80 FR 44193 - Prisoner Transportation Services, LLC-Control-Pts of America, LLC d/b/a Pts and Brevard Extraditions, Inc. d/b/a U.S. Prisoner Transport

DEPARTMENT OF TRANSPORTATION
Surface Transportation Board

Federal Register Volume 80, Issue 142 (July 24, 2015)

On June 24, 2015, Prisoner Transportation Services, LLC (Applicant), a newly created corporation, filed an application under 49 U.S.C. 14303 so that it can acquire common control of PTS of America, LLC d/b/a PTS (PTS) and Brevard Extraditions, Inc. d/b/a U.S. Prisoner Transport (USPT). The Board is tentatively approving and authorizing the transaction, and, if no opposing comments are timely filed, this notice will be the final Board action. Persons wishing to oppose the application must follow the rules at 49 CFR 1182.5 and 1182.8.

[Federal Register Volume 80, Number 142 (Friday, July 24, 2015)]
[Notices]
[Pages 44193-44194]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-18182]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

[Docket No. MCF 21064]


Prisoner Transportation Services, LLC--Control--Pts of America, 
LLC d/b/a Pts and Brevard Extraditions, Inc. d/b/a U.S. Prisoner 
Transport

AGENCY: Surface Transportation Board, Department of Transportation.

ACTION: Notice tentatively approving and authorizing finance 
transaction.

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SUMMARY: On June 24, 2015, Prisoner Transportation Services, LLC 
(Applicant), a newly created corporation, filed an application under 49 
U.S.C. 14303 so that it can acquire common control of PTS of America, 
LLC d/b/a PTS (PTS) and Brevard Extraditions, Inc. d/b/a U.S. Prisoner 
Transport (USPT). The Board is tentatively approving and authorizing 
the transaction, and, if no opposing comments are timely filed, this 
notice will be the final Board action. Persons wishing to oppose the 
application must follow the rules at 49 CFR 1182.5 and 1182.8.

DATES: Comments must be filed by September 8, 2015. Applicant may file 
a reply by September 22, 2015. If no comments are filed by September 8, 
2015, this notice shall be effective on September 9, 2015.

ADDRESSES: Send an original and 10 copies of any comments referring to 
Docket No. MCF 21064 to: Surface Transportation Board, 395 E Street 
SW., Washington, DC 20423-0001. In addition, send one copy of comments 
to Applicant's representative: Henry E. Seaton, Esq., Law Office of 
Seaton & Husk, L.P., 2240 Gallows Road, Vienna, VA 22182.

FOR FURTHER INFORMATION CONTACT: Matthew Bornstein (202) 245-0385. 
Federal Information Relay Service (FIRS) for the hearing impaired: 1-
800-877-8339.

SUPPLEMENTARY INFORMATION: Applicant, a non-carrier, states that it is 
a newly created limited liability company under the laws of Tennessee. 
Applicant states that it has been established as a holding company for 
the purpose of acquiring the corporate stock of PTS and USPT, both 
engaged in for-hire transportation of incarcerated prisoners.
    Applicant states that PTS is a limited liability corporation 
established under the laws of Tennessee. According to Applicant, PTS 
holds authority from the Federal Motor Carrier Safety Administration 
(FMCSA) as a motor carrier of passengers in Docket No. MC-689407. 
Applicant explains that PTS's current shareholders are Kent Wood and 
Alan Sielbeck, individuals residing in Tennessee. USPT, according to 
Applicant, is a Florida corporation that holds authority from the FMCSA 
as a motor carrier of passengers in Docket No. MC-643115. Applicant 
states that Robert Downs owns 80 percent of USPT's stock and Lisa Kyle 
owns 20 percent. Applicant states that both of these individuals are 
Florida residents.
    Applicant states that PTS and USPT both perform a specialized type 
of interstate transportation of passengers by motor carrier. According 
to Applicant, each carrier has separate contracts of carriage with 
state and local prisons, correctional facilities, and sheriff's 
departments for the for-hire transportation of incarcerated prisoners, 
including convicts, parole jumpers, and individuals under criminal 
indictment who have escaped to foreign jurisdictions. The services 
rendered by these companies, Applicant states, include recovery and 
extradition of prisoners from jails and detention facilities in one 
state and delivery to points of incarceration in interstate commerce 
under guard. Applicant states that both motor carriers operate 
specially equipped van and bus equipment suitable for the 
transportation of prisoners and in compliance with the Interstate 
Transportation of Dangerous Criminals Act. Applicant adds that PTS 
currently operates 20 vehicles, including two 30-passenger buses, six 
specifically designed transporters suitable for the transportation of 
as many as 20 inmates, and 12 15-passenger vans. USPT, according to 
Applicant, operates 12 vehicles, including two transporters and 10 
passenger vans.
    Applicant explains that the proposed transaction would be 
structured as an acquisition of common control of two carriers through 
contribution of the outstanding stock of both carriers to a holding 
company, Prisoner Transportation Services, LLC, for common control and 
management. Applicant seeks to acquire 100 percent of PTS through 
acquisition of the stock of Mr. Wood and Mr. Sielbeck, and 100 percent 
of USPT through acquisition of the stock of Mr. Downs and Ms. Kyle. As 
a result, Applicant states, both PTS and USPT would become wholly 
operating subsidiaries of the holding

[[Page 44194]]

company, with the current owners of PTS (Mr. Wood and Mr. Sielbeck) 
owning 31.5 percent and 38.5 percent of the outstanding corporate stock 
of the holding company and the current owners of USPT (Mr. Downs and 
Ms. Kyle) owning the remainder of the stock. Applicant states that, as 
a result of this transaction, the current owners of each company would 
jointly control both carriers, with both companies continuing to offer 
their existing service.
    Under 49 U.S.C. 14303(b), the Board must approve and authorize a 
transaction that it finds consistent with the public interest, taking 
into consideration at least: (1) The effect of the proposed transaction 
on the adequacy of transportation to the public; (2) the total fixed 
charges that result; and (3) the interest of affected carrier 
employees. Applicant submitted information, as required by 49 CFR 
1182.2, including information to demonstrate that the proposed 
transaction is consistent with the public interest under 49 U.S.C. 
14303(b), and a statement that the aggregate gross operating revenues 
of PTS and USPT exceeded $2 million for the preceding 12-month period, 
see 49 U.S.C. 14303(g).
    Applicant submits that the proposed transaction would have no 
significant impact on the adequacy of transportation services to the 
public. Rather, Applicant anticipates that common control of the 
carriers would result in more efficient and timely transportation. By 
combining the pickup and delivery schedules of both companies, 
Applicant states, detainees scheduled for pickup could be booked more 
expeditiously on the nearest available bus or transporter, regardless 
of whether the vehicle is operated by PTS or USPT. Applicant notes that 
consolidation would permit vehicle sharing arrangements, coordinated 
driver training, and safety management and load sharing arrangements. 
It further claims that consolidation would allow for the centralization 
of various management support functions such as vehicle licensing, 
legal affairs, accounting, human resources, purchasing, and 
environmental compliance.
    With respect to fixed charges, Applicant asserts that the 
efficiencies generated by the transaction would reduce the variety of 
unit costs now being incurred to operate these carriers under separate 
ownership. Additionally, Applicant states that the combined carriers 
would be able to enhance their purchasing power, thereby reducing 
insurance premiums and achieving deeper discounts for equipment and 
fuel. Applicant also claims that affected employees would benefit from 
the transaction. It says that employees would maintain job security and 
would have an increased opportunity to schedule shorter tours of duty, 
resulting in less time away from their home base.
    Applicant further claims that the proposed transaction would not 
have any adverse competitive effect on any portion of the passenger 
transportation industry. Applicant states that the vast majority of 
prisoners and detainees are transported by U.S. Marshals, state law 
enforcement officers, sheriffs, deputies, or local police officers. 
Furthermore, Applicant states, other for-hire carriers such as 
Transcor, STS, U.S. Corrections, Texas Prisoner Transport, GEO 
Transport, Lock and Load, G4S, and Global Prisoner Services are also in 
the marketplace.\1\ According to Applicant, competitors would not be 
adversely affected by the transaction because prisoner extradition 
services are provided based upon open competition among qualified 
service providers for contracts of one to three years in duration. 
Applicant also states that there is nothing to preclude existing 
carriers from expanding their routes, rates and services, and nothing 
to keep well capitalized new entrants from entering the market at any 
time.
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    \1\ In total, after consummation, Applicant asserts that the 
combined operation would constitute less than 5 percent of the 
population being transported.
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    On the basis of the application, the Board finds that the proposed 
acquisition is consistent with the public interest and should be 
tentatively approved and authorized. If any opposing comments are 
timely filed, these findings will be deemed vacated, and, unless a 
final decision can be made on the record as developed, a procedural 
schedule will be adopted to reconsider the application. See 49 CFR 
1182.6(c). If no opposing comments are filed by the expiration of the 
comment period, this notice will take effect automatically and will be 
the final Board action.
    Board decisions and notices are available on our Web site at 
``WWW.STB.DOT.GOV''.
    This decision will not significantly affect either the quality of 
the human environment or the conservation of energy resources.
    It is ordered:
    1. The proposed transaction is approved and authorized, subject to 
the filing of opposing comments.
    2. If opposing comments are timely filed, the findings made in this 
notice will be deemed vacated.
    3. This notice will be effective September 9, 2015, unless opposing 
comments are filed by September 8, 2015.
    4. A copy of this notice will be served on: (1) The U.S. Department 
of Transportation, Federal Motor Carrier Safety Administration, 1200 
New Jersey Avenue SE., Washington, DC 20590; (2) the U.S. Department of 
Justice, Antitrust Division, 10th Street & Pennsylvania Avenue NW., 
Washington, DC 20530; and (3) the U.S. Department of Transportation, 
Office of the General Counsel, 1200 New Jersey Avenue SE., Washington, 
DC 20590.

    Decided: July 20, 2015.

    By the Board, Chairman Elliott, Vice Chairman Begeman, and 
Commissioner Miller.
Brendetta S. Jones,
Clearance Clerk.
[FR Doc. 2015-18182 Filed 7-23-15; 8:45 am]
BILLING CODE 4915-01-P