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1 N.J.A.R. 402

Perno Bus Co. Inc. et. al., In the Matter of the Petition of
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Citation: 1 N.J.A.R. 402
Decision Date: 1980
Agency: DEPARTMENT OF TRANSPORTATION
Synopsis: Perno Bus Co. and 19 other bus companies operating on the Bergen Avenue bus route petitioned the Department of Transportation for a fare increase. The administrative law judge assigned to the case determined that there were three issues to be resolved before granting an increase: (1) whether or not the requested fare increase was reasonable; (2) whether or not the petitioners could be excused from the normal requirement of proving a rate base by virtue of the exceptions set forth in N.J.S.A. 48:2-21.2 and (3) whether the projected revenues and projected ridership decreases were based on fair assumptions? The administrative law judge found that the fares presently charged by petitioners did not enable them to meet average operating expenses because of the great increase in operating costs and in the rate of inflation. Since the proposed fare increase would not result in an average per bus profit to any of the petitioners nor would the increase change the fact that the gross operating revenues of each company would still exceed the depreciated book cost of the property used in each company's business, the judge ruled that the petitioners could be excused from proving a rate base. The judge found that the use of the experience of a comparable bus route (instead of the traditional Hebrank formula) to measure rider resistance to a fare increase was appropriate in this case since that experience reflected a ridership decrease resulting from a comparable fare increase on a bus line traveling over similar routes, in a similar geographic area, in a similar inflationary economy, and with similar types of riders as the petitioners. State of New Jersey 403 In Re Perno Bus Co., Inc., etal. Accordingly, the judge concluded that the petitioners had shown by a preponderance of the competent evidence that that requested fare increase was reasonable and should be granted. Morris Drogin, Esq., attorney for Petitioners, Perno Bus Co., Inc., et al. Helene Wallenstein, Deputy Public Advocate for the Department of Public Advocate Division of Rate Counsel (Stanley G. Van Ness, Public Advocate of New Jersey, attorney)