforma Based on Based on constructed year_actual year current proposed revenue revenues revenues need---------------------------------------------------------------------------------------------------------------- (1)..................... (2)..................... (3) (4) (5) (6) (7) (a) System constant costs... L. (b)+L. (c)........... $ $ $ $ $ (b) Not related to distance (See Note B)............ (c) Related to distance.... (See Note B)............ $ $ $ $ $ (d) Percent not related to L. (b)÷L. (a)...... % % % % % distance (3 decimals). (e) Percent related to L. (c)÷L. (a)...... % % % % % distance (3 decimals). (f) System sum of money..... Appendix I, part I, L. $ $ $ $ $ 11. (g) Not related to distance L. (f)xL. (d)........... (h) Related to distance.... L. (f)xL. (e)........... (i) Total system constant L. (a)+L. (f)........... costs plus sum of money. (j) Not related to distance L. (b)+L. (g)........... (k) Related to distance.... L. (c)+L. (h)........... $ $ $ $ $ (l) Tons carried on issue From traffic study (see and nonissue traffic Note C). combined. (m) Ton-miles............... ......do................ (n) Issue traffic tons ......do................ carried. (o) Issue traffic ton-miles. ......do................ (p) Percent of issue traffic L. (n)÷L. (l)...... % % % % % tons to system tons (3 decimals). (q) Percent of issue traffic L. (o)÷L. (m)...... % % % % % ton-miles to system ton- miles (3 decimals).---------------------------------------------------------------------------------------------------------------- Constant Costs and Sum of Money Allocated To Issue Traffic---------------------------------------------------------------------------------------------------------------- (r) Not related to distance L. (p)xL. (j)........... $ $ $ $ $ (s) Related to distance.... L. (q)xL. (k)........... (t) Total (enter amount in L. (r)+L. (s)........... $ $ $ $ $ Appendix I, part II, line 13).----------------------------------------------------------------------------------------------------------------Note A: This procedure allocates constant costs and the sum of money based on the ton and ton-mile method and should be submitted for the information of the Board. How much of the constant and sum of money costs may or should be recovered by any specific segment of traffic rest on (1) considerations including value of service, demand, and ability to pay, and (2) considerations which involve matters relating to regulatory policy.Note B: Separate the amount of constant costs, including unrelated, by using Statement No. 6-68, Highway Form B, Schedule A, Line III. Assign the dollars in columns (6), (7), (8), and (9) times 10 percent to line (b), and the dollars in columns (4) and (5) times 10 percent to line (c).Note C: Show tons and ton-miles on issue and nonissue traffic based on an expansion of the sample to a full year.
Method B_Constant Costs and Sum of Money Allocated To Issue Traffic Based on Dollar (Expense) Method (See Note A)---------------------------------------------------------------------------------------------------------------- Restated proforma year -------------------------------- Line Source for columns 3 Base Present Based on No. Item and 4 calendar proforma Based on Based on constructed year_actual year current proposed revenue revenues revenues need---------------------------------------------------------------------------------------------------------------- (1)..................... (2).................... (3) (4) (5) (6) (7) (a) System constant cost Note B................. $ $ $ $ $ (excluding. (b) System sum of money..... Appendix I, part I, line II. (c) Total system constant Line (a) plus line (b). costs plus sum of money. (d) Variable expenses on From traffic and cost issue traffic. study; Note C-. (e) Variable expenses on From traffic and cost issue and nonissue study; Note D-. traffic combined. (f) Percent relationship (3 Line (d) ÷ line % % % % % decimals). (e). (g) Constant costs and sum Line (c) x line (f).... $ $ $ $ $ of money allocated to issue traffic (enter amount in Appendix I, part II, line 13).----------------------------------------------------------------------------------------------------------------Note A: This procedure allocates constant costs and the sum of money based on the dollar (expense) method and should be submitted for the information of the Board. How much of the constant and sum of money costs may or should be recovered by any specific segment of traffic rests on (1) considerations including value of service, demand, and ability to pay, and (2) consideration which involve matters relating to regulatory policy.Note B: Determine the amount of constant costs, including unrelated, by using Statement No. 6-68, Highway Form B, Schedule A, Line 111, column (3) multiplied by 10 percent; insert this amount on line (a).Note C: Determine the amount of variable costs, including unrelated, by using Statement No. 6-68, Highway Form B, Schedule A, line 111, column (3) multiplied by 90 percent to obtain the variable portion.Note D: Show variable expenses allocated to the issue traffic based on an expansion of a sample to a full year.Footnotes to Appendix I:Explanatory: The Purpose of Appendix I is twofold, namely: (1) to obtain, through part 1, Revenue Need, an indication of the past actual, present, and restated system revenue needs of the traffic and cost study carriers, which, along with the financial data required in appendix B, will facilitate an analysis of the financial stability of these carriers, and (2) to allocate a part of these system revenue needs to the traffic at issue as provided for in part II, line 13. It is that portion of constant and sum of money costs resulting from this allocation plus the related variable expenses (line 14) which produces the total costs assigned to the issue traffic (line 16) which is then compared to the issue traffic revenues in the revenue-to-cost comparison shown on line 17. This comparison provides some indication of how much the total issue traffic is contributing to the carriers' overall revenue needs; and serves as a reference point for the consideration of ratemaking factors, other than costs, which may influence the appropriateness of the issue traffic's contribution.Appendix I data should be completed and submitted for all traffic and cost study carriers combined. However, data for the ``base calendar year_actual,'' column (3), should be developed and completed for each traffic and cost study carrier and the results combined for all such carriers. The data in part I, columns (4) through (7), which reflect an updating of revenue need data for the ``base calendar year_actual'' to present and restated levels, should be developed on either an individual carrier basis, or on a composite carrier basis comprised of all traffic and cost study carriers. Data in part II, line 14 columns (4) through (7), which reflect an updating of the cost and traffic study data for the ``base calendar year_actual'' to present and restated levels, should be developed by the use of either individual carrier data for each of the study carriers, or the composite carrier data for those study carriers whose revenues from the issue traffic amount to 50 percent or more of their total system revenues for the ``base calendar year_actual.'' However, for line 14, the method selected should be the same as that used to update the operating ratios to present and restated levels as required in .3 Cost study. As indicated above, appendix I data should be completed and submitted only for all traffic and cost study carriers combined. Since appendix I are to be submitted on a combined carrier basis, any underlying individual carrier data used to complete this appendix should be furnished to the Board for its use as well as for the use of parties opposing the sought increases. Data in columns (4) through (7) must be appropriately explained and supported. Each of the dollar figures called for in these columns shall be accompanied by an explanation of the bases or methods of restatement, including explicit identification of all projected or assumed changes in revenues, in wage rates, in price levels of other expenses and property items, and in productivity, as compared with the preceeding (actual) year results. Note that the time periods referred to in appendix I, that is, ``Base calendar year_actual,'' ``Present proforma year'' and ``Restated proforma year'' are the same time periods indicated in § 1139.3, Cost study.\1\ Sources in this column apply to column (3) ``Base calendar year_actual.'' Data for columns (4) through (7) should rely on column (3) as a base in order to reflect data for the ``Present proforma year'' and the ``Restated proforma year.'' Annual report sources apply to class I motor carriers for class II carriers use comparable sources.\2\ The data in column (3) should reflect the revenue need data (part 1), and the traffic and cost study data (part II), for the traffic study year. That is, the ``Base calendar year_actual,'' which should coincide with the ``Base calendar year_actual'' referred to in the Cost study (§ 1139.3). Parts I and II should be completed for each individual study carrier_the purpose being to allocate a portion of each carrier's system revenue need to the traffic at issue as provided for in part II. The results for all study carriers should then be aggregated and submitted on a combined carrier basis.\3\ The data in column (4) should be based on present wage, price and productivity levels and reflect conditions prevailing on a date no later than the 45 days prior to the date of the tariff filing.\4\ The data in columns (5), (6), and (7) should be based on wage, price, and productivity levels anticipated on the effective date of the proposed rates.\5\ The purpose of this column is to obtain data on what system revenue needs of the study carriers should be at a giving time. Part I should consider the sum of money in addition to operating expenses (including that needed to attract debt and equity capital) which the carriers feel they require to insure financial stability and the capacity to render service.\6\ In columns (4) through (7), show income taxes based on estimated taxable income reduced by the taxes applicable to other income such as, for example, capital gains transactions.\7\ In columns (4) through (7), determine the net income based on data shown for lines 1 though 7. In column (7), the estimate of the net income needed should be supported by evidence that it is a just and reasonable amount.\8\ Show expenses and revenues allocated to the total issue traffic based on an expansion of the sample to a full year. The amount shown on line 14 for variable expenses should agree with that shown in Method B, line (d).
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[47 FR 49579, Nov. 1, 1982; 47 FR 54081, Dec. 1, 1982]
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