STB REPORT #13 - JULY 1 - 15, 1998 ****************************************************************************** A compilation of decisions and notices published by the Surface Transportation Board. Includes information on track abandonments, ownership changes and trackage rights agreements. Condensed for readability. The full text is available at www.stb.dot.gov/ ****************************************************************************** SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-32 (Sub-No. 83) REQUEST TO SET TERMS AND CONDITIONS BOSTON AND MAINE CORPORATION--ABANDONMENT--IN HARTFORD AND NEW HAVEN COUNTIES, CT STB Docket No. AB-355 (Sub-No. 23) SPRINGFIELD TERMINAL RAILWAY COMPANY--DISCONTINUANCE OF SERVICE--IN HARTFORD AND NEW HAVEN COUNTIES, CT By decision served on April 22, 1998, we found that the public convenience and necessity permit Boston and Maine Corporation (B&M) to abandon and Springfield Terminal Railway Company (ST) to discontinue service over a line of railroad, known as the Canal Branch, extending from milepost 14.50 in Cheshire to milepost 24.00 in Southington, a distance of 9.50 miles, in Hartford and New Haven Counties, CT. The decision authorizing abandonment and discontinuance was scheduled to become effective on May 22, 1998, unless an offer of financial assistance (OFA) was filed on or before May 1, 1998. On May 1, 1998, Dalton Enterprises, Inc. (Dalton), filed an OFA to purchase the line for $650,240. (In the April 22 decision, we found that the net liquidation value (NLV) of the line is $1,530,240. The NLV is the sum of the net salvage value (NSV) of the track, which we determined to be $285,740, and the value of the land underlying the right-of-way, which we determined to be $1,244,500). By decision served on May 5, 1998, Dalton was found to be financially responsible and the effective date of the decision authorizing abandonment and discontinuance was postponed to permit the financial assistance process to proceed. The decision also noted that, on or before June 1, 1998, either party could request that the Board establish terms and conditions for the sale of the line if no agreement was reached during negotiations. On May 4, 1998, Dalton filed a petition for stay of the effective date of the April 22 decision pending its appeal of the decision to the United States Court of Appeals for the Second Circuit. By decision served on May 18, 1998, the petition for stay was denied. On June 1, 1998, Dalton requested that we establish the conditions and amount of compensation for the sale of the line. Applicants replied on June 8, 1998. On June 12, 1998, Dalton filed a motion for leave to file a supplement to its request to set terms and conditions, along with the supplement. The motion will be denied. We may not set a price that is below the fair market value of the line. It has been determined that, in the absence of a higher going concern value for continued rail use, the proper valuation standard in proceedings for offers to purchase is the NLV of the rail properties for their highest and best nonrail use. NLV includes the value of the real estate plus the NSV of track and materials (gross salvage less removal costs). In proceedings to set terms, the burden of proof is on the offeror, the proponent of the requested relief. Placing the burden of proof on the offeror is particularly appropriate in these proceedings because the offeror may withdraw its offer at any time prior to its acceptance of terms and conditions established by the Board pursuant to a party's request. The rail carrier, on the other hand, is required to sell its line to the offeror at the price we set, even if the railroad views the price as too low. The burden of proof standard requires that, absent evidence supporting the offeror's estimates, the rail carrier's evidence be accepted. In areas of disagreement, the offeror must present more specific evidence or analysis or provide more reliable and verifiable documentation than that which the carrier submits. Absent specific evidence supporting the offeror's estimates and contradicting the rail carrier's estimates, the burden of proof requires that we accept the carrier's estimates in these forced sales proceedings. We address below the various issues in this case. Dalton asserts that the NLV of the line is $580,304, but offers to purchase it for $650,240. Applicants urge us to affirm our finding that the NLV of the line is $1,530,240. The parties differ in the methodology they use to value the land and in the adjustments they make for commissions and conveyance taxes. Dalton also makes an adjustment for the time it may take applicants to sell the land. In its request to set terms and conditions, Dalton submits an appraisal for the land underlying the right-of-way. Dalton states that it found numerous easements that may affect the value of the land. No reversionary or other rights were found. Dalton states that it initially considered the possibility of breaking up the corridor and selling it piecemeal to the abutting landowners. It asserts, however, that the typical across-the-fence (ATF) valuation procedure would be difficult to apply in this case because there are insufficient comparable sales data in the area. Also, according to Dalton, parceling the land would reduce the economic return. Therefore, in an attempt to increase the marketability of the land, Dalton evaluated the right-of- way as a single corridor and compared it with sales of other corridors of land. It chose eight sales of former railroad lines to develop its estimate. After comparing the sales, Dalton estimated the gross value of the land to be approximately $15,000 per acre. Multiplying the per acre value by the 72.79 acres in the right-of-way, it arrived at an unadjusted value for the land of approximately $1,100,000. In response, applicants argue that the $1,244,500 figure contained in the April 22 decision sets the floor for land valuation purposes. (Applicants had proposed a much higher figure in their application.) They criticize Dalton's estimate because its uses an appraisal method which fails to incorporate the ATF method of valuation, generally considered to be the most appropriate method for estimating the market value of railroad rights-of-way. In addition, applicants object to certain downward adjustments which Dalton made to the sales data. Applicants also point out that Dalton's appraisal does not consider two other relevant sales within the market area that were higher than the average developed by Dalton. These properties consist of a 10.77 acre right-of-way running from Whitney Avenue in New Haven to the Hamden/New Haven city line. The property sold for $73,372 per acre, considerably more than any of the railroad corridors used by Dalton. In addition, a 31.82 acre parcel running from Connolly Parkway in Hamden to Old Hill Road in Cheshire sold for $46,354 per acre, also considerably more than those parcels considered by Dalton. Dalton's real estate valuation methodology is based on the sale of an intact corridor and unit costs are based on former railroad rights-of-way in the area. Unless there is a specific, documented interest expressed by a potential purchaser for an intact corridor, we do not consider this an acceptable method of valuation for NLV purposes. The highest and best non-rail use is to sell parcels to adjoining landowners or other interested parties. We find that the ATF method of valuation is appropriate for this case. Dalton argues that an $85,000 adjustment is required for a broker's commission that would be incurred in selling the land. Applicants object to this deduction because B&M's real estate department sells its abandoned rights-of-way and, as a result, B&M does not incur broker's fees. Dalton has not shown that B&M cannot sell the property without a broker, as it has done in the past, so we will not include a broker's commission in our restatement. Dalton also asserts that the value of the land should be reduced by the state and municipal conveyance taxes that must be paid on the sale. Applicants object to the inclusion of conveyance taxes because it is their practice to make these costs the buyer's responsibility. The two conveyance taxes are required by Connecticut state law and local ordinance, and thus become part of the cost of the sale. Therefore, we will include these costs in our restatement. Dalton argues that the value of the land must be reduced by the time it would take to sell the land, which Dalton estimates at 2.5 years based on the sales of similar corridors of property. An OFA is a forced sale, and is considered a one-time event. The transaction is not spread out over several years. Consequently, we find Dalton's time adjustment inappropriate and we will not include it in our restatement. In sum, we will use the land value contained in the April 22 decision, reduced by the amount of the state and local conveyance taxes. Our restated land value is $1,230,686. Dalton and applicants disagree on the value of the track materials and the cost of restoring the 16 grade crossings on the line. Dalton asserts that the NSV of the line is considerably less than zero, a negative $175,261. Applicants assert that our previous finding that the NSV is $285,740 is correct. Dalton retained Track Management Systems, Inc. (TMS) to make a physical inspection of the line over a 3-day period. Based on this inspection, Dalton states that there are 0.864 miles of 115-lb. rail and 8.365 miles of 80-lb rail, for a total of 9.229 miles. It includes costs to restore the grade crossings on the line, dispose of 19,920 scrap ties, and reclassify all of the 80-lb. rail as scrap instead of relay. Offsetting these downward adjustments, Dalton adds value for the sale of relay rail and landscape quality ties and it increases the unit cost for 115-lb. relay rail. Applicants assert that Dalton's estimate of the amount of track on the line is inaccurate. Applicants state that there are 9.05 miles of 80-lb. jointed rail and 0.90 miles of 115-lb. jointed rail, amounting to a total of 9.95 track-miles, including sidings. Contrary to Dalton's assertion, applicants state that there is a market for 80-lb. relay rail and they submit a quotation indicating that the price is about $230 per net ton (NT). Applicants also note that a recent price for scrap rail is $135 per gross ton (GT), or about $65 per GT if reduced by a removal cost of $70 per GT. They submit two quotations in support of this amount. Applicants assert that the methodology they use for tie costs in the abandonment and discontinuance application adequately considers tie disposal costs. Applicants point out that they currently have agreements with contractors for the disposal of scrap ties in exchange for the landscape ties on the line, after removal of all relay quality ties. We agree with applicants observation that Dalton's evidence contains several inconsistencies with respect to the number of track miles. Dalton does not explain the 0.721- mile discrepancy. Therefore, we find Dalton's estimate of the quantities of track materials to be unreliable. Dalton asserts that 80-lb. rail is considered scrap regardless of condition, but it does not indicate the standards that it used to reclassify the rail as scrap. Dalton's reclassification of all 80-lb. rail as scrap is not based on the actual condition of the rail itself. It submits no evidence showing that the rail is damaged or excessively worn. Because of the lack of supporting evidence, we cannot accept Dalton's downgrading of all 80-lb. rail to scrap. Applicants, however, present evidence that 80-lb. rail has some marketability as relay rail. We note that applicants have submitted a quotation indicating that the current market price of 80-lb. relay rail is $230 per NT, which is lower than the $270 value they used in their abandonment and discontinuance application, and is better supported. Consequently, we will use the lower value in our restatement. Dalton prices landscape ties at $2.00 each and relay ties at $10.00 each, but does not indicate the source of its price. It estimates that there are 19,920 scrap crossties, and that the disposal cost is $3.50 each, but does not indicate the source of its disposal cost. Dalton's prices for relay ties, landscape ties and disposal costs for scrap ties are unacceptable because it did not submit any supporting information in the form of quotations or other market data. We will continue to rely on applicants approach to tie valuation in this case, i.e., that landscape ties are approximately equal in value to the disposal cost of scrap ties. Dalton bases its grade crossing restoration cost of $295,000 ($18,438 for each crossing) on a bid from a contractor, A. J. Belliveau Railroad Construction, Inc. We note that the contractor specifies the weight of rail in each of the crossings. This is not relevant to the restoration costs because all rail is to have been removed by others prior to restoration. It may indicate, however, that the price includes the removal of the rail in each of the crossings. If so, the removal cost would be double counted. We also note that all but one of the crossings are timber, and from the photos provided in the real estate appraisal, most of the crossings appear to be relatively flat. Because of these considerations, the restoration of the crossings should be routine. Therefore, we find that Dalton's estimate is much too high. Applicants state that grade crossing restoration, if performed by railroad employees, would cost less than $100,000. While applicants estimate appears high, it is the best evidence of record and we will accept it. Applicants, however, did not adjust their NSV to include this required cost. We will make this adjustment in our restatement. Dalton has failed to support its estimate of NSV with reliable data. Therefore, we will use the NSV contained in our April 22 decision, adjusted to reflect applicants revised value for 80-lb. relay rail and the cost of restoring grade crossings. Our restated NSV for the line is $151,730. Our restated NLV for the line is as follows: Rail, relay $208,280 Rail, scrap 26,390 Joint bars, relay 11,600 Joint bars, scrap 1,540 Other Track Material, scrap 3,920 Grade crossing restoration (100,000) -------------- Net salvage value , track $151,730 Land 1,230,686 -------------- NLV $1,382,416 The purchase price for the right-of-way is $1,382,416, consisting of $1,230,686 for land and $151,730 for NSV of track and materials. Dalton requests that the terms routinely imposed in financial assistance proceedings be established. In their reply, applicants request that, in addition to the standard terms, we impose two additional conditions: (1) to require Dalton, if it purchases the line, to honor the service and crossing commitments applicants made to Rex Forge Division when they sought to abandon the line and discontinue service; and (2) in order to avoid any potential misunderstanding on the part of Dalton as to the responsibilities it will assume, to impose the service requirements and restrictions on transfer of the line set forth in 49 CFR 1152.27(i). (In the April 22 decision, applicants stated that they have agreed to retain a temporary freight easement under which the 4-mile segment of track between milepost 24.00 at Southington and milepost 20.00 at Plantsville will be left intact for at least a 12-month period so that rail delivery of additional presses by Rex Forge can be accomplished on reasonable terms and conditions. In addition, according to Rex Forge, applicants and Rex Forge will seek an extension of the freight easement, not to exceed 6 months, from the Town of Southington and/or the Connecticut Department of Transportation, if necessary, to permit delivery of additional presses during the 6-month period.) Should Dalton elect to purchase the line, to ensure an orderly transfer of the line, we will establish the typical terms: (1) payment will be made by cash or certified check; (2) closing will occur within 90 days of the service date of this decision; (3) B&M shall convey all property by quitclaim deed; and (4) B&M shall deliver all releases from any mortgage within 90 days of closing. In addition, we will require Dalton to honor the service and crossing commitments made by applicants to Rex Forge. The parties may alter any of these terms by agreement. It is ordered: 1. Dalton's motion to file a supplement to its request to set terms and conditions is denied. 2. The purchase price for the line is set at $1,382,416. Other terms of sale must comply with the provisions discussed above. 3. Within 10 days of the service date of this decision, Dalton must accept or reject, in writing, the terms and conditions established here by notifying the Board and applicants. 4. If Dalton accepts the terms and conditions established by this decision, Dalton and applicants will be bound by this decision. Dalton may not transfer or discontinue service on the line prior to the end of the second year after consummation of the sale, nor may it transfer the line, except to applicants, prior to the end of the fifth year after consummation of the sale. 5. If Dalton withdraws its offer or does not accept the terms and conditions with a timely written notification, the Board shall issue a decision within 20 days of the service date of this decision vacating the prior decision that postponed the effective date of the decision authorizing abandonment and discontinuance. Decided: June 25, 1998 Service Date - July 1, 1998 ----------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Docket No. AB-83 (Sub-No. 16X] Maine Central Railroad Company--Abandonment Exemption--in Androscoggin County, ME Maine Central Railroad Company (MeC) has filed a notice of exemption to abandon an approximately 18.97-mile line of its railroad on the Lewiston Industrial Track between Engineering Station 0+00 (approximately milepost 0.00) and Engineering Station 1001+81.6 (approximately milepost 18.97), in Androscoggin County, ME. The line traverses United States Postal Service Zip Codes 04011, 04086, 04210, 04240, 04250, 04251 and 04252. Provided no formal expression of intent to file an offer of financial assistance (OFA) has been received, this exemption will be effective on July 31, 1998, unless stayed pending reconsideration. MeC shall file a notice of consummation with the Board to signify that it has exercised the authority granted and fully abandoned the line. If consummation has not been effected by MeC's filing of a notice of consummation by July 1, 1999, and there are no legal or regulatory barriers to consummation, the authority to abandon will automatically expire. Decided: June 24, 1998. Service Date - July 1, 1998 ----------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION [STB Finance Docket No. 33612] THE BURLINGTON NORTHERN AND SANTA FE RAILWAY COMPANY TRACKAGE RIGHTS EXEMPTION UNION PACIFIC RAILROAD COMPANY By petition filed on June 4, 1998, The Burlington Northern and Santa Fe Railway Company (BNSF) and Union Pacific Railroad Company (UP) request that the Board permit the trackage rights arrangement exempted in STB Finance Docket No. 33612 to extend only until July 31, 1998. According to petitioners, the trackage rights arrangement exempted in STB Finance Docket No. 33612 is necessary because BNSF will be performing maintenance and repairs on its main line and will utilize the trackage rights over UP's line as an alternative route for BNSF traffic. However, petitioners state that UP is only willing to grant temporary operating rights on its trackage during the periods of maintenance activity on BNSF's trackage. Petitioners further state that operating crew constraints on UP dictate that BNSF's operations over UP's trackage be handled as trackage rights rather than as a detour arrangement. Petitioners maintain that, without approval of temporary trackage rights, it is unlikely that any other arrangement can be reached to allow BNSF to operate over UP's line, and BNSF would face the possibility of severe congestion and service disruption on its main line. Although the parties have expressly agreed on the term of the proposed trackage rights arrangement, trackage rights approved under the class exemption normally remain effective indefinitely regardless of any durational contract provisions. Occasionally, trackage rights exemptions have been granted for a limited term rather than in perpetuity. BNSF's trackage rights have already been authorized. Limiting the term of the trackage rights is consistent with the limited scope of the transaction previously exempted and will have no adverse impact on shippers on the line as the trackage rights are for overhead traffic only. Therefore, we will grant the petition and permit the trackage rights exempted in STB Finance Docket No. 33612 to expire on July 31, 1998. It is ordered: 1. Under 49 U.S.C. 10502, we exempt the trackage rights described in STB Finance Docket No. 33612, as discussed above, permitting them to expire on July 31, 1998. 2. Notice will be published in the Federal Register on July 1, 1998. 3. This decision is effective on July 31, 1998. Decided: June 23 , 1998 Service Date - July 1, 1998 ----------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Finance Docket No. 33613] Savannah Port Terminal Railroad, Inc.--Acquisition and Operation Exemption--Georgia Ports Authority and Savannah State Docks Railroad Savannah Port Terminal Railroad, Inc. (SAPT), a noncarrier, has filed a verified notice of exemption to acquire the exclusive easement over and operate approximately 23 miles of rail line (consisting of approximately 1 mile of common use tracks, and 22 miles of yard tracks, industrial leads, and other related trackage over which the Board might not have jurisdiction) owned by the Georgia Ports Authority (GPA). The rail line involved in this acquisition transaction is located within the Garden City Terminal, Garden City, GA. The line is currently operated by Savannah State Docks Railroad (SSDRR). Following the acquisition transaction, SSDRR will permanently relinquish its right to operate as a common carrier railroad over the line. The transaction was expected to be consummated on or shortly after June 8, 1998. This transaction is related to STB Finance Docket No. 33615, wherein Genesee & Wyoming Inc., has concurrently filed a verified notice of exemption to continue in control of SAPT upon its becoming a Class III rail carrier. Decided: June 24, 1998. Service Date - July 1, 1998 ----------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Finance Docket No. 33614] Golden Isles Terminal Railroad, Inc.--Acquisition and Operation Exemption--Georgia Ports Authority and Colonel's Island Railroad Golden Isles Terminal Railroad, Inc. (GITM), a noncarrier, has filed a verified notice of exemption to acquire the exclusive rail freight easement over and operate approximately 33 of miles rail line (consisting of approximately 12.6 miles of common use tracks and 20.4 miles of yard tracks, industrial leads, and related trackage over which the Board might not have jurisdiction) owned by Georgia Ports Authority (GPA). The rail line involved in this acquisition is located in the Colonel's Island Bulk and Auto Processing Terminal near Brunswick, Glynn County Georgia. The line is currently operated by Colonel's Island Railroad (CIRR). Following GITM's acquisition of the line CIRR will permanently relinquish its rights to operate as a common carrier railroad over the line. The transaction was expected to be consummated on or shortly after June 8, 1998. This transaction is related to STB Finance Docket 33615, wherein Genesee & Wyoming, Inc., has concurrently filed a verified notice of exemption to continue in control of GITM upon its becoming a Class III rail carrier. Decided: June 24, 1998. Service Date - July 1, 1998 ----------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Finance Docket No. 33615] Genesee & Wyoming Inc.--Continuance in Control Exemption--Savannah Port Terminal Railroad, Inc. and Golden Isles Terminal Railroad, Inc. Genesee and Wyoming Inc. (GWI), a noncarrier holding company, has filed a notice of exemption to continue in control of Savannah Port Terminal Railroad, Inc. (SAPT) and Golden Isles Terminal Railroad, Inc. (GITM), upon SAPT and GITM becoming Class III railroads. The transaction was scheduled to be consummated on or shortly after June 8, 1998. This transaction is related to STB Finance Docket No. 33613 and STB Finance Docket No. 33614, wherein SAPT and GITM seek to acquire easements to operate over certain rail lines from GPA. GWI directly controls one existing Class II rail carrier subsidiary: Buffalo & Pittsburgh Railroad, Inc., operating in New York and Pennsylvania. GWI directly controls 12 existing Class III rail carrier subsidiaries: Genesee & Wyoming Railroad Company, Inc., operating in New York; Dansville and Mount Morris Railroad Company, operating in New York; Rochester & Southern Railroad, Inc., operating in New York; Louisiana & Delta Railroad, Inc., operating in Louisiana; Bradford Industrial Rail, Inc., operating in Pennsylvania and New York; Allegheny & Eastern Railroad, Inc., operating in Pennsylvania; Willamette & Pacific Railroad, Inc., operating in Oregon; GWI Switching Services, operating in Texas; Illinois & Midland Railroad, Inc., operating in Illinois; Pittsburgh & Shawmut Railroad, Inc., operating in Pennsylvania; Portland & Western Railroad, Inc., operating in Oregon; and Corpus Christi Terminal Railroad, Inc., operating in Texas. GWI indirectly controls 3 Class III rail carriers through its ownership of Rail Link, Inc.: Carolina Coastal Railway, Inc., operating in North Carolina; Commonwealth Railway, Inc., operating in Virginia; and Talleyrand Terminal Railroad, Inc., operating in Florida. Decided: June 24, 1998. Service Date - July 1, 1998 ----------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-33 (Sub-No. 104X) UNION PACIFIC RAILROAD COMPANY--ABANDONMENT EXEMPTION--IN OCONTO COUNTY, WI On January 9, 1997, a decision and notice of interim trail use or abandonment (NITU) was served, authorizing a 180-day period for Wisconsin Department of Transportation on behalf of the Wisconsin Department of Natural Resources (WisDNR) to negotiate an interim trail use/rail banking agreement with Union Pacific Railroad Company (UP) for an approximately 8.3-mile line of railroad known as the Oconto Falls Industrial Lead from milepost 54.4, near Oconto, to the end of the line at milepost 46.1, near Stiles Junction, in Oconto County, WI. The negotiation period was extended several times; the latest extension is scheduled to expire on July 3, 1998. On June 29, 1998, the WisDNR and UP filed a joint motion to extend the negotiation period for a period of 180 days from July 3, 1998, to complete an interim trail use/rail banking agreement. The parties state that an initial timely offer has been made and that negotiations are currently continuing, but that additional time is needed to finalize negotiations. It is ordered: 1. The negotiating period under the NITU is extended to December 30, 1998. Decided: June 30, 1998 Service Date - July 2, 1998 ----------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Docket No. AB-33 (Sub-No. 116X)] Union Pacific Railroad Company--Abandonment Exemption--in Salt Lake County, UT On June 12, 1998, Union Pacific Railroad Company (UP) filed with the Surface Transportation Board a petition to abandon three rail line segments as follows: (1) the Provo Subdivision, between milepost 799.0 and milepost 800.26 (1.26 miles); (2) the Passenger Line Industrial Lead, between milepost 782.32 and milepost 782.79 (0.47-mile); and (3) the Provo Subdivision Running Track Passenger Line, between milepost 744.20 and milepost 745.48 (1.28 miles), a total distance of 3.01 miles in Salt Lake City, Salt Lake County, UT. The line segments traverse U.S. Postal Service Zip Codes 84101 and 84104. The line segments include the non- agency rail stations of Grant Tower (milepost 800.10), Salt Lake City (milepost 782.79), UP 9th St. Crossing (milepost 744.20), and Salt Lake City (milepost 745.40). By issuance of this notice, the Board is instituting an exemption proceeding pursuant to 49 U.S.C. 10502(b). A final decision will be issued by September 30, 1998. Decided: June 25, 1998. Service Date - July 2, 1998 ----------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION AND NOTICE OF INTERIM TRAIL USE OR ABANDONMENT STB Docket No. AB-33 (Sub-No. 117X) UNION PACIFIC RAILROAD COMPANY--ABANDONMENT EXEMPTION--IN LAKE COUNTY, CO Union Pacific Railroad Company (UP) filed a notice of exemption to abandon an approximately 1.8-mile portion of the Leadville Branch from milepost 274.3 near McWethy Drive to the end of the line at milepost 276.1 at the rail year near U.S. Highway 24, in Leadville, Lake County, CO. Notice of the exemption was published in the Federal Register on June 4, 1998. The exemption is scheduled to become effective on July 4, 1998. The Board's Section of Environmental Analysis (SEA) has issued an environmental assessment (EA), served June 18, 1998, indicating that the right-of-way may be suitable for other public use following abandonment in this proceeding. In the EA, SEA also indicates that the National Geodetic Survey (NGS) has identified 2 geodetic station markers that may be affected by the abandonment. NGS states that it must be notified 90 days in advance of any activities that would disturb or destroy these markers. Therefore, SEA recommends that a condition be imposed requiring UP to consult with the NGS and provide NGS with 90 days notice prior to disturbing or destroying any geodetic markers. By petition filed May 28, 1998, Lake County Board of County Commissioners filed a request for issuance of a notice of interim trail use/rail banking (NITU) for the entire line under the National Trails System Act, and for a public use condition so that it could negotiate with UP for use of the line as a recreational trail. In the submission received on May 28, 1998, Lake County initially requested that UP be prohibited from disposing of the corridor, including tracks, ties and signal equipment along the right-of-way, except for public use on reasonable terms, and that UP be barred from removing or destroying any trail related structures, such as culverts for a 180-day period from the effective date of the abandonment exemption. Lake County states that it needs the full 180-day period to complete negotiations with UP. Lake County submitted a statement indicating its willingness to assume full financial responsibility for management of, for any legal liability arising out of the transfer or use of the right-of-way, and for payment of taxes for the right-of-way, and acknowledged that the use of the right-of-way for trail purposes is subject to future reactivation for rail service. Also on May, 28, 1998, UP indicated its willingness to negotiate with Lake County over trail use/rail banking of the line, but UP opposed imposition of a public use condition on the track structure and signal equipment on the right-of-way. In a supplemental reply received on June 9, 1998, Lake County requested that the track structure and signal equipment be excluded from the public use request. UP is willing to negotiate. Therefore, a NITU will be issued. The parties may negotiate an agreement during the 180-day period prescribed below. If the parties reach a mutually acceptable final agreement, no further Board action is necessary. If no agreement is reached within 180 days, UP may fully abandon the line. When the need for interim trail use/rail banking and public use is shown, it is the Board's policy to impose both conditions concurrently, subject to the execution of a trail use agreement. If a trail use agreement is reached on a portion of the right-of-way, Lake County must keep the remaining right-of-way intact for the remainder of the 180-day period to permit public use negotiations. It is ordered: 1. This proceeding is reopened. 2. Upon reconsideration, the notice of exemption served and published in the Federal Register on June 4, 1998, exempting the abandonment of the line described above is modified to the extent necessary to implement interim trail use/rail banking as set forth below, subject to the conditions that UP shall: (a) consult with the NGS and provide NGS with 90 days notice prior to disturbing or destroying any geodetic station markers; and (b) keep intact the right-of-way underlying the track, including culverts (but not track or track material or signal equipment) for a period of 180 days (until December 31, 1998), to enable any state or local government agency, or other interested person to negotiate the acquisition of the line for public use. If an interim trail use/rail banking agreement is executed before expiration of the 180-day period specified above, the public use condition will expire to the extent the trail use/rail banking agreement covers the same line. 3. If an interim trail use/rail banking agreement is reached, it must require the trail user to assume, for the term of the agreement, full responsibility for management of, for any legal liability arising out of the transfer or use of (unless the user is immune from liability, in which case it need only indemnify the railroad against any potential liability), and for the payment of any and all taxes that may be levied or assessed against the right-of-way. 4. Interim trail use/rail banking is subject to the future restoration of rail service and to the user's continuing to meet the financial obligations for the right-of-way. 5. If interim trail use is implemented, and subsequently the user intends to terminate trail use, it must send the Board a copy of this decision and notice and request that it be vacated on a specified date. 6. If an agreement for interim trail use/rail banking is reached by December 31, 1998, interim trail use may be implemented. If no agreement is reached by that time, UP may fully abandon the line. Decided: June 29, 1998 Service Date - July 2, 1998 ----------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-33 (Sub-No. 121X) UNION PACIFIC RAILROAD COMPANY--ABANDONMENT EXEMPTION--IN ARKANSAS COUNTY, AR Union Pacific Railroad Company (UP) filed a notice to abandon and discontinue service over a 26.0-mile line of railroad on the Stuttgart Branch from milepost 236.0 near Ricusky to the end of the line at milepost 262.0 near Indiana, in Arkansas County, AR. Notice of the exemption was published in the Federal Register on June 5, 1998. The exemption is scheduled to become effective on July 5, 1998. The Board's Section of Environmental Analysis (SEA) served an environmental assessment (EA) in this proceeding on June 12, 1998. In the EA, SEA states that the National Geodetic Survey (NGS) has identified 43 geodetic markers that may be affected by the abandonment. NGS requests that it be notified 90 days in advance of any activities that would disturb or destroy these markers to plan for their relocation. Therefore, SEA recommends that a condition be imposed requiring UP to consult with the NGS and provide NGS with 90 days notice prior to disturbing or destroying any geodetic markers. The recommended condition will be imposed. It is ordered: 1. This proceeding is reopened. 2. Upon reconsideration, the exemption of the abandonment of the rail line described above is subject to the condition that UP consult with the NGS and provide NGS with 90 days notice prior to disturbing or destroying any geodetic markers. Decided: June 30, 1998 Service Date - July 2, 1998 ----------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION AND NOTICE OF INTERIM TRAIL USE OR ABANDONMENT STB Docket No. AB-493 (Sub-No. 7X) TRACK TECH, INC.--ABANDONMENT EXEMPTION--IN ADAIR AND UNION COUNTIES, IA By petition filed March 17, 1998, Track Tech, Inc. seeks an exemption to abandon a line of railroad between milepost 1.45 near Creston, and milepost 21.15 at the end of the line in or near Greenfield, a distance of 19.70 miles, in Adair and Union Counties, IA. A notice was published in the Federal Register on April 6, 1998, instituting an exemption proceeding. A request for issuance of a notice of interim trail use (NITU) and imposition of a public use condition was filed by the Iowa Trails Council, Inc. (ITC). A comment in opposition to the petition was filed by Archer T. Elliott and Darline D. Elliott. We will grant the exemption, subject to public use, trail use, environmental, and standard employee protective conditions. The line proposed for abandonment was formerly owned by The Burlington Northern and Santa Fe Railway Company (BNSF). According to Track Tech, BNSF had limited operations on the line and, at the end of February 1997, BNSF took the line out of service and embargoed it. BNSF sold the line to Track Tech on or about June 11, 1997, but, because of unsafe and poor track conditions, Track Tech has never operated trains over it. Track Tech submits that there are three shippers on the line Green Valley Chemical (Green Valley), Rolling Hills Farm Service, and Farmers Cooperative Company (Farmers Cooperative). According to Track Tech, in 1996, the last full year of operation by BNSF, shipper use was sporadic and minimal. A total of 82 cars moved over the line; 27 cars of fertilizer were received inbound at Orient and Greenfield and 55 cars of grain and anhydrous ammonia were transported outbound from Creston, Orient, and Greenfield. There is no overhead traffic on the line because it ends at Greenfield. Track Tech states that alternative transportation service is available through other rail and motor carriers that operate in the area. BNSF's east-west main line is located 4 miles south of Green Valley's facility at Creston and Iowa Interstate Railroad Company's east-west main line is located approximately 13 miles north of Greenfield. Archer and Darline Elliott are landowners whose farm property is adjacent to the railroad right-of-way proposed for abandonment. They now live in Lakewood, CO, and their farm is managed by Farmers National Company of Omaha, NE. The only access to their farm is from Cherry Street Road, which is on the west side of the farm. An access lane crosses a small portion of their land and then crosses the railroad track, via an access right-of-way, to a larger portion of their land. The Elliotts state that without this access, which they have had for years, the farm would be inaccessible. They state that their south property line separates them from Green Valley's fertilizer plant. They attach a newspaper article which indicates that the Crestland Cooperative (Crestland) has purchased the segment of the line from its plant in Creston to Townline Road, which is the north border of Creston. They also state that Green Valley is seeking to buy 4 miles of the line from Townline Road to a point where it now crosses Cherry Street Road. According to the Elliotts, Crestland and Green Valley want to use the entire length of the line that crosses their property from their south property line up to Cherry Street Road and they protest the sale of the portion of the line that extends across their property. It does not appear that the Elliotts comments have been served on Track Tech, as required by our rules. In any event, the concerns raised by the Elliotts are land use matters that must be resolved locally with the owners of the rail line and in accordance with the terms of the easement that permits the line to cross the property and the Elliotts access right-of-way. SEA indicated that the National Geodetic Survey (NGS) has identified nine geodetic station markers along the rail line and requests 90 days notice to plan relocation of any markers that may be disturbed or destroyed by the proposed abandonment. Therefore, SEA recommends that a condition be imposed on any grant of abandonment authority requiring Track Tech to consult with NGS and provide it with 90 days notice prior to disturbing or destroying any geodetic markers so that plans can be made for their relocation. SEA received a letter from the Elliotts on June 23, 1998, in which the Elliotts object to the proposed sale of a segment of the line to be abandoned by Track Tech to Green Valley. The segment in question crosses the Elliotts farm property. The Elliotts argue that the proposed sale should be restricted to the boundary of Green Valley's property and should not include the line segment which crosses the Elliotts property. Green Valley has indicated to the Elliotts that they need the additional trackage to switch cars. The Elliotts maintain that Green Valley should restrict its activities to its own property. These concerns go to activities of Green Valley over which we have no jurisdiction. Our jurisdiction concerns the abandonment and discontinuance of service with respect to rail operations and does not cover the subsequent reuse of a segment of the line by Green Valley following abandonment. However, we have noted the Elliotts concern and entered their letter in the environmental docket. We will impose the condition recommended by SEA. ITC requests that interim trail use/rail banking be imposed under the National Trails System Act, and has submitted a statement of willingness to assume financial responsibility for the right-of-way and acknowledged that use of the right-of-way is subject to possible reactivation of the right-of-way for rail service. By letter filed June 16, 1998, Track Tech states that it is willing to negotiate with ITC for interim trail use. We will issue a NITU for the described line. The parties may negotiate an agreement during the 180-day period prescribed below. If an agreement is executed, no further Board action is necessary. If no agreement is reached within 180 days, Track Tech may fully abandon the line, subject to the conditions imposed below. SEA has indicated in its EA that the right-of-way may be suitable for other public use after abandonment. As noted above, ITC has also requested that a 180-day public use condition be imposed. ITC requests that Track Tech be precluded from: (1) disposing of the rail corridor, other than the tracks, ties and signal equipment; and (2) removing or destroying potential trail- related structures such as bridges, trestles, culverts and tunnels. ITC is an Iowa corporation organized in 1984 for the purpose of preserving appropriate railroad rights-of-way for possible reactivation of rail service with the interim use of these former railroad corridors as conservation/recreation trails designed for public use. ITC states that keeping this right-of-way intact is consistent with state policies. It indicates that the 180-day time period is needed to negotiate with the carrier and raise funds for acquisition and development. ITC has met the public use criteria. Accordingly, a 180-day public use condition also will be imposed, commencing with the effective date of this decision and notice. If a trail use agreement is reached on a portion of the right-of-way, Track Tech must keep the remaining right- of-way intact for the remainder of the 180-day period to permit public use negotiations. It is ordered: 1. Under 49 U.S.C. 10502, we exempt from the prior approval requirements of 49 U.S.C. 10903 the abandonment of the above-described line, subject to employee protective conditions in Oregon Short Line R. Co.--Abandonment--Goshen, 360 I.C.C. 91 (1979), and the conditions that: (1) Track Tech shall leave intact all of the right-of-way, including bridges, trestles, culverts and tunnels (but not track or track materials), for a period of 180 days from the effective date of this decision and notice, to enable any state or local government agency or any other interested person to negotiate the acquisition of the line for public use; (2) Track Tech shall comply with the interim trail use/rail banking procedures set forth below; and (3) Track Tech shall consult with NGS and provide it with 90 days notice prior to disturbing or destroying any geodetic markers so that plans can be made for their relocation. 2. The late-filed request for a NITU under 49 U.S.C. 1247(d) and a public use condition under 49 U.S.C. 10905 is accepted. 3. If an interim trail use/rail banking agreement is reached, it must require the trail user to assume, for the term of the agreement, full responsibility for management of, any legal liability arising out of the transfer or use of (unless the user is immune from liability, in which case it need only indemnify the railroad against any potential liability), and for the payment of any and all taxes that may be levied or assessed against, the right-of-way. 4. Interim trail use/rail banking is subject to the future restoration of rail service and to the user's continuing to meet the financial obligations for the right-of-way. 5. If interim trail use is implemented and subsequently the user intends to terminate trail use, it must send the Board a copy of this decision and notice and request that it be vacated on a specified date. 6. If an agreement for interim trail use/rail banking is reached by the 180th day after service of this decision and notice, interim trail use may be implemented. If no agreement is reached by that time, Track Tech may fully abandon the line, provided the conditions imposed above are met. 7. Track Tech must serve a copy of this decision and notice on the shippers on the line within 5 days after the service date of this decision and notice and certify to the Board that it has done so. 8. Provided no OFA has been received, this exemption will be effective August 1, 1998. 9. Track Tech shall file notice of consummation with the Board to signify that it has exercised the authority granted and fully abandoned the line. If consummation has not been effected by Track Tech's filing of a notice of consummation by July 2, 1999, and there are no legal or regulatory barriers to consummation, the authority to abandon will automatically expire. Decided: June 29, 1998 Service Date - July 2, 1998 ----------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD ENVIRONMENTAL ASSESSMENT NO. AB-544X SEA LION RAILROAD COMPANY -- ABANDONMENT EXEMPTION -- IN KING COUNTY, WASHINGTON In this proceeding, Sea Lion Railroad Company (SLR) has filed a petition in connection with the abandonment of its railroad line located between Milepost 2.70 and Milepost 0.09, a distance of approximately 3.0 miles, in the City of Seattle (City), King County, Washington. If the exemption becomes effective, SLR will be able to salvage track, ties and other railroad appurtenances and to dispose of the right-of-way. However, SLR intends to transfer the rail line to the City of Seattle for interim trail use and other public uses. The City has indicated its desire to preserve the rail line intact for such purposes, and Ballard Terminal Railroad Company (BTRC) would continue rail operations on the line under contract to the City. According to SLR, BTRC is owned by existing/potential shippers on the line. Normally, the Section of Environmental Analysis (SEA) would not prepare an environmental assessment in instances where, as here, rail operations would continue at substantially the same levels after a change in ownership of a line. However, in this situation, an abandonment would technically take place prior to the sale of the line and we, therefore, must assess the potential impacts to the environment that may result from abandonment and salvage of this line. The line traverses an urban industrial area. According to SLR, the line was acquired from the Burlington Northern and Santa Fe Railway Company in October, 1997. At that time, the line was embargoed due to track deterioration. The line had been used to transport frozen fish, gravel products and miscellaneous freight. We recommend that no environmental conditions be placed on any decision granting abandonment authority. Service Date - July 2, 1998 ----------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Docket No. AB-31 (Sub-No. 34X)] Grand Trunk Western Railroad Incorporated--Abandonment Exemption--in Oakland County, MI Grand Trunk Western Railroad Incorporated (GTW) has filed a notice of exemption to abandon a 0.53-mile line of its railroad on the Cass City Subdivision between milepost 0.72 and milepost 1.25 in Oakland County, Pontiac, MI. The line traverses United States Postal Service Zip Code 48342. Provided no formal expression of intent to file an offer of financial assistance (OFA) has been received, this exemption will be effective on August 5, 1998, unless stayed pending reconsideration. GTW shall file a notice of consummation with the Board to signify that it has exercised the authority granted and fully abandoned the line. If consummation has not been effected by GTW's filing of a notice of consummation by July 6, 1999, and there are no legal or regulatory barriers to consummation, the authority to abandon will automatically expire. Decided: June 29, 1998. Service Date - July 6, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-32 (Sub-No. 86X) BOSTON AND MAINE CORPORATION--ABANDONMENT EXEMPTION--IN MIDDLESEX COUNTY, MA STB Docket No. AB-355 (Sub-No. 24X) SPRINGFIELD TERMINAL RAILWAY COMPANY--DISCONTINUANCE OF SERVICE--IN MIDDLESEX COUNTY, MA In the above-entitled proceedings, no environmental or historic preservation issues have been raised by any party or identified by the Section of Environmental Analysis. It is ordered: 1. Abandonment of the involved rail line will have no significant effect on the quality of the human environment and conservation of energy resources or on historic resources. Decided: June 26, 1998 Service Date - July 6, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-55 (Sub-No. 560X) CSX TRANSPORTATION, INC.--ABANDONMENT EXEMPTION--IN LOGAN COUNTY, WV By petition filed March 18, 1998, CSX Transportation, Inc. (CSXT) seeks an exemption to abandon a 0.72-mile portion of its Logan Subdivision, extending between milepost CMB-0.33 at Bandmill Junction and milepost CMB-1.05 at Melville, in Logan County, WV. Notice of the institution of an exemption proceeding was published in the Federal Register on April 7, 1998. The United Transportation Union (UTU) requests imposition of labor protective conditions. We will grant the petition, subject to labor protective conditions. CSXT claims that in recent years only one shipper, Austin Powder Company (Austin Powder), has used the Line to ship or receive freight. Austin Powder operates a plant that manufactures explosives at Melville. According to CSXT, traffic for Austin Powder consisted of inbound shipments of ammonium nitrate totaling 78 carloads in 1996, 51 carloads in 1997, and 12 carloads in 1998 (through March 9, 1998). CSXT states that Austin Powder plans to move its operation at Melville to CSXT's Peach Creek Yard TransFlo Services facility (Peach Creek). To accommodate Austin Powder, CSXT says that it will not abandon the Line until Austin Powder has completely relocated its operation to the Peach Creek facility. CSXT certified that a copy of its petition was served on Austin Powder. SEA served an environmental assessment (EA) on May 18, 1998, recommending that no environmental or historic conditions be imposed on the abandonment. No comments were filed in response to the EA. Based on SEA's recommendation, we conclude that the proposed abandonment, if implemented, will not significantly affect either the quality of the human environment or conservation of energy resources. It is ordered: 1. Under 49 U.S.C. 10502, we exempt from the prior approval requirements of 49 U.S.C. 10903 the abandonment by CSXT of the above-described 0.72-mile rail line, subject to the employee protective conditions in Oregon Short Line R. Co.--Abandonment--Goshen, 360 I.C.C. 91 (1979). 2. CSXT must serve a copy of this decision on Austin Powder within 5 days after the service date of this decision and certify to the Board that it has done so. 3. Provided no OFA has been received, this exemption will be effective on August 5, 1998. 4. CSXT shall file a notice of consummation with the Board to signify that it has exercised the authority granted and fully abandoned the Line. If consummation has not been effected by CSXT's filing of a notice of consummation by July 6, 1999, and there are no legal or regulatory barriers to consummation, the authority to abandon will automatically expire. Decided: June 25, 1998 Service Date - July 6, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD ENVIRONMENTAL ASSESSMENT DOCKET NO. AB-83 (Sub. No. 16X) Maine Central Railroad Company Notice of Exemption in Androscoggin County, Maine In the above entitled proceeding, the Maine Central Railroad Company (Applicant)has filed a notice of exemption in connection with the abandonment and discontinuance of service over a segment of its Lewiston Industrial Track between milepost 0.00 near Brunswick and milepost 18.97 near Lewiston, a distance of approximately 18.97 miles in Androscoggin County, Maine. The right-of-way passes through a generally rural agricultural area with a few industrial sites. In its application, Applicant states that there has been no traffic on the line during the past two years. We recommend the following environmental conditions be placed on any decision granting abandonment authority: Because of outstanding historic resources concerns, Applicant shall consult with the Maine Historic Preservation Commission and shall retain its interest in and take no steps to alter the historic integrity of the line segment until completion of the Section 106 process of the National Historic Preservation Act. The National Geodetic Survey (NGS) has identified 43 geodetic station markers that may be affected by the proposed abandonment. Therefore, Applicant shall notify NGS at least 90 days prior to any salvage activities that may disturb or destroy these markers to that plans can be made for their relocation. Service Date - July 6, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-406 (Sub-No. 7X) CENTRAL KANSAS RAILWAY, LIMITED LIABILITY COMPANY --ABANDONMENT EXEMPTION-- IN BARTON, ELLSWORTH AND RICE COUNTIES, KS By decision served July 1, 1997, the Board issued a NITU which authorized a 180-day period for James D. Jennings of Jennings & Co. to negotiate an interim trail use/rail banking agreement with CKR for the right-of-way. That negotiating period expired on December 28, 1997. On January 26, 1998, Jennings submitted a fax transmittal indicating that he was no longer interested in negotiating for interim trail use/rail banking in this proceeding. On January 29, 1998, a decision and notice of interim trail use or abandonment (NITU) was served in this proceeding, authorizing a 180-day period for Iowa Trails Council (ITC) to negotiate an interim trail use/rail banking agreement with Central Kansas Railway, Limited Liability Company (CKR) for a 53.2-mile portion of CKR's Little River Subdivision from milepost 577.1 near Lyons to milepost 594.1 near Lorraine, then from milepost 20.7 near Lorraine to milepost 56.9 near Galatia, in Barton, Ellsworth and Rice Counties, KS. The 180- day period under the NITU expired on June 26, 1998. By letter filed June 25, 1998, ITC requested an extension of the negotiating period for an additional 180 days. ITC states that the extension of time will allow the parties to continue to negotiate the acquisition of the rail corridor. Also, by letter filed that same date, CKR states that it is agreeable to an extension of the NITU for an additional 180-day period. It is ordered: 1. The request to extend the interim trail use negotiating period is granted. 2. The negotiating period under the NITU is extended for a period of 180 days from June 26, 1998, or until December 23, 1998. Decided: June 30, 1998 Service Date - July 6, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-491X R.J. CORMAN RAILROAD COMPANY/PENNSYLVANIA LINES--ABANDONMENT EXEMPTION--IN CAMBRIA COUNTY, PA A decision and notice of interim trail use or abandonment (NITU) served December 12, 1997, established a 180-day period (until June 10, 1998) for the Cambria and Indiana Trail Council (Council) to negotiate an interim trail use/rail banking agreement with the R.J. Corman Railroad Company/Pennsylvania Lines (RJCP) for the 9.6-mile line of railroad known as the Blacklick Secondary, extending from milepost 6.4 at Ebensburg Junction to the end of the track at milepost 16, east of Nanty Glo, in Cambria County, PA. Thereafter, pursuant to the offer of financial assistance provisions, the Cambria and Indiana Railroad Company (C&I) was authorized to acquire a 4.5-mile portion of the line, between milepost 6.4 and a connection with C&I's track at milepost 10.45189. Otherwise, the trail use condition remains viable for the remainder of the line between milepost 10.45189 and milepost 16. On June 18, 1998, the Council filed a request to extend the NITU negotiation period until December 14, 1998. The Council states that the negotiations were delayed by the intervening OFA process and that additional time is needed to finalize negotiations for the remaining 5.5 miles of the Blacklick Secondary. The Council represents that RJCP concurs in the requested extension of the negotiation period. It is ordered: 1. The Council's request to extend the NITU negotiation period is granted. 2. The NITU negotiation period is extended until December 14, 1998. Decided: June 30, 1998 Service Date - July 6, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD ENVIRONMENTAL ASSESSMENT NO. AB-551X KNOX AND KANE RAILROAD COMPANY-- ABANDONMENT EXEMPTION -- IN CLARION COUNTY, PA In this proceeding, the Knox and Kane Railroad Company (KKR) has filed a notice of exemption in connection with the abandonment of its railroad line located between Milepost 86 and Milepost 95, a distance of approximately 9 miles, in Clarion County, Pennsylvania. No rail traffic has moved over the line since 1989. We recommend that no environmental conditions be placed on any decision granting abandonment and/or discontinuance authority. Service Date - July 6, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Finance Docket No. 33424 PORTLAND & WESTERN RAILROAD, INC.--ACQUISITION AND OPERATION EXEMPTION--THE BURLINGTON NORTHERN AND SANTA FE RAILWAY COMPANY On July 3, 1997, Portland & Western Railroad, Inc. (PWR), filed a verified notice of exemption to acquire and operate approximately 91.66 miles of line owned by The Burlington Northern and Santa Fe Railway Company (BNSF), known as the Astoria Branch, between milepost 5.22 near Willbridge, OR, and milepost 96.88 near Tongue Point, OR. As part of the same transaction, BNSF granted incidental trackage rights to PWR over a 1.92-mile line between milepost 5.22 and milepost 3.30 near Willbridge Yard. The exemption became effective on July 10, 1997. The transaction was consummated on July 11, 1997. Also on July 10, 1997, John D. Fitzgerald, on behalf of the United Transportation Union (UTU-GCA), filed a petition to reject, to revoke, and to stay the exemption, to which PWR replied. Notice of the exemption was published in the Federal Register on July 22, 1997. On August 1, 1997, UTU-GCA filed an appeal to the publication of the notice of exemption, arguing that the notice should have been rejected or stayed. PWR replied to the appeal. We will deny UTU-GCA's petition and appeal. We may revoke an exemption if we find that regulation of the transaction at issue is necessary to carry out rail transportation policy. Labor interests may raise issues concerning the appropriate level of labor protection in a petition for revocation. To the extent that a party wishes to challenge the bona fides of a transaction, we retain the right to review the transaction to protect the integrity of our processes. The party seeking revocation has the burden of proof and petitions to revoke must be based on reasonable, specific concerns demonstrating that reconsideration of the exemption is warranted and regulation of the transaction is necessary. UTU-GCA has failed to demonstrate that regulation of this transaction is necessary or that any substantive basis exists for revocation of the exemption. UTU-GCA argues that PWR's acquisition of an exclusive rail easement over the right-of- way is in reality a lease of the line. According to UTU-GCA, a lease is not a transaction and is not embraced within the class exemption. PWR denies that the transaction is a lease because it is purchasing all of the assets of the rail line, including sufficient title to operate the line. UTU-GCA offers no evidence or argument in support of its allegation that this transaction involves something less than a bona fide easement for PWR to conduct railroad operations over this right-of-way. We have reviewed both the easement, which gives PWR permanent and exclusive rights to conduct rail operations over the right-of-way, and the bill of sale, which transfers title to all rail service related property to PWR and conclude that these instruments cannot be interpreted as creating a landlord-tenant relationship, as UTU-GCA contends. In addition to its argument about leases, UTU-GCA suggests that PWR will have a virtual monopoly in northwest Oregon, and that there are anticompetitive consequences to the transaction. PWR responds that it has significantly less ability to dominate or control the market than BNSF had. We agree with PWR and cannot find, as a general rule, that the transfer of existing rail lines and operations from a major Class I carrier to a short line carrier diminishes the pre-existing competitive situation for shippers or the public. Accordingly, we attach no weight to UTU-GCA's unsupported contention. Finally, UTU-GCA alleges that PWR is not financially independent of BNSF, referring to our inquiry into their relationship based on UTU-GCA's allegations in another exemption revocation proceeding involving PWR. UTU-GCA provides no additional support for its allegation, which, after an investigation, we found unwarranted. Accordingly, we find this unsupported allegation unpersuasive as well. We will also deny UTU-GCA's appeal of the July 22, 1997 decision publishing the notice of exemption for the same reasons that we are denying the petition to revoke. It is ordered: 1. UTU-GCA's petition to revoke is denied. 2. UTU-GCA's appeal is denied. Decided: June 26, 1998 Service Date - July 6, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-33 (Sub-No. 112X) UNION PACIFIC RAILROAD COMPANY--ABANDONMENT EXEMPTION-- IN LANCASTER COUNTY, NE A decision and notice of interim trail use or abandonment (NITU) served on September 24, 1997, authorized the Union Pacific Railroad Company (UP) to abandon a 1.88-mile segment of its Lincoln Branch between milepost 494.76 near 10th Street and milepost 492.88 near 33rd Street in Lincoln, Lancaster County, NE. The September 24, 1997 decision stated that if consummation has not been effected by UP's filing a notice of consummation by September 24, 1998, and there are no legal or regulatory barriers to consummation, the authority to abandon will automatically expire. A railroad may, for good cause shown, file a request for an extension of time to file a notice of consummation in abandonment proceedings. On June 22, 1998, UP filed a request to extend for one year (until September 24, 1999), the time to consummate the abandonment and to file its notice of consummation. UP maintains that the extension is necessary because the line currently is being used for delivery of grain trains to the Omaha, Lincoln & Beatrice Railroad Company (OL&B), as well as for providing service to Lincoln Lumber Company, while new trackage is being constructed. The new trackage is not expected to be completed prior to September 24, 1998. UP has shown good cause to extend the time to consummate the abandonment and for filing a notice of consummation in this proceeding. Accordingly, the request will be granted. It is ordered: 1. UP's request for a 1-year extension of time to exercise the abandonment authority is granted. 2. The authority to abandon is scheduled to expire on September 24, 1999. Decided: June 30, 1998 Service Date - July 7, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD ENVIRONMENTAL ASSESSMENT NO. AB-55 (SUB-NO.562X) CSX TRANSPORTATION, INC. -ABANDONMENT EXEMPTION- IN NASH COUNTY, NORTH CAROLINA In this proceeding, the CSX Transportation, Inc. has filed a petition in connection with the abandonment of its railroad line located between Valuation Station 4+30 at Falls Road and Valuation Station 36+00 at the end of the track near Earl Street, a distance of approximately 0.60 miles, in Rocky Mount, Nash County, North Carolina. In recent years, only two rail patrons have originated or terminated any rail traffic on this branch line. Log Cabin Homes has historically received lumber on this line. In 1996, Log Cabin Homes received six carloads of lumber via rail on this line and in 1997, Log Cabin Homes received ten carloads of lumber via rail. In the past, New Southern of Rocky Mount has used this branch main line to ship rail cars of vegetable oil and meal. In 1996, New Southern shipped 16 carloads via rail. However, New Southern has not used the railroad since 1996. The right-of- way fluctuates between 12 and 44 feet wide and meanders between buildings in an industrial area of urban Rocky Mount. There are seven road crossings located on the line proposed for abandonment. These crossings are all in need of immediate repair. The total length of the seven crossings is approximately 300 feet. The State of North Carolina, Department of Environment and Natural Resources (DENR) has stated that any exposed areas within the railroad right-of-way are to be appropriately stabilized prior to abandonment. The DENR also states that areas that may be contributing to off-site sedimentation may be subject to the requirements of the Sedimentation Pollution Control Act of 1973. We, therefore, recommend that CSX, prior to any salvage activities, be required to consult with the North Carolina Department of Environment and Natural Resources to determine if permits are necessary under the provisions of the Sedimentation Pollution Control Act of 1973. Service Date - July 7, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION AND NOTICE OF INTERIM TRAIL USE OR ABANDONMENT STB Docket No. AB-441 (Sub-No. 2X) SWKR OPERATING CO.--ABANDONMENT EXEMPTION-- IN COCHISE COUNTY, AZ This decision denies an extension request related to the Board's December 2, 1997 decision in this matter and grants a request for issuance of a notice of interim trail use. By decision served February 14, 1997, the Board permitted SWKR Operating Co. (SWKR) to abandon a 41.5-mile line of railroad, running between Charleston and Paul Spur, AZ. Chemical Lime Company (CLC), a shipper on the line, filed an offer of financial assistance and a request that the Board set terms and conditions for subsidy and purchase of the line. CLC rejected the terms set by the Board and, in a decision served December 2, 1997, the abandonment was made effective on that date. By letter filed March 30, 1998, Representative Gail Griffin of the Arizona House of Representatives requests a 90-day extension of the December 2 decision to allow the Arizona Department of Transportation time to hire a consultant to conduct a feasibility study on the practicable uses, economic benefits, and potential purchase of the line. SWKR filed a reply on April 13, 1998. Also on April 13, 1998, San Pedro Trails, Inc. (SPT) filed a request for issuance of a notice of interim trail use. Because the abandonment authorization is now effective and the proceeding is administratively final, the available relief is a petition to reopen the proceeding or a petition to revoke the exemption. We must therefore review Representative Griffin's request in light of the standards for granting relief by the means available. The Board may reopen an administratively final decision when the petitioner submits new evidence, shows that the Board has committed material error or demonstrates that new circumstances have arisen that warrant a different result. The Board may revoke an exemption when a petitioner shows that the application of the statutory provision from which an exemption has been granted is necessary to carry out the transportation policy set out in the ICC Termination Act of 1995. The pleading submitted by the Representative does not afford the Board a basis for granting relief by either provision. Along with its trail use request, SPT submitted a statement indicating its willingness to assume full responsibility for management of, and liability for payment of taxes for, the right-of- way, as required by 49 CFR 1152.29, and acknowledges that the use of the right-of-way as a trail is subject to future reactivation for rail service. By letter filed April 20, 1998, SWKR states that the Charleston-to-Paul Spur track has not yet been abandoned, that the railroad is willing to negotiate an agreement to rail bank the right-of-way, and that it supports the request of SPT for issuance of a NITU. Since SWKR has not consummated the abandonment and is willing to negotiate for trail use, a NITU will be issued. The parties may negotiate a trail use agreement during the 180-day period prescribed below. If the parties reach a mutually acceptable final agreement, further Board approval will not be necessary. If no agreement is reached within 180 days, SWKR may fully abandon the line. It is ordered: 1. The request for a 90-day extension of the December 2, 1997 decision is denied. 2. This proceeding is reopened. 3. Upon reconsideration, the decision served and published on February 14, 1997, exempting the abandonment of the above-described line, is modified to the extent necessary to implement interim trail use/rail banking as set forth below for a period of 180 days from the service date of this decision. 4. If an interim trail use/rail banking agreement is reached, it must require the trail user to assume, for the term of the agreement, full responsibility for management of, any legal liability arising out of the transfer or use of (unless the user is immune from liability, in which case it need only indemnify the railroad against any potential liability), and for the payment of any and all taxes that may be levied or assessed against, the right-of-way. 5. Interim trail use/rail banking is subject to the future restoration of rail service and to the user's continuing to meet the financial obligations of the right-of-way. 6. If interim trail use is implemented and subsequently the user intends to terminate trail use, it must send the Board a copy of this decision and notice and request that it be vacated on a specific date. 7. If an agreement for interim trail use/rail banking is reached by the 180th day after service of this decision and notice, interim trail use may be implemented. If no agreement is reached by that time, SWKR may fully abandon the line, provided that the historic preservation and labor protective conditions imposed in the February 14 decision are met. Decided: June 26, 1998 Service Date - July 7, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Finance Docket No. 33587 CITY OF ROCHELLE, ILLINOIS --NOTICE OF EXEMPTION-- COMMENCEMENT OF RAIL COMMON CARRIER OBLIGATIONS We are denying the petitions of the Rochelle Railroad Company (RRC) and intervener Americold, Inc. to revoke the notice of exemption filed in this proceeding by the City of Rochelle, IL (the City) for the commencement of railroad operations. By notice filed on April 28, 1998, and published in the Federal Register on June 2, 1998, the City invoked our class exemption to assume rail common carrier operations over 2.06 miles of track that it owns in an industrial park within its city limits. The notice became effective on May 5, 1998. RRC is currently operating on the line. The City asserts that RRC has been operating on the line under a lease but that the lease has been canceled. In a preliminary motion filed in STB Docket No. AB-549, the City has expressed an intention to file an adverse (involuntary) discontinuance application in order to obtain authority to expel RRC from the line. The City, however, maintains that its notice of exemption gives it the authority to operate on the line until an adverse discontinuance is granted, despite the presence of RRC. The City maintains that, pending our approval of an adverse discontinuance application, both carriers will have the right to operate on the line, but that shippers on the line have the right individually to designate which carrier will serve them. On April 30, 1998, Americold filed a petition to intervene and to reject and/or revoke the notice of exemption. By petition filed on May 1, 1998, RRC requests that we reject and/or revoke the notice of exemption. RRC filed a supplement to this petition on May 8, 1998. On May 21, 1998, the City filed a reply to RRC's petition to reject and/or revoke. RRC argues that we should reject or revoke the exemption on the grounds that: (1) it does not conform to our rules of practice, allegedly due to improper service and lack of verification; (2) the notice is void, allegedly for containing false and misleading information; and (3) the notice presents exceptional circumstances requiring regulation of the transaction. RRC argues that the notice must be rejected because it was not served upon RRC by the "same method and class of service used in serving the Board." According to RRC, the notice was served by hand on the Board. RRC asserts that it obtained a FAX copy from counsel for the City after the filing at the Board was called to its attention through a "daily" list of filings provided by an outside watching service. RRC asserts that the mailed (non-FAX) copy "has yet to arrive." RRC argues that the City's notice should be rejected because RRC was prejudiced by this method of service. We disagree. Under our regulations, notices of exemption are initially required only to be filed with the Board. Notice upon potentially interested parties like RRC is satisfied by publication in the Federal Register. RRC argues that the notice must be rejected because its only verification is a one-page affidavit from its City Manager attesting to the monthly car counts, rather than an affidavit attesting to the entire notice. We disagree. While a broader verification should have been filed, the City's error in this respect does not require rejection of its notice. The City has attached to its reply a broad verification addressing all factual issues raised in the notice. This fulfills the purpose of the verification requirement. RRC maintains that the notice is void on the grounds that it falsely identifies the common carrier and makes other misrepresentations. RRC asserts that there has been confusion in filings before the Board as to the identity of the entity that will conduct operations on behalf of the City and that this is grounds for finding that the notice is void. We disagree. The notice makes the identity of the serving railroad perfectly clear -- it is the City. The City will be the licensed rail carrier that is responsible for the provision of service in a lawful manner. While the City has referred to the "operator" of the line by various names, it appears that the operator will be nothing more than an agent of the City and that the City "will assure that all common carrier obligations are fulfilled." The agents or employees hired by the City to fulfill its common carrier obligation will not need authority from the Board. Because such agents or employees will not be responsible to shippers for the provision of service, regulated carriers like the City are not required to identify them. RRC asserts that the City has incorrectly stated that only one of the three current shippers, Edward Hines Lumber Company, is interested in continuing to use RRC. Intervener Americold states that it is also interested in using RRC. This, however, is not grounds for revoking the notice. The issue of shipper support for RRC will be resolved in the adverse discontinuance application that the City has expressed an intent to file in STB Docket No. AB-549. RRC also alleges that the City misrepresents the ability of its contractor, Total Logistics, Inc., to conduct operations on behalf of the City. We will not reject the notice based on this allegation. As discussed above, the operating authority and common carrier obligation will belong to the City, not its agent. It would be premature to conclude that the City will not be able to provide safe, adequate service or will attempt to commence operations before it can do so safely and efficiently. Finally, RRC alleges that "evidence of traffic tendered to or received by the three on line shippers [in the form of car counts and percentages] is at odds with traffic records kept by the railroad." We will not reject the notice based on that allegation. As noted by the City in its reply, the discrepancy can be explained by differences in measurement periods. We may revoke an exemption if regulation is necessary to carry out the transportation policy of 49 U.S.C. 10101. RRC argues that the transaction should be subject to regulation on the grounds that it contravenes goals in the transportation policy of 49 U.S.C. 10101 requiring avoidance of predatory practices, market concentration, adverse effect on safety, and unlawful discrimination. The transaction does not require regulation to avoid predatory practices. The term "predatory pricing and practices" refers to the pricing and practices that one carrier observes relative to another, competing carrier. Here, RRC has submitted no evidence of predatory pricing or practices. There are no grounds for regulating the transaction to avoid market concentration. The entry of the City into the railroad market as a competitor to, or a replacement of, RRC will not increase market concentration. Nor are there grounds for finding that service by the City will produce discrimination in violation of the narrow strictures contained in the ICC Termination Act. The City competes with no users of rail service and has no motivation to discriminate in favor of one to the detriment of another. Finally, we see no reason to revoke the notice on the grounds that operations by the City on the line will adversely affect safety. Here, we of course expect that both RRC and the City will coordinate operations and operate in conformity with the regulations of the Federal Railroad Administration and all other applicable safety laws. In finding that 49 U.S.C. 10502(d) does not support revocation of the notice of exemption filed by the City and that nothing in the ICC Termination Act or the regulations and precedents of the Board preclude the City from operating over this track, we do not purport to rule on the respective rights of RRC and the City to operate. Our determination of whether RRC service must continue will be made in the adverse discontinuance proceeding. It is ordered: 1. The petition to revoke and/or reject is denied. Decided: July 6, 1998 Service Date - Late Release July 7, 1998 ------------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Docket No. AB-545] South Orient Railroad Company, Ltd. Abandonment and Discontinuance of Trackage Rights Between San Angelo and Presidio, TX. On June 18, 1998, the South Orient Railroad Company, Ltd. (SORC), filed an application with the Surface Transportation Board for permission to abandon its San Angelo-Presidio Line extending from milepost 722 near Mertzon station south of San Angelo to approximately milepost 945.3 at Alpine Junction and from approximately milepost 956.7 at Paisano Junction to the end of the line at milepost 1029.1 on the International Bridge near Presidio, a distance of approximately 296.4 miles (The line also includes an additional 14.4 miles of side track) ; and to discontinue its trackage rights over the Union Pacific Railroad Company's line extending from approximately milepost 945.3 at Alpine Junction to approximately milepost 956.7 at Paisano Junction, a distance of 11.4 miles, for a total distance of approximately 307 miles in Brewster, Crane, Crockett, Irion, Pecos, Presidio, Reagan, Tom Green, and Upton Counties, TX. The line includes the stations of Mertzon, milepost 745.7; Barnhart, milepost 771.6; Big Lake, milepost 790.6; Rankin, milepost 819.9; McCamey, milepost 838.6; Baldridge, milepost 863.8; Sulphur Jct., milepost 869.4; Fort Stockton, milepost 881.7; Belding, milepost 892.9; Hovey, milepost 917.2; Alpine, milepost 944.3; Alpine Jct., milepost 945.6; Paisano Jct., milepost 956.7; Paisano, milepost 956.9; Tinaja, milepost 969.3; Plata, milepost 993.7; Casa Piedra, milepost 1002.9; and Presidio, milepost 1026.7, and traverses through United States Postal Service ZIP Codes 76903, 76666, 76930, 76932, 79778, 76752, 79735, 79830, 79832, and 79845. This line of railroad has been included in SORC's system narrative description in Category 1 since April 17, 1998. Decided: June 30, 1998. Service Date - July 8, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD ENVIRONMENTAL ASSESSMENT DOCKET NO. AB-31(Sub. No. 34X) Grand Trunk Western Railroad Incorporated Abandonment Exemption in Pontiac, Michigan In the above entitled proceeding, the Grand Trunk Western Railroad Incorporated (GTW) has filed a notice in connection with the abandonment of its line of railroad from MP 0.72 to MP 1.25, a distance of 0.53 miles in Pontiac, Oakland County, Michigan. The right-of-way passes through a generally urban area within the city of Pontiac. There has been no traffic on the line for two years and the Pontiac city planners are not opposed to the proposed abandonment. We recommend that no environmental conditions be placed on any decision granting abandonment authority. Service Date - July 10, 1998 ------------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Docket No. AB-31 (Sub-No. 35X)] Grand Trunk Western Railroad Incorporated--Abandonment Exemption--in Macomb County, MI Grand Trunk Western Railroad Incorporated (GTW) has filed a notice of exemption to abandon a 19.08-mile line of its railroad on the Romeo Subdivision between Richmond and Washington from milepost 0.42 to milepost 19.50 in Macomb County, MI. The line traverses United States Postal Service Zip Codes 48062, 48005, 48065, 48094 and 48095. Provided no formal expression of intent to file an offer of financial assistance (OFA) has been received, this exemption will be effective on August 9, 1998, unless stayed pending reconsideration. GTW shall file a notice of consummation with the Board to signify that it has exercised the authority granted and fully abandoned the line. If consummation has not been effected by GTW's filing of a notice of consummation by July 10, 1999, and there are no legal or regulatory barriers to consummation, the authority to abandon will automatically expire. Decided: July 2, 1998. Service Date - July 10, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION Docket No. AB-167 (Sub-No. 1148) CONSOLIDATED RAIL CORPORATION--ABANDONMENT--BETWEEN WALKERS MILL AND BURGETTSTOWN, IN ALLEGHENY AND WASHINGTON COUNTIES, PA By decision and certificate of interim trail use or abandonment (CITU) served July 14, 1995, a 180-day period was authorized for National Pike Trail Council (NPTC) and Allegheny County, PA, to negotiate an interim trail use/rail banking agreement with Consolidated Rail Corporation (Conrail) for the 15.7-mile right-of-way between milepost 11.00 at Walkers Mill and milepost 26.7 at Burgettstown, in Allegheny and Washington Counties, PA. At NPTC's request, the 180-day trail use negotiating period was extended through July 4, 1998, by decisions served December 22, 1995, August 22, 1996, January 14, 1997, July 14, 1997, and January 14, 1998. By letter filed July 2, 1998, NPTC requests another 180-day extension of the trail use negotiating period stating that the additional time is needed to complete negotiations. According to NPTC, the trail project involves several entities and negotiations have been slow due to the uncertainty of the railroads involved as a result of the pending acquisition of Conrail. Conrail supports the extension request. It is ordered: 1. The CITU negotiating period is extended through December 31, 1998. Decided: July 6, 1998 Service Date - July 10, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD ENVIRONMENTAL ASSESSMENT NO. AB-468 (SUB-NO. 3X) Paducah & Louisville Railway, Inc. - Abandonment Exemption In Muhlenberg County, Kentucky In this proceeding, the Paducah & Louisville Railway, Inc. (P&L) has filed a petition in connection with the abandonment of its railroad line located between Milepost J-126.6 at Central City, KY and Milepost J-133.3 at Greenville, KY, a distance of 6.70 miles; and 6.14 miles of Beech Creek Lead to Pond Creek, KY, in Muhlenberg County, KY. Recently, one rail patron, Reed Minerals, a slag facility located near the end of Beech Creek lead track, has used the line proposed for abandonment to ship outbound granulated slag. Reed did not receive any inbound shipments by rail. Reed shipped an average of 720 carloads per year from its facility in 1996 and 1997. Reed has shipped no carloads since January 1998. Reed has now closed its facility located on the line proposed for abandonment here and has relocated near its existing facilities on a CSX Transportation rail line in Drakesboro, KY. The Kentucky Heritage Council and State Historic Preservation Officer has not completed its review of the potential eligibility of sites and structures located on the line proposed for abandonment. Therefore, a condition is recommended requiring that Paducah & Louisville Railway shall retain its interest in and take no steps to alter the historic integrity of all sites and structures on the right-of-way that are 50 years old or older until completion of the Section 106 process of the National Historic Preservation Act. Service Date - July 10, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-493 (Sub-No. 7X) TRACK TECH, INC.--ABANDONMENT EXEMPTION--IN ADAIR AND UNION COUNTIES, IA By decision served on July 2, 1998, the Board exempted from the prior approval the abandonment by Track Tech, Inc. of a 19.70-mile line of railroad between milepost 1.45 near Creston, and milepost 21.15 at the end of the line in or near Greenfield, in Adair and Union Counties, IA, subject to public use, trail use, environmental, and standard employee conditions. The exemption was scheduled to become effective on August 1, 1998, unless stayed by the Board or unless a formal offer of financial assistance (OFA) was filed by July 13, 1998. On July 2, 1998, Green Valley Chemical Company (Green Valley), with the consent of Track Tech, filed a petition to toll the 10-day period for submitting an OFA for an additional 30 days. Green Valley indicates its intent to file an OFA to acquire a 3-mile portion of the subject right-of-way between milepost 1.45 and milepost 5.45. It states that, on June 29, 1998, it requested Track Tech to provide it with the financial data and information. Green Valley was advised that counsel for Track Tech would be away from the office for a week and that he would provide the information upon his return. Green Valley states that an extension of the 10-day period for filing an OFA is necessary because the requested information will not be provided in time for it to review it to permit the filing of its OFA before July 13, 1998. The Board will entertain petitions to toll the 10-day period for filing OFAs when a petitioner has failed to provide a potential offeror with the information necessary to the development of its OFA and if that information is not contained in the petition. Accordingly, the time period for filing an OFA in this proceeding will be tolled until August 12, 1998, and the effective date of the abandonment exemption for that part of the line between milepost 1.45 to milepost 5.45 will be further stayed until September 1, 1998. The exemption for the abandonment of the portion of the line between milepost 5.45 and milepost 21.15 will become effective, as scheduled, on August 1, 1998. It is ordered: 1. The time period for Green Valley to file an OFA is tolled until August 12, 1998. 2. The effective date of the abandonment exemption with respect to that part of the line segment between milepost 1.45 and milepost 5.45 is further stayed until September 1, 1998. Decided: July 9, 1998 Service Date - July 10, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD Finance Docket No. 30186 (Sub-No. 3) Tongue River Railroad Company, Construction and Operation of the Western Alignment in Rosebud and Big Horn Counties, Montana ACTION: Notice of Intent to Prepare a Supplement to the Final Environmental Impact Statement and Request for Comments. SUMMARY: On April 27, 1998, the Tongue River Railroad Company (TRRC) filed an application with the Surface Transportation Board seeking authority to construct and operate a 17.3-mile line of railroad in Rosebud and Big Horn Counties, Montana, known as the Western Alignment. The line that is the subject of this application is an alternative routing for the portion of the 41-mile Ashland to Decker, Montana rail line that was approved by the Board on November 8, 1996 in Finance Docket No. 30186 (Sub-No. 2), referred to as the Four Mile Creek Alternative. To evaluate and consider the potential environmental impacts that might result from the construction and operation of this new alignment, the Board's Section of Environmental Analysis (SEA) will prepare a Supplement to the Final Environmental Impact Statement in Finance Docket No. 30186 (Sub-No. 2) (Supplement). Comments are requested from interested parties regarding the scope of the environmental issues associated with the proposed construction and operation of the Western Alignment that should be addressed in the Supplement. SUPPLEMENTARY INFORMATION: In its original application filed on June 2, 1983 in Finance Docket No. 30186 and Finance Docket No. 30186 (Sub-No. 1), TRRC sought approval from the Interstate Commerce Commission (ICC, now the Surface Transportation Board or Board) for the construction and operation of 89 miles of railroad between Miles City, MT and two termini located near Ashland, MT (Tongue River I). TRRC explained that the proposed rail line would serve future coal mines in the Ashland area, and connect with what is now the Burlington Northern and Santa Fe Railroad Company's main line at Miles City for shipment of the coal to eastern and western destinations. In a decision served May 9, 1986, the ICC approved the application subject to several conditions, including environmental mitigation conditions that were recommended in the environmental impact statement (EIS) prepared by the ICC s environmental staff, now the Section of Environmental Analysis (SEA). On June 28, 1991, TRRC filed an application in Finance Docket No. 30186 (Sub-No. 2), seeking approval to construct and operate 41 miles of railroad running south from the approved Miles City to Ashland rail line to connect with existing rail lines serving the Decker, MT coal mines (Tongue River II). SEA also prepared an EIS for this proceeding and considered the potential environmental impacts associated with (1) TRRC's preferred route, (2) the Four Mile Creek Alternative, and (3) the no-build alternative. TRRC's preferred route would have extended south from Ashland generally paralleling the Tongue River and passed just to the west of the Tongue River Reservoir before connecting with a line owned by the Spring Creek Coal Company, which provides access to the Burlington Northern and Santa Fe Railway Company rail lines. TRRC's preferred route would have included 5 bridges and a tunnel in the approximately 6-mile section of the Tongue River Canyon located between the Tongue River Dam and the confluence of Four Mile Creek and the Tongue River. The Four Mile Creek Alternative departs from TRRC's preferred route at the confluence of the Four Mile Creek and the Tongue River and heads in a westerly direction, climbing at a 2.31 percent grade away from the Tongue River valley floor. The route winds south connecting with the Spring Creek spur at the same point as TRRC's preferred route. The Four Mile Creek Alternative thus avoids the Tongue River Canyon and Reservoir. SEA's Draft EIS (DEIS) was served on July 17, 1992, and comments were requested. The DEIS preliminarily recommended the Four Mile Creek Alternative because it would avoid the environmentally sensitive Tongue River Canyon. Because of concerns raised during the commenting process, SEA issued a Supplement to the DEIS (SDEIS) on March 17, 1994. In the SDEIS, SEA preliminarily concluded that the Four Mile Creek Alternative would have more adverse environmental consequences than TRRC's preferred route, because it would involve more land disturbance from cut and fill, erosion, deforestation, loss of habitat, and require more fuel consumption and cause more air pollution during operations. After the commenting process for the SDEIS, and further analysis and evaluation, SEA issued a Final EIS (FEIS), on April 11, 1996. In it, SEA explained that it had concluded that the Four Mile Creek Alternative would be the environmentally preferable construction option. SEA developed appropriate mitigation conditions to address potential environmental impacts if either of the two construction alternatives were approved. In its decision served November 8, 1996, the Board approved the construction and operation of the Four Mile Creek Alternative, and imposed the mitigation measures recommended in the FEIS for that route. Additionally, the Board reopened Tongue River I for the limited purpose of requiring TRRC to complete construction of the entire line between Miles City and Decker within 3 years. By petition filed July 15, 1997, TRRC sought to reopen the Board's November 1996 decision approving the construction and operation of the Four Mile Creek Alternative and proposed that the Board consider a new route, the Western Alignment, for a 17-mile portion of the approved line instead of the Four Mile Creek Alternative. The Western Alignment would roughly parallel TRRC's preferred route, but would lie slightly to the west of that route and the Tongue River. The Western Alignment would generally follow a route between TRRC s preferred alignment and the Four Mile Creek Alternative and would be located on uplands out of the Tongue River Canyon. Moving south along the approved route from Ashland, the Western Alignment would begin at a point approximately 9 miles downstream from the confluence of the Four Mile Creek and the Tongue River. It would then cross the Tongue River approximately 3,000 feet downstream of the existing county road river crossing. After crossing the river, the Western Alignment would parallel the existing Tongue River Road for 4 miles, then separate from the county road and climb away from the valley floor. At Four Mile Creek, the Western Alignment would cross the county road with a fifty-foot long bridge, and run approximately 0.07 miles west of the Hosford residence and ranch headquarters. From Four Mile Creek, the Western Alignment would continue to climb away from the Tongue River Valley, then proceed to connect with the existing Spring Creek rail spur. The Western Alignment would avoid the environmentally sensitive Tongue River Canyon and would incorporate at its steepest a grade of 0.93 percent for a length of 2.4 miles. TRRC asserted that the Western Alignment, while still avoiding the environmentally sensitive Tongue River Canyon, would also eliminate the potential economic and operational problems TRRC claimed would make the approved Four Mile Creek Alternative economically infeasible. Further, TRRC stated that, compared to the Four Mile Creek Alternative, the Western Alignment would involve less land acquisition, affect fewer land owners, and, because of the more even grade, require less fuel consumption. However, based on additional information later filed by TRRC, it appears that the Western Alignment could involve more earth-moving because of the rugged terrain, could cross more streams, could need more water during construction, and could potentially adversely affect big game movement, particularly pronghorn movement, during operations. In a decision served December 1, 1997, the Board denied TRRC's petition to reopen Tongue River II but stated that TRRC could file a new application for the Western Alignment. TRRC has now filed an application in Finance Docket 30186 (Sub-No. 3) that requests authority under 49 U.S.C. 10901 to construct and operate the Western Alignment as the final 17 miles of the Ashland to Decker line (in lieu of the Four Mile Creek Alternative), to connect with existing rail lines serving the Decker area coal mines (Tongue River III). The remainder of the approved line from Ashland to Decker would remain unchanged. In its Environmental Report that TRRC submitted with its new application, TRRC focused on the immediate vicinity of the Western Alignment and that alignment's two construction alternatives, the Four Mile Creek Alternative and TRRC's preferred route. In the Environmental Report, TRRC compares what it believes to be the environmental impacts and costs of constructing and operating the Western Alignment with the impacts and costs associated with the relevant portions of the Four Mile Creek Alternative and TRRC's preferred route. TRRC did not readdress the entire corridor between Miles City and Decker because that corridor has already received extensive environmental review in the environmental impact statements prepared in Tongue River I and Tongue River II, both for the Miles City to Ashland portion and the Ashland to Decker portion of this corridor. In preparing its Environmental Report, TRRC sought comments from a number of Federal and state agencies and included their responses in the report. Briefly, the U.S. Army Corps of Engineers (Corps) states that, since all Corps permits have expired, it will be reviewing TRRC's proposal in its entirety. The Corps indicates that it believes that the project, though analyzed in segments over a number of years, is one continuous alignment. The Corps also suggests that environmental conditions along the 130-mile rail route may have changed since the earlier analyses were performed. The Montana Department of Natural Resources and Conservation expresses concern about the direction and flow of possible flood waters and floodplain obstruction, water rights for dust control, blasting in the vicinity of the Tongue River Dam, encroachments on county roads, interference with dam rehabilitation, protection of historic resources, and disturbance of survey monuments. The Montana Department of Fish, Wildlife & Parks (MT FWP) acknowledges that the Western Alignment would avoid operating costs and operational concerns associated with the Four Mile Creek Alternative, but expresses concerns about the possible impacts from the cut and fill requirements associated with the construction of the Western Alignment and impacts to the nearby Tongue River Reservoir state park. MT FWP also describes two issues that it believes are unresolved from SEA's earlier environmental analysis: (1) the preservation of the integrity of the fish hatchery at Miles City; and (2) the status of the Multi-agency/Railroad Task Force set up in Tongue River II. The Montana Department of Transportation (MT DOT), in addition to expressing concerns about highway safety, requests re-negotiation of a Memorandum of Understanding designed to protect state highways. MT DOT also requests additional information about design plans for the I-94 grade crossing at Miles City. The Montana Natural Heritage Program has provided information about 5 species of concern that may be present in the Western Alignment area. The Northern Plains Resource Council (NPRC), in a separate filing before the Board, has suggested that the Board should now require another environmental analysis of the entire Miles City to Decker corridor. NPRC disagrees with TRRC's view that the Board should rely on its previous environmental analysis and focus its environmental review on only the Western Alignment. Instead, NPRC suggests that there are significant new changed environmental circumstances along the entire route. For example, it points to the invalidation of the Montco mine permit and the designation of the Tongue River as an impaired waterbody under the Clean Water Act. In addition, NPRC alleges that TRRC has significantly altered the alignments that were analyzed in Tongue River I and Tongue River II as it begins to exercise the authority previously granted in those proceedings. If that were shown to be the case, it could be that the environmental analysis of some of the previously approved line would no longer be adequate. Also, in separate filings, Great Northern Properties Limited Partnership suggests that the increased coal traffic projected for the Western Alignment could affect the entire 130-mile route. The Council on Environmental Quality's (CEQ) rules implementing the National Environmental Policy Act (NEPA) advise Federal agencies to prepare supplements to an EIS where, as here, new information that is relevant to environmental concerns is presented after a Final EIS has been prepared. Therefore, based on the CEQ rules, the Board's environmental regulations, and SEA's analysis of all the information on the Western Alignment SEA has received to date, SEA has determined that a Supplement to the EIS in Finance Docket 30186 (Sub-No. 2) (Supplement) is the appropriate means of reviewing TRRC's application for the Western Alignment in Tongue River III. Specifically, SEA will prepare a draft Supplement including preliminary mitigation recommendations that will be available for a 45-day comment period. Based on comments to the draft Supplement, and any further analysis, SEA will prepare a final Supplement, which will include appropriate environmental mitigation recommendations. The Board will consider the draft and final Supplements, any comments, and other available environmental information in rendering its decision on whether to grant TRRC's new application. In its decision, the Board will consider both economic and competitive transportation issues and will impose any environmental conditions it deems appropriate. Service Date - July 10, 1998 ------------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Finance Docket No. 33619] Richard B. Webb and Susan K. Lundy--Continuance in Control Exemption--Stillwater Central Railroad, Inc. Richard B. Webb and Susan K. Lundy (Applicants), have filed a verified notice of exemption to continue in control of Stillwater Central Railroad, Inc. (SCRR), upon SCRR becoming a Class III railroad. The transaction was scheduled to be consummated on or shortly after June 19, 1998. This transaction is related to two simultaneously filed verified notices of exemption: (1) STB Finance Docket No. 33620, wherein the State of Oklahoma by and through the Oklahoma Department of Transportation (ODOT) seeks to acquire rail lines from The Burlington Northern and Santa Fe Railway Company (BNSF), and (2) STB Finance Docket No. 33621, wherein SCRR seeks to lease and operate the lines being acquired by ODOT. In addition to SCRR (SCRR is a noncarrier corporation formed for the purpose of leasing the rail lines acquired by ODOT from BNSF and operating the 124.78 miles of rail line), Applicants control two Class III rail carriers: South Kansas and Oklahoma Railroad Company, operating in the States of Kansas and Oklahoma, and the Palouse River & Coulee City Railroad, Inc., operating in the States of Washington and Idaho. On May 15, 1998, Applicants filed a petition for exemption seeking Board approval to indirectly control the Blue Mountain Railroad, Inc., and the Southeast Kansas Railroad Company in STB Finance Docket No. 33603. This proceeding is currently pending. Decided: July 1, 1998. Service Date - July 10, 1998 ------------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Finance Docket No. 33620] State of Oklahoma by and through the Oklahoma Department of Transportation--Acquisition Exemption--The Burlington Northern and Santa Fe Railway Company The State of Oklahoma, a noncarrier, by and through the Oklahoma Department of Transportation (ODOT), has filed a verified notice of exemption to acquire approximately 124.78 miles of rail line from The Burlington Northern and Santa Fe Railway Company. ODOT will acquire the lines between: (1) between Oklahoma City, OK (milepost 536.4) and Sapulpa, OK (milepost 438.9), (2) between Pawnee Junction, OK (milepost 8.46) and Stillwater, OK (milepost 30.74), and (3) between Midwest City, OK (milepost 2.9) (EPS 15944+14) and the end of track (milepost 7.9) (EPS 16204+29). The transaction was scheduled to be consummated on or shortly after June 19, 1998. Stillwater Central Railroad, Inc. (SCRR), a noncarrier, has filed a notice of exemption in STB Finance Docket No. 33621, wherein SCRR seeks to lease and operate the lines being acquired by ODOT. Decided: July 1, 1998. Service Date - July 10, 1998 ------------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Finance Docket No. 33621] Stillwater Central Railroad, Inc.--Lease and Operation Exemption--the State of Oklahoma by and through the Oklahoma Department of Transportation Stillwater Central Railroad, Inc. (SCRR), a noncarrier, has filed a verified notice of exemption to lease from the State of Oklahoma by and through the Oklahoma Department of Transportation (ODOT) and to operate approximately 124.78 miles of rail line. The rail line is located in Oklahoma (1) between Oklahoma City (milepost 536.4) and Sapulpa (milepost 438.9), (2) between Pawnee Junction (milepost 8.46) and Stillwater (milepost 30.74), and (3) between Midwest City (milepost 2.9) (EPS 15944+14) and the end of the track (milepost 7.9) (EPS 16204+29). The Burlington Northern and Santa Fe Railway Company (BNSF) currently operates the line under retained unconditional freight service easements. ODOT has acquired the assets subject to these easements. Following the acquisition by ODOT and the lease and operation transaction by SCRR will become a Class III rail carrier and BNSF's easements and common carrier authority will terminate. The transaction was scheduled to be consummated on or shortly after June 19, 1998. This transaction is related to two simultaneously filed notice of exemptions: (1) STB Finance Docket No. 33619, wherein Richard B. Webb and Susan K. Lundy will continue in control of SCRR, upon its becoming a Class III rail carrier, and (2) STB Finance Docket No. 33620, wherein ODOT seeks to acquire the rail lines owned by BNSF and lease the rail lines to SCRR to operate. Decided: July 1, 1998. Service Date - July 10, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-33 (Sub-No. 114X) UNION PACIFIC RAILROAD COMPANY--ABANDONMENT EXEMPTION-- IN WASHBURN COUNTY, WI By decision and notice of interim trail use or abandonment (NITU) served January 16, 1998, a 180-day period was authorized for the Wisconsin Department of Natural Resources (WisDNR), acting through the Wisconsin Department of Transportation (WisDOT) (collectively referred to as WisDNR/DOT), to negotiate an interim trail use/rail banking agreement with Union Pacific Railroad Company (UP) for UP's 12.68-mile line of railroad known as the Hayward Industrial Lead, extending from milepost 83.32 near Trego to milepost 96.0 near Hayward Junction, in Washburn County, WI. The 180-day period under the NITU is scheduled to expire on July 15, 1998. In the January 16 decision, we also imposed a 180-day public use condition at the request of Washburn County (County). On June 29, 1998, WisDNR/DOT and UP filed a joint motion for an extension of the negotiation period for an additional 180 days. The parties state that an initial timely offer has been made and that negotiations are continuing in good faith, but that additional time is needed to finalize negotiations. Also, on June 29, 1998, the County filed a letter requesting an additional 90 days to negotiate with UP for the purchase of the line. The Board's public use jurisdiction expires 180 days from the effective date of the decision approving the abandonment. The public use condition imposed in the January 16 decision was for the maximum 180-day period; it expires on August 14, 1998, and cannot be extended. Therefore, the extension requested by the County must be denied. It is ordered: 1. The request filed by WisDNR/DOT and UP to extend the NITU negotiation period under the NITU for an additional 180 days is granted. 2. The negotiation period under the NITU is extended to January 11, 1999. 3. The County's request to extend the negotiating period under the public use condition is denied. Decided: July 6, 1998 Service Date - July 13, 1998 ------------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Docket No. AB-548] Tacoma Eastern Railway Company Adverse Discontinuance of Operations Application A Line of City of Tacoma, in Pierce, Thurston and Lewis Counties, WA On June 23, 1998, the City of Tacoma, WA (City) filed an application requesting that the Surface Transportation Board (Board) find that the public convenience and necessity require and permit the discontinuance of the operations by Tacoma Eastern Railway Company (TE) on 131.5 miles of City rail line in Pierce, Thurston, and Lewis Counties, WA: (1) between milepost 2192.0, at Tacoma, and milepost 17.7, at Chehalis; and (2) between milepost 2192.0, at Tacoma, and milepost 64.2, at Morton. The line traverses United States Postal Service ZIP Codes 98235, 98304, 98328, 98330, 98338, 98344, 98355, 98356, 98371, 98373-98375, 98387, 98401-98405, 98408, 98421, 98424, 98443-98446, 98501, 98531, 98532 and 98576. TE was authorized to operate the line by lease in Finance Docket No. 32591 (ICC served Nov. 3, 1994). City states that it has terminated the contract pursuant to which TE has been operating on the line because TE has not satisfactorily performed its obligations under the contract. Once City receives Board approval, it intends to replace TE with the Belt Line Division of the City of Tacoma Department of Public Utilities (Belt Line). Beltline will file a notice of exemption to enable it to commence operations without any interruption in service to shippers on the line. In addition, City has petitioned the Board to waive certain provisions of 49 CFR 1152.22 on the grounds that the information required by these provisions is not relevant to the merits of the application or is not available to the City because of the circumstances of the application. Requests for waivers are typically filed before the application drawn in reliance on those waivers is filed. By filing its application contemporaneously with the waivers, City has run the risk that the waivers will be denied in whole or part and City will have wasted time and effort in filing an application based on them. But, as City is no doubt aware, grants of waiver petitions in applications filed by third parties are customary. The waiver request as to information to be contained in the application will be granted in a separate decision to be served concurrently with this notice. In an application by a third party for a determination that the public convenience and necessity permits a line to be discontinued or abandoned, the issue before the Board is whether the public interest requires that the line in question be retained as part of the national rail system. By granting a third party application, the Board withdraws its primary jurisdiction over the line. Questions of the disposition of the line, including the adjudication of various claims of ownership or other rights and obligations, are then left to state or local authorities. Decided: July 7, 1998. Service Date - July 13, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION STB Docket No. AB-548 TACOMA EASTERN RAILWAY COMPANY ADVERSE DISCONTINUANCE OF OPERATIONS APPLICATION A LINE OF CITY OF TACOMA, IN PIERCE, THURSTON AND LEWIS COUNTIES, WA On June 23, 1998, City of Tacoma, WA (City), filed a petition for waiver of certain regulations. The petition for waiver was included in and made a part of City's application for an adverse discontinuance of operations. City filed the application assertedly when the tenant railroad, Tacoma Eastern Railway Company (TE), failed to satisfy its obligations under its lease agreement to operate 131.5 miles of rail line owned by the City (line) in Pierce, Thurston, and Lewis Counties, WA: (1) between milepost 2192.0, at Tacoma, and milepost 17.7, at Chehalis; and (2) between milepost 2192.0, at Tacoma, and milepost 64.2, at Morton. The Board will ordinarily reject an abandonment or discontinuance application which does not substantially conform to the regulations in 49 CFR Subpart C. However, City seeks waiver of a number of the requirements governing the contents of an application. These include: a statement of the condition of the properties; a statement describing the service being provided on the line; a statement of revenue and costs; a statement of alternative sources of transportation available. City correctly states that the requirements cited are not relevant to this adverse discontinuance application. In appropriate instances, such as situations involving adverse applications, the Board, or its predecessor agency, has waived inapplicable and unneeded portions of its abandonment regulations. Because City is not the operator of the line, it is not in possession of the data required by the regulations. Although requested, TE has failed to provide City with information pertaining to the condition of the properties, the service being provided on the line, or the line's revenue and cost data. In addition, City states that there will be no interruption or diminution in rail service on the line as a consequence of the adverse discontinuance requested in the application. Once City receives Board approval, it intends to replace TE with the Belt Line Division of the City of Tacoma Department of Public Utilities (Belt Line). Beltline will file a notice of exemption to enable it to commence operations without any interruption in service to shippers on the line. Accordingly, City's petition for waiver is granted. It is ordered: 1. City's petition for waiver is granted and certain provisions of the abandonment regulations at 49 CFR 1152.22 are waived. Decided: July 7, 1998. Service Date - July 13, 1998 ------------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Finance Docket No. 33579] Gauley River Railroad, LLC--Purchase, Lease and Operation Exemption--CSX Transportation, Inc. Gauley River Railroad, LLC (GRIV), a noncarrier, has filed a notice of exemption to purchase from CSX Transportation, Inc. (CSXT) and operate approximately 30.7 miles of rail line in West Virginia. GRIV will acquire two rail line segments: (1) between milepost BUE- 119 (Valuation Station 5035+89.6) near Cowen, WV, and milepost BUE-129 (Valuation Station 5563+89.6) at Allingdale, WV (Line A) and (2) between milepost BUE-12.4 (Valuation Station 1096+48.2) at Muddlety Falls, WV, and milepost BUE-20.7 (Valuation Station 1092+45), including the McMillion Creek Branch, Delmont Branch, and all other connecting spur and sidetracks (Line C). GRIV will also sublease from CSXT a third line segment, which connects or bridges together Line A and Line C, extending from milepost BUE-0.0 (Valuation Station 441+43) at Allingdale, WV, to milepost BUE-12.4 (Valuation Station 649+86.8) at Muddlety Falls, WV (Line B). Line B serves as a connecting stretch of railroad linking together Lines A, B, and C. Line B is currently owned by Strouds Creek and Muddlety Railroad (SC&M). SC&M leases the line to CSXT. According to CSXT's lease agreement with SC&M, CSXT is permitted to enter into the contemplated sublease. The transaction was expected to be consummated on or shortly after June 25, 1998. Decided: July 6, 1998. Service Date - July 14, 1998 ------------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Finance Docket No. 33624] Mississippi & Tennessee RailNet, Inc.--Acquisition and Operation Exemption--The Kansas City Southern Railway Company Mississippi & Tennessee RailNet, Inc. (MTRN), a noncarrier, has filed a verified notice of exemption to acquire and operate approximately 87.1 miles of rail line and approximately 7.53 miles of spur and side tracks from The Kansas City Southern Railway Company between milepost 281.5 at Houston, MS, and milepost 368.6 at Middleton, TN. The transaction was scheduled to be consummated on or shortly after June 26, 1998. This transaction is related to STB Finance Docket No. 33625, wherein North American RailNet, Inc. will continue in control of MTRN upon its becoming a Class III rail carrier. Decided: July 6, 1998. Service Date - July 14, 1998 ------------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Finance Docket No. 33625] North American RailNet, Inc.--Continuance in Control Exemption--Mississippi & Tennessee RailNet, Inc. North American RailNet, Inc. (NARN), has filed a verified notice of exemption to continue in control of Mississippi & Tennessee RailNet, Inc. (MTRN), upon MTRN becoming a Class III railroad. The transaction was scheduled to be consummated on or shortly after June 26, 1998. This transaction is related to STB Finance Docket No. 33624, wherein MTRN seeks to acquire and operate a rail line from The Kansas City Southern Railway Company. NARN controls three existing Class III railroads: Nebraska, Kansas & Colorado RailNet, Inc., operating in Nebraska, Kansas, and Colorado; Illinois RailNet, Inc., operating in Illinois; and Camas Prairie RailNet, Inc., operating in Mississippi and Tennessee. Decided: July 6, 1998. Service Date - July 14, 1998 ------------------------------------------------------------------------- DEPARTMENT OF TRANSPORTATION Surface Transportation Board [STB Finance Docket No. 33628] Fort Worth and Western Railroad Company--Trackage Rights Exemption--The Burlington Northern and Santa Fe Railway Company The Burlington Northern and Santa Fe Railway Company (BNSF) has agreed to grant overhead trackage rights to Fort Worth and Western Railroad Company (FWWR) over BNSF's rail line in Fort Worth, TX, between milepost 2.08 and milepost 4.67, a distance of 2.59 miles. The transaction was scheduled to be consummated on or soon after July 3, 1998, the effective date of the exemption. The purpose of the overhead trackage rights is to allow FWWR to directly interchange traffic with Union Pacific Railroad Company (UP) in Peach Yard (milepost 2.08), thereby improving service, financial viability, and operations. Decided: July 6, 1998. Service Date - July 14, 1998 ------------------------------------------------------------------------- SURFACE TRANSPORTATION BOARD DECISION AND NOTICE OF INTERIM TRAIL USE OR ABANDONMENT STB Docket No. AB-33 (Sub-No. 120X) UNION PACIFIC RAILROAD COMPANY--ABANDONMENT AND DISCONTINUANCE OF SERVICE EXEMPTION--IN WARREN COUNTY, IA By petition filed on March 27, 1998, Union Pacific Railroad Company (UP) seeks an exemption to: (1) abandon a line of railroad owned by UP known as the Carlisle Branch, extending from milepost 368.3 near Carlisle, IA, to milepost 379.13 near Indianola, IA, a distance of 10.83 miles; and (2) discontinue operations over a portion of the Carlisle Branch from milepost 379.13 to the end of the line at milepost 379.98 in Indianola, a distance of 0.85 mile, a total distance of 11.48 miles in Warren County, IA. UP states that it owns and operates the line between milepost 368.3 and milepost 379.13, and that it operates over a line segment, between milepost 379.13 and the end of the line at milepost 379.98, which is owned by shipper Heartland Coop. The Board published a notice in the Federal Register on April 16, 1998, instituting an exemption proceeding. A request for issuance of a notice of interim trail use (NITU) and for imposition of a public use condition was filed by the cities of Carlisle and Indianola, the Warren County Conservation Board, and the Iowa Natural Heritage Foundation (Agencies). The United Transportation Union seeks the imposition of labor protective conditions. We will grant the exemption, subject to trail use, public use, an historic preservation condition, an environmental condition, and standard employee protective conditions. According to petitioner, there are two rail customers, both located at Indianola, that have used the line in the past two years: Heartland Coop and Jerico Services. UP avers that the rail traffic on the line totaled 21 carloads of chemicals for the year 1997 (14 carloads of fertilizer for Heartland Coop and 7 carloads of brine for Jerico Services). UP projects a total of 21 carloads to move over the line in the forecast year. According to UP, service is provided on the line on an as-needed basis, which is seldom more than once a month. UP indicates that all rail traffic to or from the line is interchanged at Carlisle on the railroad's Des Moines-Kansas City main line, which runs in a north-south direction. UP further states that there is no overhead traffic on the line because it ends at Indianola. Petitioner adds that alternative transportation service is available through motor carriers over U.S. Highway 69, a north-south highway, or Iowa Highway 92, an east-west highway, both of which serve Indianola. UP estimates the line's net liquidation value at $294,168. UP also estimates that its operation of the line in the forecast year would result in an operating loss of $51,423, with normalized maintenance included, and that it would incur an annual opportunity cost in the forecast year of $37,700 if the railroad were to continue to own the line. UP argues that the proposed abandonment and discontinuance is justified in that: (1) freight revenues from local traffic on the line are insufficient to justify operation and the expenses involved in maintaining the line; and (2) there is no reasonable prospect that traffic and revenue will ever increase sufficiently in the foreseeable future to justify operation and retention of the line. The two shippers on the line have not objected to the proposed abandonment and discontinuance, have used the line only sporadically in 1997 with rail traffic totaling 21 carloads, and appear to have adequate transportation alternatives available to them. Nevertheless, to ensure that shippers are informed of our action, we will require UP to serve a copy of this decision on Heartland Coop and Jerico Services within 5 days of the service date of this decision and to certify to us that it has done so. In the EA, SEA indicated that the State Historical Society of Iowa has not yet completed its review pur