B-167771, MAY 14, 1970, 49 COMP. GEN. 768

B-167771: May 14, 1970

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IS NOT REGULATED BY THE INTERSTATE COMMERCE COMMISSION. IT IS SUBJECT TO CERTAIN PROVISIONS OF THE INTERSTATE COMMERCE ACT PURSUANT TO SECTION 3(A) OF EXECUTIVE ORDER 11107. DISPUTED TRANSPORTATION CLAIMS THAT ARE MORE THAN 3 YEARS OLD WILL BE VIEWED AS NOT SUBJECT TO THE 3 YEAR STATUTE OF LIMITATIONS AGAINST THE CONSIDERATION OF CLAIMS BY THE UNITED STATES GENERAL ACCOUNTING OFFICE BECAUSE OF THE LIMITED NUMBER OF CLAIMS INVOLVED AND THE FACT THAT PAYMENT HAS BEEN MADE BY THE RAILROAD TO CONNECTING CARRIERS FOR THEIR SHARE OF THE REVENUE. 1970: WE HAVE CONSIDERED LETTERS OF APRIL 30. TWO CLAIMS WERE ALLOWED IN THE TOTAL AMOUNT OF $139.62. FOUR CLAIMS WERE NOT CONSIDERED ON THEIR MERITS BECAUSE THEY ACCRUED MORE THAN 3 YEARS PRIOR TO RECEIPT IN THIS OFFICE.

B-167771, MAY 14, 1970, 49 COMP. GEN. 768

ALASKA RAILROAD -- CLAIMS -- STATUTES OF LIMITATION ALTHOUGH THE ALASKA RAILROAD, A GOVERNMENT-OWNED FACILITY OPERATED BY THE DEPARTMENT OF TRANSPORTATION UNDER AUTHORITY DELEGATED BY THE PRESIDENT, IS NOT REGULATED BY THE INTERSTATE COMMERCE COMMISSION, IT IS SUBJECT TO CERTAIN PROVISIONS OF THE INTERSTATE COMMERCE ACT PURSUANT TO SECTION 3(A) OF EXECUTIVE ORDER 11107, APRIL 25, 1963, AND FUNCTIONS AS A COMMON CARRIER. HOWEVER, DISPUTED TRANSPORTATION CLAIMS THAT ARE MORE THAN 3 YEARS OLD WILL BE VIEWED AS NOT SUBJECT TO THE 3 YEAR STATUTE OF LIMITATIONS AGAINST THE CONSIDERATION OF CLAIMS BY THE UNITED STATES GENERAL ACCOUNTING OFFICE BECAUSE OF THE LIMITED NUMBER OF CLAIMS INVOLVED AND THE FACT THAT PAYMENT HAS BEEN MADE BY THE RAILROAD TO CONNECTING CARRIERS FOR THEIR SHARE OF THE REVENUE, BUT, FUTURE CLAIMS FOR TRANSPORTATION SERVICES SHOULD BE TIMELY FILED.

TO THE SECRETARY OF TRANSPORTATION, MAY 14, 1970:

WE HAVE CONSIDERED LETTERS OF APRIL 30, 1970, AND AUGUST 14, 1969, FROM J. GLEN CASSITY, CHIEF COUNSEL, THE ALASKA RAILROAD, ASKING FOR OUR REVIEW OF THE SETTLEMENT ISSUED DECEMBER 13, 1968, IN CLAIM TK 880531, DISPOSING OF CLAIMS AGGREGATING $515.63 ON SIX BILLS OF LADING. IN THAT SETTLEMENT, TWO CLAIMS WERE ALLOWED IN THE TOTAL AMOUNT OF $139.62; FOUR CLAIMS WERE NOT CONSIDERED ON THEIR MERITS BECAUSE THEY ACCRUED MORE THAN 3 YEARS PRIOR TO RECEIPT IN THIS OFFICE. OUR DECISION ON THESE FOUR CLAIMS WILL AFFECT SOME OTHER CLAIMS BEING HELD BY THE RAILROAD WE HAVE CONCLUDED THAT THE FOUR CLAIMS MAY BE CONSIDERED ON THE MERITS AND, IF OTHERWISE CORRECT, MAY BE ALLOWED.

IT IS URGED THAT THE 3-YEAR STATUTE OF LIMITATIONS AGAINST THE CONSIDERATION OF CLAIMS BY THE GENERAL ACCOUNTING OFFICE, PUBLIC LAW 85 762, AUGUST 26, 1958, 72 STAT. 860, 49 U.S.C.A. 66, DOES NOT APPLY TO THE ALASKA RAILROAD, A GOVERNMENT-OWNED FACILITY, STATED BY THE ATTORNEY GENERAL IN 1924 TO BE AN ARM OF THE FEDERAL GOVERNMENT PERFORMING A GOVERNMENTAL FUNCTION AND NOT A COMMON CARRIER SUBJECT TO THE INTERSTATE COMMERCE ACT, 34 OP. ATTY. GEN. 232. IT IS ALSO POINTED OUT THAT WE LONG AGO HELD THE ALASKA RAILROAD TO BE ENTITLED TO PAYMENT FOR SERVICES FURNISHED OTHER GOVERNMENT DEPARTMENTS. DECISION A-10659, JANUARY 28, 1926. THE RAILROAD HAS ALREADY PAID OVER TO ITS CONNECTING CARRIERS THEIR PROPORTIONS OF THE REVENUES EARNED ON THESE ITEMS; THERE IS THEN NO POSSIBILITY THAT COMMON CARRIERS SUBJECT TO THE INTERSTATE COMMERCE ACT AND THUS TO THE 3-YEAR BARRING ACT WOULD SHARE IN ANY SUMS ALLOWED ON THESE ITEMS.

THERE IS NO QUESTION OF THE RAILROAD'S ENTITLEMENT TO PAYMENT FOR SERVICES PERFORMED FOR OTHER GOVERNMENT AGENCIES. THE DISPOSITION OF YOUR CLAIMS BY THE SETTLEMENT IN TK-880531 RESTED SOLELY UPON THEIR TIMELINESS: THOSE RECEIVED HERE BEFORE THE LAPSE OF 3 YEARS FROM THE DATE OF ACCRUAL WERE PAID; THOSE RECEIVED HERE AFTER THE 3-YEAR LAPSE WERE NOT CONSIDERED AT ALL. THE REAL QUESTION HERE IS WHETHER TRANSPORTATION PERFORMED BY THE ALASKA RAILROAD FOR THE UNITED STATES MAY BE REGARDED AS BEING WITHIN THE PURVIEW OF SECTION 322 OF THE TRANSPORTATION ACT OF 1940, AS AMENDED BY PUBLIC LAW 85-762, AND THUS SUBJECT TO THE 3-YEAR LIMITATION ON CLAIMS COGNIZABLE BY THE GENERAL ACCOUNTING OFFICE CONTAINED IN THAT SECTION.

THE ALASKA RAILROAD WAS CREATED BY THE ACT OF MARCH 12, 1914, 38 STAT. 305, WHICH, IN THE INTEREST OF THE NATIONAL DEFENSE, TERRITORIAL DEVELOPMENT, AND COMMERCE GENERALLY, AUTHORIZED THE PRESIDENT OF THE UNITED STATES TO ACQUIRE, CONSTRUCT AND OPERATE A RAILROAD OR RAILROADS IN ALASKA AND, AMONG OTHER THINGS, "TO RECEIVE COMPENSATION FOR THE TRANSPORTATION OF PASSENGERS AND PROPERTY, AND TO PERFORM GENERALLY ALL THE USUAL DUTIES OF A COMMON CARRIER BY RAILROAD." THE ACT FURTHER PROVIDED THAT AFTER COMPLETION OF THE RAILROAD, THE PRESIDENT MIGHT IN HIS DISCRETION LEASE IT FOR NO MORE THAN 20 YEARS, IN WHICH CASE IT SHOULD BE "OPERATED UNDER THE JURISDICTION AND CONTROL OF THE PROVISIONS OF THE INTERSTATE COMMERCE LAWS." IF THE PRESIDENT DID NOT LEASE THE RAILROAD, THE STATUTE PROVIDED THAT HE SHOULD CONTINUE TO OPERATE IT UNTIL FURTHER ACTION OF THE CONGRESS.

THE ACT ALSO AUTHORIZED THE PRESIDENT TO APPOINT OR EMPLOY OFFICERS, AGENTS OR AGENCIES TO PERFORM ANY OR ALL OF THE DUTIES IMPOSED ON HIM UNDER THE ACT AND TO DO ALL ADDITIONAL THINGS NECESSARY TO ACCOMPLISH ITS PURPOSES AND OBJECTIVES. PURSUANT TO THIS AUTHORITY, THE PRESIDENT, BY EXECUTIVE ORDER NO. 3861, JUNE 8, 1923, DELEGATED TO THE SECRETARY OF THE INTERIOR THE AUTHORITY TO OPERATE AND CONTROL THE ALASKA RAILROAD.

THEREAFTER THE SECRETARY OF THE INTERIOR ASKED THE ATTORNEY GENERAL FOR THE ANSWERS TO SEVERAL QUESTIONS ABOUT THE ISSUANCE OF PASSES FOR TRANSPORTATION OVER THE LINES OF THE ALASKA RAILROAD. AS THE ATTORNEY GENERAL POINTED OUT, SECTION 1 OF THE ACT OF MARCH 12, 1914, PROVIDED THAT "NO FREE TRANSPORTATION OR PASSES SHALL BE PERMITTED EXCEPT THAT THE PROVISIONS OF THE INTERSTATE COMMERCE LAWS RELATING TO THE TRANSPORTATION OF EMPLOYEES AND THEIR FAMILIES SHALL BE IN FORCE AS TO THE LINES CONSTRUCTED UNDER THIS ACT." THE INTERSTATE COMMERCE ACT AUTHORIZES COMMON CARRIERS SUBJECT THERETO TO PROVIDE FREE TRANSPORTATION TO EMPLOYEES AND THEIR FAMILIES, AMONG OTHERS.

UNDER THE 1914 ACT AS THE ATTORNEY GENERAL INTERPRETED IT, THE SECRETARY OF THE INTERIOR COULD ISSUE PASSES FOR FREE TRANSPORTATION OVER THE LINES OF THE ALASKA RAILROAD ONLY TO EMPLOYEES OF THAT RAILROAD AND THEIR FAMILIES. TO REACH THIS CONCLUSION AND RESPOND TO THE SECRETARY'S QUESTIONS, IT WAS UNNECESSARY TO DETERMINE THE COMMON CARRIER STATUS OF THE RAILROAD. THE ATTORNEY GENERAL'S COMMENTS ON THAT POINT IN 1924 SEEM, THEREFORE, TO BE OBITER DICTA. IN ANY EVENT THERE HAS BEEN NO FORMAL DECISION ON THE QUESTION WHETHER THE ALASKA RAILROAD MAY PROPERLY BE REGARDED AS A COMMON CARRIER SUBJECT TO THE INTERSTATE COMMERCE ACT SO AS TO BRING IT WITHIN THE AMBIT OF THE 3 YEAR LIMITATION IN THE 1958 ACT ON THE CONSIDERATION OF TRANSPORTATION CLAIMS BY THE GENERAL ACCOUNTING OFFICE.

AS AUTHORIZED BY THE 1914 STATUTE, THE RAILROAD PERFORMS "THE USUAL DUTIES OF A COMMON CARRIER BY RAILROAD." LIKE OTHER COMMON CARRIERS, THE RAILROAD HOLDS ITSELF OUT IN TARIFFS WHICH IT PUBLISHES TO TRANSPORT THE GOODS OF ALL WHO APPLY; IT PARTICIPATES IN TRANSPORTATION IN INTERSTATE AND FOREIGN COMMERCE WITH OTHER COMMON CARRIERS BY RAIL AND WITH COMMON CARRIERS BY WATER; HOWEVER, IT REMAINED FREE FROM REGULATION BY THE INTERSTATE COMMERCE COMMISSION. THIS SITUATION PREVAILED EVEN THOUGH THE RAILROAD ENTERED INTO JOINT THROUGH RATES AND THROUGH ROUTES WITH OTHER COMMON CARRIERS SUBJECT TO THE ACT WHICH WERE PUBLISHED IN TARIFFS FILED WITH THE INTERSTATE COMMERCE COMMISSION AND, WHERE APPROPRIATE, WITH THE FEDERAL MARITIME COMMISSION. THE RAILROAD HAS NOT BEEN LEASED BUT HAS CONTINUED TO BE OPERATED BY THE GOVERNMENT.

PRESIDENT KENNEDY, BY EXECUTIVE ORDER NO. 11107, APRIL 25, 1963, 28 F. R. 4225, AUTHORIZED THE SECRETARY OF THE INTERIOR TO OPERATE THE RAILROAD (SECTION 1), TO ALLOCATE A PORTION OF THE RAILROAD'S CAPITAL INVESTMENT TO THE NATIONAL PUBLIC PURPOSES WHICH LARGELY INSPIRED ITS CONSTRUCTION (SECTION 2(A)), AND TO FIX, CHANGE AND MODIFY RATES, WITH DUE REGARD FOR ACTIONS OF THE INTERSTATE COMMERCE COMMISSION UNDER SECTION 3, (SECTION 2(B)). SECTION 3(A) OF THE EXECUTIVE ORDER PROVIDES THAT, AS TO RATES FILED, THE INTERSTATE COMMERCE COMMISSION MAY ACT AS THOUGH THE ALASKA RAILROAD WERE SUBJECT TO VARIOUS SECTIONS OF THE INTERSTATE COMMERCE ACT, WITH CERTAIN EXCEPTIONS AS TO SAFETY REGULATIONS, MOTOR CARRIAGE FOR THE RAILROAD, OR MOTOR CARRIAGE INCIDENTAL TO RAIL CARRIAGE. SECTION 3(B) OF THE EXECUTIVE ORDER PROVIDES THAT THE INTERSTATE COMMERCE COMMISSION, IN DETERMINING THE JUSTNESS AND REASONABLENESS OF THE RAILROAD'S RATES AND CHARGES, SHALL EXCLUDE FOR VALUATION AND COST FINDING PURPOSES THE PORTION OF CAPITAL INVESTMENT ALLOCATED TO PUBLIC PURPOSES UNDER SECTION 2(A).

WHEN THE DEPARTMENT OF TRANSPORTATION WAS ESTABLISHED, THE ENABLING ACT CONTAINED A PROVISION TRANSFERRING TO THE SECRETARY THE ADMINISTRATIVE CONTROL OF THE ALASKA RAILROAD WHICH HAD BEEN DELEGATED TO THE SECRETARY OF THE INTERIOR IN EXECUTIVE ORDER NO. 11107. PUBLIC LAW 89-670, OCTOBER 15, 1966, 80 STAT. 931, 941, 49 U.S.C. 1655(I). AUTHORITY DELEGATED TO THE COMMISSION IN SECTION 3 OF EXECUTIVE ORDER NO. 11107, HOWEVER, HAS NOT BEEN DISTURBED AND THE COMMISSION CONTINUES TO BE EMPOWERED TO ACT AS THOUGH THE RAILROAD WERE SUBJECT TO THOSE SECTIONS OF THE ACT ENUMERATED ABOVE.

FOR ALL PRACTICAL PURPOSES, IT WOULD SEEM THEN, THAT THE ALASKA RAILROAD FUNCTIONS AS A COMMON CARRIER IN RELATION TO THE GEOGRAPHICAL AREA AND TO THE CUSTOMERS IT SERVES AND IS ADMINISTERED AS A COMMON CARRIER SUBJECT TO POSSIBLE RATE REGULATION BY THE INTERSTATE COMMERCE COMMISSION. THE RAILROAD FUNCTIONS AS A COMMON CARRIER BY DIRECTION OF THE 1914 ACT. AND EXECUTIVE ORDER NO. 11107 MAINTAINED THE DISTINCTION: SECTION 3(A) PROVIDES THAT, AS TO RATES FILED, THE COMMISSION MAY ACT AS THOUGH THE RAILROAD WERE SUBJECT TO CERTAIN PROVISIONS OF THE INTERSTATE COMMERCE ACT.

AS INDICATED, CERTAIN PROVISIONS OF THE INTERSTATE COMMERCE ACT MAY BE APPLIED TO THE OPERATIONS OF THE ALASKA RAILROAD. THE RAILROAD FILES TARIFFS WITH THE INTERSTATE COMMERCE COMMISSION, AS WELL AS COPIES OF SO- CALLED SECTION 22 QUOTATIONS TENDERED TO GOVERNMENT SHIPPING AGENCIES; IN ADDITION, ITS BILLS ARE PAID UPON PRESENTATION WITHOUT PRIOR AUDIT BY OUR OFFICE AND ARE SUBJECT TO THE SAME OVERCHARGE NOTICE AND COLLECTION TREATMENT, INCLUDING SETOFF WHERE VOLUNTARY REFUND OF OVERCHARGES IS NOT MADE, AFFORDED OTHER COMMON CARRIER ACCOUNTS UNDER THE PROVISIONS OF 49 U.S.C. 66.

NEVERTHELESS, IN VIEW OF THE LIMITED NUMBER OF CLAIMS THAT ARE MORE THAN 3 YEARS OLD, IT IS DOUBTFUL THAT ANY SUBSTANTIAL PURPOSE WILL BE SERVED BY APPLYING A 3-YEAR LIMITATION TO REJECT OTHERWISE VALID ALASKA RAILROAD CLAIMS PARTICULARLY WHERE PAYMENTS HAVE BEEN MADE TO CONNECTING CARRIERS IN SETTLEMENT OF THEIR SHARE OF THE REVENUE. THEREFORE, IN THE LIGHT OF THE BACKGROUND OF THE LEGISLATIVE AND ADMINISTRATIVE HISTORY OF THE RAILROAD, AND IN THE ABSENCE OF CONTRADICTORY JUDICIAL PRECEDENT, STATUTORY PROHIBITIONS, OR OTHER COMPELLING REASONS, THE DISPUTED AND SIMILAR CLAIMS WILL NOT BE VIEWED AS SUBJECT TO THE 3-YEAR LIMITATION IN 49 U.S.C. 66. THIS CONCLUSION IS NOT TO BE REGARDED AS ENCOURAGING UNDUE DELAY IN PRESENTING CLAIMS FOR TRANSPORTATION SERVICES, AND IT IS ASSUMED THAT THE RAILROAD WILL MAKE EVERY REASONABLE EFFORT TO TIMELY FILE ANY BILL WHICH IT HAS FOR SERVICES FURNISHED OTHER GOVERNMENT AGENCIES.

THE FOUR ITEMS WHICH WERE EXCLUDED FROM CONSIDERATION IN THE SETTLEMENT MADE IN CLAIM TK-880531 WILL NOW BE CONSIDERED ON THEIR MERITS. NOTICE OF A REVISED SETTLEMENT WILL BE SENT TO THE RAILROAD IN DUE COURSE. OTHER CLAIMS WHICH, ACCORDING TO MR. CASSITY'S LETTER OF APRIL 30, 1970, WILL BE SUBMITTED FOLLOWING OUR REVIEW OF THE SETTLEMENT ON CLAIM TK-880531, SHOULD BEAR REFERENCE TO THE NUMBER AND DATE OF THIS DECISION.