This day, this matter came on for consideration upon the petition of The Cleveland, Columbus & Cincinnati Highway, Inc. to establish a Commercial Zone for the City of Niles, Ohio; the appearance of intervenors; the report and recommendation of Attorney Examiner Eugene J. Nolan, dated October 10, 1956; the exceptions to said report filed [450]*450by Aetna Freight Lines, Inc., also by Komray & Bock, Inc., Burbank Van & Storage, Inc., J. M. Barbe Co., The Youngstown Cartage Co. and Mahoning Express Company, intervenors herein; the reply to said exceptions filed by The Cleveland, Columbus & Cincinnati Highway, Inc., et al; the request for oral argument, and the testimony and exhibits offered and introduced in evidence upon said hearing.
The Commission, being fully advised in the premises, and in compliance with §4903.09 R. C., hereby renders the following opinion:
SUMMARY OF THE EVIDENCE:
The Commission hereby adopts as its own, as if fully rewritten herein, the “Summary of the Evidence” as contained in the written report of the Attorney Examiner, dated October 10, 1956.
FINDINGS OF FACT AND LAW
The Commission after oral argument, and upon consideration of the exceptions filed herein, the reply thereto, and all matters at issue, submits the following Discussion, which Discussion is pertinent to Case No. 26,094, being the instant application, and Case No. 26,363 and Case No. 26,095, which cases were consolidated for public hearing.
COMMISSION’S DISCUSSION
As used throughout this order the term “APPLICANT,” refers to those parties who support the findings of the Attorney Examiner.
“PROTESTANT,” as so used, refers to all parties who object to the findings of the Examiner.
These cases arise out of petitions, filed by holders of presently existing Certificates of Public Convenience and Necessity, in the Cities of Youngstown, Niles, and Waren requesting the enlargement (in the case of Youngstown) and the establishment (in the cases of Warren and Niles) of commercial zones about said cities. The cases were consolidated for public hearing and were heard upon joint record by Attorney Examiner Eugene J. Nolan.
In his Report and Recommendation Attorney Examiner Nolan recommended that the Youngstown Zone be expanded and that zones be created about the Cities of Niles and Warren.
Exceptions were filed to the report of the Attorney Examiner and, at the request of the parties, an oral argument was held upon such Exceptions.
It appears that the objections raised by Protestants by way of Exceptions, as well as their objections stated during the course of the Oral Argument, may be classified in two basic categories as follows:
I. Complaints which relate to the actual physical area of the Zones recommended by the Attorney Examiner.
II. Complaints which allege that the zones as recommended by the Attorney Examiner do not grant “reciprocal” rights, (i. e. do not grant operating rights to serve the cities in question as well as the zone to existing certificated holders who hold operating rights out in the area now being included in the commercial zone.)
As to the first issue, namely, the area question, the Commission finds that the recommendation of its Attorney Examiner in each of these three zones is proper. As to this aspect of these cases the report should be adopted.
[451]*451Protestants have requested specificially that the Village of Mineral Ridge be included in one or more of the zone areas. The Protestants also request that McDonald, Ohio, now located in the Youngstown Commercial Zone, also be included in the Niles zone.
There is likewise a pending request that certain township area, not now included in the recommended zone for Niles, be included.
As to all of these complaints and allegations, it is sufficient to state that the Commission has thoroughly reviewed the transcript of evidence made at the public hearing as well as the arguments made by Protestants at Oral Argument by way of objections to findings of the Examiner. Having made this review the Commission finds no basis for disturbing the Examiner’s findings with respect to the zone areas. There appears to be little probative evidence of record to substantiate the request of expansion of the zone areas beyond that recommended by the Examiner. The very purpose of creating or expanding commercial zones is to make available to shippers who, because of geographical location, business interest, shipping or receiving requirements, need, although they are actually outside the governmental corporate limits of a municipal corporation, the same type and character of motor transportation service which shippers or receivers within such municipal corporation enjoy. It was never contemplated that §4921.26 R.- C., be used as an automatic device by carriers to expand their operating territories; such section exists for the benefit of shippers and receivers and to meet their needs.
This raises the question of the meaning of the term “commercially a part of” as the same is used in §4921.26 R. C. The opinion of the Ohio Supreme Court in Beiter Lines v. P. U. C. O., 165 Oh St 1, has clearly established that it is not necessary to meet the strict test of Public Convenience and Necessity in a commercial zone case. There must, however, be some kind of a demand or requirement on the part of shippers or receivers of freight in the proposed zone area for the new expanded service. Mere showing of “community of interest” in such things as banking, telephone service, a gas or water supply, is not enough. To hold otherwise would be folly; for how could expanding motor carrier service be justified if there has been no showing of any kind that it would be used. As it is used in .§4921.26 R. C., “COMMERCIALLY A PART OF” really means “COMMERCIALLY A PART OF FOR TRANSPORTATION PURPOSES.” Judged in this 'light, it appears that these requests for further expansion of zone areas are actually made by carriers for their own benefit and for enlargement of their operating rights without reference to shipper requirements: such requests are not substantiated by enough sufficient, substantial, and competent testimony to indicate that the disputed areas are “commercially a part” of the municipal corporation in question.
It is readily apparent that the latter of the two objections which were raised at the Oral Argument is the more basic. It goes to the power and jurisdiction of this Commission to create and delimit commercial zones in the first instance. It requires an interpretation of the statute itself. The commercial zone statute (§4921.26 R. C.), reads as follows:
[452]*452“Where industrial plants or other enterprises are located in a district 'which is outside but commercially a part of any municipal corporation, the Public Utilities Commission, on its own motion or on petition of any interested common carrier by motor vehicle or shipper, may, after investigation, notice, and hearing, determine and fix the limits of a zone surrounding such municipal corporation, and may include in such zone any adjacent territory, incorporated or unincorporated, which it finds commercially a part of such municipal corporation.
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This day, this matter came on for consideration upon the petition of The Cleveland, Columbus & Cincinnati Highway, Inc. to establish a Commercial Zone for the City of Niles, Ohio; the appearance of intervenors; the report and recommendation of Attorney Examiner Eugene J. Nolan, dated October 10, 1956; the exceptions to said report filed [450]*450by Aetna Freight Lines, Inc., also by Komray & Bock, Inc., Burbank Van & Storage, Inc., J. M. Barbe Co., The Youngstown Cartage Co. and Mahoning Express Company, intervenors herein; the reply to said exceptions filed by The Cleveland, Columbus & Cincinnati Highway, Inc., et al; the request for oral argument, and the testimony and exhibits offered and introduced in evidence upon said hearing.
The Commission, being fully advised in the premises, and in compliance with §4903.09 R. C., hereby renders the following opinion:
SUMMARY OF THE EVIDENCE:
The Commission hereby adopts as its own, as if fully rewritten herein, the “Summary of the Evidence” as contained in the written report of the Attorney Examiner, dated October 10, 1956.
FINDINGS OF FACT AND LAW
The Commission after oral argument, and upon consideration of the exceptions filed herein, the reply thereto, and all matters at issue, submits the following Discussion, which Discussion is pertinent to Case No. 26,094, being the instant application, and Case No. 26,363 and Case No. 26,095, which cases were consolidated for public hearing.
COMMISSION’S DISCUSSION
As used throughout this order the term “APPLICANT,” refers to those parties who support the findings of the Attorney Examiner.
“PROTESTANT,” as so used, refers to all parties who object to the findings of the Examiner.
These cases arise out of petitions, filed by holders of presently existing Certificates of Public Convenience and Necessity, in the Cities of Youngstown, Niles, and Waren requesting the enlargement (in the case of Youngstown) and the establishment (in the cases of Warren and Niles) of commercial zones about said cities. The cases were consolidated for public hearing and were heard upon joint record by Attorney Examiner Eugene J. Nolan.
In his Report and Recommendation Attorney Examiner Nolan recommended that the Youngstown Zone be expanded and that zones be created about the Cities of Niles and Warren.
Exceptions were filed to the report of the Attorney Examiner and, at the request of the parties, an oral argument was held upon such Exceptions.
It appears that the objections raised by Protestants by way of Exceptions, as well as their objections stated during the course of the Oral Argument, may be classified in two basic categories as follows:
I. Complaints which relate to the actual physical area of the Zones recommended by the Attorney Examiner.
II. Complaints which allege that the zones as recommended by the Attorney Examiner do not grant “reciprocal” rights, (i. e. do not grant operating rights to serve the cities in question as well as the zone to existing certificated holders who hold operating rights out in the area now being included in the commercial zone.)
As to the first issue, namely, the area question, the Commission finds that the recommendation of its Attorney Examiner in each of these three zones is proper. As to this aspect of these cases the report should be adopted.
[451]*451Protestants have requested specificially that the Village of Mineral Ridge be included in one or more of the zone areas. The Protestants also request that McDonald, Ohio, now located in the Youngstown Commercial Zone, also be included in the Niles zone.
There is likewise a pending request that certain township area, not now included in the recommended zone for Niles, be included.
As to all of these complaints and allegations, it is sufficient to state that the Commission has thoroughly reviewed the transcript of evidence made at the public hearing as well as the arguments made by Protestants at Oral Argument by way of objections to findings of the Examiner. Having made this review the Commission finds no basis for disturbing the Examiner’s findings with respect to the zone areas. There appears to be little probative evidence of record to substantiate the request of expansion of the zone areas beyond that recommended by the Examiner. The very purpose of creating or expanding commercial zones is to make available to shippers who, because of geographical location, business interest, shipping or receiving requirements, need, although they are actually outside the governmental corporate limits of a municipal corporation, the same type and character of motor transportation service which shippers or receivers within such municipal corporation enjoy. It was never contemplated that §4921.26 R.- C., be used as an automatic device by carriers to expand their operating territories; such section exists for the benefit of shippers and receivers and to meet their needs.
This raises the question of the meaning of the term “commercially a part of” as the same is used in §4921.26 R. C. The opinion of the Ohio Supreme Court in Beiter Lines v. P. U. C. O., 165 Oh St 1, has clearly established that it is not necessary to meet the strict test of Public Convenience and Necessity in a commercial zone case. There must, however, be some kind of a demand or requirement on the part of shippers or receivers of freight in the proposed zone area for the new expanded service. Mere showing of “community of interest” in such things as banking, telephone service, a gas or water supply, is not enough. To hold otherwise would be folly; for how could expanding motor carrier service be justified if there has been no showing of any kind that it would be used. As it is used in .§4921.26 R. C., “COMMERCIALLY A PART OF” really means “COMMERCIALLY A PART OF FOR TRANSPORTATION PURPOSES.” Judged in this 'light, it appears that these requests for further expansion of zone areas are actually made by carriers for their own benefit and for enlargement of their operating rights without reference to shipper requirements: such requests are not substantiated by enough sufficient, substantial, and competent testimony to indicate that the disputed areas are “commercially a part” of the municipal corporation in question.
It is readily apparent that the latter of the two objections which were raised at the Oral Argument is the more basic. It goes to the power and jurisdiction of this Commission to create and delimit commercial zones in the first instance. It requires an interpretation of the statute itself. The commercial zone statute (§4921.26 R. C.), reads as follows:
[452]*452“Where industrial plants or other enterprises are located in a district 'which is outside but commercially a part of any municipal corporation, the Public Utilities Commission, on its own motion or on petition of any interested common carrier by motor vehicle or shipper, may, after investigation, notice, and hearing, determine and fix the limits of a zone surrounding such municipal corporation, and may include in such zone any adjacent territory, incorporated or unincorporated, which it finds commercially a part of such municipal corporation. Upon and after the effective date of an order establishing any such commercial zone, all common carriers by motor vehicle transporting property over regular or irregular routes and authorized to serve such municipal corporation as a point of origin and destination of shipments shall, by virtue of and in accordance with such order, serve such commercial zone in the same manner and to the same extent as they are authorized by their respective certificates to serve such municipal corporation. The Commission may attach such conditions to any such order as, in its judgment, the public convenience and necessity requires. The Commission shall give to all such common carriers so authorized to serve such municipal corporation at least ten days’ written notice of the time and place of any hearing had under this section. The Commission may prescribe appropriate forms and rules for the administration of this section.” (Emphasis supplied.)
Relying upon one single portion of that statute, which has been emphasized for tlie purpose here, the Applicants assert that the Public Utilities Commission is without jurisdiction to make any commercial zone reciprocal (i. e. to allow carriers located out in the zone to serve it). They assert that only those carriers who hold operating rights in the municipal corporation about which a zone is being created may be authorized to serve the commercial zone. As indicated, they rely for support of this proposition upon the one sentence of the statute which has been emphasized.
The Commission finds that it cannot agree with the position of these Applicants. To so hold would actually be to emasculate the provisions of the statute itself and frustrate the very aims sought by its enactment. Further, it would result in gross inequities to all affected parties and might even create deficiencies in service. The Commission finds instead that, under the very wording of the statute itself it has ample power and authority to make commercial zones which it creates reciprocal. That authority is specifically granted to the Commission by the closing language of §4921.26 R. C., which reads as follows:
“The Commission may attach such conditions to any such order as, in its judgment, the public convenience and necessity requires.”
This provision of the statute invests this Commission with the broadest type of discretionary power and requires it to exercise that judgment in creating commercial zones:
The Applicants have also challenged the “reciprocal” provisions of Administrative Order No. 155, which promulgates Rule of Practice No. 28. In effect, the Applicants ask its repeal or modification. It is the finding of this Commission that the provisions of its presently existing Administrative Order No. 155, which promulgates Rule 28 and provides that all zones shall be reciprocal is proper and is hereby reaffirmed.
[453]*453There are several compelling reasons which necessitate that a commercial zone' be reciprocal. The first and foremost of these is that the granting of reciprocity in a zone makes the service of common carriers throughout the zone uniform in its operations and availability. It is always in the best interest of shippers or receivers of commodities that the most flexible type service be made available to them. Reciprocity guarantees this. Finally, it is more equitable and fair to the common carriers themselves that zones be made reciprocal.
As the Supreme Court of Ohio indicated in its opinion on commercial zones, Beiter Lines v. P. U. C. O., 165 Oh St 1, the creation of commercial zones is in many ways analogous to annexation. When a given area is annexed to a corporation it thereafter enjoys all the benefits of other citizens of the municipal corporation. In addition thereto any special services or facilities which it already had are likewise now available to the residents of the existing municipal corporation. Such a system certainly should prevail in commercial zone cases. If reciprocity is not given a situation results in which a given city is served by a certain number of common carriers (by way of example, say 10) while the outlying area after a commercial zone is created is thereafter served by those 10 city carriers plus whatever transportation services might have already been available in the area. Thus, it results that certain areas in the newly created commercial zone might have 14 or 15 carriers, whereas the formerly existing city has only its original 10 carriers. Certainly the statute never contemplated that the creation of a commercial zone would confer such irregular and spasmodic service upon the zone area and would actually end in a situation in which the new area has more service than the old. When it is remembered that the creation of a commercial zone also creates an added burden and imposes an additional duty upon the city carriers to serve the new commercial zone and thus, to that extent at least, decreases the availability of their service to the existing city, it should be clear that it is in the best interest of all concerned to make available to the existing city whatever facilities are already available in the area which has now been incorporated into the commercial zone.
As stated previously it is beyond question that these commercial zones are always created for benefit of the shipping public rather than the carriers. The creation of a commercial zone without reciprocity makes the service which any given shipper in the zone will have dependent upon a mere accident. It is doubtful if such was the intent of the statute.
Finally, it is in the public interest to promote a sound transportation system, this requires that commercial zones be made reciprocal. To do so tends to equalize competition and to avoid unfair and unnecessary competition to carriers already located in an area which becomes incorporated into a commercial zone. If reciprocity is not given, such a carrier suddenly finds himself faced with intense competition from many new carriers located in the municipal corporation, while he, himself, is without any new markets or areas in which to offer his service. If reciprocity is granted, however, although he does face greatly expanded competition, he nevertheless finds his own operative area ex-[454]*454paneled to a considerable extent and is thus able to recoup 1 some of the business which may be lost to new carriers. The entire process is one of equalization resulting in fairness to all carriers concerned and, parenthetically, in a more adequate and sound transportation system.
For all the above enumerated reasons the Commission finds that, insofar as the reciprocity issue is concerned, the previously issued Rule No. 28 which states that all commercial zones shall grant reciprocal rights is a valid rule and should not be disturbed. It finds, further, that it had and has adequate authority, power and discretion to promulgate such a rule.
Applying the reasoning set forth above to the situation at hand, therefore, the Commission finds that: (1) the actual physical zone areas delineated and described by the Examiner in his recommendation are proper as to this part of the case and the Examiner should be affirmed.
(2) With regard to the reciprocity feature of this case, the Commission finds that it cannot concur with its Examiner and finds instead that the areas which he recommended as being made commercially a part of the three cities in question should be served by all carriers located in any portion of the zones to the full extent of the operating authority of such carriers. Therefore, existing restrictions against serving municipalities in question should be lifted from the certificates of all carriers located at and authorized to serve any part of the zone. All carriers located in the zone should be authorized to serve all parts of such zone to the same extent as municipal carriers. Motor transportation service should be uniform and equal to and between' all parts of a commercial zone, including the municipality around which the zone is created.
ULTIMATE FINDINGS:
The Commission, being fully advised in the premises, now finds:
That the Commission has jurisdiction to hear and determine the issues presented;
That there exists an area adjacent to the City of Niles, Ohio, which is commercially a part of said municipal corporation, in which are located industrial plants and other enterprises, and it is in the public interest that a Niles, Ohio, Commercial Zone be established;
That motor transportation service should be uniform and equal to and between all parts of the Commercial Zone, including the municipality around which the Zone is created;
That all common carriers transporting property over regular or irregular routes authorized to serve Niles, Ohio, or any part of the herein established zone, should be authorized to serve the Niles, Ohio, Commercial Zone to the same extent as they are authorized to furnish service under their respective certificates;
That under §4921.26 R. C., a Commercial Zone for Niles, Ohio, should be established, and that said Commercial Zone shall consist of the territory embraced within the following metes and bounds description:
“Commencing at a point on the East bank of the Mahoning River at [455]*455a point due east of DeForest Town Line Road (CR 69); thence due east to DeForest Town Line Road; thence east along DeForest-Town Line Road (CR 78) to Heaton-North Road (CR 54); thence north on HeatonNorth Road (CR 54) to US 422; thence south on US 422 to northerly city limits of Girard; thence west and south along city limits of Girard to Watson-Marchalí Road (CR 60); thence north, west and south along city limits of McDonald to junction with Ohltown-McDonald Road (CR 58); thence Southwest on Ohltown-McDonald Road (CR 58) to Salt Springs Road (CR 64) thence northwest on Salt Springs Road (CR 64) to Austintown-Warren Road (CR 67); thence north on Austin-town-Warren Road (CR 67) to Brunstetter-Niles Road (CR 68); thence east on Brunstetter-Niles Road to the east bank of the Mahoning River; thence north along the east bank of the Mahoning River to the point of beginning.”
The Commission further finds:
That certain irregular route common carriers are presently authorized to transport property from and to specifically named points in the Niles area, including intervening unincorporated territory between such named points and Niles, Ohio, which area is now being incorporated in the Niles Commercial Zone under the provisions of this order. However the operating authority under Certificates Numbers 1214-1, 1952-1, 1352-1, 501-1, 2388-1 and 1092-1 is presently restricted against serving Niles, and to make the provisions .of this order establishing the Niles, Ohio, Commercial Zone operative in its full scope, said restrictions with respect to Niles should be modified or made inapplicable so long as the Niles Commercial Zone is in effect.
It is, therefore
ORDERED, That, effective 12:01 o’clock A. M., Eastern Standard Time, October 1, 1957, the territory bounded as herein described is declared to be the Niles, Ohio, Commercial Zone, and all certificated motor transportation companies authorized to serve Niles, Ohio, or any part or point located within such Zone are required to render service to the aforesaid described area located within such Zone in the same manner and to the same extent as they are authorized to furnish service under their respective certificates. It is, further
ORDERED, That Certificates Numbers 1214-1, 1952-1, 1352-1, 501-1, 2388-1 and 1092-1 be amended by setting forth therein the following condition—
“CONDITIONED, That during the effective period of the Niles, Ohio, Commercial Zone, the restriction with respect to serving Niles, Ohio, shall not be applicable.”
It is, further
ORDERED, That a copy of this order shall be forthwith served upon every motor transportation company authorized to serve Niles, [456]*456Ohio, or any part or point within the herein described Commercial Zone.
THE PUBLIC UTILITIES COMMISSION OP OHIO
Entered in the Journal
August 12, 1957
A true copy:
W. E. Herron, Secretary
Chairman
Ralph A. Winter
Edward J. Kenealy
Commissioners