Case No. RC272-00403

December 2, 1999

DECISION AND ORDER

OF THE DEPARTMENT OF ENERGY

Supplemental Order

Name of Petitioner: Blaylock Trucking Co., Inc.

Date of Filing: October 15, 1999

Case Numbers: RC272-00403

RJ272-00076

On May 12, 1988, the Office of Hearings and Appeals (OHA) of the Department of Energy (DOE) issued a Decision and Order granting crude oil refunds to 20 claimants. Warrensville Heights City School, et al., Case Nos. RF272-5783 (May 12, 1988) (Warrensville Heights). In that Decision, the DOE granted Blaylock Trucking Co., Inc. (Blaylock), a trucking firm located in Moraine, Ohio (Case No. RF272-05870), a refund of $110 based on its purchases of 552,259 gallons of refined petroleum products. On September 7, 1999, the Office of Hearings and Appeals (OHA) issued a Supplemental Decision and Order granting crude oil refunds to 226 claimants, Crude Oil Supplemental Refund Distribution, Case No. RB272-00156 (September 7, 1999). In that Decision, the DOE granted Blaylock Trucking Co. a supplemental refund in the amount of $442. Both refund checks were made payable to Blaylock Trucking Co., Inc., and sent to 2250 Sandridge Rd., Moraine, Ohio 45439.

However, we recently discovered that Blaylock Trucking is a wholly owned subsidiary of Waste Management of North America.(1) In a Decision and Order issued on October 2, 1987, OHA granted the

parent firm, Waste Management of North America, a refund from the Surface Transporters (ST) Escrow Account. See Antelope Valley Bus Co., 16 DOE ¶ 85,466 (1987) (unpublished Appendix). Pursuant to Paragraph III.A.1 of the Settlement Agreement, an applicant for a refund from one of the Stripper Well escrows waives its right to a refund in the Subpart V crude oil proceedings.(2) See CF Industries, Inc., 16 DOE ¶ 85,586 (1987 (CFI); Boise Cascade Corp., 16 DOE ¶ 85,214 (1987) (Boise Cascade). The waiver provisions of Paragraph III.A.1 of the Settlement Agreement were incorporated into Paragraphs 7 and 10 of the Surface Transporters Escrow Claim Form and Waiver (ST Release) which all ST applicants had to agree to in order to be eligible for a ST refund.

The Waiver and Release form which Waste Management of North America filed with OHA as part of its ST application became effective and irrevocable at the time of its filing with OHA. See CFI, 16 DOE at 89,169; Boise Cacade, 16 DOE at 88,411-412. Accordingly, by virtue of its Application for Refund from the ST Escrow, Waste Management of North America waived its right and any affiliate’s right to participate in this Subpart V proceeding.

Paragraph VI.A of the Settlement Agreement provides that:

The provisions of this Agreement. . . shall be binding upon (1) all the Parties hereto and (2) all Persons executing waivers or releases pursuant to this Agreement, and with respect to such Parties and Persons, their Affiliates, subsidiaries. . . officers, agents, attorneys and any other Persons while acting under their direction or control. As used herein, an “Affiliate” of any Party includes any Person (and the successors and assigns of such Person) which controls, is controlled by or is under common control with such Party. For this purpose, “control” means the power (existing on the Payment Date), by contract, partnership agreement, stock ownership or otherwise, to control the policies and business operations of a Person, including, without limitation, the ownership, directly or indirectly (through one or more intermediaries), of more than 49 percent of a person.

The applicability of the waiver provisions of the Settlement Agreement to affiliates of firms that apply for ST funds is also set forth in Paragraph 9 of the ST release signed by Waste Management of North America.

As Blaylock Trucking Co., Inc. is an affiliate of Waste Management of North America as that term is defined under Paragraph VI.A of the Settlement Agreement, the applicant is bound by the terms of the Agreement, including the waiver provisions.

In view of these circumstances, we have determined that the refunds issued to Blaylock Trucking Co., Inc. of Moraine, Ohio, should be rescinded. In Warrensville Heights we stated:

The determinations made in this Decision and Order are based upon the presumed validity of the statements and documentary material submitted by the applicants. Any of these determinations may be revoked or modified at any time upon a finding that the basis underlying any refund application is incorrect.

Consequently, this Office is therefore rescinding the refund in the amount of $110 that was granted to Blaylock Trucking Co., under Case No. RF272-05870, and the supplemental refund in the amount of $442 that was granted to Blaylock Trucking Co., under Crude Oil Supplemental Refund Distribution, Case No. RB272-00156. Therefore, Blaylock Trucking Co. is liable for the repayment of $552.

It Is Therefore Ordered That:

(1) The Decision and Order issued by the DOE on May 12, 1988, Warrensville Heights City School et al., Case Nos. RF272-5783, is hereby rescinded as to Blaylock Trucking Co., Inc., Case No. RF272- 05870, redesignated as RC272-00403.

(2) The Supplemental Order issued by the Department of Energy on September 7, 1999, Crude Oil Supplemental Refund Distribution, Case No. RB272-00156 is hereby rescinded as to Blaylock Trucking Co., Inc., Case No. RF272-05870, redesignated as RJ272-00076.

(3) Blaylock Trucking Co. of Moraine, Ohio, is directed to remit $552 to the Department of Energy. Payment shall be mailed to the following address:

U.S. Department of Energy

Office of the Controller

Cash Control Branch

P.O. Box 500

Germantown, MD 20874-0500

Payment should be made by check payable to the U.S. Department of Energy and should refer to Case Nos. RC272-00403 and RJ272-00076. In the event that payment is not made within 30 days of the date of this Decision and Order, interest shall accrue on the amount due at the rate generally assessed by the Department of Energy on overdue DOE receivables. Other charges generally assessed on overdue DOE receivables shall also apply.

(4) Upon receipt of the payment specified in paragraph (2) above, the Director of Special Accounts and Payroll, Office of Departmental Accounting and Financial Systems Development, Office of the Controller, of the Department of Energy shall redeposit the amount of $552 back into the DOE deposit fund escrow account maintained at the Department of the Treasury and funded by Crude Tracking-Claimants 4, Account No. 999DOE010Z.

(5) This is a final Order of the Department of Energy.

George B. Breznay

Director

Office of Hearings and Appeals

Date: December 2, 1999

(1)In an October 13, 1999, telephone conversation, Keith Gregory, Maintenance Manager of Blaylock Trucking of Moraine, Ohio, informed this Office that Waste Management of North America, who has since changed its name to Waste Management Corporation, was the parent company of Blaylock Trucking Co., Inc. during the crude oil price control period (August 1973 through January 1981).

(2)Paragraph III.A.1 of the Settlement Agreement states:

The Parties other than DOE and the States release, waive, and agree to withdraw any claims before any Federal or state court or agency . . . (a) against funds which have been or will be paid to satisfy compliance or enforcement actions (including declaratory actions) brought or to be brought based on Alleged Crude Oil Violations.