PUC Annual ReportâFiscal Year 2011-12 - Public Utilities Commission

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Public Utilities Commission Annual Report 2011-12 State of Hawaii Page 47 companies, limousine services, and other transportation providers. Property carriers are classified by the types of commodities transported and the nature of services performed, namely: general commodities, household goods, commodities in dump trucks, and specific commodities. By law, certain transportation services, including, without limitation, taxis, school and city buses, ambulance services, refuse haulers, farming vehicles, and persons transporting personal property, are exempt from Commission regulation. In accordance with its statutory requirements, the Commission performs the following functions in the regulation of motor carriers: (1) certification and licensing; (2) ratemaking; and (3) business regulation. New Motor Carriers Certifications The Commission regulates 743 passenger carriers and 555 property carriers in the State. During the Fiscal Year, new certificates or permits were issued to 107 motor carriers, of which 90 were passenger carriers and 17 were property carriers. In the Fiscal Year, the number of passenger carriers increased over the previous fiscal year while the number of property carriers decreased, as shown in Figure 9. Figure 9. Number of active motor carriers per fiscal year 800 700 600 500 521 590 651 679 680 627 588 600 593 582 555 743 400 300 200 100 0 2006‐07 2007‐08 2008‐09 2009‐10 2010‐11 2011‐12 Property Carriers Passenger Carriers Requests for Rate Changes Many of the State’s motor carriers are members of either the Western Motor Tariff Bureau, Inc. (“WMTB”) or the Hawaii State Certified Common Carriers Association (“HSCCCA”). The WMTB and the HSCCCA are nonprofit organizations engaged in the research, development, and publication of motor carrier tariffs. The two organizations represent their members in ratemaking proceedings before the Commission. During the Fiscal Year, both the WMTB and HSCCCA filed requests for rate changes for its
Public Utilities Commission Annual Report 2011-12 State of Hawaii Page 48 members. Of the independent motor carriers, the Commission reviewed and approved rate requests from 41 motor carriers. Rates that are increased or decreased by ten percent within a calendar year are presumed to be just and reasonable, pursuant to the zone of reasonableness program (“ZRP”), which went into effect on January 1, 2004. On September 22, 2010, the Commission issued an order authorizing the permanent continuation of the ZRP, subject to certain conditions. Motor carriers who request rate increases or decreases that do not fall within the ±10 percent zone are required to show that the rate request is just and reasonable. In reviewing these requests, the Commission requires the carrier to submit financial statements containing the carrier’s revenues, expenditures, and operating ratio. The Commission will approve the rate increase or decrease based on an acceptable operating ratio reported in the financial statements. Water Carriers Proceedings The Commission regulates four water carriers: Young Brothers, Limited (“Young Brothers”), a provider of inter-island cargo service between all major islands; Sea Link of Hawaii, Inc. (“Sea Link”), a passenger and cargo carrier providing water transportation services between the islands of Maui and Molokai; Hone Heke Corporation (“Hone Heke”), a passenger and cargo carrier providing water transportation services between the islands of Maui and Lanai; and Pasha Hawaii Transport Lines LLC (“Pasha”), a provider of cargo service between the ports of Honolulu, Kahului, and Hilo with authorization to make calls to Nawiliwili, Barbers Point, and Pearl Harbor upon a customer’s request. Water carrier docket proceedings are highlighted below. • Young Brothers, Limited’s Request for General Rate Increase— Docket No. 2010-0171 On December 22, 2010, Young Brothers filed an application, seeking commission approval to: (1) increase its commodity rates, fees, and charges; (2) make certain revisions to its Tariff 5-A; and (3) switch from a calendar monthly closing schedule to a closing schedule that, on a quarterly basis, would divide the reporting periods as follows: five weeks for the first period, four weeks for the second period, and four weeks for the third period within the quarter (referred to Young Brothers as its proposed “Five-Four-Four” quarterly schedule. Specifically, in the December 22 Application, Young Brothers requested approval to increase its revenues in the amount of $14,404,000, or by 23.97 percent over revenues at current rates in the amount of $60,079,767, at a proposed rate of return of 14.12 percent. On February 3, 2011, the Commission issued an order, rejecting Young Brothers’ December 22 application without prejudice. Specifically, the Commission found that Young Brothers’ December 22 Application lacked the recorded actual results of operations for the prior calendar year, as required by the Commission’s rules. The Commission, however, allowed Young Brothers to re-file a new application in accordance with the Commission’s rules.
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PUC Annual ReportâFiscal Year 2011-12 - Public Utilities Commission