(1) Progress reports.

(a) If a certificate holder has not initiated service to all or any portion of the route or routes granted in its certificate, the certificate holder must, during the first five years after obtaining the certificate, and during each twelve-month extension period granted by the commission, file written progress reports with the commission every six months after the certificate is granted.

(b) For purposes of these rules the following definitions shall apply:

(i) The term "portion of a route or routes" means service to any named point or points along a route, and service between two or more points named in a certificated commercial ferry certificate; and

(ii) The term "initiating service" means providing regular, ongoing service to all points and between all points granted in a certificated commercial ferry certificate.

(c) Progress reports must include a statement of progress toward overcoming impediments to initiating service, including, but not limited to, the following information: The progress of environmental impact, parking, local government land use, docking, and financial considerations, the purchase or lease of a vessel or vessels, hiring of employees, advertising, and the ability to handle proposed traffic.

(2) Extensions of time to initiate service.

(a) If a certificate holder has not initiated all or any portion of the route or routes granted in its certificate during the first five years after obtaining the certificate, the certificate holder may petition the commission to extend the certificate on a twelve-month basis for up to three years.

(b) If a certificate holder obtained its certificate prior to July 25, 1993, and is not providing service on all or any portion of the route or routes granted in its certificate during the first five years after obtaining its certificate, and has not initiated service during the three-year extension period discussed above in (a) of this subsection, the certificate holder may petition the commission to extend its certificate on a twelve-month basis for up to an additional two years.

(c) The term "providing service" means operating to all points and between all points granted in a certificate by the commission. In determining whether a certificated commercial ferry which operates in on-call service, such as launch service or service to flag stops, is providing service, the commission shall consider whether the certificated commercial ferry is ready, willing, and able to provide the service when requested, and makes a reasonable effort to obtain traffic.

(d) For purposes of these rules, the term "not providing service on all or any portion of the route or routes" does not include:

(i) Service discontinued by grant of the commission under WAC 480-51-130; or

(ii) Temporary interruptions of regular service reported promptly to the commission in accordance with WAC 480-51-140.

(e) In determining whether to grant an extension of time in which to initiate service, the commission will consider whether:

(i) The certificate holder has submitted timely progress reports during the first five years after obtaining the certificate and during any extension period; and

(ii) The progress reports indicate significant advancement toward initiating service.

(3) Failure to initiate service. Certificates, or portions thereof, are subject to cancellation, alteration or amendment by the commission under the provisions of RCW 81.84.060(1) if:

(a) A certificate holder has not initiated all or a portion of the route or routes granted in its certificate during the first five years after obtaining its certificate, and has not submitted timely progress reports to the commission as required in RCW 81.84.010(2);

(b) The commission has denied a certificate holder's request for an extension of time to initiate service and the certificate holder has not initiated service within thirty days of the denial; or

(c) A certificate holder has not initiated all or a portion of the route or routes granted before the expiration of any extensions of time to initiate service, and the certificate holder has not timely filed for an additional extension.

(4) Petitions for extension of time to initiate service.

(a) A certificate holder must file a petition with the commission seeking an extension of time to initiate service no later than ninety days prior to:

(i) The date upon which the five-year period following the grant of the certificate expires; or

(ii) The date upon which the current twelve-month extension period expires.

(b) Petitions for extension of time to initiate service shall be legibly prepared on forms to be furnished by the commission, giving all information requested.

(c) The commission may grant or deny petitions for extension without hearing. The grant or denial of extensions will be issued by letter of the secretary of the commission. A certificate holder aggrieved by the denial of an extension petition may seek review of the denial by filing a request for review of the decision within twenty days after service of the letter notifying the certificate holder of the denial. Within thirty days after receipt of the request for review, the commission shall schedule an adjudicative proceeding, and provide at least twenty days notice of the proceeding to the certificate holder requesting review. The commission may, in its own discretion, on the request of the aggrieved certificate holder, or on its own motion, order a brief adjudicative proceeding on the petition. WAC 480-07-610 governs applications for and procedures in brief adjudicative proceedings.