- 9 -
during 1994. The effective date of the FAAAA was January 1,
1995. Thus, the right of the holders of the pre-1995 operating
authorities to intervene in the application process and to limit
the competition on their routes terminated on December 31, 1994,
which makes 1994 the year the loss was sustained. See Corra
Resources, Ltd. v. Commissioner, 945 F.2d 224 (7th Cir. 1991)
(loss realized in the year in which mineral lease expired), affg.
T.C. Memo. 1990-133; George Freitas Dairy, Inc. v. United States,
582 F.2d 500 (9th Cir. 1978) (milk processors' acceptance of
producers' cancellation of milk production contract was the
identifiable event).
Finally, we do not agree with respondent's argument on brief
that the loss was sustained in 1995 because "petitioner relied on
its operating authorities in order to receive replacement permits
to which it would not have been entitled if it did not possess
operating authorities in good standing as of December 31, 1994."
At most, the pre-1995 operating authorities saved petitioner
the cost of applying for new general permits. Although the State
of Washington provided that there was no fee for an application
to convert a pre-1995 operating authority to a new general
permit, and Oregon automatically issued petitioner a new 1A
permit, the fee charged a motor carrier that was not converting a
pre-1995 authority to apply for a permit to operate in either
State was minimal. See Wash. Admin. Code sec. 480-14-140 (1995)
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