SURFACE TRANSPORTATION BOARD DECISION DOCUMENT
    Decision Information

Docket Number:  
AB_55_785_X

Case Title:  
CSX TRANSPORTATION, INC.--DISCONTINUANCE OF SERVICE EXEMPTION--IN
VERMILION COUNTY, ILL.

Decision Type:  
Decision

Deciding Body:  
Entire Board

    Decision Summary

Decision Notes:  
DECISION DENIED A REQUEST BY VERMILION VALLEY RAILROAD TO REJECT, OR, ALTERNATIVELY, TO STAY THE EFFECTIVE DATE OF THE VERIFIED NOTICE OF EXEMPTION FILED BY CSX TRANSPORTATION, INC. IN THIS PROCEEDING.

    Decision Attachments

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    Full Text of Decision

46769                                  SERVICE DATE – FEBRUARY 15, 2019

EB

 

SURFACE TRANSPORTATION BOARD

 

DECISION

 

Docket No. AB 55 (Sub­No. 785X)

 

CSX TRANSPORTATION, INC.—DISCONTINUANCE OF SERVICE EXEMPTION—IN VERMILION COUNTY, ILL.

 

Digest:[1]  This decision denies the request by Vermilion Valley Railroad to reject, or, alternatively, to stay the effective date of, the verified notice of exemption filed by CSX Transportation, Inc.

 

Decided:  February 14, 2019

 

            On November 13, 2018, CSX Transportation, Inc. (CSXT), filed a verified notice of exemption under 49 C.F.R. Part 1152, Subpart F—Exempt Abandonments and Discontinuance of Service, to discontinue service over an approximately 3.6-mile rail line on its Woodlands Subdivision between milepost QSK 0.0 and milepost QSK 3.6, the end of the line, in Vermilion County, Ill. (the Line).  Notice of the exemption was served and published in the Federal Register on December 3, 2018 (83 Fed. Reg. 62,398).  On November 30, 2018, Vermilion Valley Railroad (VVRR) filed a petition to reject the notice of exemption or stay the effective date of the exemption.  CSXT filed a response on December 17, 2018.  The exemption became effective on January 2, 2019.[2]

 

            In its petition to reject or stay, VVRR states that it would like to purchase the Line and the related yard to serve nearby potential customers and stage trains needed to serve those customers; it states that it has submitted several purchase proposals to CSXT.  (VVRR Pet. 3.)  In support of its petition to reject the notice, VVRR argues, first, that the notice contains materially false information, rendering the exemption void ab initio.  (Id. at 5-6.)  VVRR states that in October 2018, a CSXT contractor was observed removing track from the Line and the associated yard.  (Id. at 4.)  VVRR states that it notified Board staff, which contacted CSXT, and CSXT responded that it would restore a through track on the Line.  (Id.)  VVRR asserts that the Line, as restored, would not be able to hold a train.  (Id.)  VVRR argues that CSXT’s actions conflict with what VVRR claims are CSXT’s representations in the verified notice of exemption that the Line is intact or has recently been restored.  (Id. at 5-6.)

 

            VVRR also argues that the discontinuance is controversial and therefore not suitable for the notice of exemption process.  (Id. at 8-9.)  Relying on two recent Board proceedings,[3] VVRR asserts that, due to the removal of track on the Line, CSXT should be required to file a petition for exemption or an application so that the Board has more time to consider CSXT’s request to discontinue service.  (VVRR Pet. 8.)  Additionally, according to VVRR, permitting the discontinuance without allowing VVRR to purchase the track through an offer of financial assistance or through negotiations with CSXT is contrary to the statutory rail transportation policy at 49 U.S.C. § 10101, (VVRR Pet. 2), and violates the “spirit of Board policy if not the law itself,” (id. at 9).  Alternatively, VVRR asks that the Board stay the effective date of the exemption so that the Board can thoroughly examine the facts of this case.  (Id. at 9-10.)  VVRR also asks the Board to offer mediation to the parties.  (Id. at 10.) 

 

In reply, CSXT asserts that its verified notice contained no materially false allegations, that this proceeding is not controversial, and that VVRR is not entitled to a stay.  CSXT explains that a contractor had mistakenly removed the rail that connected the Line through CSXT’s Hillery Yard but notes that the track was replaced before CSXT filed its verified notice of exemption to discontinue service.  (CSXT Reply 4-6.)  Further, CSXT states that it “will not remove the track unless and until CSXT seeks and receives abandonment authority from the Board.”  (Id. at 6.)  CSXT asserts that certain other track it has removed is yard track excepted from the Board’s abandonment authority and that “VVRR cannot demand the yard track be restored because it wants to purchase CSXT’s Yard.”  (Id. at 8.)  CSXT also argues that this discontinuance is not controversial as the Line has not been used since at least 2001, VVRR has not shown any demand for service, and there are currently no potential shippers on the Line.  (Id. at 7.)   Finally, CSXT argues that VVRR has not met the standards for a stay and states that it is not willing to engage in mediation.  (Id. at 9-11.)

 

DISCUSSION AND CONCLUSIONS

 

            Under 49 C.F.R. § 1152.50(b), discontinuance of service over a rail line that has been out of service for at least two years is exempt from the prior approval requirements of 49 U.S.C. § 10903 if certain criteria are met.  To qualify for the exemption, a carrier (after properly notifying appropriate agencies) must file a verified notice of exemption at least 50 days before it intends to discontinue service on a particular line, including the certifications required by 49 C.F.R. § 1152.50(b).  However, if the verified notice of exemption contains false or misleading information, the carrier’s use of the exemption is void ab initio, and the Board will reject the notice.  49 C.F.R. § 1152.50(d)(3).  Notices that raise significant unresolved issues or questions that require detailed scrutiny may also be rejected.[4]

 

Here, CSXT meets the requirements outlined above, thereby qualifying for a two-year out-of-service exemption.  See CSX Transp., Inc.—Discontinuance of Serv. Exemption—in Vermilion Cty., Ill., AB 55 (Sub-No. 785X), slip op. at 1 (STB served Dec. 3, 2018).  VVRR does not contest that CSXT meets the requirements for the exemption.

 

Additionally, the Board finds that VVRR’s arguments—that CSXT’s verified notice contains materially false or misleading information, rendering the exemption void ab initio, and that the transaction raises significant unresolved issues that require detailed scrutiny—lack merit.  CSXT states in its notice that “[o]nce discontinuance is authorized, CSXT will remove the signals but leave the remaining infrastructure in place to preserve the corridor in case business returns,” and that it “is not salvaging the track and materials on the Line.”  (CSXT Verified Notice 4‑5.)  While VVRR presents evidence that CSXT removed and later replaced part of the Line, CSXT explains in its reply that the track was mistakenly removed by a CSXT contractor and was replaced before CSXT filed its verified notice.  CSXT also represents that the track will remain in place until abandonment authority is sought.  Because the removed track was replaced before the verified notice was filed and there is no evidence that any track on the Line has been removed since then, VVRR has failed to show that CSXT’s representations in its verified notice are materially false or misleading.  The exemption, therefore, is not void ab initio.[5]

 

            Moreover, the notice of exemption does not raise significant unresolved issues or questions that require detailed scrutiny, as VVRR claims.  As the Board and its predecessor, the Interstate Commerce Commission (ICC), have long held, “[m]ere speculation about future traffic is not a sufficient basis upon which to deny or revoke an abandonment or discontinuance exemption.”  CSX Transp., Inc.—Aban. Exemption—in Bell Cty., Ky., & Claiborne Cty., Tenn., AB 55 (Sub‑No. 478X), slip op. at 2 (ICC served Aug. 5, 1994).  There has been no traffic on the Line for at least 17 years, and although VVRR “sees a business opportunity . . . to develop new freight business,” (VVRR Pet. 8), no record evidence has been submitted demonstrating that shippers would request service on the Line if service continued to be offered.  VVRR’s desire to purchase the Line and related yard[6] in anticipation of possibly providing service does not alter these facts.

 

            The cases VVRR relies on for support are significantly distinguishable.  Although VVRR analogizes this case to the Board’s rejection of the amended notice of discontinuance in V&S Discontinuance, the Board in that case rejected the discontinuance because “the issues raised in the [related Colorado Wheat complaint proceeding . . . would need to be resolved if V&S sought discontinuance authority rather than
abandonment authority.”<span style='mso-spacerun:yes'>  </span><u>V&amp;S
Discontinuance</u>, AB&nbsp;603 (Sub&#8209;No.&nbsp;4X), slip op. at 4.<span
style='mso-spacerun:yes'>  </span>There is no related complaint proceeding here
preventing the discontinuance from becoming effective.<span
style='mso-spacerun:yes'>  </span>Moreover, in <u>Colorado Wheat</u>, the
proceeding related to <u>V&amp;S Discontinuance</u>, V&amp;S was the subsidiary
of a salvage company and intended to salvage 60&nbsp;miles of track over which
service had been discontinued, and V&amp;S was contractually obligated to salvage
the track.<span style='mso-spacerun:yes'>  </span><u>Colo. Wheat</u>, NOR&nbsp;42140,
slip op. at&nbsp;5.<span style='mso-spacerun:yes'>  </span>The facts of that
case bear little resemblance to those here—CSXT’s contractor mistakenly removed
track on a small portion of the Line, CSXT replaced the track to maintain
continuity of the Line prior to filing its notice of discontinuance, and CSXT
has stated that it would not remove the track unless and until it seeks and
receives abandonment authority from the Board.<span style='mso-spacerun:yes'> 
</span>(CSXT Reply&nbsp;6.)<o:p></o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p>&nbsp;</o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><span
style='mso-tab-count:1'>            </span>Because CSXT meets the two-year out-of-service
exemption requirements and VVRR has not demonstrated that the notice should be
rejected, VVRR’s petition to reject CSXT’s notice of exemption will be denied.<o:p></o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p>&nbsp;</o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><span
style='mso-tab-count:1'>            </span>VVRR also requests, in the
alternative, that the Board stay the effectiveness of the exemption.&nbsp; However,
as noted, the exemption became effective on January&nbsp;2, 2019.<span
style='mso-spacerun:yes'>  </span>Additionally, the Board has already
determined that the use of the two-year out-of-service exemption in this case
is appropriate and that no further inquiry is necessary.&nbsp; Accordingly, the
petition to stay is denied as moot.<o:p></o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p>&nbsp;</o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
.5in;line-height:normal'><span style='font-size:12.0pt;font-family:"Times New Roman",serif'>Finally,
VVRR requests that the Board offer mediation services to the parties. <span
style='mso-spacerun:yes'> </span>(VVRR Pet.&nbsp;10.)<span
style='mso-spacerun:yes'>  </span>However, CSXT has responded that it is not
willing to engage in mediation. <span style='mso-spacerun:yes'> </span>(CSXT Reply&nbsp;11.)<span
style='mso-spacerun:yes'>  </span>Should the parties reach an agreement to
mediate issues regarding the Line, they should so inform the Board.<o:p></o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><span style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p>&nbsp;</o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal;mso-pagination:widow-orphan lines-together;page-break-after:avoid'><span
style='font-size:12.0pt;font-family:"Times New Roman",serif'><span
style='mso-tab-count:1'>            </span><u>It is ordered</u>:<o:p></o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal;mso-pagination:widow-orphan lines-together;page-break-after:avoid'><span
style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p>&nbsp;</o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal;mso-pagination:widow-orphan lines-together;page-break-after:avoid'><span
style='font-size:12.0pt;font-family:"Times New Roman",serif'><span
style='mso-tab-count:1'>            </span>1.<span style='mso-spacerun:yes'> 
</span>VVRR’s petition to reject and/or stay is denied.<o:p></o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal;mso-pagination:widow-orphan lines-together;page-break-after:avoid'><span
style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p>&nbsp;</o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal;mso-pagination:widow-orphan lines-together;page-break-after:avoid'><span
style='font-size:12.0pt;font-family:"Times New Roman",serif'><span
style='mso-tab-count:1'>            </span>2.<span style='mso-spacerun:yes'> 
</span>This decision is effective on the date of service.<o:p></o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal;mso-pagination:widow-orphan lines-together;page-break-after:avoid'><span
style='font-size:12.0pt;font-family:"Times New Roman",serif'><o:p>&nbsp;</o:p></span></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal;mso-pagination:widow-orphan lines-together;page-break-after:avoid'><span
style='font-size:12.0pt;font-family:"Times New Roman",serif'><span
style='mso-tab-count:1'>            </span>By the Board, Board Members Begeman,
Fuchs, and Oberman.<o:p></o:p></span></p>

</div>

<div style='mso-element:footnote-list'><![if !supportFootnotes]><br clear=all>

<hr align=left size=1 width="33%">

<![endif]>

<div style='mso-element:footnote' id=ftn1>

<p class=MsoFootnoteText><a style='mso-footnote-id:ftn1' href="#_ftnref1"
name="_ftn1" title=""><span class=MsoFootnoteReference><span style='mso-special-character:
footnote'><![if !supportFootnotes]><span class=MsoFootnoteReference><span
style='font-size:12.0pt;mso-bidi-font-size:10.0pt;line-height:115%;font-family:
"Times New Roman",serif;mso-fareast-font-family:Calibri;mso-ansi-language:EN-US;
mso-fareast-language:EN-US;mso-bidi-language:AR-SA'>[1]</span></span><![endif]></span></span></a><span
style='mso-spacerun:yes'>  </span>The digest constitutes no part of the
decision of the Board but has been prepared for the convenience of the
reader.<span style='mso-spacerun:yes'>  </span>It may not be cited to or relied
upon as precedent.<span style='mso-spacerun:yes'>  </span><u>Policy Statement
on Plain Language Digests in Decisions</u>, EP&nbsp;696 (STB served
Sept.&nbsp;2, 2010).</p>

</div>

<div style='mso-element:footnote' id=ftn2>

<p class=MsoFootnoteText><a style='mso-footnote-id:ftn2' href="#_ftnref2"
name="_ftn2" title=""><span class=MsoFootnoteReference><span style='mso-special-character:
footnote'><![if !supportFootnotes]><span class=MsoFootnoteReference><span
style='font-size:12.0pt;mso-bidi-font-size:10.0pt;line-height:115%;font-family:
"Times New Roman",serif;mso-fareast-font-family:Calibri;mso-ansi-language:EN-US;
mso-fareast-language:EN-US;mso-bidi-language:AR-SA'>[2]</span></span><![endif]></span></span></a><span
style='mso-spacerun:yes'>  </span>The Board had not issued a decision addressing
VVRR’s petition before the partial Federal government shutdown (from December&nbsp;22,
2018, through January&nbsp;25, 2019).</p>

</div>

<div style='mso-element:footnote' id=ftn3>

<p class=MsoFootnoteText><a style='mso-footnote-id:ftn3' href="#_ftnref3"
name="_ftn3" title=""><span class=MsoFootnoteReference><span style='mso-special-character:
footnote'><![if !supportFootnotes]><span class=MsoFootnoteReference><span
style='font-size:12.0pt;mso-bidi-font-size:10.0pt;line-height:115%;font-family:
"Times New Roman",serif;mso-fareast-font-family:Calibri;mso-ansi-language:EN-US;
mso-fareast-language:EN-US;mso-bidi-language:AR-SA'>[3]</span></span><![endif]></span></span></a><span
style='mso-spacerun:yes'>  </span><u>See</u> <u>Colo. Wheat Admin. Comm. v. V&nbsp;&amp;&nbsp;S
Ry.</u>, NOR 42140 (STB served May&nbsp;7, 2015); <u>V&nbsp;&amp;&nbsp;S
Ry.—Discontinuance Exemption—in Pueblo, Crowley, Kiowa,&nbsp;&amp;&nbsp;Otero <span
class=SpellE>Ctys</span>., Colo.</u> (<u>V&amp;S Discontinuance</u>), AB&nbsp;603
(Sub-No.&nbsp;4X) (STB served Jan.&nbsp;15, 2016).</p>

</div>

<div style='mso-element:footnote' id=ftn4>

<p class=MsoFootnoteText><a style='mso-footnote-id:ftn4' href="#_ftnref4"
name="_ftn4" title=""><span class=MsoFootnoteReference><span style='mso-special-character:
footnote'><![if !supportFootnotes]><span class=MsoFootnoteReference><span
style='font-size:12.0pt;mso-bidi-font-size:10.0pt;line-height:115%;font-family:
"Times New Roman",serif;mso-fareast-font-family:Calibri;mso-ansi-language:EN-US;
mso-fareast-language:EN-US;mso-bidi-language:AR-SA'>[4]</span></span><![endif]></span></span></a><span
style='mso-spacerun:yes'>  </span><u>See</u> <u>V&amp;S Discontinuance</u>, AB&nbsp;603
(Sub&#8209;No.&nbsp;4X), slip op. at 3-4; <u>ABC&nbsp;&amp;&nbsp;D Recycling,
Inc.—Lease&nbsp;&amp;&nbsp;Operation Exemption—a Line of R.R. in Ware, Mass.</u>,
FD&nbsp;35397, slip op. at 4 (STB served Jan.&nbsp;20, 2011); <u>FPN USA,
Inc.—Operation Exemption—Tijuana-<span class=SpellE>Tecate</span> <span
class=SpellE>Shortline</span></u>, FD&nbsp;35155 (STB served Aug.&nbsp;8,
2008); <u>Pro-Go Corp.—Operation Exemption—in Suffolk <span class=SpellE>Cty</span>.,
N.Y.</u>, FD&nbsp;35120 (STB served Mar.&nbsp;13, 2008).</p>

</div>

<div style='mso-element:footnote' id=ftn5>

<p class=MsoFootnoteText><a style='mso-footnote-id:ftn5' href="#_ftnref5"
name="_ftn5" title=""><span class=MsoFootnoteReference><span style='mso-special-character:
footnote'><![if !supportFootnotes]><span class=MsoFootnoteReference><span
style='font-size:12.0pt;mso-bidi-font-size:10.0pt;line-height:115%;font-family:
"Times New Roman",serif;mso-fareast-font-family:Calibri;mso-ansi-language:EN-US;
mso-fareast-language:EN-US;mso-bidi-language:AR-SA'>[5]</span></span><![endif]></span></span></a><span
style='mso-spacerun:yes'>  </span><a name="_Hlk879967">Furthermore, as the
Board has explained, “[t]he </a><span class=GramE><span style='mso-bookmark:
_Hlk879967'>focus</span></span><span style='mso-bookmark:_Hlk879967'> of the
inquiry under the Board’s two-year out-of-service exemption regulations is
whether there has been any service or request for service on the line in the
last two years, not the condition of the track.”<span
style='mso-spacerun:yes'>  </span><u>Norfolk S. Ry.—<span class=SpellE>Aban</span>.
Exemption—in Aurora, Portage <span class=SpellE>Cty</span>., Ohio</u>,
AB&nbsp;290 (Sub&#8209;No.&nbsp;394X) et al., slip op. at 5 (STB served Mar.&nbsp;30,
2018) (citation omitted).</span></p>

</div>

<div style='mso-element:footnote' id=ftn6>

<p class=MsoFootnoteText><a style='mso-footnote-id:ftn6' href="#_ftnref6"
name="_ftn6" title=""><span class=MsoFootnoteReference><span style='mso-special-character:
footnote'><![if !supportFootnotes]><span class=MsoFootnoteReference><span
style='font-size:12.0pt;mso-bidi-font-size:10.0pt;line-height:115%;font-family:
"Times New Roman",serif;mso-fareast-font-family:Calibri;mso-ansi-language:EN-US;
mso-fareast-language:EN-US;mso-bidi-language:AR-SA'>[6]</span></span><![endif]></span></span></a><span
style='mso-spacerun:yes'>  </span>The yard track is not part of the Line for
which CSXT seeks a discontinuance exemption.<span style='mso-spacerun:yes'> 
</span>(<u>See generally</u> CSXT Verified Notice; <u>see also</u> CSXT
Reply&nbsp;4 (“Because this was yard track, CSXT did not seek authority for
removal of the yard track from the Board.”).)<span style='mso-spacerun:yes'> 
</span>Therefore, CSXT’s removal of the yard track does not provide a basis to
reject CSXT’s notice of exemption or stay the effective date of the exemption.</p>

</div>

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