[Federal Register Volume 59, Number 60 (Tuesday, March 29, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-7335]


[[Page Unknown]]

[Federal Register: March 29, 1994]


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INTERSTATE COMMERCE COMMISSION
[Finance Docket No. 32393]

 

Southern Electric Railroad Company; Acquisition and Operation 
Exemption; Southern Electric Generating Company

    On March 7, 1994, Southern Electric Railroad Company (SERC), filed 
a notice of exemption under 49 CFR 1180.2(d)(3) and 49 CFR 1180.4(g), 
to acquire from Southern Electric Generating Company (SEGCO),1 all 
of SEGCO's rights and obligations to provide common carrier service 
over the approximately 7.5-mile rail line between CSX Transportation 
Inc.'s (CSXT) main line near Westover, AL, and the Ernest C. Gaston 
Steam Electric Generating Plant near Wilsonville, in Shelby County, AL 
(Gaston Line).2 SERC maintains that it will obtain an exclusive, 
permanent easement to conduct rail operations over and maintenance of 
the assets of SEGCO, but not the physical assets themselves, which 
SEGCO states it wishes to retain.3
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    \1\SERC and SEGCO were granted exemptions to construct lines of 
railroad in Southern Electric Railroad Company--Construction 
Exemption--Jefferson County, AL, Finance Docket No. 31972 (ICC 
served Mar. 17, 1992) (Jefferson County), Southern Electric Railroad 
Company--Construction Exemption--Effingham County, GA, Finance 
Docket No. 32195 (ICC served Jan. 12, 1993) (Effingham County), and 
Southern Electric Generating Co.--Petition for Exemption--
Construction of a Rail Line in Shelby County, AL, Finance Docket No. 
31498 (ICC served Sept. 19, 1989). SERC and SEGCO are, therefore, 
carriers subject to Commission jurisdiction.
    \2\SERC states that none of its lines connects with the Gaston 
Line. The parties previously proposed to accomplish the same result 
proposed here by having SEGCO convey to SERC all of its rights, 
title, and interest in the Gaston Line, followed by SERC's conveying 
the property back to SEGCO, subject to SEGCO's retention of an 
exclusive easement interest for purposes of rail carrier operations 
and rail line maintenance. A notice of exemption was filed and 
published, Southern Electric Railroad Company--Corporate Family 
Transaction Exemption--Southern Electric Generating Company, Finance 
Docket No. 32281 (ICC served May 5, 1993), but the transaction was 
never consummated because of tax and other regulatory reasons.
    \3\SERC cites South Orient Railroad Company, Ltd.--Acquisition 
and Operation Exemption--Line of The Atchison, Topeka and Santa Fe 
Railway Company, Finance Docket No. 31971 (ICC served Sept. 2, 
1992), in which the Commission determined that it did not have 
jurisdiction over the transfer of the fixed assets of rail line, but 
that it did have jurisdiction over the transfer of the common 
carrier obligation. The Commission determined there that a notice of 
exemption should be published to provide for the transfer of the 
operations.
    SERC asserts that it is constructing other lines, but that it 
will not itself operate any of those lines, each of which will be 
operated as a separate entity through operation agreements with 
nonaffiliated carriers. See Jefferson County and Effingham County. 
SERC asserts that the present transaction does not involve a Class I 
carrier, that none of its lines connects with the Gaston Line, and 
that its purchase of SEGCO's common carrier obligation and 
accompanying permanent operating easement are not part of a series 
of anticipated transactions that would connect the rail lines with 
each other. SERC maintains that the transaction, therefore, would 
also qualify for an exemption under 49 CFR 1180.2(d)(2).
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    SERC asserts that CSXT currently provides all service over the 
Gaston Line and will continue to provide service over the line under 
the agreement. SERC asserts further that it will substitute itself for 
SEGCO in the operating agreement with CSXT and in other similar 
agreements.4 The parties intend to consummate the proposed 
transaction on or before December 31, 1994.
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    \4\SERC does not believe that it needs to obtain Commission 
authority to substitute itself for SEGCO in the operating agreement 
between SERC and SEGCO which was granted in CSX Transportation, 
Inc.--Operating Exemption--Line of Southern Electric Generating 
Company, Finance Docket No. 31500 (ICC served Aug. 1, 1989). SERC 
indicates, however, that if the Commission does not agree, it will 
promptly file for such authority.
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    SERC, Alabama Power Company (APC),5 and Georgia Power Company 
(GPC) are subsidiaries of The Southern Company (Southern), a public 
utility holding company. APC and GPC each own 50% of the stock of 
SEGCO.
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    \5\APC is the only current shipper on the Gaston Line.
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    Because the parties are members of the same corporate family, and 
the transactions will not result in adverse changes in service levels, 
significant operational changes, or a change in the competitive balance 
with carriers operating outside the corporate family, the transaction 
qualifies for the class exemption at 49 CFR 1180.2(d)(3).
    The purpose of the transaction is to allow Southern to consolidate 
all of its rail functions within one subsidiary, SERC. Southern wishes 
to enhance administrative efficiencies for all rail lines serving its 
operating electric utility affiliates by centralizing in SERC the 
administration of operations for all of the rail lines Southern 
controls.
    To ensure that all employees who may be affected by the 
transactions are given no less than the minimum protection under 49 
U.S.C. 10505(g)(2) and 11347, the labor conditions set forth in New 
York Dock Ry.--Control--Brooklyn Eastern Dist., 360 I.C.C. 60 (1979) 
are imposed.
    Petitions to revoke the exemption under 49 U.S.C. 10505(d) may be 
filed at any time. The filing of a petition to revoke will not stay the 
transaction. Pleadings must be filed with the Commission and served on: 
William A. Mullins, 601 Pennsylvania Ave., NW., suite 640, North 
Building, Washington, DC 20004.

    Decided: March 23, 1994.

    By the Commission, David M. Konschnik, Director, Office of 
Proceedings.
Sidney L. Strickland Jr.,
Secretary.
[FR Doc. 94-7335 Filed 3-28-94; 8:45 am]
BILLING CODE 7035-01-P