an unjust and undue burden upon the interstate operations of the carrier or upon interstate commerce, and there is no requirement that the entire intrastate operations of a carrier in the State involved must be conducted at a loss before an individual intrastate train may be discontinued. In this case, however, the uncontradicted evidence shows that the carrier's intrastate operations, as a whole, both freight and passenger, are being conducted at a substantial loss. In the prior report, division 4 considered the system revenues of the carrier and properly rejected the State commission's contention that the carrier's system operations as a whole must be unprofitable before it can be found that an undue burden on interstate commerce exists. In this connection, see Great Northern Ry. Co.-Discontinuance of Service, 307 I.C.C. 59, and New York Central R. Co. Abandonment, supra. The State commission further contends that section 13a (2) is unconstitutional. It is well established that an administrative agency such as the Interstate Commerce Commission has no power to pass upon the constitutionality of a Federal statute which it is called upon to administer. Only the courts have authority to determine the question of constitutionality. Engineers Public Service Co. v. SEC, 78 U.S. App. D.C. 199, 138 F. (2d) 936, 952–953, dismissed as moot 332 U.S. 788; Panitz v. District of Columbia, 72 App. D.C. 131, 112 F. (2d) 39; Todd v. SEC, 137 F. (2d) 475, 478 (6th Cir.), Central Nebraska Public Power & Irr. Dist. v. FPC, 160 F. (2d) 782 (8th Cir.), certiorari denied 332 U.S. 765; and Public Utilities Commission v. United States, 355 U.S. 534, 539. For reasons expressed in Missouri Pac. R. Co. Discontinuance of Passenger Service, 312 I.C.C. 105,1 we reaffirm that we have no authority to impose conditions for the protection of employees adversely affected by the discontinuance of intrastate trains authorized under the provisions of section 13a (2) of the act. Contentions of the parties as to either fact or law not specifically discussed herein or in the previous report have been given consideration and found to be without material significance or not justified. Considering the losses being incurred from the peninsula commuter operations as a whole, the losses resulting from the operation of trains Nos. 155 and 156, and the little use being made of the trains, as well as available alternative means of transportation as discussed in the prior report, we affirm the finding in the prior report of division 4 that the present and future public convenience and necessity permit the discontinuance of service provided by trains Nos. 155 and 156 between San Francisco and San Jose and that the continued opera 1 Petitions for reconsideration were denied by the Commission. tion of such trains will constitute an unjust and undue burden upon the interstate operations of the carrier and upon interstate commerce. An appropriate order will be entered. COMMISSIONER MCPHERSON did not participate. FINANCE DOCKET No. 21382 CHICAGO & NORTH WESTERN RAILWAY COMPANY CONSTRUCTION OF TRACK NEAR RADNOR, ILL. Decided September 21, 1961 Certificate issued authorizing construction and operation by the Chicago and North Western Railway Company of an extension of its line of railroad from Radnor to the new plant of Muirson Label Company in Peoria, County, Ill. Edgar Vanneman, Jr., for applicant. Arthur L. Winn., Jr., for intervener in support of applicant. REPORT OF THE COMMISSION DIVISION 3, COMMISSIONERS TUGGLE, MCPHERSON, AND BUSH MCPHERSON, Commissioner: By application filed December 2, 1960, The Chicago and North Western Railway Company, hereinafter called the North Western, seeks a certificate of public convenience and necessity, under section 1(18) of the Interstate Commerce Act, authorizing the construction and operation of a line of railroad extending approximately 1.91 miles from milepost 71.35 at Radnor, Ill., to the site of the new Muirson Label Company plant located in an area presently being developed as the Pioneer Industrial Park, in Peoria County, Ill. A protest was filed by the Chicago, Rock Island and Pacific Railroad Company, hereinafter called the Rock Island, and a hearing has been held. Briefs were filed by applicant and the intervener in opposition, and the latter also filed a reply brief. Service of an examiner's recommended report has been waived. The Pioneer Industrial Park, hereinafter called the park, was dedicated by Peoria Industrial Enterprises, Inc., in September 1959, for the purpose of attracting new industry to the vicinity of Peoria, Ill. 312 I.C.C. The park is presently comprised of approximately 340 acres of formerly undeveloped farmland. It is situated slightly to the northwest of Peoria and adjoined on the east by a branch line of the Rock Island extending from Peoria. The double track, East St. Louis-Chicago main line of the North Western, at its closest point, is situated approximately 1.3 miles west of the western boundary of the park. A north-south highway known as "University Street" bisects the park into eastern and western sections. The Rock Island provided no service to the described area prior to 1960. Applicant had established a station at Radnor with team track facilities for the purpose of forwarding and receiving agricultural products and other commodities for the local residents. The proprietor of the park is controlled by a group of Peoria businessmen who chose the location between the two rail lines in anticipation that the service of both lines would be available, thus, in their opinion, making the park attractive to more industries, since, depending upon their particular traffic problems, one carrier could better serve the needs of a particular shipper than could the other carrier. It is their belief that Rock Island service will develop the eastern section of the park, while North Western service will develop the western section. The proprietor contemplates the subsequent acquisition of an additional 300 acres, some of which is presently under option. The Rock Island operates a way freight over its branch line 3 days a week, southbound only, from Silvis to Peoria. The switching limits of Peoria were extended in March 1960, to include the park, although not for reciprocal switching. Daily switch engine service is, therefore, available to the park from the Rock Island's yard in Peoria. On March 9, 1960, the latter carrier completed a spur track from its branch line to the new plant of the C. A. Reed Company, located in the eastern section of the park. In December 1960 it completed construction of another spur into the park to serve the new warehouse of Super Valu Stores which is located immediately west of University Street. This spur track is approximately 3,300 feet in length. Sometime after the dedication of the park, the Muirson Label Company, a division of International Paper Company, approached applicant concerning an adequate location for the establishment of a new plant, and applicant became instrumental in the shipper's decision to locate in the considered industrial area. In the fall of 1960, applicant commenced construction of trackage from its station at Radnor to the new plant site on the assumption that it was a spur or industrial track within the meaning of section 1(22) of the act, for which no certificate would be required. The Rock Island instituted action in the United States District Court for the Southern District of Illinois, Northern Division (civil action No. P-2354),1 for an injunction to stay completion of the construction. In a memorandum opinion dated November 15, 1960, the court concluded that: the trackage proposed by defendant [North Western] to be constructed constitutes an extension of line within the meaning of paragraph 18 [Interstate Commerce Act] since it extends into an area which is being served by plaintiff [Rock Island]. The construction of that trackage is, therefore, unlawful until and unless defendant shall have applied to the [Interstate] Commerce Commission and received a certificate of convenience and necessity therefor. Judgment was entered permanently enjoining defendant from constructing the proposed trackage until it had applied for, and obtained, a certificate. The instant application has been filed as a result of the court decision. As presently proposed, the length of track to be constructed would total 10,095 feet, of which 6,886 feet would extend from point of switch at Radnor to the boundary of the park, with an additional 2,214 feet within the park from boundary to plant site. The track would be standard gage consisting of 112-pound rail on No. 3 track ties. The estimated cost of construction, including $66,000 for acquisition of land, is $231,900, which expenditure has already been made from applicant's current funds, except for labor expense of $28,090 for construction of the track. All basic engineering work has been completed, including the survey, running a profile of the existing ground line, and the establishment of proposed finished grades. It is estimated that construction can be completed within 1 month after authorization. International Paper Company, intervener in support of the application, manufactures and sells wood pulp, pulpboard, and various grades of paper, including wrapping, printing, newsprint, and groundwood paper. Much of the output of its papermills is further processed at company-owned converting plants which manufacture paper bags, envelopes, labels, milk containers, and fiberboard boxes of various kinds. At present, there are three new converting plants under construction, one of which is the label plant involved in this proceeding. The available maps of record disclose that the new plant site is located on a lot bounded on the east by University Street and on the south by the northern boundary of the plot upon which the warehouse of Super Valu Stores is located. The initial cost of construction is $2,000,000, and the shipper expects to expand the facilities within the next 5 years. The plant's loading facilities which are specifically designed for a railroad siding from the North Western's station at Radnor, can be reached only by trackage entering the build 1 See Chicago, R.I. & P. R. Co. v. Chicago & N.W. Ry. Co., 188 F. Supp. 549. ing from the west. The record does not disclose the date upon which construction commenced, but all rail service for the transportation of the building materials and supplies has been provided by applicant through its facilities at Radnor, from which point the materials were moved to the plant site by motor vehicle. It was expected that the plant would be completed and placed in operation in April or May of this year. Its production will move to central and midwestern territory, although there will be some movements beyond that area. Inbound raw material will consist principally of printing paper originating at the shipper's mill in Mississippi. Rail traffic for the first full year of the plant's operation is expected to reach 400 cars of inbound material and approximately 200 cars of outbound shipments. Applicant estimates that the total traffic (inbound and outbound) expected to be handled for the label company during the first 5 years of operation will amount to 600, 825, 1,050, 1,275, and 1,500 cars, respectively, and that net revenues for the respective periods would be $55,919, $76,874, $97,829, $118,842, and $139,797. Pending final determination of these proceedings, the shipper will either move its inbound shipments directly from its mill in Mississippi by motor carrier or ship by rail to Radnor and truck from that station to the plant. Outbound shipments will be trucked to Radnor for further shipment by rail. The principal question for determination is whether the public convenience and necessity require an invasion of the territory served by intervener to the extent proposed by applicant herein. In similar prior decisions the Commission has held that carriers have no legal right to exclusive occupancy of a territory. See Chesapeake & O. Ry. Co. Construction, 267 I.C.C. 665, 679. However, sound economic conditions in the transportation industry require that carriers serving a particular territory should normally be accorded the right to transport all traffic which they can handle adequately, efficiently, and economically, before a new operation is authorized. This conclusion is applicable not only with respect to existing traffic but also with respect to potential traffic. See Northern Pac. Ry. Co. Construction, 295 I.C.C. 281, 294 and cases cited therein. Under the circumstances, justification for the construction of the line as here sought by applicant must be established by clear proof that the line is to be both a public convenience and a public necessity. We have said that the latter implies a strong or urgent need. See Galesburg & G.E.R. Co. Construction, 244 I.C.C. 470, 477. We also recognize that interests of a shipper are matters of substantial importance in determining the question of public convenience and necessity. Compare St. Marys R. Co. Construction, 295 I.C.C. 677, 688. |