[Federal Register Volume 61, Number 248 (Tuesday, December 24, 1996)]
[Rules and Regulations]
[Pages 67876-67917]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-32229]
[[Page 67875]]
_______________________________________________________________________
Part II
Department of Transportation
_______________________________________________________________________
Surface Transportation Board
_______________________________________________________________________
49 CFR Parts 1105 and 1152
Abandonment and Discontinuance of Rail Lines and Rail Transportation
Under 49 U.S.C. 10903; Final Rule
Federal Register / Vol. 61, No. 248 / Tuesday, December 24, 1996 /
Rules and Regulations
[[Page 67876]]
DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
49 CFR Parts 1105 and 1152
[STB Ex Parte No. 537]
Abandonment and Discontinuance of Rail Lines and Rail
Transportation Under 49 U.S.C. 10903
AGENCY: Surface Transportation Board, DOT.
ACTION: Final rules.
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SUMMARY: The ICC Termination Act of 1995 revised the law governing
applications by rail carriers to abandon or discontinue service over
lines of railroad and related offers of financial assistance that would
continue rail service after approval of abandonment or discontinuance
by the Surface Transportation Board (Board). The Board now revises part
1152 to implement the changes and update the pertinent regulations, and
to streamline the abandonment and discontinuance processes consistent
with the new law. While making a number of changes, both substantive
and conforming, the Board has not undertaken a comprehensive revision
or rewrite of all of the existing regulations at part 1152 in this
proceeding. The Board also is making conforming changes to the
environmental rules at part 1105.
EFFECTIVE DATE: The rules are effective January 23, 1997.
FOR FURTHER INFORMATION CONTACT: Joseph H. Dettmar, (202) 927-5660.
[TDD for the hearing impaired: (202) 927-5721.]
SUPPLEMENTARY INFORMATION: The ICC Termination Act of 1995, Public Law
104-88, 109 Stat. 803 (1995) (ICCTA), abolished the Interstate Commerce
Commission (ICC) and transferred the responsibility for regulating rail
transportation, including the proposed abandonment and discontinuance
of rail lines, to the Surface Transportation Board (Board). Section
204(b)(1) of the ICCTA provides that proceedings and applications
pending before the ICC on January 1, 1996, insofar as they involve
functions retained by the ICCTA, including abandonment proceedings and
applications, shall be decided under the law in effect prior to January
1, 1996. Abandonment applications and proceedings filed on or after
January 1, 1996, shall be decided under the law as revised in the
ICCTA. Under section 204(a), regulations, including those at 49 CFR
part 1152, issued by the ICC and effective as of January 1, 1996, shall
remain in effect ``until modified, terminated, superseded, set aside,
or revoked in accordance with law by the Board * * *.''
On March 15, 1996, we served a Notice of Proposed Rulemaking (NPR)
in this proceeding, published at 61 FR 11174 (March 19, 1996). In that
notice, we proposed to revise part 1152 to implement the changes
brought about by the ICCTA and to streamline and update the
regulations. Included in the proposed revisions were deletions of
obsolete references. We stated that, while we were not proposing major
revisions at this time to our environmental rules at 49 CFR part 1105,
or our National Trails System Act (Trails Act) rules at 49 CFR 1152.29,
we were proposing some notice and timing changes to those regulations
in this proceeding, because the changes were directly related to our
efforts to streamline and improve the abandonment process. For the same
reason, we proposed some conforming changes to our procedures for
handling abandonments exempted as a class, and petitions for individual
abandonment exemptions, to reflect statutory changes resulting from the
ICCTA.
Comments in response to the NPR were received from various
categories of entities. The Association of American Railroads (AAR)
filed on behalf of its member railroads. The Rails to Trails
Conservancy (RTC) filed as an advocate of trail use/rail banking.
Comments were filed by the National Association of Reversionary
Property Owners (NARPO), which is a nationwide organization with
members interested in reversionary and other property rights. In
addition, comments were filed by: (1) Numerous Federal, state, and
local government agencies and entities; (2) labor unions; (3) trade
associations; and (4) a large number of individual landowners and
institutions representing landowners. Basically, the commenters, while
expressing certain reservations and having questions concerning certain
sections, embrace the changes and revisions to the abandonment
regulations that we have proposed.
Before addressing the specific comments, some matters bear
repeating from the NPR. We continue to view the ICCTA as reform
legislation and thus our effort has been to reform and streamline the
existing rules and process. As we stated in the NPR, our goal has been
to revise part 1152 to meet the letter and spirit of the ICCTA and to
update the regulations to improve notice to the public and ensure ample
opportunity for full public participation early in our proceedings. We
continue to believe that this will result in a timely, expeditious
resolution of abandonment cases and allow all interested parties to
participate fully. We emphasize, however, that the purpose of this
rulemaking proceeding is to implement the changes mandated by the ICCTA
along with conforming amendments; we have not attempted to conduct a
comprehensive revision or rewrite of all of the existing regulations at
part 1152. Also, we note that the parties themselves in their comments
have not suggested a wholesale ``cleanup'' of these regulations.
We now turn to the major issues raised by the commenting
parties.1
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\1\ All comments have been carefully considered. Due to the
large number of filings, however, not every specific issue raised by
the commenters will be discussed here.
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1. Uniform schedule. In the NPR, we proposed a new time schedule
for processing abandonment applications:
Day 0--Application filed, including applicant's case in chief.
Day 10--Due date for oral hearing requests.
Day 15--Due date for Board decision on oral hearing requests.
Day 20--Due date for Notice of Application to be published in the
Federal Register.
Day 45--Due date for protests and comments, including opposition case
in chief, and for public use and trail use requests.
Day 60--Due date for applicant's reply to opposition case and for
applicant's response to trail use requests.
Day 110--Due date for service of decision on the merits.
Day 120--Due date for offers of financial assistance, except that if an
application has been granted by decision issued sooner than Day 110,
the offer of financial assistance shall be due 10 days after service of
the decision granting the application.
We also stated that we viewed the notice of intent requirement as
an important early warning of proposed abandonments and intended to
retain its use. Accordingly, an applicant would be required to file
with the Board a notice of intent to abandon a line no more than 30
days and no less than 15 days before the application is filed. In
addition, we proposed to update the list of entities due to receive the
notice, including the addition of RTC and NARPO, to provide the
earliest possible notice that a particular right-of-way might be used
as a trail.
Although several parties raised concerns about the time frames in
their comments, we find no reason to alter the proposed time frames. We
continue to believe that the schedule we had
[[Page 67877]]
proposed will allow for full public participation and timely
resolution, thus benefiting all interested parties. For instance, some
commenters urged that the notice of intent be submitted up to 120 days
before the filing of the application. While that would obviously allow
additional time for parties to gather information and formulate
strategy for offers of financial assistance (OFAs), trail use, etc., it
would also unnecessarily delay many proceedings and has no statutory
basis.\2\ Moreover, the shorter time frame we proposed is in keeping
with the spirit of the ICCTA, which (in section 10904) establishes a 4-
month deadline after an application is filed for the submission of
OFAs. Also, as stated in the NPR, the 110-day outer limit for the Board
to issue a final decision is just that--a maximum time frame. In some
instances, the Board will be able to render a final decision well
before the 110th day.
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\2\ Rather, section 10903(a)(3)(E) requires merely that a rail
carrier certify to the Board with its application that the carrier
has satisfied the notice requirements of section 10903(a)(3) (A)--
(D) within the most recent 30-day period prior to the filing date of
the application.
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NARPO and RTC both oppose our proposal to include them in the list
of entities due to receive the notice of intent. Since notice to these
organizations apparently would not further our goal of achieving the
earliest possible notice that a particular right-of-way might be used
as a trail (and neither expresses willingness or ability to take on
notification responsibilities to persons interested in, or potentially
interested in, trails), we will not include this requirement in our
final rules.
Contrary to the position of RTC and NARPO, the Transportation
Trades Department of the AFL-CIO requests that carriers provide this
advance notice to the duly certified labor organizations that represent
employees on the affected rail line. The request is reasonable and we
will include these organizations on the list of entities to receive the
notice of intent.
A number of individuals, presumably adjoining property owners or
their supporters, argue that applicants should be required to provide
actual notice to each adjoining landowner when filing for abandonment
or when a trail condition is requested. However, actual notice has not
been shown to be feasible or necessary to ensure that affected
landowners and other interested parties receive adequate notice. Our
current procedures ensure extensive notice to the public of proposed
abandonments and the possibility that the right-of-way may be used as a
trail. A notice of every abandonment proposal is published in the
Federal Register. A local newspaper notice also must be published in
every abandonment case in each county affected. Furthermore, local
public hearings on trail use proposals typically are held and there is
usually widespread local publicity. Also, landowners can contact the
Board, the railroad, or the trail group for information on particular
abandonment or trail use plans.
Moreover, it would be difficult to identify, locate and
individually identify each landowner along a line proposed for
abandonment and/or trail use. Hundreds if not thousands of landowners
could potentially be interested in a single line. More importantly, no
available source provides readily ascertainable information on the
chain of title, the names and addresses of current landowners, the
nature of their property interests, and the circumstances, if any, that
might trigger a reversion in a particular state. Thus, there simply is
no practical way to name and locate all of the landowners that might
have a reversionary interest in a railroad right-of-way, as the ICC
concluded in Rail Abandonments--Use of Rights-of-Way as Trails--
Supplemental Trails Act Procedures, Ex Parte No. 274 (Sub-No. 13) (ICC
served May 26, 1989, Feb. 21, 1990, and July 28, 1994), 1994 decision
aff'd mem. 70 F.3d 638 (D.C. Cir. 1995), cert. denied, 116 U.S. 1323
(1996).
While we will not require actual notice to landowners, we will make
other changes to facilitate and improve notice to the public. For
example, RTC recommends that the newspaper and Federal Register notices
we require should specifically alert the public of the possibility
that, following the abandonment of rail service and salvage of the
line, the line may be suitable for other public use, including interim
trail use, and advise how the public may participate in the Board
proceeding (pro or con). We agree with RTC. As RTC states, newspaper
notice and Federal Register notice containing this information will
give adequate notice to the public of the Board's abandonment
proceedings and ensure that interested parties can take such action as
they deem appropriate, if they wish to participate.
In the NPR, we also proposed to change the environmental rules by
amending 49 CFR 1105.7 and 1105.8 to require railroads to serve their
environmental and/or historic reports on the required agencies at least
20 days prior to filing their case in chief with the Board. Also, we
proposed that railroads, in order to facilitate identification of lines
proposed for abandonment, be required to identify those lines by United
States Postal Service Zip Codes. We will adopt both changes. The
earlier distribution of environmental and historic reports will
expedite the environmental review process (by giving participating
agencies additional lead time to conduct their analysis) without being
unduly burdensome on the railroads. While comments on the use of Zip
Codes were mixed, the use of Zip Codes is a means to provide notice to
the public that a line near them has been proposed to be abandoned.
Therefore, we will require use of Zip Codes in the final rules.
Finally, the Department of the Army has requested that the Military
Traffic Management Command Transportation Engineering Agency (MTMCTEA)
continue to receive a copy of abandonment notices. It states that
MTMCTEA is responsible for maintaining a rail network for national
defense purposes and that MTMCTEA must receive notice to determine if
the line designated for abandonment is an essential element in the rail
network.
We have retained MTMCTEA on the list of agencies on which notices
must be served. See Secs. 1152.20(a)(2) (requiring service of notice of
intent on MTMCTEA) and 1152.50(d)(1). We have also assured that MTMCTEA
will receive copies of petitions for exemption in new Sec. 1152.60(d).
2. Federal Register Publication. Commenters overwhelmingly
supported our proposal to publish a notice of an abandonment
application or a petition for an individual exemption in the Federal
Register 20 days after the application or petition is filed.3
Accordingly, we will adopt that proposal in our final rules. The
Federal Register notice will describe the proposal, advise the public
about the due dates for offers of financial assistance and requests for
public use and trail use conditions, and explain how to participate
(pro or con) in the Board's proceeding. Abandonment applicants and
petitioners will be required to file draft Federal Register notices
that can be used to announce the filing.
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\3\ We proposed no changes for the publication of Federal
Register notices for the procedural timing of abandonments covered
by the class exemption embraced in subpart F.
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RTC argues that, in addition, we should continue our current
practice of publishing another Federal Register notice when, and if,
the abandonment authority is granted. We disagree. Because there will
be Federal Register notice and newspaper notice at the beginning of the
process specifically advising the public as to how to
[[Page 67878]]
participate (pro or con), any interested person can become a party or
can ask to be put on the service list of a proceeding and thus receive
copies of all subsequent decisions in the case.4 Moreover, Federal
Register notice is extremely costly; we lack the financial and staff
resources to publish multiple Federal Register notices in abandonment
cases.
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\4\ We note that the timing for Federal Register notices we are
adopting for applications and petitions for exemption is similar to
what has been done under the class exemption at subpart F for many
years. Under the class exemption, as here, the only Federal Register
notice is at the beginning of the process.
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Also RTC suggests that we not use the term ``must'' in the portion
of the draft Federal Register notice informing requesters of a public
use condition or trail use condition that such requests are due within
45 days of the filing of the application, 40 days of the filing of a
petition, or 10 days after the publication of a notice of exemption.
RTC argues that the use of ``must'' will lead to claims by anti-trail
groups that no late-filed requests should ever be granted. We have not
made the suggested change. Trail use requests, like all other requests,
need to be timely filed if at all possible so our uniform schedule can
be met.5 Moreover, we will specifically retain our current policy
of accepting filings after the due date when good cause is shown.
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\5\ We see no reason why trail use requests cannot typically be
filed on time. Filing a trail use request is not onerous. Moreover,
a party can request a trail condition before there is an arrangement
for interim trail use; the condition simply provides time to
negotiate.
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Finally, the comments received regarding changes to our rules for
abandonments covered by the class exemption embraced in subpart F raise
issues that are inappropriate for resolution on the current record.
Accordingly, we will not attempt to change or modify our regulations
concerning the class exemption at this time but reserve the right to
address these issues further in a separate proceeding at a later date.
3. System Diagram Maps. The ICCTA retains the requirement that rail
carriers prepare, file, and amend, as appropriate, system diagram maps
(SDMs) that identify lines that are, or soon will be, the subject of an
abandonment application. In the NPR we proposed several changes to part
1152 regarding SDMs to eliminate unnecessary regulatory and paperwork
burdens. These changes include the following:
(1) Because of the potential burden on small carriers, we proposed
to require only Class I and Class II railroads to prepare and file
SDMs.
(2) In lieu of an annual filing of these maps, we proposed a one-
time filing of a complete and current set of maps within 60 days of the
effective date of these regulations. The carrier would decide when
changes have been extensive enough to warrant the filing of a new,
updated SDM, but the Board would retain the discretion to require an
updated SDM if that became necessary.
(3) We proposed to require only 3 (instead of 6) copies whenever an
SDM or an update is filed.
(4) We proposed to reject an abandonment application of a Class I
or Class II railroad for a line that has not been identified on a SDM
in category 1 for at least 30 days.
Many commenters expressed views on this subject. First, there was
strong opposition to our excusing Class III carriers from filing SDMs.
Commenters pointed out that Class III carriers now comprise a
substantial portion of the rail network, both in numbers of carriers
and length of track operated.6 Commenters (including several state
agencies) argued that to excuse such a large portion of the rail
network from these filing requirements would work a severe hardship
upon parties opposing abandonments. Moreover, commenters argued that,
because rail lines by statute may qualify for feeder line applications
under 49 U.S.C. 10907 if they have been identified on an SDM, our
proposal would in effect limit the use of the feeder line provisions
for lines owned by Class III carriers.
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\6\ According to the National Grain and Feed Association, as of
1994, there were 487 Class III carriers operating 25,999 miles of
track. This was approximately 21 percent of the total track operated
by Class I railroads (123,355 miles in 1994).
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Based on the comments, we have decided to continue to require Class
III carriers to file the information normally found in an SDM. Because
we recognize, however, that the extensive SDM filing requirements under
our current rules could be unnecessarily burdensome on smaller
entities, we will give Class III carriers the option of filing a map or
filing only a narrative description of its lines as provided under
Sec. 1152.11.
A number of commenters also opposed our proposal to shorten the
period of time that a carrier must identify a line in category 1 of its
SDM before filing an application to abandon the line. Because the ICCTA
deleted the 4-month requirement under the prior law, we proposed
requiring that a carrier identify a line in category 1 at least 30 days
prior to filing an abandonment application, believing that period to be
adequate to meet the various parties' planning needs. A significant
number of parties maintained that 30 days was too short a period of
time to properly notify persons who might wish to file statements in
opposition to an abandonment or for public agencies and shippers to
prepare an OFA for the line or otherwise plan for alternative
transportation. Many commenters supported retention of the 4-month
period provided under prior law and implementing regulations.
We are persuaded by the comments that 30 days may be insufficient
time for parties to properly oppose an abandonment or to make
alternative service plans. At the same time, we continue to believe
that 4 months is too long and unduly delays the overall process.
Therefore, our final rules provide for rejection of any abandonment
application for a line that has not been identified on an SDM 7 in
category 1 for at least 60 days. The additional time should be adequate
to meet the planning needs of shippers and state and local governments
while avoiding unnecessary delay.
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\7\ For Class III carriers, the term SDM shall include the
filing of a narrative description without an actual map.
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Some commenters, including AAR, recommend that we eliminate
categories (2), (3), and (4) from the SDM. We see no need to do so. By
adopting a one-time filing requirement (unless extensive changes
occur), we have already eliminated much of the extensive work and
burdensome procedures required under our prior rules.
A number of parties have also argued that we should retain the
prior requirement concerning the annual filing of updated maps or at
least require updates on a specific, periodic basis. We believe these
requirements would result in more burdens on the carriers than benefits
to the shipping public. We emphasize that carriers must continue to
file revisions when changing the category of a line, and must file
updated SDMs as appropriate or when ordered by us.
MTMCTEA asks that it continue to receive updated copies of SDMs. We
have provided copies of SDMs and updates to MTMCTEA in the past on an
informal basis. As this procedure apparently has worked well, we will
continue to provide the information to MTMCTEA as before.
4. Summary application. Absent meaningful opposition, we will
finalize our intention to delete the ``Summary Application''
provisions. By doing so, we will have a uniform, streamlined process
for all applications.
[[Page 67879]]
5. Abandonment procedures for bankrupt railroads. As part of our
proposal to adopt a streamlined process appropriate for all
applications, we preliminarily indicated in the NPR that no need
existed to continue to have separate procedures in subpart E for
bankrupt railroads. However, we did propose to include as special
provisions for bankrupt railroads in the general abandonment procedures
the requirements that abandonment applications filed by bankrupt
railroads, and protests or other public responses to the applications,
be filed with the bankruptcy court; that Board decisions or reports on
abandonment applications by bankrupt railroads be filed with the
bankruptcy court; and that special processing schedules would be
established to meet court deadlines, so long as a reasonable period of
time is allowed to obtain public responses and build a record in an
abandonment application by a bankrupt railroad. The commenters either
support, or fail to show harm from, these proposals, and we will adopt
them as part of our final regulations.
6. Due date for filing public use requests and trail use requests.
In the NPR, we proposed changes in due dates for these filings to
further our goal of compiling a full record for disposition as early as
possible. In abandonment applications, we proposed that trail use
requests and public use requests be filed at the same time as protests
and other written comments (within 45 days after the application is
filed). An applicant would then be required to respond regarding
willingness to negotiate for trail use within 15 days (or within 60
days after the application is filed). For abandonments covered by the
class exemption at subpart F, we proposed to continue to require trail
use/rail banking requests to be filed within 10 days after Federal
Register publication of the exemption and public use requests to be
filed within 20 days after Federal Register publication. For petitions
for individual exemption, we proposed to require that trail use/rail
banking requests and public use requests be filed within 20 days after
Federal Register publication of the notice of the filing of the
petition (40 days from the filing of the petition). For both class
exemptions and petitions for exemption, we proposed to require the rail
carrier to respond to trail use/rail banking requests within 10 days
after the request is filed.
Commenters have for the most part agreed with our proposed rules,
which we will adopt. Some have sought additional or more comprehensive
changes to the regulations governing public use and trail use
conditions. We will not, however, address those requests here, because
we did not set out in this proceeding to undertake a detailed re-
examination of all aspects of our handling of public use and trail use
requests. In short, our purpose in proposing to modify these due dates
was to find a way to complete a full record as early as practicable to
expedite and streamline the abandonment process.
Finally, several commenters suggest that we should undertake a
``takings implication assessment'' whenever we issue a trail condition,
pursuant to Executive Order 12630, Governmental Actions And
Interference With Constitutionally Protected Property Rights. See 53 FR
8859 (March 18, 1988). But, as the ICC had explained, the Executive
Order applies only to executive agencies, and not to independent
agencies like the ICC.8 The Executive Order does not apply to the
Board, which was created as the successor agency to the ICC.9
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\8\ Burlington Northern Railroad Company--Aband. Exemption--In
Skagit County, WA, Docket No. AB-6 (Sub. No. 299X) (ICC served June
23, 1989).
\9\ While the Board is lodged within the Department of
Transportation, just as the Federal Energy Regulatory Commission is
lodged within the Department of Energy, the Board was created as an
independent establishment of the United States Government. See 49
U.S.C. 703(a).
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7. Notice of consummation. To arrive at more definitive standards
to be used in resolving the issue of when an abandonment has been
consummated, or fully exercised, we proposed in the NPR to require that
carriers file with the Board a notice of consummation, and to give
conclusive effect to the filing of such notice.10 We did not
propose a deadline for filing, or a penalty for failure to file. We
indicated that, if no notice of consummation of abandonment had been
filed, we would continue to look at the other facts and circumstances
to determine if consummation of the abandonment had occurred.
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\10\ Until 1984, the ICC required a railroad to send the agency
a letter confirming that it had consummated an abandonment within 1
year after the abandonment was authorized. Since then, some carriers
have continued to send in these letters. Moreover, the courts have
considered these letters in determining whether the line is still
part of the interstate rail network, and thus available for interim
trail use under 16 U.S.C. 1247(d), or public use under 49 U.S.C.
10905.
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After considering the comments, we continue to believe that a
notice of consummation requirement would help clarify the consummation
issue and prevent consummation disputes from arising in the future.
Several commenters, however, criticize our failure to include a filing
deadline in our proposal, on grounds that it would leave the railroad
free never to consummate an abandonment and thus would be unfair to
adjoining landowners with a reversionary interest in the right-of-way.
Based on the comments, we have decided to set a 1-year time limit by
which time a railroad must exercise the authority to abandon and inform
us that it has done so by sending us a consummation notice.11
Accordingly, our final rules provide that, if after 1 year from the
date of service of a decision permitting abandonment, consummation has
not been effected by the railroad's filing of a notice of
consummation--and there are no legal or regulatory barriers to
consummation (i.e., outstanding conditions, including Trails Act
conditions)--the authority to abandon will automatically expire. That
means that a new proceeding would have to be instituted if the railroad
wanted to abandon the line.12
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\11\ Several parties suggest shorter time periods ranging from
30 to 180 days. AAR supports our initial decision to have no time
period at all, noting that a railroad may have reason to delay
consummation of an abandonment for a substantial period of time. We
believe that a 1-year time period is appropriate. That time period
ensures that the consummation issue will not be left open
indefinitely. At the same time, it is long enough to give carriers
that do not want to exercise their abandonment authority immediately
time to hold open the possibility that new shippers will seek rail
service or that the right-of-way could be used for interim
recreational or conservation purposes under 16 U.S.C. 1247(d), or
public use under 49 U.S.C. 10905.
\12\ There is nothing inconsistent about this approach and our
rules that permit states to acquire lines that have not been fully
abandoned upon the mere filing of a notice. See 49 CFR 1150.22. If
the line is acquired during the first year after we authorize
abandonment, and before a notice of consummation is filed, the line
has not been fully abandoned and can be acquired under our rules.
After a year has passed, if there is no notice of consummation, the
railroad's abandonment authority lapses, and the line cannot be
abandoned (or acquired by a state or any one else) without further
authority from us.
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We reject the suggestion of some commenters that we should not
adopt a notice of consummation requirement because the issue of when
abandonment has been consummated has been settled by Fritsch v. ICC, 59
F.3d 248 (D.C. Cir. 1995), cert. denied, 116 S. Ct. 1262 (1996). In
Fritsch, the court held that a public use condition imposed under
former section 10906 (now 49 U.S.C. 10905) did not prevent consummation
of the abandonment and the vesting of reversionary interests in the
right-of-way in the circumstances of that case. The courts, however,
have expressly declined to read Fritsch as holding that abandonment is
necessarily triggered upon a showing of any single piece of
[[Page 67880]]
evidence indicative of an intent to abandon. See Conrail v. STB, 93
F.3d 793, 799 (D.C. Cir. 1996); Birt v. STB, 90 F.3d 580, 588 n.15
(D.C. Cir. 1996); Grantwood Village v. Missouri Pacific RR, 95 F.3d
654, 659 n.6 (8th Cir. 1996). Moreover, the court in Fritsch
essentially viewed the railroad's letters to the ICC declaring that it
had abandoned the line as conclusive evidence that abandonment had been
consummated, therefore depriving the ICC of jurisdiction to impose a
trail condition. See 59 F.3d at 253. Thus, our adoption of a notice of
consummation requirement here will codify that portion of the court's
ruling in Fritsch and prevent similar disputes from arising in the
future.
Finally, the Oregon and Montana Departments of Transportation
suggest that we require notices of consummation to be filed with the
appropriate state agencies (DOT, Public Service Commission) as well as
with us. We will grant that request, and require that the railroads
file notices of consummation with the State Public Service Commission
(or equivalent agency) in each state through which the line passes,
because it will help keep the states apprised of the status of lines
authorized to be abandoned and is not unduly burdensome.
8. Certificate of abandonment. Since the ICCTA does not
specifically require that ``certificates'' be issued when abandonment
applications are granted, in the NPR we proposed to dispense with the
issuance of certificates and instead simply issue ``decisions
granting'' an application. However, we proposed to continue to refer to
``Certificates of Interim Trail Use or Abandonment'' in the trail use
context in part to distinguish an application proceeding from an
exemption proceeding. We received a few comments regarding this issue
but no commenter presents strong objections to our proposal. Because
the term ``certificate'' is widely known in the trail use context, we
will continue to use it for trail use purposes alone.
9. Contents of the application. In the NPR, we initially determined
that applicants should be required to submit their entire case as part
of the application. We then indicated that applicants must include all
relevant workpapers and supporting documents with each application.
AAR, in its comments, objects to the necessity of supplying all
workpapers and supporting documents. It argues that this would be a
step backward in our effort to streamline the application process. AAR
explains that differences of opinion would arise concerning what
constitutes ``workpapers'' and that the gathering of all materials
would be an unnecessary burden on applicants and produce copious
documents with little practical use. We agree with the comments and
emphasize that we did not intend to create a more burdensome process
than exists today. We clarify that what we meant by the use of the word
``all'' was that we expect each applicant to submit sufficient (or all
that the applicant believes is necessary) workpapers and supporting
documents to present a complete or prima facie case. We will modify the
regulations accordingly, but we emphasize that the burden is on the
applicant to show that the proposed abandonment or discontinuance is in
the public interest.
a. Service data. In the NPR we proposed to streamline the
requirements for abandonment applications by excluding all branch line
(line proposed for abandonment) service data for time periods prior to
the Base Year period, with the exception of data on changes in train
service. The current regulations require data for the 2 preceding
calendar years and that portion of the current calendar year for which
data are available.13
---------------------------------------------------------------------------
\13\ As we stated in the NPR, this change had been proposed by
the ICC in a notice of proposed rulemaking in Abandonment
Proceedings: Elimination of the Revenue and Cost Data for All Years
Prior to the Base Year Period, Ex Parte No. 274 (Sub-No. 26) (ICC
served Nov. 9, 1992), to reduce the reporting burden on the
carriers. Comments were received but a final rule was never issued.
---------------------------------------------------------------------------
We also proposed changes to the service and traffic data required
to be provided in three specific areas. First, we proposed that the
carload data on the line would have to show only the total carloads for
each commodity group. Second, we proposed that data pertaining to
overhead or bridge traffic would have to be included only if the
serving carrier would not retain this traffic after approval of the
abandonment. Finally, we proposed that only changes in train service in
the last 2 years (instead of the last 5 years) would need to be
discussed.
A number of commenters raised concerns about the proposed exclusion
of historic operational data in the application. Reasons for their
concern vary but include: (1) Base Year data could be intentionally
distorted; (2) historical calendar year evidence reflects trends in
rail line profitability; (3) 1 or 2 years of data are inadequate to
make a determination on the viability of a rail line; and (4) without
the data from past periods, it will be difficult to determine if
intentional downgrading has occurred.
We do not entirely agree with the commenters that urge that there
is a need for more historical data. Under our proposed rules,
applicants would have to include and discuss changes in train service
for the last 2 years. In addition, applicants would also be required to
supply, under proposed Sec. 1152.22(e)(2), a list of significant
shippers and their tonnage and/or carload data for the last 2 calendar
years and, under proposed Sec. 1152.22(c)(4), total carloads by each
commodity group on the line during the Base Year. This information
should give protestants sufficient data to address alleged downgrading
and the other concerns outlined above.
Nevertheless, in response to commenters and their concerns, we have
decided to expand our traffic data requirements somewhat. Specifically,
the data required for significant users under Sec. 1152.22(e)(2) of our
final rules will include the tonnage and carloads for each commodity
group for the last 2 calendar years, any part of the current calendar
year for which data are available, and the Base Year. In addition, we
will require that the total tonnages and carloads for each commodity
group originating and/or terminating on the line segment (not limited
to significant users) be shown for the same time periods as those for
the significant users. Consistent with these changes, we also will
expand proposed Sec. 1152.22(c)(4) to require inclusion of total tons
and carloads by each commodity group on the line. With these changes,
we believe that an application will contain sufficient service and
traffic data to allow appropriate analysis of all issues relevant to
service on the subject line.
b. Financial data. In the NPR, we proposed to exclude computations
for the revenue and cost data developed for the branch line for the
prior 2 calendar years and any portion of the current year. Revenue and
cost data would be computed only for the Base Year, Forecast Year, and
Subsidy Year.14
---------------------------------------------------------------------------
\14\ These changes also had been proposed in the ICC's
rulemaking in Ex Parte No. 274 (Sub-No. 26).
---------------------------------------------------------------------------
We also proposed to delete the requirements that the impact of the
abandonment on the carrier's net railway operating income (NROI) for
the past 2 calendar years be developed and that the impact on the NROI
of other carriers operated under common control of the abandoning
railroad be submitted. In addition, we proposed to delete the
requirement that the railroad's balance sheet and income statements be
filed.
Commenters voice concern regarding the absence of financial
operating results in prior years and object to the
[[Page 67881]]
proposal to delete the requirements concerning NROI and the filing of
balance sheets and income statements. They make the same arguments
against the elimination of these data as they make regarding the
elimination of historic service data. Regarding common control, some
commenters argue that the financial effect of abandonment by one
``family'' member affects another. Also, they argue that financial
statements are needed because they show the overall financial condition
of the applicant, which can be important in the Board's weighing of the
evidence under its public convenience and necessity standard.
We do not believe that the benefits of requiring a carrier to
submit all of these data justify the very real burden on the applicant
of preparing the data. Profits or losses on a line segment in prior
years typically do not provide a proper basis on which to judge the
line's current and future financial viability. The Board's primary
measures of financial condition are the operations in the Base Year and
Forecast Year, which recognize the current and future financial
viability of the line segment. Moreover, changes in traffic are in most
instances the main cause of changes in operating results from a profit
to a loss, and necessary traffic information is included in the data
applicant is required to file. For these reasons, we will not make the
requested changes to our proposal.
c. Other application changes. In the NPR, we proposed to delete the
requirements that the carrier identify in detail the sources of
alternate transportation available and describe its efforts to solicit
traffic on the line. Instead, we proposed to require only a general
description of alternative transportation sources. We also proposed
that the carrier no longer be required to describe its efforts to
solicit traffic on the branch line in every case, but that we would
permit the carrier instead to provide a description of its efforts if
it believes that the information would aid its case regarding
protestants' claims of either potential increases in traffic or
deliberate downgrading. Comments specifically addressing these points
were unpersuasive. Accordingly, we will incorporate these changes in
our final rules.
d. Summary. We will adopt in our final rules the modifications
discussed in subparts a-c above. We believe that the information
required to be provided in the application, along with information that
the parties already have, or may readily obtain, will afford all
interested parties a fair opportunity to analyze and present argument
on every issue relevant to the abandonment process that is related to
the above data. Moreover, we remind applicants that the burden of proof
in these proceedings remains on them, and that they may wish to provide
additional data with their applications where doing so would help
assure that they have met their burden regarding anticipated challenges
such as, for example, challenges claiming deliberate downgrading of the
line.
10. Offers of financial assistance. As discussed in the NPR, in
addition to the time limits explained above, new 49 U.S.C. 10904
contains other changes in the way OFAs are handled. Initially, the
Board need only find that the offeror is a financially responsible
person before the negotiating process can begin. We proposed to revise
the rules accordingly. Under new section 10904, the Board has 30 days,
rather than 60 as before, from the date requested to issue a decision
establishing the conditions and amount of compensation for the purchase
or subsidy of the line. To meet the new deadline, we proposed to
require the requesting party to submit its case in chief at the time it
makes its request and to serve the other party(ies) with a copy by
overnight mail. The other party(ies) would have 5 days from the date of
filing to file a reply. As before, we proposed that our new rules would
automatically stay the effective date of (or revoke as necessary for a
class exemption) the underlying abandonment decision. We will adopt
these changes in our final rules. The final rules also continue to
provide that, if a request to set terms and conditions is not made to
the Board, a decision making the underlying abandonment approval (or
exemption) effective would be served within 10 days of the due date for
making the request.
The statute now places a 1-year limit on operating subsidies
imposed by the Board, unless otherwise mutually agreed by the parties.
As a result, we proposed in the NPR that: (1) Subsidy agreements
imposed by the Board would end after 1 year, and (2) beyond this period
any subsidy would be strictly a contractual agreement between the
carrier and the subsidizer without the involvement of the Board.
Also regarding subsidies, we proposed that the new rules continue
to provide for interim financial status reports, as presently included
in the abandonment regulations. However, with certain exceptions, the
subsidizer's final responsibility would be limited to a maximum of 15%
over the agreed-to amount of the operating subsidy. The exceptions
would be: (1) If the subsidizer is notified of a higher amount within
the first 10 months of the agreement; and (2) the increase results from
an expense that has been preapproved by the subsidizer. We explained in
the NPR that we believed that the limitation is needed to provide a
degree of certainty to a party that seeks to subsidize operation of a
line approved for abandonment. Our final rules include all of these
provisions.
We have considered the concern of some commenters regarding the
shortening of the 120-day statutory period for submission of OFAs when
an abandonment is granted by decision issued sooner than 110 days after
the application is filed. (Our uniform schedule provides that in such
cases the OFA will be due 10 days after service of the decision
granting the application, which could be sooner than 4 months after the
application is filed.) However, given our goal of expediting the
process where possible, we have decided not to change our proposed
Uniform Schedule. We recognize that 49 U.S.C. 10904(c) sets 4 months as
the outer limit for the filing of OFAs. At the same time, we believe
that the expanded notice that will be provided at the outset of
abandonment proceedings under our new rules typically will allow
adequate time for parties to consider filing an OFA, and marshal the
funds necessary to do so, within the Uniform Time Frames, even if in
some cases this results in something less than the full 120 day period
to file an OFA. Accordingly, we do not read the statute to require that
we delay in all cases abandonment proceedings that can be decided in
less time than the full 110 days. However, in light of the time frames
in 49 U.S.C. 10904(c), parties that can show that they would be
materially prejudiced by having less than the full 4 months may
petition the Board for the full time provided by the statute for
application proceedings.15
---------------------------------------------------------------------------
\15\ Parties may seek relief under 49 CFR part 1117.
---------------------------------------------------------------------------
In addition, RTC contends that we should retain the requirement
that, in addition to being made by a financially responsible person,
the offer must be ``bona fide.'' RTC requests that we include such
language in the regulations. We find no merit in RTC's request. New 49
U.S.C. 10904 clearly does not retain that aspect of the prior statute.
Accordingly, we will not add such a requirement in our regulations. Our
final rules adopt the changes proposed in the NPR.
11. Return on investment. In the NPR, we stated that we believed
several problem areas existed with the rules for establishing return on
investment. To address these issues, we proposed
[[Page 67882]]
various changes regarding the determination of the net liquidation
value (NLV) of road properties on the branch line, a component used in
calculating return on investment. These proposed changes involved the
inclusion of assets with negative net salvage values, adjustments to
right-of-way land values, and the bases used to value right-of-way
land.
Very few comments were received regarding these proposed changes.
However, AAR has raised concerns about the proposed inclusion of
negative salvage values for those assets where the cost of dismantling
exceeds the value of the materials salvaged. There are three situations
where this value has implications. These situations are: (1)
Calculation of the operating and economic loss on the line, i.e., the
merits of the application; (2) the continuation subsidy payment
calculation; and (3) selling price in OFA purchase determinations.
Regarding the merits of the application, a negative return on value
would distort the loss from operations being borne by the serving
railroad. This could, according to AAR, result in the application being
denied.
AAR also is concerned that inclusion of a negative NLV and a
negative return on properties would reduce the subsidy amount below the
operating loss being incurred by the serving carrier. Additionally, AAR
states that in OFA proceedings a negative value for the properties
could result in an artificially low value being placed on the assets
that are to be purchased. This situation, it claims, would also reverse
the burden of proof from the offeror to the railroad in proving the
value of the line's assets.
In light of the concerns of AAR as to the potential implications of
including both a negative NLV and calculating a negative return on
value, we have made appropriate changes to our proposed regulations
regarding the calculation of subsidy payments or purchase price in OFA
proceedings.
First, to amplify what we said in the NPR, no asset on the branch
line will have a negative value unless the railroad intends to remove
the structure, or it is proven by protestants, that the structure must
be dismantled to comply with a Federal law, state law, or a local
ordinance.
Moreover, in assessing the merits of the application, if a negative
value results for the composite NLV of all branch line properties, the
negative value will be inserted in the submission of the Forecast Year
revenue and cost data, Exhibit 1 to the application. However, the
return on value will be calculated at zero. This will allow the Board
to compare the loss from operations with the negative opportunity cost
of the railroad. The cost to the railroad for dismantling the
structure(s) is recognized by the Board as a one time expense whereas
the operating loss will reoccur each year, if nothing changes.
We will amend Sec. 1152.34 of the proposed regulations to include
changes in developing the NLV of road property and the return on value
requested by AAR. Under our final rules, in calculating a continuation
subsidy payment, assets with negative value will be handled in the
following manner. Any individual asset with a negative value will be
valued at zero. The balance of the assets will have their NLV
calculated in the normal manner. A continuation subsidy must recognize
the line segment as a going concern and a return should be earned by
the railroad on those assets with value. Under no circumstances will
the subsidy payment be less than the loss from operations incurred by
the railroad from providing service on the line.
With regard to OFAs to purchase a line segment, the NLV of the
line's assets will be determined in the same manner as that used in
calculating continuation subsidy payments.
Finally, AAR favors the use of the comparable sales method for
valuing real estate. We reject that approach, as the ICC did in the
past. Accordingly, the proposed rules will be adopted concerning this
issue.
12. Holding gains and losses. In the NPR, we proposed the use of
the Gross Domestic Product as a replacement for the Gross National
Product used in estimating holding gains and losses (computed for
freight cars, locomotives, and road property accounts). We suggested
this change to bring our rules in line with the current measures used
at the U.S. Department of Commerce, Bureau of Economic Analysis.
Commenters generally approve of this modification, and we will include
it in our final regulations.
13. Appendix listing of carriers and AB numbers. In the NPR, we
proposed to delete the Appendix to part 1152 that lists carriers and
their assigned AB numbers. We preliminarily concluded that the list
serves no useful purpose, noting that interested persons could instead
contact the Board's Office of the Secretary if they have a need to
ascertain a particular carrier's assigned AB number.
The lack of comments regarding this change confirms our preliminary
conclusion that the listing does not continue to serve a useful
purpose. Accordingly, it will be deleted from part 1152 as proposed.
14. Filing fees. Several commenters address the issue of filing
fees. However, we will not address those comments here as fees issues
were considered and resolved by the Board in Regulations Governing Fees
for Service, 1 S.T.B. 179 (1996).
Small Entities
In the NPR, we sought comments on our preliminary conclusion that
these regulations, if adopted, would not have effects on small entities
that should be considered in a regulatory flexibility analysis. No
comments provided information showing that there would be significant
effects on small entities. Accordingly, the Board certifies that these
rules will not have a significant economic effect on a substantial
number of small entities. They should result in streamlining,
improving, and updating the abandonment process while ensuring the
opportunity for full public participation in our proceedings.
Environmental Finding
This action will not significantly affect either the quality of the
human environment or the conservation of energy resources.
List of Subjects
49 CFR Part 1105
Environmental impact statements, Reporting and recordkeeping
requirements.
49 CFR Part 1152
Administrative practice and procedure, Conservation, Environmental
protection, National forests, National parks, National trails system,
Public lands-grants, Public lands rights-of-way, Railroads, Recreation
and recreation areas, Reporting and recordkeeping requirements.
Decided: December 9, 1996.
By the Board, Chairman Morgan, Vice Chairman Simmons, and
Commissioner Owen.
Vernon A. Williams,
Secretary.
For the reasons set forth in the preamble, title 49, chapter X,
parts 1105 and 1152 of the Code of Federal Regulations are amended as
follows:
PART 1105--PROCEDURES FOR IMPLEMENTATION OF ENVIRONMENTAL LAWS
1. The authority citation for part 1105 is revised to read as
follows:
Authority: 5 U.S.C. 553 and 559; 16 U.S.C. 470f, 1451, and 1531;
42 U.S.C. 4332 and
[[Page 67883]]
6362(b); and 49 U.S.C. 701 note (1995) (section 204 of the ICC
Termination Act of 1995), 721(a), 10502, and 10903-10905.
2. Section 1105.7 is amended as follows:
a. In paragraph (a), after the words ``must submit'' add the words
``to the Board'';
b. In paragraph (a), after the words ``notice of exemption'' add
the words ``, except as provided in paragraph (b) for abandonments and
discontinuances'';
c. Paragraph (b), introductory text is revised;
d. In paragraph (b)(11) the last sentence is removed;
e. Paragraph (c), first sentence, after the words ``to the agencies
listed'' add the words ``and within the time period specified'';
f. In paragraph (c) the third sentence is removed.
The revision to the introductory text in paragraph (b) reads as
follows:
Sec. 1105.7 Environmental reports.
* * * * *
(b) At least 20 days prior to the filing with the Board of a notice
of exemption, petition for exemption, or an application for abandonment
or discontinuance, the applicant must serve copies of the Environmental
Report on:
* * * * *
3. In Sec. 1105.8, paragraph (c) is revised to read as follows:
Sec. 1105.8 Historic Reports.
* * * * *
(c) Distribution. The applicant must send the Historic Report to
the appropriate State Historic Preservation Officer(s), preferably at
least 60 days in advance of filing the application, petition, or
notice, but not later than 20 days prior to filing with the Board.
* * * * *
Sec. 1105.12 [Amended]
4. Section 1105.12, the appendix, is amended as follows:
a. In the first paragraph of the sample newspaper notice for out-
of-service abandonment exemptions after the words ``(station name),''
add the following words: ``which traverses through United States Postal
Service ZIP Codes (ZIP Codes).''
b. In the first paragraph of the sample newspaper notice for
petitions for abandonment exemptions, after the words ``(station
name),'' add the following words: ``which traverses through United
States Postal Service ZIP Codes (ZIP Codes).''
5. Part 1152 is revised to read as follows:
PART 1152--ABANDONMENT AND DISCONTINUANCE OF RAIL LINES AND RAIL
TRANSPORTATION UNDER 49 U.S.C. 10903
Subpart A--General
Sec.
1152.1 Purpose and scope.
1152.2 Definitions.
Subpart B--System Diagram
1152.10 System diagram map.
1152.11 Description of lines to accompany the system diagram map or
information to be contained in the narrative.
1152.12 Filing and publication.
1152.13 Amendment of the system diagram map or narrative.
1152.14 Availability of data.
1152.15 Reservation of jurisdiction.
Subpart C--Procedures Governing Notice, Applications, Financial
Assistance, Acquisition for Public Use, and Trail Use
1152.20 Notice of intent to abandon or discontinue service.
1152.21 Form of notice.
1152.22 Contents of application.
1152.23 [Reserved]
1152.24 Filing and service of application.
1152.25 Participation in abandonment or discontinuance proceedings.
1152.26 Board determination under 49 U.S.C. 10903.
1152.27 Financial assistance procedures.
1152.28 Public use procedures.
1152.29 Prospective use of rights-of-way for interim trail use and
rail banking.
Subpart D--Standards for Determining Costs, Revenues, and Return on
Value
1152.30 General.
1152.31 Revenue and income attributable to branch lines.
1152.32 Calculation of avoidable costs.
1152.33 Apportionment rules for the assignment of expenses to on-
branch costs.
1152.34 Return on investment.
1152.35 [Reserved]
1152.36 Submission of revenue and cost data.
1152.37 Financial status reports.
Subpart E--[Reserved]
Subpart F--Exempt Abandonments and Discontinuances of Service and
Trackage Rights
1152.50 Exempt abandonments and discontinuances of service and
trackage rights.
Subpart G--Special Rules Applicable to Petitions for Abandonments or
Discontinuances of Service or Trackage Rights Filed Under the 49 U.S.C.
10502 Exemption Procedure
1152.60 Special rules.
Authority: 5 U.S.C. 553, 559, and 704; 11 U.S.C. 1170; 16 U.S.C.
1247(d) and 1248; and 49 U.S.C. 701 note (1995) (section 204 of the
ICC Termination Act of 1995), 721(a), 10502, 10903-10905, and 11161.
Subpart A--General
Sec. 1152.1 Purpose and scope.
(a) 49 U.S.C. 10903 et seq. governs abandonment of rail lines and
discontinuance of rail service by common carriers. Section 10903(d)
provides that no line of railroad may be abandoned and no rail service
discontinued unless the Board finds that the present or future public
convenience and necessity require or permit the abandonment or
discontinuance.
(b) Part 1152 contains regulations governing abandonment of, and
discontinuance of service over, rail lines. This part also sets forth
procedures for providing financial assistance to assure continued rail
freight service under 49 U.S.C. 10904, for acquiring rail lines for
alternate public use under 49 U.S.C. 10905, and for acquiring or using
a rail right-of-way for interim trail use and rail banking.
Sec. 1152.2 Definitions.
Unless otherwise provided in the text of the regulations, the
following definitions apply in this part:
(a) Account means an account in the Board's Uniform System of
Accounts for Railroad Companies (49 CFR part 1201).
(b) Act means the ICC Termination Act of 1995 (Pub. L. 104-88, 109
Stat. 803), as amended.
(c) Base Year means the latest 12-month period, ending no earlier
than 6 months prior to the filing of the abandonment or discontinuance
application, for which data have been collected at the branch level as
prescribed in Sec. 1152.30(b).
(d) Board means the Surface Transportation Board.
(e) Branch means a segment of line for which an application for
abandonment or discontinuance, pursuant to 49 U.S.C. 10903, has been
filed.
(f) Carrier means a railroad company or the trustee or trustees of
a railroad company subject to regulation under 49 U.S.C., Subtitle IV,
chapter 105.
(g) Designated state agency means the instrumentality created by a
state or designated by appropriate authority to administer or
coordinate its state rail plan.
(h) Forecast Year means the 12-month period, beginning with the
first day of the month in which the application is filed with the
Board, for which future revenues and costs are estimated.
(i) Form R-1 means the railroad's annual report filed with the
Board in accordance with the requirements of 49 U.S.C. 11145.
(j) Offeror means a shipper, a state, the United States, a local or
regional transportation authority, or any
[[Page 67884]]
financially responsible person offering rail service continuation
assistance under 49 U.S.C. 10904.
(k) URCS means the Uniform Railroad Costing System.
(l) Significant user means: (1) Each of the 10 rail patrons which
originated and/or received the largest number of carloads (or each
patron if there are less than 10); and
(2) Any other rail patron which originated and/or received 50 or
more carloads, on the line proposed for abandonment or discontinuance,
during the 12-month period preceding the month in which notice is given
of the abandonment or discontinuance application.
(m) Subsidy year means any 12-month period for which a subsidy
agreement has been negotiated and is in operation.
Subpart B--System Diagram
Sec. 1152.10 System diagram map.
(a) Each carrier shall prepare a diagram of its rail system on a
map, designating all lines in its system by the categories established
in paragraph (b) of this section. A Class III carrier shall either
prepare the aforementioned map of its rail system or file only a
narrative description of its lines that provides all of the information
required in this subpart.
(b) All lines in each carrier's rail system shall be separated into
the following categories:
(1) All lines or portions of lines which the carrier anticipates
will be the subject of an abandonment or discontinuance application to
be filed within the 3-year period following the date upon which the
diagram or narrative, or any amended diagram or narrative, is filed
with the Board;
(2) All lines or portions of lines which are potentially subject to
abandonment, defined as those which the carrier has under study and
believes may be the subject of a future abandonment application because
of either anticipated operating losses or excessive rehabilitation
costs, as compared to potential revenues;
(3) All lines or portions of lines for which an abandonment or
discontinuance application is pending before the Board on the date upon
which the diagram or narrative, or any amended diagram or narrative, is
filed with the Board;
(4) All lines or portions of lines which are being operated under
the rail service continuation provisions of 49 U.S.C. 10904 (and former
49 U.S.C. 10905) on the date upon which the diagram or narrative, or
any amended diagram or narrative, is filed with the Board; and
(5) All other lines or portions of lines which the carrier owns and
operates, directly or indirectly.
(c) The system diagram map shall be color-coded to show the 5
categories of lines as follows:
(1) Red shall designate those lines described in
Sec. 1152.10(b)(1);
(2) Green shall designate those lines described in
Sec. 1152.10(b)(2);
(3) Yellow shall designate those lines described in
Sec. 1152.10(b)(3);
(4) Brown shall designate those lines described in
Sec. 1152.10(b)(4); and
(5) Black or dark blue shall designate those lines described in
Sec. 1152.10(b)(5).
(d) The system diagram map shall also identify, and shall be drawn
to a scale sufficient to depict clearly, the location of:
(1) All state boundary lines;
(2) Boundaries of every county in which is situated a rail line
owned or operated by the carrier which is listed in categories 1 thru 4
(Sec. 1152.10(b)(1) thru (4));
(3) Every Standard Metropolitan Statistical Area (SMSA) any portion
of which is located within 5 air miles of a rail line owned or operated
by the carrier; and
(4) Every city outside an SMSA which has a population of 5,000 or
more persons (according to the latest published United States census
reports) and which has any portion located within 5 air miles of a rail
line owned or operated by the carrier. A series of interrelated maps
may be used where the system serves a very large or congested area. An
explanation of the interrelationship must be furnished.
Sec. 1152.11 Description of lines to accompany the system diagram map
or information to be contained in the narrative.
Each carrier required to file a system diagram map or narrative
shall list and describe, separately by category and within each
category by state, all lines or portions of lines identified on its
system diagram map or to be included in its narrative as falling within
categories 1 thru 3 (Sec. 1152.10(b)(1) thru (3)) as follows:
(a) Carrier's designation for each line (for example, the
Zanesville Secondary Track);
(b) State or states in which each line is located;
(c) County or counties in which each line is located;
(d) Mileposts delineating each line or portion of line; and
(e) Agency or terminal stations located on each line or portion of
line with milepost designations.
Sec. 1152.12 Filing and publication.
(a) Each carrier required to file a system diagram map or a
narrative shall file with the Board three copies of a complete and up-
dated color-coded system diagram map or narrative (identified by its
``AB number'') and the accompanying line descriptions in conformance
with the filing and publication requirements of this section. If a
revised map or narrative is filed, the line descriptions for the lines
which were revised must be filed.
(b) The color-coded system diagram map or narrative, any
amendments, and accompanying line descriptions shall be served upon the
Governor, the public service commission (or equivalent agency) and the
designated state agency of each state within which the carrier operates
or owns a line of railroad.
(c) The carrier shall: (1) Publish in a newspaper of general
circulation in each county containing category 1 through 3 lines or
lines being revised, a notice containing:
(i) A black-and-white copy of the system diagram map (or a portion
of the map clearly depicting its lines in that county); and
(ii) A description of each line (in the case of Class III carriers
only the line description is required);
(2) Post a copy of the newspaper notice:
(i) In each agency station or terminal on each line in categories 1
through 3 and on each line which has been revised; or
(ii) If there is no agency station on the line, at any station
through which business for the line is received or forwarded;
(3) Furnish, at reasonable cost, upon request of any interested
person, a copy of its system diagram map (either color-coded or black-
and-white) or narrative; and
(4) Notify interested persons of this availability through its
publication in the appropriate county newspaper.
(d) Each carrier required to file a system diagram map or narrative
shall file with the Board an affidavit of service and publication
stating the date each was accomplished. A copy of each newspaper notice
published shall be attached to the affidavit. The effective date of the
filing of the initial system diagram map or narrative and each amended
system diagram map or narrative as required in paragraph (a) of this
section shall be deemed to be the date upon which the Board receives
the affidavit required in this paragraph.
(e) The Board shall require republication of the notice if it is
found to be inadequate.
[[Page 67885]]
Sec. 1152.13 Amendment of the system diagram map or narrative.
(a) Each carrier shall be responsible for maintaining the
continuing accuracy of its system diagram map and the accompanying line
descriptions or narrative. Amendments may be filed at any time and will
be subject to all carrier filing and publication requirements of
Sec. 1152.12.
(b) By March 24, 1997, each carrier shall file with the Board a
revised and updated color-coded system diagram map and line
descriptions or narrative which shall be subject to the filing and
publication requirements of Sec. 1152.12. Thereafter, each carrier
shall file amendments as line designations change and update its map or
narrative, as appropriate. Also, each carrier shall file an updated or
amended map or narrative upon order of the Board. Each new rail carrier
shall comply with the requirements of this subsection within 60 days
after it becomes a carrier.
(c) The Board will reject an abandonment or discontinuance
application filed by a rail carrier if any part of the application
includes a line that has not been identified and described, by
amendment or otherwise, on the carrier's system diagram map or
narrative, as appropriate, as a line in category 1 (Sec. 1152.10(b)(1))
for at least 60 days.
Sec. 1152.14 Availability of data.
Each carrier shall provide to the designated state agency, upon
request, information concerning the net liquidation value (as defined
in Sec. 1152.34(c)) of any line placed in category 1
(Sec. 1152.10(b)(1)) on its system diagram map or narrative together
with a description of such a line and any appurtenant facilities and of
their condition.
Sec. 1152.15 Reservation of jurisdiction.
49 U.S.C. 10903(c)(1) authorizes the Board, at its discretion, to
provide for designation of lines as ``potentially subject to
abandonment'' under standards which vary by region of the United
States, by railroad, or by group of railroads. The Board expressly
reserves the right to adopt such varying standards in the future.
Subpart C--Procedures Governing Notice, Applications, Financial
Assistance, Acquisition for Public Use, and Trail Use
Sec. 1152.20 Notice of intent to abandon or discontinue service.
(a) Filing and publication requirements. An applicant shall give
Notice of Intent to file an abandonment or discontinuance application
by complying with the following procedures:
(1) Filing. Applicant must serve its Notice of Intent on the Board,
by certified letter, in the format prescribed in Sec. 1152.21. The
Notice shall be filed in accordance with the time requirements of
paragraph (b) of this section.
(2) Service. Applicant must serve, by first-class mail (unless
otherwise specified), its Notice of Intent upon:
(i) Significant users of the line;
(ii) The Governor (by certified mail) of each state directly
affected by the abandonment or discontinuance;
(iii) The Public Service Commission (or equivalent agency) in these
states;
(iv) The designated state agency in these states;
(v) The State Cooperative Extension Service in these states;
(vi) The U.S. Department of Transportation (Federal Railroad
Administration);
(vii) Department of Defense (Military Traffic Management Command,
Transportation Engineering Agency, Railroads for National Defense
Program);
(viii) The U.S. Department of Interior (Recreation Resources
Assistance Division, National Park Service);
(ix) The U.S. Railroad Retirement Board;
(x) The National Railroad Passenger Corporation (``Amtrak'') (if
Amtrak operates over the involved line);
(xi) The headquarters of the Railroad Labor Executives'
Association;
(xii) The U.S. Department of Agriculture, Chief of the Forest
Service; and
(xiii) The headquarters of all duly certified labor organizations
that represent employees on the affected rail line. For purposes of
this subsection ``directly affected states'' are those in which any
part of a line sought to be abandoned is located.
(3) Posting. Applicant must post a copy of its Notice of Intent at
each agency station and terminal on the line to be abandoned. (If there
are no agency stations on the line, the Notice of Intent should be
posted at any agency station through which business for the involved
line is received or forwarded.)
(4) Newspaper publication. Applicant must publish its Notice of
Intent at least once during each of 3 consecutive weeks in a newspaper
of general circulation in each county in which any part of the involved
line is located.
(b) Time limits. (1) The Notice of Intent must be served at least
15 days, but not more than 30 days, prior to the filing of the
abandonment application;
(2) The Notice must be posted and fully published within the 30-day
period prior to the filing of the application; and
(3) The Notice must be filed with the Board either concurrently
with service or when the Notice is first published (whichever occurs
first).
(c) Environmental and Historic Reports. Applicant must also submit
the Environmental and Historic Reports described at Secs. 1105.7 and
1105.8 at least 20 days prior to filing an application.
Sec. 1152.21 Form of notice.
The Notice of Intent to abandon or to discontinue service shall be
in the following form:
STB No. AB ________(Sub-No. ________)
Notice of Intent to Abandon or to Discontinue Service
(Name of Applicant) gives notice that on or about (insert date
application will be filed with the Board) it intends to file with
the Surface Transportation Board, Washington, D.C. 20423, an
application for permission for the abandonment of (the
discontinuance of service on), a line of railroad known as
____________ extending from railroad milepost near (station name) to
(the end of line or rail milepost) near (station name), which
traverses through United States Postal Service ZIP Codes (ZIP
Codes), a distance of ____________ miles, in [County(ies),
State(s)]. The line includes the stations of (list all stations on
the line in order of milepost number, indicating milepost location).
The reason(s) for the proposed abandonment (or discontinuance)
is (are) ____________ (explain briefly and clearly why the proposed
action is being undertaken by the applicant). Based on information
in our possession, the line (does) (does not) contain federally
granted rights-of-way. Any documentation in the railroad's
possession will be made available promptly to those requesting it.
This line of railroad has appeared on the system diagram map or
included in the narrative in category 1 since (insert date).
The interest of railroad employees will be protected by (specify
the appropriate conditions).
The application will include the applicant's entire case for
abandonment (or discontinuance) (case in chief). Any interested
person, after the application is filed on (insert date), may file
with the Surface Transportation Board written comments concerning
the proposed abandonment (or discontinuance) or protests to it.
These filings are due 45 days from the date of filing of the
application. All interested persons should be aware that following
any abandonment of rail service and salvage of the line, the line
may be suitable for other public use, including interim trail use.
Any request for a public use condition under 49 U.S.C. 10905
(Sec. 1152.28 of the Board's rules) and any request for a trail use
condition under 16 U.S.C. 1247(d) (Sec. 1152.29 of the Board's
rules) must also be filed within 45 days from the date of filing of
the application. Persons who may oppose the abandonment or
discontinuance but who
[[Page 67886]]
do not wish to participate fully in the process by appearing at any
oral hearings or by submitting verified statements of witnesses,
containing detailed evidence, should file comments. Persons
interested only in seeking public use or trail use conditions should
also file comments. Persons opposing the proposed abandonment or
discontinuance that do wish to participate actively and fully in the
process should file a protest.
Protests must contain that party's entire case in opposition
(case in chief) including the following:
(1) Protestant's name, address and business.
(2) A statement describing protestant's interest in the
proceeding including:
(i) A description of protestant's use of the line;
(ii) If protestant does not use the line, information concerning
the group or public interest it represents; and
(iii) If protestant's interest is limited to the retention of
service over a portion of the line, a description of the portion of
the line subject to protestant's interest (with milepost
designations if available) and evidence showing that the applicant
can operate the portion of the line profitably, including an
appropriate return on its investment for those operations.
(3) Specific reasons why protestant opposes the application
including information regarding protestant's reliance on the
involved service [this information must be supported by affidavits
of persons with personal knowledge of the fact(s)].
(4) Any rebuttal of material submitted by applicant.
In addition, a commenting party or protestant may provide a
statement of position and evidence regarding:
(i) Intent to offer financial assistance pursuant to 49 U.S.C.
10904;
(ii) Environmental impact;
(iii) Impact on rural and community development;
(iv) Recommended provisions for protection of the interests of
employees;
(v) Suitability of the properties for other public purposes
pursuant to 49 U.S.C. 10905; and
(vi) Prospective use of the right-of-way for interim trail use
and rail banking under 16 U.S.C. 1247(d) and Sec. 1152.29.
A protest may demonstrate that: (1) the protestant filed a feeder
line application under 49 U.S.C. 10907; (2) the feeder line
application involves any portion of the rail line involved in the
abandonment or discontinuance application; (3) the feeder line
application was filed prior to the date the abandonment or
discontinuance application was filed; and (4) the feeder line
application is pending before the Board.
Written comments and protests will be considered by the Board in
determining what disposition to make of the application. The
commenting party or protestant may participate in the proceeding as
its interests may appear.
If an oral hearing is desired, the requester must make a request
for an oral hearing and provide reasons why an oral hearing is
necessary. Oral hearing requests must be filed with the Board no
later than 10 days after the application is filed.
Those parties filing protests to the proposed abandonment (or
discontinuance) should be prepared to participate actively either in
an oral hearing or through the submission of their entire opposition
case in the form of verified statements and arguments at the time
they file a protest. Parties seeking information concerning the
filing of protests should refer to Sec. 1152.25.
Written comments and protests, including all requests for public
use and trail use conditions, should indicate the proceeding
designation STB No. AB ________ (Sub-No. ________) and must be filed
with the Secretary, Surface Transportation Board, Washington, DC
20423, no later than (insert the date 45 days after the date
applicant intends to file its application). Interested persons may
file a written comment or protest with the Board to become a party
to this abandonment (or discontinuance) proceeding. A copy of each
written comment or protest shall be served upon the representative
of the applicant (insert name, address, and phone number). The
original and 10 copies of all comments or protests shall be filed
with the Board with a certificate of service. Except as otherwise
set forth in part 1152, each document filed with the Board must be
served on all parties to the abandonment proceeding. 49 CFR
1104.12(a).
The line sought to be abandoned (or discontinued) will be
available for subsidy or sale for continued rail use, if the Board
decides to permit the abandonment (or discontinuance), in accordance
with applicable laws and regulations (49 U.S.C. 10904 and 49 CFR
1152.27). No subsidy arrangement approved under 49 U.S.C. 10904
shall remain in effect for more than 1 year unless otherwise
mutually agreed by the parties (49 U.S.C. 10904(f)(4)(B)). Applicant
will promptly provide upon request to each interested party an
estimate of the subsidy and minimum purchase price required to keep
the line in operation. The carrier's representative to whom
inquiries may be made concerning sale or subsidy terms is (insert
name and business address).
Persons seeking further information concerning abandonment
procedures may contact the Surface Transportation Board or refer to
the full abandonment or discontinuance regulations at 49 CFR part
1152. Questions concerning environmental issues may be directed to
the Board's Section of Environmental Analysis.
A copy of the application will be available for public
inspection on or after (insert date abandonment application is to be
filed with Board) at each agency station or terminal on the line
proposed to be abandoned or discontinued [if there is no agency
station on the line, the application shall be deposited at any
agency station through which business for the line is received or
forwarded (insert name, address, location, and business hours)]. The
carrier shall furnish a copy of the application to any interested
person proposing to file a protest or comment, upon request.
An environmental assessment (EA) (or environmental impact
statement (EIS), if necessary) prepared by the Section of
Environmental Analysis will be served upon all parties of record and
upon any agencies or other persons who commented during its
preparation. Any other persons who would like to obtain a copy of
the EA (or EIS) may contact the Section of Environmental Analysis.
EAs in these abandonment proceedings normally will be made available
within 33 days of the filing of the application. The deadline for
submission of comments on the EA will generally be within 30 days of
its service. The comments received will be addressed in the Board's
decision. A supplemental EA or EIS may be issued where appropriate.
Sec. 1152.22 Contents of application.
Applications for the abandonment of railroad lines or the
discontinuance of rail service shall contain the following information,
including workpapers and supporting documents, and each paragraph (a)
through (j) of this section shall be attested to by a person having
personal knowledge of the matters contained therein:
(a) General. (1) Exact name of applicant.
(2) Whether applicant is a common carrier by railroad subject to 49
U.S.C. Subtitle IV, chapter 105.
(3) Relief sought (abandonment of line or discontinuance of
service).
(4) Detailed map of the subject line on a sheet not larger than
8 x 10\1/2\ inches, drawn to scale, and with the scale shown thereon.
The map must show, in clear relief, the exact location of the rail line
to be abandoned or over which service is to be discontinued and its
relation to other rail lines in the area, highways, water routes, and
population centers.
(5) Reference to inclusion of the rail line to be abandoned or over
which service is to be discontinued on the carrier's system diagram map
or narrative, in compliance with Secs. 1152.10 through 1152.13, and the
date upon which such line was first listed on the system diagram map or
included in the narrative in category 1 in accordance with
Sec. 1152.10(b)(1). A copy of the line description which accompanies
the system diagram map shall also be submitted.
(6) Detailed statement of reasons for filing application.
(7) Name, title, and address of representative of applicant to whom
correspondence should be sent.
(8) List of all United States Postal Service ZIP Codes that the
line proposed for abandonment traverses.
(b) Condition of properties. The present physical condition of the
line including any operating restrictions and estimate of deferred
maintenance and rehabilitation costs (e.g., number of ties that need
replacing, miles of rail that need replacing and/or new ballast, bridge
repairs or replacement needed,
[[Page 67887]]
and estimated labor expenses necessary to upgrade the line to minimum
Federal Railroad Administration class 1 safety standards). The bases
for the estimates shall be stated with particularity, and workpapers
shall be filed with the application.
(c) Service provided. Description of the service performed on the
line during the Base Year (as defined by Sec. 1152.2(c)), including the
actual:
(1) Number of trains operated and their frequency.
(2) Miles of track operated (include main line and all railroad-
owned sidings).
(3) Average number of locomotive units operated.
(4) Total tonnage and carloads by each commodity group on the line.
(5) Overhead or bridge traffic by carload commodity group that will
not be retained by the carrier.
(6) Average crew size.
(7) Level of maintenance.
(8) Any important changes in train service undertaken in the 2
calendar years immediately preceding the filing of the application.
(9) Reasons for decline in traffic, if any, in the best judgment of
applicant.
(d) Revenue and cost data. (1) Computation of the revenues
attributable and avoidable costs for the line to be abandoned for the
Base Year (as defined by Sec. 1152.2(c) and to the extent such branch
level data are available), in accordance with the methodology
prescribed in Secs. 1152.31 through 1152.33, as applicable, and
submitted in the form called for in Sec. 1152.36, as Exhibit 1.
(2) The carrier shall compute an estimate of the future revenues
attributable, avoidable costs and reasonable return on the value for
the line to be abandoned, for the Forecast Year (as defined in
Sec. 1152.2(h)) in the form called for in Exhibit 1. The carrier shall
fully support and document all dollar amounts shown in the Forecast
Year column including an explanation of the rationale and key
assumptions used to determine the Forecast Year amounts.
(3) The carrier shall also compute an ``Estimated Subsidy Payment''
for the Base Year in the form called for in Exhibit 1 and an alternate
payment to reflect:
(i) Increases or decreases in attributable revenues and avoidable
costs projected for the subsidy year; and
(ii) An estimate, in reasonable detail, of the cash income tax
reductions, Federal and state, to be realized in the subsidy year. The
bases for the adjustment, e.g., rate increase, changes in traffic
level, necessary maintenance to comply with minimum Federal Railroad
Administration class 1 safety standards, shall be stated with
particularity.
(e) Rural and community impact. (1) The name and population
(identify source and date of figures) of each community in which a
station on the line is located.
(2) Identification of significant users, as defined in
Sec. 1152.2(l), by name, address, principal commodity, and by tonnage
and carloads for each of the 2 calendar years immediately preceding the
filing of the abandonment or discontinuance application, for that part
of the current year for which information is available, and for the
Base Year. In addition, the total tonnage and carloads for each
commodity group originating and/or terminating on the line segment
shall also be shown for the same time periods as those of the
significant users.
(3) General description of the alternate sources of transportation
service (rail, motor, water, air) available, and the highway network in
the proximate area.
(4) Statement of whether the properties proposed to be abandoned
are appropriate for use for other public purposes, including roads or
highways, other forms of mass transportation, conservation, energy
production or transmission, or recreation. If the applicant is aware of
any restriction on the title to the property, including any
reversionary interest, which would affect the transfer of title or the
use of property for other than rail purposes, this shall be disclosed.
(f) Environmental impact. The applicant shall submit information
regarding the environmental impact of the proposed abandonment or
discontinuance in compliance with Secs. 1105.7 and 1105.8. If certain
information required by the environmental regulations duplicates
information required elsewhere in the application, the environmental
information requirements may be met by a specific reference to the
location of the information elsewhere in the application.
(g) Passenger service. If passenger service is provided on the
line, the applicant shall state whether appropriate steps have been
taken for discontinuance pursuant to the Rail Passenger Service Act.
(45 U.S.C. 501 et seq.)
(h) Additional information. The applicant shall submit such
additional information to support its application as the Board may
require.
(i) Draft Federal Register Notice. The applicant shall submit a
draft notice of its application to be published by the Board. In
addition to the regular number of copies that must be filed with the
Board, the applicant must submit a copy of the draft notice as data
contained on a computer diskette compatible with the Board's current
word processing capabilities. The Board will publish the notice in the
Federal Register within 20 days of the application's filing with the
Board. The draft notice shall be in the form set forth below:
STB No. AB-________ (Sub-No. ________)
Notice of Application to Abandon or to Discontinue Service
On (insert date application was filed with the Board) (name of
applicant) filed with the Surface Transportation Board, Washington,
D.C. 20423, an application for permission for the abandonment of
(the discontinuance of service on) a line of railroad known as
____________ extending from railroad milepost near (station name) to
(the end of line or rail milepost) near (station name), a distance
of ____________ miles, in [County(ies), State(s)]. The line includes
the stations of (list all stations on the line in order of milepost
number, indicating milepost location) and traverses through
____________ (ZIP Codes) United States Postal Service ZIP Codes.
The line (does) (does not) contain federally granted rights-of-
way. Any documentation in the railroad's possession will be made
available promptly to those requesting it. The applicant's entire
case for abandonment (or discontinuance) (case in chief) was filed
with the application.
This line of railroad has appeared on the applicant's system
diagram map or has been included in its narrative in category 1
since (insert date).
The interest of railroad employees will be protected by (specify
the appropriate conditions).
Any interested person may file with the Surface Transportation
Board written comments concerning the proposed abandonment (or
discontinuance) or protests (including the protestant's entire
opposition case), within 45 days after the application is filed. All
interested persons should be aware that following any abandonment of
rail service and salvage of the line, the line may be suitable for
other public use, including interim trail use. Any request for a
public use condition under 49 U.S.C. 10905 (Sec. 1152.28 of the
Board's rules) and any request for a trail use condition under 16
U.S.C. 1247(d) (Sec. 1152.29 of the Board's rules) must be filed
within 45 days after the application is filed. Persons who may
oppose the abandonment or discontinuance but who do not wish to
participate fully in the process by appearing at any oral hearings
or by submitting verified statements of witnesses, containing
detailed evidence should file comments. Persons interested only in
seeking public use or trail use conditions should also file
comments. Persons opposing the proposed abandonment or
discontinuance that do wish to participate actively and fully in the
process should file a protest.
In addition, a commenting party or protestant may provide:
[[Page 67888]]
(i) An offer of financial assistance, pursuant to 49 U.S.C.
10904 (due 120 days after the application is filed or 10 days after
the application is granted by the Board, whichever occurs sooner);
(ii) Recommended provisions for protection of the interests of
employees;
(iii) A request for a public use condition under 49 U.S.C.
10905; and
(iv) A statement pertaining to prospective use of the right-of-
way for interim trail use and rail banking under 16 U.S.C. 1247(d)
and Sec. 1152.29.
Parties seeking information concerning the filing of protests
should refer to Sec. 1152.25.
Written comments and protests, including all requests for public
use and trail use conditions, must indicate the proceeding
designation STB No. AB-____ (Sub-No. ____) and should be filed with
the Secretary, Surface Transportation Board (Board), Washington, DC
20423, no later than (insert the date 45 days after the date
applicant intends to file its application). Interested persons may
file a written comment or protest with the Board to become a party
to this abandonment (or discontinuance) proceeding. A copy of each
written comment or protest shall be served upon the representative
of the applicant (insert name, address, and phone number). The
original and 10 copies of all comments or protests shall be filed
with the Board with a certificate of service. Except as otherwise
set forth in part 1152, every document filed with the Board must be
served on all parties to the abandonment proceeding. 49 CFR
1104.12(a).
The line sought to be abandoned (or discontinued) will be
available for subsidy or sale for continued rail use, if the Board
decides to permit the abandonment (or discontinuance), in accordance
with applicable laws and regulations (49 U.S.C. 10904 and 49 CFR
1152.27). No subsidy arrangement approved under 49 U.S.C. 10904
shall remain in effect for more than 1 year unless otherwise
mutually agreed by the parties (49 U.S.C. 10904(f)(4)(B)). Applicant
will promptly provide upon request to each interested party an
estimate of the subsidy and minimum purchase price required to keep
the line in operation. The carrier's representative to whom
inquiries may be made concerning sale or subsidy terms is (insert
name and business address).
Persons seeking further information concerning abandonment
procedures may contact the Surface Transportation Board or refer to
the full abandonment or discontinuance regulations at 49 CFR part
1152. Questions concerning environmental issues may be directed to
the Board's Section of Environmental Analysis.
An environmental assessment (EA) (or environmental impact
statement (EIS), if necessary) prepared by the Section of
Environmental Analysis will be served upon all parties of record and
upon any agencies or other persons who commented during its
preparation. Any other persons who would like to obtain a copy of
the EA (or EIS) may contact the Section of Environmental Analysis.
EAs in these abandonment proceedings normally will be made available
within 33 days of the filing of the application. The deadline for
submission of comments on the EA will generally be within 30 days of
its service. The comments received will be addressed in the Board's
decision. A supplemental EA or EIS may be issued where appropriate.
(j) Verification. The original application shall be executed and
verified in the form set forth below by an officer of the carrier
having knowledge of the facts and matters relied upon.
Verification
State of ____________ ss.
County of ____________
____________ (Name of affiant) makes oath and says that (s)he
is the ____________ (title of affiant) of the ____________ (name of
applicant) applicant herein; that (s)he has been authorized by the
applicant (or as appropriate, a court) to verify and file with the
Surface Transportation Board the foregoing application in STB AB-
____ (Sub-No. ____); that (s)he has carefully examined all of the
statements in the application as well as the exhibits attached
thereto and made a part thereof; that (s)he has knowledge of the
facts and matters relied upon in the application; and that all
representations set forth therein are true and correct to the best
of his(her) knowledge, information, and belief.
(Signature)
Subscribed and sworn to before me ____________ in and for the
State and County above named, this ____ day of ____, 19__.
My commission expires
Sec. 1152.23 [Reserved]
Sec. 1152.24 Filing and service of application.
(a) An original and 10 copies of applications, typewritten or
printed on paper approximately 8\1/2\ inches by 11 inches with 1\1/2\
inch left margin, shall be filed with the Secretary of the Surface
Transportation Board, Washington, DC 20423. The original shall bear the
date and signature and shall be complete in itself; the signature may
be stamped or typed and the notarial seal may be omitted on the copies.
A check or money order payable to the Surface Transportation Board must
also be submitted to cover the applicable filing fee. If the applicant
carrier is in bankruptcy, the application shall also be filed on the
bankruptcy court.
(b) The applicant shall tender with its application an affidavit
attesting to its compliance with the notice requirement of
Sec. 1152.20. The affidavit shall include the dates of service,
posting, and publication of the notice.
(c) When the application is filed with the Board, the applicant
shall serve, by first class mail, a copy on the Governor, the Public
Service Commission (or equivalent agency), and the designated state
agency of each state in which any part of the line of railroad sought
to be abandoned or discontinued is situated. A copy of the application
will be available for public inspection, on or after the date the
abandonment application is filed with the Board, at each agency station
or terminal on the line proposed to be abandoned or discontinued (if
there is no agency station on the line, the application shall be
deposited at any agency station through which business for the line is
received or forwarded). A certificate of service shall be promptly
filed with the Board.
(d) The applicant shall promptly furnish by first class mail a copy
of the application to any interested person proposing to file a written
comment or protest upon request. A certificate of service shall
promptly be filed with the Board.
(e)(1) The Board shall reject any abandonment or discontinuance
application which does not substantially conform to the regulations in
this subpart C regarding notice, form, and content, or which applies to
a line which has not properly been published on the carrier's system
diagram map (or included in a narrative in the case of a Class III
carrier), in conformance with the regulations of subpart B of this
part.
(2) Upon the filing of an abandonment or discontinuance
application, the Board will review the application and determine
whether it conforms with all applicable regulations. If the application
is substantially incomplete or its filing otherwise defective, the
Board shall reject the application for stated reasons by order (which
order will be administratively final) within 20 days from the date of
filing of the application. If the Board does not reject the
application, notice of the filing of the application shall be published
in the Federal Register by the Board within 20 days of the filing of
the application.
(3) If the application is rejected, a revised application may be
submitted, and the Board will determine whether the resubmitted
application conforms with all prescribed regulations. A properly
revised application submitted within 60 days of the order rejecting the
incomplete or improper application need not be subjected to new notice
and publication under Sec. 1152.20, unless the defect causing the
rejection was in the notice and/or publication. A revised application
submitted after such 60-day period must be newly published and noticed.
(4) The resubmission of an abandonment or discontinuance
application shall be considered a de novo filing for the purposes of
computation of the time period for filing an offer of financial
assistance under 49
[[Page 67889]]
U.S.C. 10904, and for other time periods prescribed in the regulations
contained in this part (49 CFR part 1152), provided, that a resubmitted
application is deemed complete and proper.
(5) An applicant may seek waiver of specific regulations listed in
subpart C of this part by filing a petition for waiver with the Board.
A decision by the Director of the Office of Proceedings granting or
denying a waiver petition will be issued within 30 days of the date the
petition is filed. Appeals from the Director's decision will be decided
by the entire Board. If waiver is not obtained prior to the filing of
the application, the application may be subject to rejection under
paragraphs (e) (1) and (2) of this section.
(f) As provided in Sec. 1152.29(e)(2), rail carriers authorized to
abandon a line under 49 U.S.C. 10903 must file with the Board a notice
that abandonment has been consummated.
Sec. 1152.25 Participation in abandonment or discontinuance
proceedings.
(a) Public participation. (1) Protests and comments. Interested
persons may become parties to an abandonment or discontinuance
proceeding by filing written comments or protests with the Board. Any
request for a public use condition under 49 U.S.C. 10905 (Sec. 1152.28
of the Board's rules) and any request for a trail use condition under
16 U.S.C. 1247(d) (Sec. 1152.29 of the Board's rules) must be included
in these filings. Persons who may oppose the abandonment or
discontinuance, but who do not wish to participate fully in the process
by appearing at any oral hearings or by submitting verified statements
of witnesses containing detailed evidence, should file comments.
Persons interested only in seeking public use or trail use conditions
should also file comments. Persons opposing the proposed abandonment or
discontinuance that do wish to participate actively and fully in the
process should file a protest. Protests shall include all evidence and
argument in support of protestant's position (protestant's case in
chief). Protests must contain the following information:
(i) Protestant's name, address and business.
(ii) A statement describing protestant's interest in the proceeding
including:
(A) A description of protestant's use of the line;
(B) If protestant does not use the line, information concerning the
group or public interest it represents; and
(C) If protestant's interest is limited to the retention of service
over a portion of the line, a description of the portion of the line
subject to protestant's interest (with milepost designations if
available) and evidence showing that the applicant can operate the
portion of the line profitably, including an appropriate return on its
investment for those operations.
(iii) Specific reasons why protestant opposes the application
including information regarding protestant's reliance on the involved
service (this information must be supported by affidavits of persons
with personal knowledge of the fact(s)).
(iv) Any rebuttal of material submitted by applicant.
(v) Any request for a public use condition under 49 U.S.C. 10905
(Sec. 1152.28 of the Board's rules) and any request for a trail use
condition under 16 U.S.C. 1247(d) (Sec. 1152.29 of the Board's rules).
(2) Additional information. In addition to the information required
in paragraph (a) (1) of this section, a commenting party or protestant
may provide a statement of position and a summary of evidence
regarding:
(i) Intent to offer financial assistance under 49 U.S.C. 10904;
(ii) Environmental impact;
(iii) Impact on rural and community development;
(iv) Recommended provisions for protection of the interests of
employees;
(v) A request for a public use condition under 49 U.S.C. 10905; and
(vi) Prospective use of the right-of-way for interim trail use and
rail banking under 16 U.S.C. 1247(d) and 49 CFR 1152.29.
(3) Feeder line application for all or part of the line subject to
the abandonment application. In addition to the information required in
paragraphs (a)(1) and (2) of this section, a commenting party or
protestant must provide information that:
(i) The protestant filed a feeder line application under 49 U.S.C.
10907 (or former 49 U.S.C. 10910);
(ii) The feeder line application involves any portion of the rail
line involved in the abandonment or discontinuance application;
(iii) The feeder line application was filed prior to the date the
abandonment or discontinuance application was filed; and
(iv) The feeder line application is pending before the Board.
(b) Employee or employee representative participation. Employees or
their representatives may file protests or comments to an application.
However, because the Board will impose employee protective conditions
under 49 U.S.C. 10903(b)(2) if an application is granted, employees and
their representatives need not file comments or protests seeking this
protection.
(c) Filing and service of written comments, protests, along with
evidence and argument, and replies. (1) Written comments and protests,
as well as public use and trail use requests, shall be filed with the
Board (the Secretary, Surface Transportation Board, Washington, DC
20423) within 45 days of the filing with the Board of an abandonment or
discontinuance application.
(2) An original and 10 copies of each written comment or protest
shall be filed with the Board.
(3) A copy of each written comment or protest shall be served on
applicant or its representative at the time of filing with the Board.
If the applicant carrier is in bankruptcy, each comment or protest
shall also be filed on the Bankruptcy Court. Each filing shall contain
a certificate of service.
(4) Replies or rebuttal to written comments and protests shall be
filed and served by applicants no later than 60 days after the filing
of the application. An original and 10 copies of such replies shall be
filed with the Board.
(d) Time limits. (1) Pleadings, requests or other papers or
documents (including any comments or protests and any appeal from a
Board decision) required or permitted to be filed under this part must
be received for filing at the Board's Offices at Washington, DC within
the time limits, if any, for such filing. The date of receipt at the
Board and not the date of deposit in the mail is determinative,
provided, however, that if such document is mailed by certified,
registered, or express mail, postmarked at least 3 days prior to the
due date, it will be accepted as timely filed.
(2) In computing any time period prescribed or allowed by this
part, the day of the act, event, or default after which the designated
period of time begins to run is not to be included.
(3) Any filing under this part which falls due on a Saturday,
Sunday, or a legal holiday in the District of Columbia, may be filed at
the Board by the end of the next day which is neither a Saturday,
Sunday, nor a holiday, except as indicated in paragraph (d)(4) of this
section. A half holiday shall not be considered as a holiday.
(4) Offers of financial assistance made pursuant to Sec. 1152.27(c)
must be filed on or before their statutory or regulatory due date as
computed in paragraph (d)(2) of this section, regardless of whether
that date is a Saturday, Sunday,
[[Page 67890]]
or a legal holiday in the District of Columbia.
(5) The Board will reject any pleading filed after its due date
unless good cause is shown why the pleading is filed late.
(6) Oral Hearings: (i) If the Board decides to hold an oral
hearing, the oral hearing shall be for the primary purpose of cross
examination of witnesses filing verified statements in the proceeding.
Any direct testimony, other than applicant's rebuttal evidence, shall
be received at the discretion of the hearing officer.
(ii) In addition to that contained in the application, the
submission of written evidence prior to the commencement of the hearing
shall be established by the Board.
(iii) Post hearing legal briefs shall be due 10 days after the
close of the oral hearing, or at an earlier date if established at the
hearing by the hearing officer.
(e) Appellate procedures. (1) Scope of rule. Except as specifically
indicated below, these appellate procedures are to be followed in
abandonment and discontinuance proceedings in lieu of the general
procedures at 49 CFR 1115. Appeals of initial decisions of the Director
of the Office of Proceedings determining:
(i) Whether offers of financial assistance satisfy the standard of
49 U.S.C. 10904(d) for purposes of instituting negotiations or, in
exemption proceedings, for purposes of partial revocation and
instituting negotiations;
(ii) Whether partially to revoke or to reopen abandonment
exemptions authorized, respectively, under 49 U.S.C. 10502 and 49 CFR
part 1152 subpart F for the purpose of imposing public use conditions
under the criteria in 49 CFR 1152.28 and/or conditions limiting salvage
of the rail properties for environmental and historic preservation
purposes; and
(iii) The applicability and administration of the Trails Act [16
U.S.C. 1247(d)] in abandonment proceedings under 49 U.S.C. 10903 (and
abandonment exemption proceedings), issued pursuant to delegations of
authority at 49 CFR 1011.8(c) (4) and (5), will be acted on by the
entire Board as set forth at 49 CFR 1011.2(a)(7). An original and 10
copies of all appeals, and replies to appeals, under this section must
be filed with the Board.
(2) Appeals criteria. Appeals to the Board's decision in
abandonment or discontinuance proceedings will not be entertained.
Those decisions are administratively final upon the date they are
served.
(i) Parties seeking further administrative action may file a
petition to reopen the proceeding under paragraph (e)(4) of this
section. If an abandonment or discontinuance is granted and a party
wishes the Board to have the opportunity to consider a petition to
reopen before the abandonment or discontinuance authorization becomes
effective, it must file its petition within 15 days after the
administratively final decision is served together with a request for a
stay of effectiveness under paragraph (e)(7) of this section. If such a
petition to reopen and stay request is received within that 15-day
period, any replies to the petition to reopen must be filed no later
than 25 days after the date the decision is served, and any reply to
the stay request must reach the Board no later than 5 days after the
stay request is filed.
(ii) The Board will grant a petition to reopen only upon a showing
that the action would be affected materially because of new evidence,
changed circumstances, or material error.
(3) Form. A petition to reopen and any reply shall not exceed 30
pages in length, including the index of subject matter, argument, and
appendices or other attachments.
(4) Petitions to reopen administratively final actions. A person
may file a petition to reopen any administratively final action of the
Board. A petition to reopen shall state in detail the respects in which
the proceeding involves material error, new evidence, or substantially
changed circumstances. An original and 10 copies of such petitions must
be filed with the Board.
(5) Judicial review: (i) Parties may seek judicial review of a
Board action in an abandonment or discontinuance proceeding on the day
the action of the Board becomes final.
(ii) If a petition seeking reopening is filed under this section,
before or after a petition seeking judicial review is filed with the
courts, the Board will act upon the petition after advising the court
of its pendency unless action might interfere with the court's
jurisdiction.
(6) Petitions to vacate. In the event of procedural defects (such
as the loss of a properly filed protest, the failure of the applicant
to afford the public the requisite notice of its proposed abandonment,
etc.), the Board will entertain petitions to vacate the abandonment or
discontinuance authorization. An original and 10 copies of these
petitions to vacate must be filed with the Board.
(7) Petitions to stay. (i) The filing of a petition to reopen shall
not stay the effect of a prior action. An original and 10 copies of any
petitions to stay must be filed with the Board.
(ii) A petition to reopen an administratively final action may be
accompanied by a petition for a stay of the effectiveness of the
abandonment or discontinuance. As provided in paragraph (e)(2) of this
section, a petition to reopen must be accompanied by a stay request if
the party wishes the Board to have the opportunity to consider the
petition to reopen before the abandonment or discontinuance
authorization becomes final.
(iii) A party may petition for a stay of the effectiveness of
abandonment or discontinuance authorization pending a request for
judicial review. The reasons for the desired relief shall be stated in
the petition, and the petition shall be filed not less than 15 days
prior to the effective date of the abandonment authorization. No reply
need be filed. If a party elects to file a reply, the reply must reach
the Board no later than 5 days after the petition is filed.
Sec. 1152.26 Board determination under 49 U.S.C. 10903.
(a) The following schedule shall govern the process for Board
consideration and decisions in abandonment and discontinuance
application proceedings from the time the application is filed until
the time of the Board's decision on the merits:
Day 0--Application filed, including applicant's case in chief.
Day 10--Due date for oral hearing requests.
Day 15--Due date for Board decision on oral hearing requests.
Day 20--Due date for Notice of Application to be published in the
Federal Register.
Day 45--Due date for protests and comments, including opposition case
in chief, and for public use and trail use requests.
Day 60--Due date for applicant's reply to opposition case and for
applicant's response to trail use requests.
Day 110--Due date for service of decision on the merits.
Day 120--Due date for offers of financial assistance, except that if an
application has been granted by decision issued sooner than Day 110,
the offer of financial assistance shall be due 10 days after service of
the decision granting the application.
(b) If an application for abandonment or discontinuance is filed by
a bankrupt railroad, the Board shall base its decision (Report to the
Bankruptcy Court) on the application and any responses to the
application that are filed. In each such instance, the Board shall
establish a reasonable period of
[[Page 67891]]
time for filing responses to the application so that public input can
be included in the Board's decision (Report) and so that the Board will
be able to meet a deadline imposed or requested by the Bankruptcy
Court.
Sec. 1152.27 Financial assistance procedures.
(a) Provision of information. An applicant must provide promptly
upon request to a party considering an offer of financial assistance to
continue existing rail service, and concurrently to the Board, the
following:
(1)(i) In an application or petition for exemption proceeding, an
estimate of the annual subsidy and minimum purchase price required to
keep the line or a portion of the line in operation;
(ii) In a class exemption proceeding, either an estimate of the
annual subsidy or the minimum purchase price, depending upon the type
of financial assistance indicated in the potential offeror's formal
expression of intent submitted under paragraph (c)(2)(i) of this
section;
(2) Its most recent reports on the physical condition of the
involved line; and
(3) Traffic, revenue, and other data necessary to determine the
amount of annual financial assistance that would be required to
continue rail transportation over that part of the railroad line. In an
exemption proceeding, the data to be provided must at a minimum include
the carrier's estimate of the net liquidation value of the line, with
supporting data reflecting available real estate appraisals,
assessments of the quality and quantity of track materials in a line,
and removal cost estimates (including the cost of transporting removed
materials to point of sale or point of storage for relay use), and, if
an offer of subsidy is contemplated, an estimate of the cost of
rehabilitating the line to Federal Railroad Administration class 1
Safety Standards (49 CFR part 213).
(b) Federal Register notice. (1) Abandonment and discontinuance
applications. The Federal Register publication, which gives notice of
the filing of the application 20 days after the application is filed,
will serve as notice to persons intending to offer financial assistance
to assure continued rail service under 49 U.S.C. 10904 and these
regulations as they relate to abandonment and discontinuance
applications. Offers of financial assistance will be due 120 days after
the application is filed or 10 days after a decision granting the
application is served, whichever occurs sooner.
(2) Exemption proceedings. (i) If a petition for individual
exemption from the prior approval requirements of 49 U.S.C. 10903 is
filed with the Board for abandonment or discontinuance of a line of
railroad, the Board will publish notice of the petition in the Federal
Register within 20 days of the filing of the petition. The Federal
Register publication will serve as notice to persons with a potential
interest in providing financial assistance to assure continued rail
service on the line under 49 U.S.C. 10904 and these regulations as they
relate to exempt abandonments and discontinuances. Offers of financial
assistance will be due 120 days after the filing of the petition for
exemption or 10 days after service of a Board decision granting the
exemption, whichever occurs sooner.
(ii) If a notice of exemption is filed under the class exemption,
the Board will publish notice of the exemption in the Federal Register
within 20 days of filing. The Federal Register publication will serve
as notice to persons with a potential interest in providing financial
assistance to assure continued rail service on the line under 49 U.S.C.
10904 and these regulations as they relate to exempt abandonments and
discontinuances. Offers of financial assistance will be due no later
than 30 days after the date of the Federal Register publication giving
notice of the exemption.
(c) Submission of financial assistance offer. (1) Abandonment and
discontinuance applications and petitions for exemption. (i) Service
and filing. An offeror must serve its offer of assistance on the
carrier owning and operating the line and all parties to the
abandonment or discontinuance application or exemption proceeding. The
offer must be filed concurrently with the Secretary, Surface
Transportation Board, Washington, DC 20423.
(A) An offer may be filed and served at any time after the filing
of the abandonment or discontinuance application or petition for
exemption. Once a decision is served granting an application or
petition for exemption, however, the Board must be notified that an
offer has previously been submitted.
(B) An offer, or notification of a previously filed offer, must be
filed and served no later than 10 days after service of the Board
decision granting the application or petition for exemption. This
filing and service is subject to the requirements of 49 CFR 1152.25
(d)(1), (d)(2), and (d)(4).
(C) If, after a bona fide request, applicant or petitioner has
failed to provide a potential offeror promptly with the information
required under paragraph (a) of this section and if that information is
not contained in the application or petition, the Board will entertain
petitions to toll the 10-day period for submitting offers of financial
assistance under paragraph (c)(1) of this section. Petitions must be
filed with the Board within 5 days after service of the decision
granting the application or petition for exemption. Petitions should
include copies of the prior written request for information or an
accurate outline of the specific information that was orally requested.
Replies to these petitions must be filed within 10 days after service
of the decision granting the application or petition for exemption.
These petitions and replies must be filed on or before their actual due
date under 49 CFR 1152.25(d)(4). The Board will issue a decision on
petitions within 15 days after service of the decision granting the
application or petition for exemption.
(ii) Contents of offer. The offeror shall set forth its offer in
detail. The offer must:
(A) Identify the line, or the portion of the line, in question;
(B) Demonstrate that the offeror is financially responsible; that
is, that it has or within a reasonable time will have the financial
resources to fulfill proposed contractual obligations; governmental
entities will be presumed to be financially responsible; and
(C) Explain the disparity between the offeror's purchase price or
subsidy if it is less than the carrier's estimate under paragraph
(a)(1) of this section, and explain how the offer of subsidy or
purchase is calculated.
(2) Class exemption proceedings. (i) Expression of intent to file
offer. Persons with a potential interest in providing financial
assistance must, no later than 10 days after the Federal Register
publication described in paragraph (b)(2)(ii) of this section, submit
to the carrier and the Board a formal expression of their intent to
file an offer of financial assistance, indicating the type of financial
assistance they wish to provide (i.e., subsidy or purchase). Such
submissions are subject to the filing requirements of
Sec. 1152.25(d)(1) through (d)(3). Submission of a formal expression of
intent under this subsection will automatically stay the effective date
of the notice of exemption under the class exemption for 40 days
(normally, this will be 10 days beyond the date stated in the Federal
Register publication).
(ii) Service and filing. An offeror must serve its offer of
assistance on the carrier that instituted the exempt filing as well
[[Page 67892]]
as all other parties to the proceeding. The offer must be filed
concurrently with the Secretary, Surface Transportation Board,
Washington, DC 20423.
(A) An offer may be filed and served at any time after the filing
of the notice of exemption. Once a notice of exemption is published in
the Federal Register, however, the Board must be notified that an offer
has previously been submitted.
(B) An offer, or notification of a previously filed offer, must be
filed and served no later than 30 days after the Federal Register
publication described in paragraph (b)(2)(ii) of this section. This
filing and service is subject to the requirements of 49 CFR 1152.25
(d)(1), (d)(2), and (d)(4).
(C) If, after a bona fide request, applicant has failed to provide
a potential offeror promptly with the information required under
paragraph (a) of this section and if that information is not contained
in the notice of exemption, the Board will entertain petitions to toll
the 30-day period for submitting offers of financial assistance under
paragraph (c)(2) of this section. Petitions must be filed with the
Board within 25 days after publication in the Federal Register
(described in paragraph (b)(2)(ii) of this section). Petitions should
include copies of the prior written request for information or an
accurate outline of the specific information that was orally requested.
Replies to these petitions must be filed within 30 days after the
publication. These petitions and replies must be filed on or before
their actual due date under 49 CFR 1152.25(d)(4). The Board will issue
a decision on petitions to toll the offer period within 35 days after
publication.
(D) Upon receipt of a formal expression of intent to file an offer
under paragraph (c)(2)(i) of this section, the rail carrier applicant
may advise the Board and the potential offeror that additional time is
needed to develop the information required under paragraph (a) of this
section. Applicant shall expressly indicate the amount of time it
considers necessary (not to exceed 60 days) to develop and submit the
required information to the potential offeror. For the duration of the
time period so indicated by the applicant, the 30-day period for
submitting offers of financial assistance under paragraph (c)(2) of
this section shall be tolled without formal Board action.
(iii) Contents of offer. The offeror shall set forth its offer in
detail. The offer must meet the requirements of paragraph (c)(1)(ii) of
this section.
(d) Access to documents. Upon receipt by the carrier of a written
comment under Sec. 1152.25 or a formal expression of intent under
paragraph (c)(2)(i) of this section indicating an intent to offer
financial assistance, or upon receipt by the carrier of an offer of
financial assistance, whichever occurs earlier, the carrier must make
available to that party or offeror the records, accounts, appraisals,
working papers, and other documents used in preparing Exhibit 1
(Sec. 1152.36) or, if an exemption proceeding, those documents that
would have been used in preparing Exhibit 1 had an abandonment or
discontinuance application been filed, or other records, reports, and
data in the possession of the carrier seeking the exemption that
provide comparable data. These documents shall be made available during
regular business hours at a time and place mutually agreeable to the
parties.
(e) Review of offers. (1) Abandonment and discontinuance
applications. The Board will review each offer submitted to determine
if a financially responsible person has offered assistance. If that
criterion is met, the Board will issue a decision postponing the
effective date of the authorization for abandonment or discontinuance.
This decision will be issued within 15 days of the service of the
decision granting the application (or within 5 days after the offer is
filed if the time for filing has been tolled under paragraph
(c)(1)(i)(C) of this section, or within 5 days after expiration of the
120 day (4 month) period described in 49 U.S.C. 10904, if that occurs
first). Under the delegation of authority at Sec. 1011.8, the Director
of the Office of Proceedings will make the initial determination
whether offers of financial assistance satisfy the standards of 49
U.S.C. 10904(d) for purposes of instituting negotiations. Appeals of
initial decisions determining whether offers of financial assistance
satisfy the standards of 49 U.S.C. 10904(d) for purposes of instituting
negotiations will be acted upon by the entire Board pursuant to 49 CFR
1011.2(a)(7).
(2) Exemption proceedings. The Board will review each offer
submitted to determine if a financially responsible person has offered
assistance. If that criterion is met, the Board will postpone the
effective date either of the decision granting a petition for
individual exemption or the notice of exemption under the class
exemption and partially revoke the exemption or (in the case of a class
exemption) the notice of exemption to the extent it applies to 49
U.S.C. 10904. The decision to postpone and partially revoke will be
issued within 15 days of the service date of a decision granting a
petition for exemption, or within 35 days of the Federal Register
publication described in paragraph (b)(2)(ii) of this section (or
within 5 days after the offer is filed if the time for filing has been
tolled under paragraph (c)(1)(i)(C) or (c)(2)(ii) (C) or (D) of this
section). Under the delegation of authority at Sec. 1011.8, the
Director of the Office of Proceedings will make the initial
determination whether offers of financial assistance satisfy the
standards of 49 U.S.C. 10904(d) for purposes of partial revocation and
institution of negotiations. Appeals of initial decisions determining
whether offers of financial assistance satisfy the standards of 49
U.S.C. 10904(d) for purposes of partial revocation and institution of
negotiations will be acted upon by the entire Board pursuant to 49 CFR
1011.2(a)(7).
(f) Agreement on financial assistance. (1) If the carrier and a
person offering financial assistance enter into a subsidy agreement
designed to provide for continued rail service, the Board will postpone
the effective date of the abandonment or discontinuance. If a decision
granting a petition for individual exemption, or a notice of exemption,
has been issued, the Board will postpone the effective date of the
decision or notice of exemption. The postponement will be for as long
as the subsidy agreement is in effect.
(2) If the carrier and a person offering to purchase a line enter
into a purchase agreement which will result in continued rail service,
the Board will approve the transaction and dismiss the application for
abandonment or discontinuance, or the petition for exemption or notice
of exemption. Board approval is not required under 49 U.S.C. 10901,
10902, or 11323 for the parties to consummate the transaction or for
the purchaser to institute service and operate as a railroad subject to
49 U.S.C. 10501(a).
(g) Failure to reach agreement on financial assistance. (1) If the
carrier and a financially responsible person fail to agree on the
amount or terms of subsidy or purchase, either party may request the
Board to establish the conditions and amount of compensation. This
request must be filed with the Board within 30 days after the offer is
made and served concurrently by overnight mail on all parties to the
proceeding. The request must be accompanied by the appropriate fee,
codified at 49 CFR 1002.2(f)(26). Replies will be due 5 days later.
(2) If no agreement is reached within 30 days after the offer of
purchase or subsidy is made, and no request is made
[[Page 67893]]
to the Board to set the conditions and amount of compensation under
paragraph (g)(1) of this section, the Board will serve a decision
vacating the prior decision, which postponed the effective date of the
decision granting the application, the decision granting the exemption,
or the notice of exemption and, which, if applicable, partially revoked
either the decision granting the exemption or (in the case of a class
exemption) the notice of exemption. The Board will issue the decision
to vacate within 10 days of the due date for requesting the Board to
set the conditions and amount of compensation, and the Board will make
the decision to vacate effective on its date of service.
(h) Request to establish conditions and compensation for financial
assistance. (1) If the Board is requested to establish conditions and
compensation for financial assistance under paragraph (g)(1) of this
section, the Board will issue a decision within 30 days after the
request is due.
(2) If the applicant receives multiple offers of financial
assistance, requests to establish conditions and compensation will not
be permitted before the applicant selects the offeror with whom it
wishes to transact business. (See paragraph (l)(1) of this section.)
(3) A party requesting the Board to establish conditions and
compensation for financial assistance must, within the time period set
forth in paragraph (h)(4) of this section, provide its case in chief,
including reasons why its estimates are correct and the other
negotiating party's estimates are incorrect, points of agreement and
points of disagreement between the negotiating parties, and evidence
substantiating these allegations. The offeror has the burden of proof
as to all issues in dispute.
(4) The offeror must submit all evidence and information supporting
the terms it seeks within 30 days after the offer is made. The
carrier's reply to this evidence and support for the terms it seeks are
due within 35 days after the offer is made. No rebuttal evidence will
be permitted and evidence and information submitted after these dates
will be rejected.
(5) If requested, the Board will determine the amount and terms of
subsidy based on the avoidable cost of providing continued rail
transportation, plus a reasonable return on the value of the line.
Under 49 U.S.C. 10904(f)(4)(B), no subsidy arrangement approved under
section 10904 shall remain in effect for more than one year unless
mutually agreed by the parties.
(6) If requested, the Board will determine the price and other
terms of sale. The Board will not set a price below the fair market
value of the line (including, unless otherwise agreed upon by the
parties, all facilities on the line or portion necessary to provide
effective transportation services). Fair market value equals
constitutional minimum value which is the greater of the net
liquidation value of the line or the going concern value of the line.
The constitutional minimum value is computed without regard to labor
protection costs.
(7) Within 10 days of the service date of the Board's decision, the
offeror must accept or reject the Board's terms and conditions with a
written notification to the Board and all parties to the proceeding. If
the offeror accepts the terms and conditions set by the Board, the
Board's decision is binding on both parties. If the offeror withdraws
its offer or does not accept the terms and conditions set by the Board
with a timely written notification, the Board will serve, within 20
days after the service date of the Board decision setting the terms and
conditions, a decision vacating the prior decision, which postponed the
effective date of either the decision granting the application or
exemption or the notice of exemption, and which, if applicable,
partially revoked the exemption or (in the case of a class exemption)
the notice of exemption (unless other offers are being considered under
paragraph (l) of this section). The decision to vacate will be
effective on its date of service.
(i) Substitution of purchasers and disposition after sale. (1)
Prior to the consummation of a purchase under this section, an offeror
may substitute its corporate affiliate as the purchaser under an
agreement, provided the Board has determined either:
(i) The original offeror has guaranteed the financial
responsibility of its affiliate; or
(ii) The affiliate has demonstrated financial responsibility in its
own right.
(2) Except as provided in paragraph (i)(3) of this section, a
purchaser under this section may not:
(i) Transfer the line or discontinue service over the line prior to
the end of the second year after consummation of the original sale
under these provisions; or
(ii) Transfer the line, except to the carrier from whom the line
was purchased, prior to the end of the fifth year after consummation.
(3) Paragraph (i)(2) of this section does not preclude a purchaser
under this section from transferring the line to a corporate affiliate
following the consummation of the original sale. Prior Board approval
of the affiliate's acquisition and operation, however, is required
under 49 U.S.C. 10901, 10902, or 11323. A corporate affiliate acquiring
a line under this section is prohibited from discontinuing service over
the line or transferring the line to a party that is not a corporate
affiliate during the time periods prescribed in paragraph (i)(2) of
this section.
(j) Discontinuance of subsidy. A subsidizer may discontinue a
subsidy under this section by giving 60 days notice of the
discontinuance to the applicant and all other parties to the
proceeding. Unless another financially responsible party enters into a
subsidy agreement as beneficial to the carrier as the discontinued
subsidy agreement in a situation where the 1-year time limit of 49
U.S.C. 10904(f)(4)(B) has not yet run, the carrier may by filing a
request with the Board and serving the request on all parties to the
abandonment or exemption proceeding obtain a decision vacating the
decision postponing the effective date of either the decision granting
the application, or petition for individual exemption, or the notice of
exemption. The Board will issue a decision to vacate within 10 days
after the filing and service of the request. This decision to vacate
will be effective on its service date.
(k) Default on agreement. If any party defaults on its obligations
under a financial assistance agreement, any other party to the
agreement may promptly inform the Board of that default. Upon
notification, the Board will take appropriate action.
(l) Multiple offers of financial assistance. (1) If an applicant
receives more than one offer to purchase or subsidize the line from
offerors found to be financially responsible, the applicant must select
the offeror from those with whom it wishes to transact business. In
abandonment and discontinuance application and petition for exemption
proceedings within 25 days after service of the decision granting the
application or petition for exemption, and in class exemption
proceedings within 45 days after the Federal Register publication
described in paragraph (b)(2)(ii) of this section, the railroad must:
(i) File a written notification of its selection with the Board;
and
(ii) Serve a copy of the notification on all parties to the
proceeding.
(2)(i) Abandonment and discontinuance applications and petitions
for exemption. If the applicant has received multiple offers of
financial assistance from persons found to be financially responsible
and has selected the offeror with whom it wishes to transact business,
the negotiating parties shall complete the sale or subsidy
[[Page 67894]]
agreement or request the Board to establish the conditions and amount
of compensation within 40 days after the service date of the decision
granting the application or petition for exemption. A request to the
Board to set terms and conditions must be served concurrently on all
parties to the proceeding. If no agreement on subsidy or sale is
reached within the 40-day period and the Board has not been requested
to establish the conditions and amount of compensation, any other
financially responsible offeror may request the Board to establish the
conditions and amount of compensation. This request must be filed at
the Board within 50 days of the service date of the decision granting
the application or petition for exemption and served concurrently on
all parties to the proceeding. If no other request is filed, the Board
will issue a decision authorizing abandonment or discontinuance within
60 days of the service date of the decision granting the application or
petition for exemption. This decision will be effective on the date of
service.
(ii) Class exemption proceedings. If the carrier seeking the
exemption has received multiple offers of financial assistance from
persons found to be financially responsible and has selected the
offeror with whom it wishes to transact business, the negotiating
parties shall complete the sale or subsidy agreement or request the
Board to establish the conditions and amount of compensation within 60
days after the Federal Register publication described in paragraph
(b)(2)(ii) of this section. A request to the Board to set terms and
conditions must be served concurrently on all parties to the
proceeding. If no agreement on subsidy or sale is reached within the
60-day period and the Board has not been requested to establish the
conditions and amount of compensation, any other financially
responsible offeror may request the Board to establish the conditions
and amount of compensation. This request must be filed at the Board
within 70 days of the Federal Register publication described in
paragraph (b)(2)(ii) of this section and served concurrently on all
parties to the proceeding. If no other request is filed, the Board will
issue a decision vacating the decision postponing the effective date of
the notice of exemption within 80 days of the Federal Register
publication described in paragraph (b)(2)(ii) of this section. The
decision to vacate will be effective on the date of service.
(3) If the Board has established the conditions and amount of
compensation, and the original offer is withdrawn under paragraph
(h)(7) of this section, any other offeror found to be financially
responsible may accept the Board's decision within 20 days after the
service date of the Board's decision setting terms and conditions. If
the decision is accepted by another such offeror, the Board will
require the applicant to accept the terms incorporated in the Board's
decision.
(m) Additional time for filing. Notwithstanding the deadlines
previously set forth in part 1152 for filing an offer of financial
assistance, parties that can show that they would be materially
prejudiced by having less than the full 4 months for filing an offer of
financial assistance provided in 49 U.S.C. 10904(c) for application
proceedings may seek relief under 49 CFR part 1117.
Sec. 1152.28 Public use procedures.
(a)(1) If the Board finds that the present or future public
convenience and necessity require or permit abandonment or
discontinuance, the Board will determine if the involved rail
properties are appropriate for use for other public purposes.
(2) A request for a public use condition under 49 U.S.C. 10905 must
be in writing and set forth:
(i) The condition sought;
(ii) The public importance of the condition;
(iii) The period of time for which the condition would be effective
(up to the statutory maximum of 180 days); and
(iv) Justification for the imposition of the time period. A copy of
the request shall be mailed to the applicant.
(3) For applications filed under part 1152, subpart C, a request
for a public use condition must be filed not more than 45 days after
the application is filed. A decision on the public use request will be
issued by the Board or the Director of the Office of Proceedings prior
to the effective date of the abandonment. For abandonment exemptions
under part 1152, subpart F or exemptions granted on the basis of an
individual petition for exemption filed under 49 U.S.C. 10502, a
request for a public use condition must be filed not more than 20 days
from the date of publication of the notice of exemption in the Federal
Register in the case of class exemptions under subpart F of this part,
or not more than 20 days from the date of publication of notice of the
filing of the petition for individual exemption in the Federal
Register.
(b) If the Board finds that the rail properties are appropriate for
use for other public purposes, the railroad may dispose of the rail
properties only under the conditions described in the Board's decision.
The conditions imposed by the Board may include a prohibition against
the disposal of the rail assets for a period of not more than 180 days
from the effective date of the decision authorizing the abandonment or
discontinuance, unless the properties have first been offered, on
reasonable terms, for sale for public purposes. This period will run
concurrently with any other postponements. Jurisdiction to impose such
conditions expires after 180 days from the effective date of the
decision authorizing the abandonment or discontinuance.
Sec. 1152.29 Prospective use of rights-of-way for interim trail use
and rail banking.
(a) If any state, political subdivision, or qualified private
organization is interested in acquiring or using a right-of-way of a
rail line proposed to be abandoned for interim trail use and rail
banking pursuant to 16 U.S.C. 1247(d), it must file a comment or
otherwise include a request in its filing (in a regulated abandonment
proceeding) or a petition (in an exemption proceeding) indicating that
it would like to do so. The comment/request or petition must include:
(1) A map depicting, and an accurate description of, the right-of-
way, or portion thereof (including mileposts), proposed to be acquired
or used;
(2) A statement indicating the user's willingness to assume full
responsibility: for managing the right-of-way; for any legal liability
arising out of the use of the right-of-way (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 all taxes
assessed against the right-of-way; and
(3) An acknowledgment that interim trail use is subject to the
user's continuing to meet its responsibilities described in paragraph
(a)(2) of this section, and subject to possible future reconstruction
and reactivation of the right-of-way for rail service. The statement
must be in the following form:
Statement of Willingness To Assume Financial Responsibility
In order to establish interim trail use and rail banking under
16 U.S.C. 1247(d) and 49 CFR 1152.29, __________ (Interim Trail
User) is willing to assume 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 owned by __________ (Railroad) and operated
by __________ (Railroad). The property, known as __________ (Name of
Branch Line), extends from railroad milepost __________ near
__________ (Station Name), to railroad
[[Page 67895]]
milepost __________, near __________ (Station name), a distance of
__________ miles in [County(ies), (State(s)]. The right-of-way is
part of a line of railroad proposed for abandonment in Docket No.
STB AB-______ (Sub-No. ______).
A map of the property depicting the right-of-way is attached.
______ (Interim Trail User) acknowledges that use of the right-
of-way is subject to the user's continuing to meet its
responsibilities described above and subject to possible future
reconstruction and reactivation of the right-of-way for rail
service. A copy of this statement is being served on the railroad(s)
on the same date it is being served on the Board.
(b)(1) In abandonment application proceedings under 49 U.S.C.
10903, interim trail use statements are due within the 45-day protest
and comment period following the date the abandonment application is
filed. See Sec. 1152.25(c). The applicant carrier's response notifying
the Board whether and with whom it intends to negotiate a trail use
agreement is due within 15 days after the close of the protest and
comment period (i.e., 60 days after the abandonment application is
filed).
(i) In every proceeding where a Trails Act request is made, the
Board will determine whether the Trails Act is applicable.
(ii) If the Trails Act is not applicable because of failure to
comply with Sec. 1152.29(a), or is applicable but the carrier either
does not intend to negotiate an agreement, or does not timely notify
the Board of its intention to negotiate, a decision on the merits will
be issued and no Certificate of Interim Trail Use or Abandonment will
be issued. If the carrier is willing to negotiate an agreement, and the
public convenience and necessity permit abandonment, the Board will
issue a CITU.
(2) In exemption proceedings, a petition containing an interim
trail use statement is due within 10 days after the date the notice of
exemption is published in the Federal Register in the case of a class
exemption and within 20 days after publication in the Federal Register
of the notice of filing of a petition for exemption in the case of a
petition for exemption. When an interim trail use comment(s) or
petition(s) is filed in an exemption proceeding, the railroad's reply
to the Board (indicating whether and with whom it intends to negotiate
an agreement) is due within 10 days after the date a petition
requesting interim trail use is filed.
(3) Late-filed trail use statements must be supported by a
statement showing good cause for late filing.
(c) Regular and NERSA abandonment proceedings. (1) If continued
rail service does not occur pursuant to 49 U.S.C. 10904 and
Sec. 1152.27, and a railroad agrees to negotiate an interim trail use/
rail banking agreement, then the Board will issue a CITU to the
railroad and to the interim trail user for that portion of the right-
of-way to be covered by the agreement. The CITU will: Permit the
railroad to discontinue service, cancel any applicable tariffs, and
salvage track and material consistent with interim trail use and rail
banking, as long as it is consistent with any other Board order, 30
days after the date it is issued (10 days after issuance in NERSA
proceedings); and permit the railroad to fully abandon the line if no
trail use agreement is reached 180 days after it is issued, subject to
appropriate conditions, including labor protection and environmental
matters.
(2) The CITU will indicate that any interim trail use is subject to
future restoration of rail service, and subject to the user continuing
to meet the financial obligations for the right-of-way. The CITU will
also provide that, if the user intends to terminate trail use, it must
send the Board a copy of the CITU and request that it be vacated on a
specified date. The Board will reopen the abandonment proceeding,
vacate the CITU, and issue a decision permitting immediate abandonment
for the involved portion of the right-of-way. Copies of the decision
will be sent to:
(i) The abandonment applicant;
(ii) The owner of the right-of-way; and
(iii) The current trail user.
(3) If an application to construct and operate a rail line over the
right-of-way is authorized under 49 U.S.C. 10901 and 49 CFR part 1150,
or exempted under 49 U.S.C. 10502, then the CITU will be vacated
accordingly.
(d) Exempt abandonment proceedings. (1) If continued rail service
does not occur under 49 U.S.C. 10904 and Sec. 1152.27 and a railroad
agrees to negotiate an interim trail use/rail banking agreement, then
the Board will issue a Notice of Interim Trail Use or Abandonment
(NITU) to the railroad and to the interim trail user for the portion of
the right-of-way to be covered by the agreement. The NITU will: permit
the railroad to discontinue service, cancel any applicable tariffs, and
salvage track and materials, consistent with interim trail use and rail
banking, as long as it is consistent with any other Board order, 30
days after the date it is issued; and permit the railroad to fully
abandon the line if no agreement is reached 180 days after it is
issued, subject to appropriate conditions, including labor protection
and environmental matters.
(2) The NITU will indicate that interim trail use is subject to
future restoration of rail service, and subject to the user continuing
to meet the financial obligations for the right-of-way. The NITU will
also provide that, if the user intends to terminate trail use, it must
send the Board a copy of the NITU and request that it be vacated on a
specific date. The Board will reopen the exemption proceeding, vacate
the NITU, and issue a decision reinstating the exemption for that
portion of the right-of-way. Copies of the decision will be sent to:
(i) The abandonment exemption applicant;
(ii) The owner of the right-of-way; and
(iii) The current trail user.
(3) If an application to construct and operate a rail line over the
right-of-way is authorized under 49 U.S.C. 10901 and 49 CFR part 1150,
or exempted under 49 U.S.C. 10502, then the NITU will be vacated
accordingly.
(e)(1) Where late-filed trail use statements are accepted, the
Director (or designee) will telephone the railroad to determine whether
abandonment has been consummated and, if not, whether the railroad is
willing to negotiate an interim trail use agreement. The railroad shall
confirm, in writing, its response, within 5 days. If abandonment has
been consummated, the trail use request will be dismissed. If
abandonment has not been consummated but the railroad refuses to
negotiate, then trail use will be denied. If abandonment has not been
consummated and the railroad is willing to negotiate, the abandonment
proceeding will be reopened, the abandonment decision granting an
application, petition for exemption or notice of exemption will be
vacated, and an appropriate CITU or NITU will be issued. The effective
date of the CITU or NITU will be the same date as the vacated decision
or notice.
(2) A railroad that receives authority from the Board to abandon a
line (in a regulated abandonment proceeding under 49 U.S.C. 10903, or
by individual or class exemption issued under 49 U.S.C. 10502) shall
file a notice of consummation with the Board to signify that it has
exercised the authority granted and fully abandoned the line (e.g.,
discontinued operations, salvaged the track, canceled tariffs, and
intends that the property be removed from the interstate rail network).
The notice shall provide the name of the STB proceeding and its docket
number, a brief description of the line, and a statement that the
railroad has consummated, or fully exercised, the abandonment authority
on a certain date. The notice shall be filed within 1 year of the
[[Page 67896]]
service date of the decision permitting the abandonment (assuming that
the railroad intends to consummate the abandonment). Notices will be
deemed conclusive on the point of consummation if there are no legal or
regulatory barriers to consummation (such as outstanding conditions,
including Trails Act conditions). If, after 1 year from the date of
service of a decision permitting abandonment, consummation has not been
effected by the railroad's filing of a notice of consummation, and
there are no legal or regulatory barriers to consummation, the
authority to abandon will automatically expire. In that event, a new
proceeding would have to be instituted if the railroad wants to abandon
the line. Copies of the railroad's notice of consummation shall be
filed with the Secretary of the Board. In addition, the notice of
consummation shall be sent to the State Public Service Commission (or
equivalent agency) of every state through which the line passes.
(f)(1) When a trail user intends to terminate trail use and another
person intends to become a trail user by assuming financial
responsibility for the right-of-way, then the existing and future trail
users shall file, jointly:
(i) A copy of the extant CITU or NITU; and
(ii) A Statement of Willingness to Assume Financial Responsibility
by the new trail user.
(2) The parties shall indicate the date on which responsibility for
the right-of-way is to transfer to the new trail user. The Board will
reopen the abandonment or exemption proceeding, vacate the existing
NITU or CITU; and issue an appropriate replacement NITU or CITU to the
new trail user.
(g) In proceedings where a timely trail use statement is filed, but
due to either the railroad's indication of its unwillingness to
negotiate interim trail use agreement, or its failure to timely notify
the Board of its willingness to negotiate, a decision authorizing
abandonment or an exemption notice or decision is issued instead of a
CITU or NITU, and subsequently the railroad and trail use proponent
nevertheless determine to negotiate an interim trail use agreement
under the Trails Act, then the railroad and trail use proponent must
file a joint pleading requesting that an appropriate CITU or NITU be
issued. If the abandonment has not been consummated, the Board will
reopen the proceeding, vacate the outstanding decision or notice (or
portion thereof), and issue an appropriate CITU or NITU that will
permit the parties to negotiate for a period agreed to by the parties
in their joint filing, but not to exceed 180 days, at the end of which,
the CITU or NITU will convert into a decision or notice permitting
abandonment.
Subpart D--Standards for Determining Costs, Revenues, and Return on
Value
Sec. 1152.30 General.
(a) Contents of subpart. (1) 49 U.S.C. 10904 directs the Board to
determine the extent to which the avoidable costs of providing rail
service plus a reasonable return on the value of the line exceed the
revenues attributable to the line. This subpart contains the
methodology for such determinations and the standards necessary for
application of those terms in the context of a particular proceeding.
Such data will be used in reaching the Board's findings on the merits
of an abandonment or discontinuance proceeding and in making the
necessary financial assistance determinations.
(2) This subpart also sets forth a method by which the carrier may
establish its Forecast Year estimates and Estimated Subsidy Payment to
be included in its application (Sec. 1152.22(d) of this part).
Furthermore, an offeror of financial assistance may use this method to
formulate a subsidy offer and/or Proposed Subsidy Payment under 49
U.S.C. 10904 and Sec. 1152.27 of subpart C of this part.
(b) Data collection. The owning or operating carrier shall
establish a system to collect at branch level the data necessary to
compute the base year data and the final subsidy payment. The
collection and compilation of such data shall be in accordance with the
Branch Line Accounting System (49 CFR part 1201).
(c) Final payment of financial assistance. (1) When a financial
assistance agreement is concluded, the final payment will be adjusted
to reflect the actual revenues derived, avoidable costs incurred, and
value of the properties used in the subsidy year.
(2) Where an adjustment results in an increase in the Estimated
Subsidy Payment upon which the financial assistance agreement is based,
the amount of such increase is limited to 15 percent of the estimated
payment. However, if the railroad notifies the subsidizer that the
estimate will be exceeded by more than 15 percent in one of the
Financial Status Reports (Sec. 1152.37) issued during the first 10
months of the subsidy year or the increase results from an expense
preapproved by the subsidizer, the adjusted amount shall be included in
the final payment.
Sec. 1152.31 Revenue and income attributable to branch lines.
The revenue attributable to the rail properties is the total of the
revenues assigned to the branch in accordance with this section, plus
any subsidy payments that would cease upon discontinuance of service on
the branch, for the subsidy year. The revenues assigned shall be
derived from the following accounts:
(a) Account 101--Freight. The revenue assigned under this account
shall be the actual revenues, including transit revenues, accruing to
the railroad, derived from waybills and other source documents, for all
traffic that:
(1) Originates and terminates on the branch;
(2) Originates or terminates on the branch and is handled off the
branch on the system but not on another carrier; and
(3) Originates or terminates on the branch and is handled on
another carrier. All traffic that is received or forwarded through
interchange at a point on the branch, including ferry operations, shall
be considered as originating or terminating on the branch. The revenues
of all other bridge or overhead traffic that will not be retained by
the carrier shall be attributed to the branch on the ratio of miles
moved on the branch to miles moved on the system, provided, however,
that the parties may agree on a mutually acceptable usage charge for
bridge traffic in lieu of the mileage apportionment.
(b) Account 104--Switching; Account 105--Water transfers; Account
106--Demurrage; Account 110--Incidental; Account 121--Joint Facility-
Credit; Account 122--Joint Facility-Debt; Account 506--Revenues from
Properties Used in Other Than Carrier Operations; Account 510--
Miscellaneous Rent Income; Account 519--Miscellaneous Income. The
revenues assigned under these accounts shall be the actual revenues
accruing to the railroad that are directly attributable to the branch.
(c) Chart For Revenue Accounts.
------------------------------------------------------------------------
Revenue account title Account No.
------------------------------------------------------------------------
Freight................................... 101
Switching................................. 104
Water transfers........................... 105
Demurrage................................. 106
Incidental................................ 110
Joint facility-credit..................... 121
Joint facility-debt....................... 122
Revenues from property used in other than 506, 534
carrier operations, less expenses.
Miscellaneous rent income................. 510
[[Page 67897]]
Miscellaneous income...................... 519
------------------------------------------------------------------------
Sec. 1152.32 Calculation of avoidable costs.
This section defines: which cost elements are eligible for
inclusion in the calculation of avoidable costs; the conditions under
which certain cost elements become eligible for inclusion; and the
basis of apportioning those cost elements which are not assigned to the
branch on an actual expense basis. The avoidable costs of providing
freight service on a branch shall be the total of the costs assigned to
the branch in accordance with this section. The avoidable costs of
providing freight service on a branch shall be just and reasonable, and
shall not exceed those necessary for an honest and efficient operation.
Those expenses apportioned under this section shall be derived from the
latest Form R-1 Annual Report for Class I railroads filed with the
Board prior to the conclusion of the subsidy year, and company records
for all non-Class I railroads, and assigned to the branch according to
the procedures set forth in Sec. 1152.33 of these regulations. When the
term ``Actual'' is specified as the basis for assigning an expense, it
shall mean that the only costs which can be assigned to the account are
those costs which are incurred solely as a result of the continuation
of rail freight service on the branch. The accounts in the following
charts, which list only the ``freight-only'' account numbers, shall
include the portion of common expenses that have been apportioned to
freight service.
----------------------------------------------------------------------------------------------------------------
Operating expense group and accounts Account No. Basis of assignment to on-branch costs
----------------------------------------------------------------------------------------------------------------
(a) Maintenance of way and structures:
(1) Administration: Track:
Salaries and wages......................... 11-13-02 Actual.
Materials.................................. 21-13-02 Do.
Purchased services......................... 41-13-02 Do.
Other expenses............................. 61-13-02 Do.
Bridges and buildings
Salaries and wages......................... 11-13-03 Do.
Materials.................................. 21-13-03 Do.
Purchased services......................... 41-13-03 Do.
Other expenses............................. 61-13-03 Do.
Signals
Salaries and wages......................... 11-13-04 Do.
Materials.................................. 21-13-04 Do.
Purchased services......................... 41-13-04 Do.
Other expenses............................. 61-13-04 Do.
Communications
Salaries and wages......................... 11-13-05 Do.
Materials.................................. 21-13-05 Do.
Purchased services......................... 41-13-05 Do.
Other expenses............................. 61-13-05 Do.
Other
Salaries and wages......................... 11-13-06 Do.
Materials.................................. 21-13-06 Do.
Purchased services......................... 41-13-06 Do.
Other expenses............................. 61-13-06 Do.
(2) Repair maintenance and other roadway--
running:
Salaries and wages......................... 11-11-10 Do.
Materials.................................. 21-11-10 Do.
Repairs by others--DR...................... 39-11-10 Do.
Repairs for others--CR..................... 40-11-10 Do.
Purchased services......................... 41-11-10 Do.
Other expenses............................. 61-11-10 Do.
Roadway--switching
Salaries and wages......................... 11-12-10 Do.
Materials.................................. 21-12-10 Do.
Repairs by others--DR...................... 39-12-10 Do.
Repairs for others--CR..................... 40-12-10 Do.
Purchased services......................... 41-12-10 Do.
Other expenses............................. 61-12-10 Do.
Tunnels and subways--running
Salaries and wages......................... 11-11-11 Do.
Materials.................................. 21-11-11 Do.
Repairs by others--DR...................... 39-11-11 Do.
Repairs for others--CR..................... 40-11-11 Do.
Purchased services......................... 41-11-11 Do.
Other expenses............................. 61-11-11 Do.
Tunnels and subways--switching
Salaries and wages......................... 11-12-11 Do.
Materials.................................. 21-12-11 Do.
Repairs by others--DR...................... 39-12-11 Do.
Repairs for others--CR..................... 40-12-11 Do.
Purchased services......................... 41-12-11 Do.
Other expenses............................. 61-12-11 Do.
Bridges and culverts--running
Salaries and wages......................... 11-11-12 Do.
Materials.................................. 21-11-12 Do.
[[Page 67898]]
Repairs by others--DR...................... 39-11-12 Do.
Repairs for others--CR..................... 40-11-12 Do.
Purchased services......................... 41-11-12 Do.
Other expenses............................. 61-11-12 Do.
Bridges and culverts--switching
Salaries and wages......................... 11-12-12 Do.
Materials.................................. 21-12-12 Do.
Repairs by others--DR...................... 39-12-12 Do.
Repairs for others--CR..................... 40-12-12 Do.
Purchased services......................... 41-12-12 Do.
Other expenses............................. 61-12-12 Do.
Ties--running--material........................ 21-11-13 Do.
Ties--switching--material...................... 21-12-13 Do.
Rails--running--material....................... 21-11-14 Do.
Rails--switching--material..................... 21-12-14 Do.
Other track material--running--material........ 21-11-15 Do.
Other track material--switching--material...... 21-12-15 Do.
Ballast--running--material..................... 21-11-16 Do.
Ballast--switching--material................... 21-12-16 Do.
Track laying and surfacing--running
Salaries and wages......................... 11-11-17 Do.
Materials.................................. 21-11-17 Do.
Repairs by others--DR...................... 39-11-17 Do.
Repairs for others--CR..................... 40-11-17 Do.
Purchased services......................... 41-11-17 Do.
Other expenses............................. 61-11-17 Do.
Track laying and surfacing--switching
Salaries and wages......................... 11-12-17 Do.
Materials.................................. 21-12-17 Do.
Repairs by others--DR...................... 39-12-17 Do.
Repairs for others--CR..................... 40-12-17 Do.
Purchased services......................... 41-12-17 Do.
Other expenses............................. 61-12-17 Do.
Road property damaged--running
Salaries and wages......................... 11-11-48 Do.
Materials.................................. 21-11-48 Do.
Repairs by others--DR...................... 39-11-48 Do.
Repairs for others--CR..................... 40-11-48 Do.
Purchased services......................... 41-11-48 Do.
Other expenses............................. 61-11-48 Do.
Road property damaged--switching
Salaries and wages......................... 11-12-48 Do.
Materials.................................. 21-12-48 Do.
Repairs by others--DR...................... 39-12-48 Do.
Repairs for others--CR..................... 40-12-48 Do.
Purchased services......................... 41-12-48 Do.
Other Expenses............................. 61-12-48 Do.
Road property damaged--other
Salaries and wages......................... 1-13-48 Do.
Materials.................................. 21-13-48 Do.
Repairs by others--DR...................... 39-13-48 Do.
Repairs for others--CR..................... 40-13-48 Do.
Purchased services......................... 41-13-48 Do.
Other expenses............................. 61-13-48 Do.
Signals and interlockers--running
Salaries and wages......................... 11-11-19 Do.
Materials.................................. 21-11-19 Do.
Repairs by others--DR...................... 39-11-19 Do.
Repairs for others--CR..................... 40-11-19 Do.
Purchased services......................... 41-11-19 Do.
Other expenses............................. 61-11-19 Do.
Signals and interlockers--switching
Salaries and wages......................... 11-12-19 Do.
Materials.................................. 21-12-19 Do.
Repairs by others--DR...................... 39-12-19 Do.
Repairs for others--CR..................... 40-12-19 Do.
Purchased services......................... 41-12-19 Do.
Other expenses............................. 61-12-19 Do.
Communications systems
Salaries and wages......................... 11-13-20 Do.
Materials.................................. 21-13-20 Do.
Repairs by others--DR...................... 39-13-20 Do.
Repairs for others--CR..................... 40-13-20 Do.
Purchased services......................... 41-13-20 Do.
[[Page 67899]]
Other expenses............................. 61-13-20 Do.
Electric power systems
Salaries and wages......................... 11-13-21 Do.
Materials.................................. 21-13-21 Do.
Repairs by others--DR...................... 39-13-21 Do.
Repairs for others--CR..................... 40-13-21 Do.
Purchased services......................... 41-13-21 Do.
Other expenses............................. 61-13-21 Do.
Highway grade crossings--running
Salaries and wages......................... 11-11-22 Do.
Materials.................................. 21-11-22 Do.
Repairs by others--DR...................... 39-11-22 Do.
Repairs for others--CR..................... 40-11-22 Do.
Purchased services......................... 41-11-22 Do.
Other expenses............................. 61-11-22 Do.
Highway grade crossings--switching
Salaries and wages......................... 11-12-22 Do.
Materials.................................. 21-12-22 Do.
Repairs by others--DR...................... 39-12-22 Do.
Repairs for others--CR..................... 40-12-22 Do.
Purchased services......................... 41-12-22 Do.
Other expenses............................. 61-12-22 Do.
Station and office buildings
Salaries and wages......................... 11-13-23 Do.
Materials.................................. 21-13-23 Do.
Repairs by others--DR...................... 39-13-23 Do.
Repairs for others--CR..................... 40-13-23 Do.
Purchased services......................... 41-13-23 Do.
Other expenses............................. 61-13-23 Do.
Station buildings--locomotives
Salaries and wages......................... 11-13-24 Do.
Materials.................................. 21-13-24 Do.
Repairs by others--DR...................... 39-13-24 Do.
Repairs for others--CR..................... 40-13-24 Do.
Purchased services......................... 41-13-24 Do.
Other expenses............................. 61-13-24 Do.
Shop buildings--freight cars
Salaries and wages......................... 11-13-25 Do.
Materials.................................. 21-13-25 Do.
Repairs by others--DR...................... 39-13-25 Do.
Repairs for others--CR..................... 40-13-25 Do.
Purchased services......................... 41-13-25 Do.
Other expenses............................. 61-13-25 Do.
Shop buildings--other equipment
Salaries and wages......................... 11-13-26 Do.
Materials.................................. 21-13-26 Do.
Repairs by others--DR...................... 39-13-26 Do.
Repairs for others--CR..................... 40-13-26 Do.
Purchased services......................... 41-13-26 Do.
Other expenses............................. 61-13-26 Do.
Locomotive servicing facilities
Salaries and wages......................... 11-13-27 Do.
Materials.................................. 21-13-27 Do.
Repairs by others--DR...................... 39-13-27 Do.
Repairs for others--CR..................... 40-13-27 Do.
Purchased services......................... 41-13-27 Do.
Other expenses............................. 61-13-27 Do.
Miscellaneous buildings and structures
Salaries and wages......................... 11-13-28 Do.
Materials.................................. 21-13-28 Do.
Repairs by others--DR...................... 39-13-28 Do.
Repairs for others--CR..................... 40-13-28 Do.
Purchased services......................... 41-13-28 Do.
Other expenses............................. 61-13-28 Do.
Coal terminals
Salaries and wages......................... 11-13-29 Do.
Materials.................................. 21-13-29 Do.
Repairs by others--DR...................... 39-13-29 Do.
Repairs for others--CR..................... 40-13-29 Do.
Purchased services......................... 41-13-29 Do.
Other expenses............................. 61-13-29 Do.
Ore terminals
Salaries and wages......................... 11-13-30 Do.
Materials.................................. 21-13-30 Do.
[[Page 67900]]
Repairs by others--DR...................... 39-13-30 Do.
Repairs for others--CR..................... 40-13-30 Do.
Purchased services......................... 41-13-30 Do.
Other expenses............................. 61-13-30 Do.
TOFC/COFC terminals
Salaries and wages......................... 11-13-31 Do.
Materials.................................. 21-13-31 Do.
Repairs by others--DR...................... 39-13-31 Do.
Repairs for others--CR..................... 40-13-31 Do.
Purchased services......................... 41-13-21 Do.
Other expenses............................. 61-13-31 Do.
Other marine terminals
Salaries and wages......................... 11-13-32 Do.
Materials.................................. 21-13-32 Do.
Repairs by others--DR...................... 39-13-32 Do.
Repairs for others--CR..................... 40-13-32 Do.
Purchased services......................... 41-13-32 Do.
Other expenses............................. 61-13-32 Do.
Motor vehicle loading and distribution
facilities
Salaries and wages......................... 11-13-33 Do.
Materials.................................. 21-13-33 Do.
Repairs by others--DR...................... 39-13-33 Do.
Repairs for others--CR..................... 40-13-33 Do.
Purchased services......................... 41-13-33 Do.
Other expenses............................. 61-13-33 Do.
Facilities for other specialized service
operations
Salaries and wages......................... 11-13-35 Do.
Materials.................................. 21-13-35 Do.
Repairs by others--DR...................... 39-13-35 Do.
Repairs for others--CR..................... 40-13-35 Do.
Purchased services......................... 41-13-35 Do.
Other expenses............................. 61-13-35 Do.
Roadway machines
Salaries and wages......................... 11-13-36 Daily repair costs per GMA, for each type of
machine used on the branch line sec.
1152.33(a)(1).
Materials.................................. 21-13-36 Do.
Repairs by others--DR...................... 39-13-36 Do.
Repairs for others--CR..................... 40-13-36 Do.
Purchased services......................... 41-13-36 Do.
Other expenses............................. 61-13-36 Do.
Small tools and supplies
Other expenses............................. 11-13-37 Assign supplies on the daily costs per GMA, for
each type of machine used on the branch; small
tool assign to maintenance of way 11- 11/12-10
through 17, and 48, sec. 1152.33(a)(2).
Materials.................................. 21-13-37 Do.
Repairs by others--DR...................... 39-13-37 Do.
Repairs for others--CR..................... 40-13-37 Do.
Purchased services......................... 41-13-37 Do.
Other expenses............................. 61-13-37 Do.
Snow removal
Salaries and wages......................... 11-13-38 Actual.
Materials.................................. 21-13-38 Do.
Repairs by others--DR...................... 39-13-38 Do.
Repairs for others--CR..................... 40-13-38 Do.
Purchased Services......................... 41-13-38 Do.
Other expenses............................. 61-13-38 Do.
Fringe benefits--running....................... 12-11-00 11-11-XX, sec. 1152.33(a)(3)(i).
Fringe benefits--switching..................... 12-12-00 11-12-XX, sec. 1152.33(a)(3)(ii).
Fringe benefits--other......................... 12-13-00 11-13-XX, sec. 1152.33(a)(3)(iii).
Casualties and insurance--running
Other casualties........................... 52-11-00 Actual.
Insurance.................................. 53-11-00 Do.
Casualties and insurance--switching
Other casualties........................... 52-12-00 Do.
Insurance.................................. 53-12-00 Do.
Lease rentals--debit--running.................. 31-11-00 Do.
Lease rentals--debit--switching................ 31-12-00 Do.
Lease rentals--debit--other.................... 31-13-00 Do.
Lease rentals--credit--running................. 32-11-00 Do.
Lease rentals--credit--switching............... 32-12-00 Do.
Lease rentals--credit--other................... 32-13-00 Do.
Joint facility rent--debit--running............ 33-11-00 Do.
Joint facility rent--debit--switching.......... 33-12-00 Do.
[[Page 67901]]
Casualties and insurance--other
Other casualties........................... 52-13-00 Do.
Insurance.................................. 53-13-00 Do.
Joint facility--debit--other................... 33-13-00 Do.
Joint facility rent--credit--running........... 34-11-00 Do.
Joint facility rent--credit--switching......... 34-12-00 Do.
Joint facility rent--credit--other............. 34-13-00 Do.
Other rents--debit--running.................... 35-11-00 Do.
Other rents--debit--switching.................. 35-12-00 Do.
Other rents--debit--other...................... 35-13-00 Do.
Other rents--credit--running................... 36-11-00 Do.
Other rents--credit--switching................. 36-12-00 Do.
Other rents--credit--other..................... 36-13-00 Do.
Depreciation--running.......................... 62-11-00 Do.
Depreciation--switching........................ 62-12-00 Do.
Depreciation--other............................ 62-13-00 Do.
Joint facility--debit--running................. 37-11-00 Do.
Joint facility--debit--switching............... 37-12-00 Do.
Joint facility--debit--other................... 37-13-00 Do.
Joint facility--credit--running................ 38-11-00 Do.
Joint facility--credit--switching.............. 38-12-00 Do.
Joint facility--credit--other.................. 38-13-00 Do.
Dismantling retired road property--
running
Salaries and wages......................... 11-11-39 Do.
Materials.................................. 21-11-39 Do.
Purchased services......................... 41-11-39 Do.
Other expenses............................. 61-11-39 Do.
Dismantling retired road property--
switching
Salaries and wages......................... 11-12-39 Do.
Materials.................................. 21-12-39 Do.
Purchased services......................... 41-12-39 Do.
Other expenses............................. 61-12-39 Do.
Dismantling retired road property--other
Salaries and wages......................... 11-13-39 Do.
Materials.................................. 21-13-39 Do.
Purchased services......................... 41-13-39 Do.
Other expenses............................. 61-13-39 Do.
Other--running
Salaries and wages......................... 11-11-99 Do.
Materials.................................. 21-11-99 Do.
Purchased services......................... 41-11-99 Do.
Other expenses............................. 61-11-99 Do.
Other--switching
Salaries and wages......................... 11-12-99 Do.
Materials.................................. 21-12-99 Do.
Purchased Services......................... 41-12-99 Do.
Other Expenses............................. 61-12-99 Do.
Other--other
Salaries and wages......................... 11-13-99 Do.
Materials.................................. 21-13-99 Do.
Purchased services......................... 41-13-99 Do.
Other expenses............................. 61-13-99 Do.
(b) Maintenance of equipment:
(1) Locomotives: Administration
Salaries and wages......................... 11-21-01 Do.
Materials.................................. 21-21-01 Do.
Purchased services......................... 41-21-01 Do.
Other expenses............................. 61-21-01 Do.
Repairs and maintenance
Salaries and wages......................... 11-21-41 Road diesel and road electric locomotive gross
ton miles. Yard diesel and yard electric
locomotive unit hours, Sec. 1152.33(b)(1).
Materials.................................. 21-21-41 Do.
Repairs by others--DR...................... 39-21-41 Do.
Repairs for others--CR..................... 40-21-41 Do.
Purchased services......................... 41-21-41 Do.
Other expenses............................. 61-21-41 Do.
Machinery repair
Salaries and wages......................... 11-21-40 Actual.
Materials.................................. 21-21-40 Do.
Repairs by others--DR...................... 39-21-40 Do.
Repairs for others--CR..................... 40-21-40 Do.
Purchased services......................... 41-21-40 Do.
Other expenses............................. 61-21-40 Do.
[[Page 67902]]
Equipment damaged
Salaries and wages......................... 11-21-48 Do.
Materials.................................. 21-21-48 Do.
Repairs by others--DR...................... 39-21-48 Do.
Repairs for others--CR..................... 40-21-48 Do.
Purchased services......................... 41-21-48 Do.
Other expenses............................. 61-21-48 Do.
Equipment damaged
Fringe benefits................................ 12-21-00 11-21-XX, sec. 1152.33(b)(3)(i).
Other casualties and insurance
Other casualties........................... 52-21-00 Actual.
Insurance.................................. 53-21-00 Do.
Lease rentals--debit........................... 31-21-00 Do.
Lease rentals--credit.......................... 32-21-00 Do.
Joint facility rent--debit..................... 33-21-00 Do.
Joint facility rent--credit.................... 34-21-00 Do.
Other rents--debit............................. 35-21-00 Do.
Other rents--credit............................ 36-21-00 Do.
Joint facility--debit.......................... 37-21-00 Do.
Joint facility--credit......................... 38-21-00 Do.
Depreciation................................... 62-21-00 All locomotives, locomotive unit hours, sec.
1152.33(b)(2).
Dismantling retired property
Salaries and wages......................... 11-21-39 Actual.
Materials.................................. 21-21-39 Do.
Purchased services......................... 41-21-39 Do.
Other expenses............................. 61-21-39 Do.
Other
Salaries and wages......................... 11-21-99 Do.
Materials.................................. 21-21-99 Do.
Purchased services......................... 41-21-99 Do.
Other expenses............................. 61-21-99 Do.
(2) Freight cars: Administration:
Salaries and wages......................... 11-22-01 Do.
Materials.................................. 21-22-01 Do.
Purchased services......................... 41-22-01 Do.
Other expenses............................. 61-22-01 Do.
Machinery repair
Salaries and wages......................... 11-22-40 Do.
Materials.................................. 21-22-40 Do.
Repairs by others--DR...................... 39-22-40 Do.
Repairs for others--CR..................... 40-22-40 Do.
Purchased services......................... 41-22-40 Do.
Other expenses............................. 61-22-40 Do.
Equipment damage
Salaries and wages......................... 11-22-48 Do.
Materials.................................. 21-22-48 Do.
Repairs by others--DR...................... 39-22-48 Do.
Repairs for others--CR..................... 40-22-48 Do.
Purchased services......................... 41-22-48 Do.
Other expenses............................. 61-22-48 Do.
Fringe benefits................................ 12-22-00 11-22-XX, sec. 1152.33-(b)(3)(iii).
Other casualties and insurance
Other casualties........................... 52-22-00 Actual.
Insurance.................................. 53-22-00 Do.
Joint facility rent--DR........................ 33-22-00 Do.
Joint facility rent--CR........................ 34-22-00 Do.
Joint facility--DR............................. 37-22-00 Do.
Joint facility--CR............................. 38-22-00 Do.
Dismantling retired property
Salaries and wages......................... 11-22-39 Do.
Materials.................................. 21-22-39 Do.
Purchased services......................... 41-22-39 Do.
Other expenses............................. 61-22-39 Do.
Other
Salaries and wages......................... 11-22-99 Do.
Materials.................................. 21-22-99 Do.
Purchased services......................... 41-22-99 Do.
Other expenses............................. 61-22-99 Do.
Freight car costs per day and per mile:
Repair and maintenance
Salaries and wages......................... 11-22-42 These accounts are used to develop the cost per
car day and per car mile for each type of car,
sec. 1152.32(g).
Materials.................................. 21-22-42 Do.
Repairs by others--DR...................... 39-22-42 Do.
[[Page 67903]]
Repairs for others--CR..................... 40-22-42 Do.
Purchased services......................... 41-22-42 Do.
Other expenses............................. 61-22-42 Do.
Lease rentals--DR.............................. 31-22-00 ...............................................
Lease rentals--CR.............................. 32-22-00 ...............................................
Depreciation................................... 62-22-00 ...............................................
Other rents--DR................................ 35-22-00 ...............................................
Other rents--CR................................ 36-22-00 ...............................................
(3) Other equipment: Administration
Salaries and wages......................... 11-23-01 Actual.
Materials.................................. 21-23-01 Do.
Purchased services......................... 41-23-01 Do.
Other expenses............................. 61-23-01 Do.
Repair and maintenance: Trucks, trailers and
containers--revenue service
Salaries and wages......................... 11-23-43 Do.
Materials.................................. 21-23-43 Do.
Repairs by others--DR...................... 39-23-43 Do.
Repairs for others--CR..................... 40-23-43 Do.
Purchased services......................... 41-23-43 Do.
Other expenses............................. 61-23-43 Do.
Floating equipment--revenue service
Salaries and wages......................... 11-23-44 Do.
Materials.................................. 21-23-44 Do.
Repairs by others--DR...................... 39-23-44 Do.
Repairs for others--CR..................... 40-23-44 Do.
Purchased services......................... 41-23-44 Do.
Other expenses............................. 61-23-44 Do.
Computer and data processing
Salaries and wages......................... 11-23-46 Do.
Materials.................................. 21-23-46 Do.
Repairs by others--DR...................... 39-23-46 Do.
Repairs for others--CR..................... 40-23-46 Do.
Purchased services......................... 41-23-46 Do.
Other expenses............................. 61-23-46 Do.
Machinery
Salaries and wages......................... 11-23-40 Do.
Materials.................................. 21-23-40 Do.
Repairs by others--DR...................... 39-23-40 Do.
Repairs for others--CR..................... 40-23-40 Do.
Purchased services......................... 41-23-40 Do.
Other expenses............................. 61-23-40 Do.
Work and other non revenue equipment
Salaries and wages......................... 11-23-47 Do.
Materials.................................. 21-23-47 Do.
Repairs by others--DR...................... 39-23-47 Do.
Repairs for others--CR..................... 40-23-47 Do.
Purchased services......................... 41-23-47 Do.
Other expenses............................. 61-23-47 Do.
Equipment damaged
Salaries and wages......................... 11-23-48 Do.
Materials.................................. 21-23-48 Do.
Repairs by others--DR...................... 39-23-48 Do.
Repairs for others--CR..................... 40-23-38 Do.
Purchased services......................... 41-23-48 Do.
Other expenses............................. 61-23-48 Do.
Equipment damaged
Fringe benefits................................ 12-23-00 11-23-XX, sec. 1152.33(b)(3)(ii).
Other casualties and insurance
Other casualties........................... 52-23-00 Actual.
Insurance................................ 53-23-00 Do.
Lease rentals--DR.......................... 31-23-00 Do.
Lease rentals--CR.......................... 32-23-00 Do.
Joint facility rent--DR.................... 33-23-00 Do.
Joint facility rent--CR.................... 34-23-00 Do.
Other rents--DR............................ 35-23-00 Do.
Other rents--CR............................ 36-23-00 Do.
Depreciation............................... 62-23-00 Do.
Joint facility--DR......................... 37-23-00 Do.
Joint facility--CR......................... 38-23-00 Do.
Dismantling retired property
Salaries and wages......................... 11-23-39 Do.
Materials.................................. 21-23-39 Do.
Purchased services......................... 41-23-39 Do.
[[Page 67904]]
Other expenses............................. 61-23-39 Do.
Other
Salaries and wages......................... 11-23-99 Do.
Materials.................................. 21-23-99 Do.
Purchased services......................... 41-23-99 Do.
Other expenses............................. 61-23-99 Do.
(c) Transportation:
(1) Train operations: Administration:
Salaries and wages......................... 11-31-01 Do.
Materials.................................. 21-31-01 Do.
Purchased services......................... 41-31-01 Do.
Other expenses............................. 61-31-01 Do.
Engine crews
Salaries and wages......................... 11-31-56 Do.
Materials.................................. 21-31-56 Train hours, sec. 1152.33(c)(1)(i).
Purchased services......................... 41-31-56 Actual.
Other expenses............................. 61-31-56 Do.
Train crews
Salaries and wages......................... 11-31-57 Do.
Materials.................................. 21-31-57 Train hours, sec. 1152.33(c)(1)(i).
Purchased services......................... 41-31-57 Actual.
Other expenses............................. 61-31-57 Do.
Dispatching trains
Salaries and wages......................... 11-31-58 Do.
Materials.................................. 21-31-58 Do.
Purchased services......................... 41-31-58 Do.
Other expenses............................. 61-31-58 Do.
Operating signals and interlockers
Salaries and wages......................... 11-31-59 Do.
Materials.................................. 21-31-59 Do.
Purchased services......................... 41-31-59 Do.
Other expenses............................. 61-31-59 Do.
Operating drawbridges
Salaries and wages......................... 11-31-60 Do.
Materials.................................. 21-31-60 Do.
Purchased services......................... 41-31-60 Do.
Other expenses............................. 61-31-60 Do.
Highway crossing protection
Salaries and wages......................... 11-31-61 Do.
Materials.................................. 21-31-61 Do.
Purchased services......................... 41-31-61 Do.
Other expenses............................. 61-31-61 Do.
Train and inspection and lubrication
Salaries and wages......................... 11-31-62 Train hours, Sec. 1152.33(c)(1)(i).
Materials.................................. 21-31-62 Do.
Purchased services......................... 41-31-62 Actual.
Other expenses............................. 61-31-62 Do.
Locomotive fuel
Salaries and wages......................... 11-31-67 Diesel locomotive unit hours, Sec.
1152.33(c)(1)(ii).
Materials.................................. 21-31-67 Do.
Purchased services......................... 41-31-67 Do.
Other expenses............................. 61-31-67 Do.
Electric power purchased or produced for
motive power
Salaries and wages......................... 11-31-68 Electric locomotive unit hours, sec.
1152.33(c)(1)(iii).
Materials.................................. 21-31-68 Do.
Purchased services......................... 41-31-68 Do.
Other expenses............................. 61-31-68 Do.
Servicing locomotives
Salaries and wages......................... 11-31-69 Locomotive unit miles, sec. 1152.33(c)(1)(iv).
Materials.................................. 21-31-69 Do.
Purchased services......................... 41-31-69 Do.
Other expenses............................. 61-31-69 Do.
Freight lost or damaged--solely related........ 51-31-00 Actual.
Clearing wrecks
Salaries and wages......................... 11-31-63 Do.
Materials.................................. 21-31-63 Do.
Purchased services......................... 41-31-63 Do.
Other expenses............................. 61-31-63 Do.
Fringe benefits................................ 12-31-00 11-31-XX, sec. 1152.33 (c)(4)(i).
Other casualties and insurance
Other casualties........................... 52-31-00 Actual.
Insurance.................................. 53-31-00 Do.
Joint facility--DR......................... 37-31-00 Do.
Joint facility--CR......................... 38-31-00 Do.
[[Page 67905]]
Other
Salaries and wages......................... 11-31-99 Do.
Materials.................................. 21-31-99 Do.
Purchased services......................... 41-31-99 Do.
Other expenses............................. 61-31-99 Do.
(2) Yard operations: Administration:
Salaries and wages......................... 11-32-01 Do.
Materials.................................. 21-32-01 Do.
Purchased services......................... 41-32-01 Do.
Other expenses............................. 61-32-01 Do.
Switch crews
Salaries and wages......................... 11-32-64 Do.
Materials.................................. 21-32-64 Locomotive unit hours, sec. 1152.33(c)(2)(i)
Purchased services......................... 41-32-64 Actual.
Other expenses............................. 61-32-64 Do.
Controlling operations
Salaries and wages......................... 11-32-65 Do.
Materials.................................. 21-32-65 Do.
Purchased services......................... 41-32-65 Do.
Other expenses............................. 61-32-65 Do.
Yard and terminal clerical
Salaries and wages......................... 11-32-66 Do.
Materials.................................. 21-32-66 Do.
Purchased services......................... 41-32-66 Do.
Other expenses............................. 61-32-66 Do.
Operating switches, signals, retarders
and humps
Salaries and wages......................... 11-32-59 Do.
Materials.................................. 21-32-59 Do.
Purchased services......................... 41-32-59 Do.
Other expenses............................. 61-32-59 Do.
Locomotive fuel
Salaries and wages......................... 11-32-67 Dieselloco motive unit hours, sec.
1152.33(c)(2)(ii)
Materials.................................. 21-32-67 Do.
Purchased services......................... 41-32-67 Do.
Other expenses............................. 61-32-67 Do.
Electric power purchased or produced for
motive power
Salaries and wages......................... 11-32-68 Electric locomotive unit hours, sec.
1152.33(c)(2)(iii).
Materials.................................. 21-32-68 Do.
Purchased services......................... 41-32-68 Do.
Other expenses............................. 61-32-68 Do.
Servicing locomotives
Salaries and wages......................... 11-32-69 Locomotive unit hours, sec. 1152.33(c)(2)(i).
Materials.................................. 21-32-69 Do.
Purchased services......................... 41-32-69 Do.
Other expenses............................. 61-32-69 Do.
Freight lost or damaged--solely related........ 51-32-00 Actual.
Clearing wrecks
Salaries and wages......................... 11-32-63 Do.
Materials.................................. 21-32-63 Do.
Purchased services......................... 41-32-63 Do.
Other expenses............................. 61-32-63 Do.
Fringe benefits............................ 12-32-00 11-32-XX, sec. 1152.33(c)(4)(ii).
Other casualties and insurance
Other casualties........................... 52-32-00 Actual.
Insurance.................................. 53-32-00 Do.
Joint facility--DR......................... 37-32-00 Do.
Joint facility--CR......................... 38-32-00 Do.
Other
Salaries and wages......................... 11-32-99 Do.
Materials.................................. 21-32-99 Do.
Purchased services......................... 41-32-99 Do.
Other expenses............................. 61-32-99 Do.
(3) Train and yard operations common:
Cleaning car interiors
Salaries and wages......................... 11-33-70 Do.
Materials.................................. 21-33-70 Do.
Purchased services......................... 41-33-70 Do.
Adjusting and transferring loads
Salaries and wages......................... 11-33-71 Do.
Materials.................................. 21-33-71 Do.
Purchased services......................... 41-33-71 Do.
Carloading devices and grain doors
Salaries and wages......................... 11-33-72 Do.
Materials.................................. 21-33-72 Do.
[[Page 67906]]
Purchased services......................... 41-33-72 Do.
Freight lost or damaged--all other............. 51-33-00 Do.
Fringe benefits................................ 12-33-00 11-33-XX, sec. 1152.33(c)(4)(iii).
(4) Specialized service operations:
Administration:
Salaries and wages......................... 11-34-01 Actual.
Materials.................................. 21-34-01 Do.
Purchased services......................... 41-34-01 Do.
Other expenses............................. 61-34-01 Do.
Pick-up and delivery, marine line haul,
and rail substitute service
Salaries and wages......................... 11-34-73 Do.
Materials.................................. 21-34-73 Do.
Purchased services......................... 41-34-73 Do.
Other expenses............................. 61-34-73 Do.
Loading and unloading and local marine
Salaries and wages......................... 11-34-74 Do.
Materials.................................. 21-34-74 Do.
Purchased services......................... 41-34-74 Do.
Other expenses............................. 61-34-74 Do.
Protective services
Salaries and wages......................... 11-34-75 Do.
Materials.................................. 21-34-75 Do.
Purchased services......................... 41-34-75 Do.
Other expenses............................. 61-34-75 Do.
Freight lost or damaged--Solely related........ 51-34-00 Do.
Fringe benefits................................ 12-34-00 11-34-XX, sec. 1152.33(c)(4)(iv).
Casualties and insurance
Other casualties........................... 52-34-00 Actual.
Insurance.................................. 53-34-00 Do.
Joint facility--DR......................... 37-34-00 Do.
Joint facility--CR......................... 38-34-00 Do.
Other
Salaries and wages......................... 11-34-99 Do.
Materials.................................. 21-34-99 Do.
Purchased services......................... 41-34-99 Do.
Other expenses............................. 61-34-99 Do.
(5) Administrative support operations:
Administration :
Salaries and wages......................... 11-35-01 Do.
Materials.................................. 21-35-01 Do.
Purchased services......................... 41-35-01 Do.
Other expenses............................. 61-35-01 Do.
Employees performing clerical and
accounting functions
Salaries and wages......................... 11-35-76 Do.
Materials.................................. 21-35-76 Do.
Purchased services......................... 41-35-76 Do.
Other expenses............................. 61-35-76 Do.
Communication systems operation
Salaries and wages......................... 11-35-77 Do.
Materials.................................. 21-35-77 Do.
Purchased services......................... 41-35-77 Do.
Other expenses............................. 61-35-77 Do.
Loss and damage claims processing
Salaries and wages......................... 11-35-78 Number of claims, sec. 1152.33(c)(3)(i).
Materials.................................. 21-35-78 Do.
Purchased services......................... 41-35-78 Do.
Other expenses............................. 61-35-78 Do.
Fringe benefits................................ 12-35-00 11-35-XX. sec. 1152.33(c)(4)(v).
Joint facility--DR............................. 37-35-00 Actual.
Joint facility--CR............................. 38-35-00 Do.
Casualties and insurance...................
Other casualties........................... 52-35-00 Do.
Insurance.................................. 53-35-00 Do.
Other
Salaries and wages......................... 11-35-99 Do.
Materials.................................. 21-35-99 Do.
Purchased services......................... 41-35-99 Do.
Other expenses............................. 61-35-99 Do.
(d) General Administrative Officers--general
administration:
Salaries and wages......................... 11-61-01 Do.
Materials.................................. 21-61-01 Do.
Purchased services......................... 41-61-01 Do.
Other expenses............................. 61-61-01 Do.
Accounting, auditing and finance
Salaries and wages......................... 11-61-86 Do.
[[Page 67907]]
Materials.................................. 21-61-86 Do.
Purchased services......................... 41-61-86 Do.
Other expenses............................. 61-61-86 Do.
Management services and data processing
Salaries and wages......................... 11-61-87 Do.
Materials.................................. 21-61-87 Do.
Purchased services......................... 41-61-87 Do.
Other expenses............................. 61-61-87 Do.
Marketing:
Salaries and wages......................... 11-61-88 Do.
Materials.................................. 21-61-88 Do.
Purchased services......................... 41-61-88 Do.
Other expenses............................. 61-61-88 Do.
Sales
Salaries and wages......................... 11-61-89 Do.
Materials.................................. 21-61-89 Do.
Purchased services......................... 41-61-89 Do.
Other expenses............................. 61-61-89 Do.
Industrial development
Salaries and wages......................... 11-61-90 Do.
Materials.................................. 21-61-90 Do.
Purchased services......................... 41-61-90 Do.
Other expenses............................. 61-61-90 Do.
Personnel and labor relations
Salaries and wages......................... 11-61-91 Do.
Materials.................................. 21-61-91 Do.
Purchased services......................... 41-61-91 Do.
Other expenses............................. 61-61-91 Do.
Legal and secretarial
Salaries and wages......................... 11-61-92 Do.
Materials.................................. 21-61-92 Do.
Purchased services......................... 41-61-92 Do.
Other expenses............................. 61-61-92 Do.
Public relations and advertising
Salaries and wages......................... 11-61-93 Do.
Materials.................................. 21-61-93 Do.
Purchased services......................... 41-61-93 Do.
Other expenses............................. 61-61-93 Do.
Research and development
Salaries and wages......................... 11-61-94 Do.
Materials.................................. 21-61-94 Do.
Purchased services......................... 41-61-94 Do.
Other expenses............................. 61-61-94 Do.
Fringe benefits................................ 12-61-00 11-61-XX, sec. 1152.33(d)(1).
Casualties and insurance
Other casualties........................... 52-61-00 Actual
Insurance.................................. 53-61-00 Do.
Writedown of uncollectible accounts............ 63-61-00 Do.
Other taxes except on corporate income or 65-61-00 Do.
payroll.
Joint facility--DR............................. 37-61-00 Do.
Joint facility--CR............................. 38-61-00 Do.
Other
Salaries and wages......................... 11-61-99 Do.
Materials.................................. 21-61-99 Do.
Purchased services......................... 41-61-99 Do.
Other expenses............................. 61-61-99 Do.
----------------------------------------------------------------------------------------------------------------
(e) Deadheading, taxi, and hotel costs. The costs assigned under
this subsection shall be the actual costs incurred as a result of
providing service to the branch line for deadheading, taxi, and hotel
costs. The amounts included under this subsection shall not be included
under other subsections of these regulations.
(f) Overhead movement costs. The costs assigned under this
subsection shall be the actual costs incurred in moving over any other
rail line solely to reach and provide service to the branch. The
amounts shown under this subsection shall not be included under other
subsections of these regulations.
(g) Freight car costs. For Class I railroads, the on-segment costs
for time-mileage freight cars shall be calculated on the basis of the
carrier's average cost per day and per mile. Those freight cars that
are rented on a straight mileage basis are to be costed on the
carrier's average cost per mile for each type of car rented on this
basis. No costs are to be included in the calculation for private line
(shipper owned) or other cars for which the railroad does not make
payments. The cost per day and per mile shall be calculated separately
for each type of car specified in Ex Parte No. 334, Car Service
Compensation--Basic Per Diem Charges, 362 I.C.C. 884 (1980). The
freight car costs shall be separated between ``return on value-freight
cars'' and ``freight car costs other than return on freight cars''. The
costs assigned to a line under this subsection
[[Page 67908]]
are to be derived from the accounts listed below.
------------------------------------------------------------------------
Operating expense group--Repair and maintenance Account No.
------------------------------------------------------------------------
Salaries and wages........................................ 11-22-42
Materials................................................. 21-22-42
Repairs by others--DR..................................... 39-22-42
Repairs for others--CR.................................... 40-22-42
Purchased services........................................ 41-22-42
Other expenses............................................ 61-22-42
Lease rentals--DR......................................... 31-22-00
Lease rentals--CR......................................... 32-22-00
Depreciation
Other rents--DR......................................... 35-22-00
Other rents--CR......................................... 36-22-00
------------------------------------------------------------------------
The system total of the repair and maintenance accounts, all
accounts designated XX-XX-42, and depreciation shall be divided into
time-related costs and mileage-related costs on the basis of 50 percent
time and 50 percent mileage for repairs, and 60 percent time and 40
percent mileage for depreciation. Freight car costs shall not include
depreciation as determined in Account No. 62-22-00. Freight car
depreciation shall be calculated in the manner set forth in paragraph
(g)(3)(i) of this section. The system total receipts and payments for
the hire of time-mileage cars, and the basic data used in the
development of the car-day and car-mile factors, shall be taken from
the carrier's latest Form R-1 and company records. The specific steps
to complete the calculation are as follows:
(1) The total system car days by car type shall be calculated by:
(i) Averaging the carrier's freight car ownership at the beginning
and end of the year (Form R-1, schedule 710, columns (b) and (k);
(ii) Multiplying the average by the standard active number of car
days (346) as developed in ICC Docket No. 31358;
(iii) Subtracting car days on foreign lines (source: Company
records); and
(iv) Adding the foreign car days on home line (source: Company
records). This procedure shall be followed for each car type specified
in Ex Parte No. 334, supra.
(2) The total railroad car miles shall be calculated by adding the
loaded car miles for the railroad owned and leased cars (R-1, Schedule
755) to empty car miles for the railroad owned or leased cars (R-1,
Schedule 755). The total car miles, loaded and empty, shall be
calculated for each car type specified in Ex Parte No. 334, supra.
(3) The cost per car day shall be calculated for each type of time-
mileage car by adding 50 percent of total freight car repair costs for
each type (Form R-1, schedule 415, column (b)), and 60 percent of the
depreciation shall be developed as follows:
(i) The current value for each type of car shall be calculated by
first arriving at the current cost per car using the most recent
purchase of this type by the railroad indexed to the midpoint of the
year or a price quote from the manufacturer. This unit price shall be
applied to the average number of this type of car owned by the carrier
during the year. The current value developed for each car type is then
multiplied by the composite depreciation rate for that type of car as
shown in the latest annual report filed with the Board or company
records.
(ii) Add 100 percent of the return on investment. Return on
investment shall be determined by multiplying the current value of each
type of car, developed in paragraph (g)(3)(i) of this section, by 1
minus the ratio of accumulated depreciation to the total original cost
investment. This will determine the net current value for each type of
car. The net current value for each type of car shall then be
multiplied by the nominal rate of return calculated in Sec. 1152.34(d)
to obtain nominal return on investment for each type of car. The total
return on investment shall then be calculated by deducting the
projected holding gain (loss) for the forecast and/or subsidy year from
the nominal return on investment for each type of car. In any instance
where the holding gain is not specifically determined for freight cars,
the Gross Domestic Product deflator calculated by the U.S. Department
of Commerce shall be used. The total return on investment for each type
of car shall then be divided by total car-days for each car-type
developed in paragraph (g)(1) of this section.
(iii) To the amounts for repairs and depreciation, add the time
portion of the railroad's payment for hire of time-mileage freight cars
(Form R-1, schedule 414, column (g)), and subtract the time portion of
the railroad's receipts for hire of time mileage freight cars (Form R-
1, schedule 414, column (d)). The total of these costs is divided by
the total car days for each type developed in paragraph (g)(1) of this
section.
(4) The cost per mile shall be calculated for each type of time-
mileage car as follows. First, add:
(i) 50 percent of the total freight train car repair cost for each
car type (Form R-1, schedule 415, column (b));
(ii) 40 percent of the total depreciation costs for each car type
developed in paragraph (g)(3)(i) of this section; and
(iii) The mileage portion of the carrier's payments for the hire of
time-mileage freight cars (Form R-1, schedule 414, column (f)).
Second, subtract the mileage portion of the carrier's receipts for hire
of time-mileage freight cars (Form R-1, schedule 414, column (c)).
Finally, divide the result by the total car-miles for each car-type
developed in paragraph (g)(2) of this section.
(5) The costs per car day and per car mile developed in paragraphs
(g) (3) and (4) of this section shall be applied to the total car days
and total car miles for each car type accumulated on the line segment
for all traffic originated and/or terminated on the segment plus those
freight cars that bridge the line segment which are attributed to time-
mileage freight train cars. The on-segment costs for freight cars
rented on a straight mileage basis shall be the railroad's total
payments for mileage cars (Form R-1, schedule 414, column (e)) for each
car type divided by the total miles on which the charges were based.
(6) For Class II and III railroads, the on-segment costs for time-
mileage and straight mileage freight cars shall be calculated in the
same manner prescribed for Class I railroads, using the latest data
available.
(h) Return on investment--locomotive (line). The return on
investment shall be calculated for each type of classification of
locomotive that is actually used to provide service to the line
segment. The return for the locomotive(s) used shall be calculated in
accordance with the following procedure:
(1) The current replacement cost for each type of locomotive used
to serve the line segment shall be based on the most recent purchase of
that particular type and size locomotive by the carrier, indexed to the
midpoint of the forecast and/or subsidy year, or on an amount quoted by
the manufacturer. The amount must be substantiated. This unit cost
shall be multiplied by 1 minus the ratio of total accumulated
depreciation to original total cost of that type of equipment owned by
applicant-carrier, as shown by company records.
(2) The current nominal cost of capital shall be used in the
calculation of return on investment for locomotives and shall be
calculated as provided in Sec. 1152.34(d).
(3) The return on investment for each category or type of
locomotive shall be the nominal return less the holding gain (loss).
The nominal return is calculated by multiplying the replacement cost
determined in paragraph (h)(1) of this section by the nominal rate of
return determined in paragraph (h)(2) of this section. The holding gain
(loss) shall be the gain (loss) projected to occur during the forecast
and/or subsidy year. In any instance where the holding gain is not
specifically determined for locomotives,
[[Page 67909]]
the Gross Domestic Product deflator calculated by the U.S. Department
of Commerce shall be used.
(4) The return on investment for each type of locomotive shall be
assigned to the line segment on a ratio of the locomotive unit hours on
the segment to average locomotive unit hours per unit for each type of
locomotive in the system. This ratio will be developed as follows:
(i) The carrier shall keep and maintain records of the number of
hours that each type of locomotive incurred in serving the segment
during the subsidy period.
(ii) The railroad shall develop the system average locomotive unit
hours per unit for each of the following types of locomotives; yard
diesel; yard-other; road diesel; and road-other.
(iii) The ratio applied to the return on investment is calculated
by dividing the hours that each type or class of locomotive is used to
serve the segment, as developed in paragraph (h)(4)(i) of this section,
by the system average locomotive unit hours per unit for the applicable
type developed in paragraph (h)(4)(ii) of this section.
(5) The cost assigned to the segment for each type of locomotive
shall be calculated by multiplying the annual return on investment
developed in paragraph (h)(3) of this section by the ratio(s) developed
in paragraph (h)(4) of this section.
(i) Revenue taxes. The amount of revenue taxes shall be computed
based on the amounts directly paid in those states that subject the
railroad to a revenue tax.
(j) Property taxes (Line). (1) The assigned costs under this
subsection shall be the net systemwide property tax savings resulting
from the abandonment, calculated as set out below, if the applicant-
carrier intends subsequently to sell or otherwise dispose of the
abandoned properties. If the applicant-carrier expresses an intent to
dispose of the properties, it will be presumed that the properties will
ultimately be sold or otherwise disposed of after abandonment.
Protestants may rebut this presumption by showing that it would be
financially beneficial to retain ownership of the property for
investment purposes.
(2) In states where a true ad valorem tax is levied on real
property (such as track, land, buildings, and other facilities),
applicant must affirm that the ad valorem method applies and must
substantiate the amount of property taxes levied against the property
on the line segment.
(3) In states where the ad valorem method is not employed,
applicant must describe the applicable property tax methodology if it
is claiming the local property tax as an avoidable cost of operations.
Additionally, it must substantiate with evidence and computations the
actual statewide tax savings attributable to the abandonment.
(4) Any property tax properly substantiated under paragraphs (f)(2)
or (3) of this section shall be presumed to represent systemwide
savings to the carrier. Protestants may rebut this presumption by
presenting evidence:
(i) That property taxes in those states where the carrier operates
that are not involved in the abandonment will increase significantly
because of reassessments attributable to the abandonment; or
(ii) That a significantly higher property tax will be levied
against a retained portion of the abandoned property. If applicant does
not refute protestant's evidence, it may claim avoidable property taxes
only if, and to the extent, it proves systemwide property tax savings.
(5) In states where real property taxes are assessed and levied
against the owner of the property but the tax on rolling stock is
assessed to the railroad operating the service on the basis of a
formula of a statewide valuation of property, the tax on rolling stock
attributable to each line segment shall be determined as follows:
(i) Using ratio of the cost of equipment (as used in the formula)
to the total of all property costs (as used in formula);
(ii) Apply that ratio to the total state assessment to determine
the portion of the assessment attributable to rolling stock;
(iii) Allocate the rolling stock assessment thus determined to each
line segment on the basis of car and locomotive unit miles on the
segment to total car and locomotive unit miles in the state; and
(iv) Apply the appropriate tax rate or rates to the allocated
assessment thus determined.
(k) Administrative costs. The costs assigned under this account
shall be the actual costs directly attributable to the administration
of the subsidy program or at the option of the carrier, one percent of
the total annual revenues attributed to the branch shall be allowable
to cover all costs of administering the subsidy program. Either method
may be used, but not both.
(l) Casualty reserve account. The costs assigned under this account
shall be any payments mutually agreed to by the person offering the
subsidy and the railroad for the purpose of holding the subsidizer
harmless from any liability under those accounts that are used to
record any costs incurred by the railroad as a result of an accident.
(m) Rehabilitation. (1) For abandonment purposes the applicant
carrier shall project the amounts necessary to permit efficient
operations over the line segment. The carrier shall indicate the level
of FRA class safety standard to be attained with the amount of
expenditure. See 49 CFR part 213. Applicant, in making its projection
of rehabilitation costs, shall give consideration to:
(i) The cost to attain the lowest operationally feasible track
level;
(ii) The cost to attain the rehabilitation level resulting in the
lowest operating and rehabilitation expenditures; or
(iii) The cost to attain the rehabilitation level resulting in the
lowest loss, or highest profit, from operations.
(2) For subsidy purposes rehabilitation costs shall not be included
unless:
(i) The track fails to meet minimum Federal Railroad Administrative
class 1 safety standards (49 CFR part 213), in which case the railroad
will furnish, with the abandonment application, a detailed estimate of
the costs to rehabilitate the track to the minimum level; or
(ii) The potential subsidizer requests a level of service which
requires expenditures for rehabilitation.
(n) Off-branch costs. The off-branch costs developed in this
section shall be separated between ``off-branch costs other than return
on freight cars'' and ``return on value-freight cars''. The off-branch
costs shall be developed in the following manner:
(1) Terminal costs, line-haul costs, interchange costs, and
modified terminal costs shall be considered as the off-branch avoidable
costs of providing service over the remainder of the railroad's system.
These costs shall be computed by applying the variable unit costs to
the service units attributed to the branch line's traffic for the time
periods specified in Sec. 1152.22(d) of this part.
(2) The procedure for determining the off-branch costs shall be
based upon the URCS cost formula. This formula shall be applied to the
latest Annual Report Form R-1 filed by the railroad, with two
exceptions. First, the amount used in the formula for freight car
depreciation shall be calculated using the procedure discussed in
paragraph (g)(3)(iii) of this section applied to the average total car
fleet of the railroad. Second, the return on investment in freight cars
shall be computed using the procedure set forth
[[Page 67910]]
in paragraph (g)(3)(ii) of this section. In addition, the application
of URCS shall include the use of the nominal cost of capital for all
return on investment determinations.
(3) The Class I Procedure: A Class I railroad shall calculate its
off-branch costs using the Class I procedure as set forth below in this
paragraph.
(i) The unit costs developed by applying URCS in the manner
specified in paragraph (n)(2) of this section shall be applied to the
service characteristics of each movement of traffic that is attributed
to the branch line. This application shall result in the total off-
branch cost associated with this traffic for normal terminal handlings,
line-haul mileage, and interchange events.
(ii) The modified terminal cost per carload shall be calculated
separately for each type of freight car and applied to each car that is
attributed to the branch line. The modified terminal cost shall consist
of clerical costs, two days of freight car cost, and an inter-intra
train switching cost (locomotive engine minute cost only). The clerical
cost and inter-intra train switching cost shall be calculated from unit
costs developed within the individual URCS application.
(A) The unit costs for the clerical cost per carload calculation
are located in URCS Worktable E1, Part 1: Line 106, columns 1, 2, and
3; line 107, column 1; line 108, column 1; line 109, column 1; and line
110, column 1.
(B) The inter-intra train switching cost shall be calculated by
multiplying the total switch engine minute cost from URCS Worktable E1,
Part 1, line 111, columns 1, 2, and 3 by the total minutes specified in
the next sentence. The total minutes specified in this sentence shall
equal the sum of:
(1) The minutes per switch event from Worktable E2, Part 1, line
118, column 29; and
(2) The product of the minutes per switch event from Worktable E2,
Part 1, line 118, column 29 and the ratio of loaded to total car miles
for the particular type of freight car being costed.
(C) The freight car cost shall be the car ownership costs per car
day for 2 days developed in accordance with the procedures set forth in
paragraph (g)(3) of this section for the type of freight car being
costed.
(iii) For a Class I railroad, the total costs calculated using the
procedures set forth in paragraphs (n)(3)(i) and (n)(3)(ii) of this
section shall constitute the off-branch costs attributable to the
branch line's traffic.
(4) A Class II or Class III railroad shall calculate its off-branch
costs using any one of three different procedures. The Class I
Procedure: A Class II or Class III railroad may calculate its off-
branch costs using the Class I procedure set forth in paragraph (n)(3)
of this section, if the necessary data are available from the
railroad's own records. If the data necessary to complete the Class I
procedure set forth in paragraph (n)(3) of this section are not
available from the railroad's own records, the Class II or Class III
railroad shall calculate its off-branch costs using either one of the
following procedures based on the latest regional URCS data and the
railroad's own records. The Class II/III Simplified Costing Procedure:
A Class II or Class III railroad may calculate its off-branch costs
using the Class I procedure set forth in paragraph (n)(3) of this
section, with regional URCS data of the Class I railroads used in lieu
of individual URCS data of the Class II or Class III railroad. Costs
developed through the use of the Class II/III simplified costing
procedure shall enjoy a rebuttable presumption of correctness. The
Class II/III Standard Costing Procedure: A Class II or Class III
railroad may calculate its off-branch costs using the Class II/III
standard costing procedure set forth in paragraphs (n)(4)(i) through
(n)(4)(xiv) of this section. Costs developed through the use of the
Class II/III standard costing procedure shall be given preference over
costs developed through the use of the Class II/III simplified costing
procedure. The Class II/III standard costing procedure is set forth in
paragraphs (n)(4)(i) through (n)(4)(xiv) of this section.
(i) The Class II or Class III railroad shall first determine which
URCS regional application will be used based on its geographical
location. The railroad's total estimated system variable expenses are
calculated by multiplying its total operating expenses by the ratio of
variable expenses to total expenses; this ratio is located in Worktable
D8, Part 6, line 615, column 1 of the URCS printout for the appropriate
region. If a railroad has passenger and freight service, the freight
portion of the total estimated system variable expenses shall be
calculated by multiplying the total estimated system variable expenses,
calculated as above, by the ratio of freight related operating expenses
to total railway operating expenses.
(ii) The total number of revenue carload terminal handlings, as
determined from the railroad's records, shall be calculated as the sum
of:
(A) Originated and terminated (local) revenue carloads multiplied
by 2; plus
(B) Interchanged and either originated or terminated (interline)
revenue carloads.
(iii) The total number of revenue carload interchange handlings, as
determined from the railroad's records, shall be calculated as the sum
of:
(A) Bridge (interchange to interchange) revenue carloads multiplied
by 2; plus
(B) Revenue carloads that are interchanged and either originated or
terminated (interline).
(iv) The system average shipment weight per car, as determined from
the railroad's records, shall be calculated by dividing:
(A) Ton-miles-revenue freight by
(B) Loaded freight car miles.
(v) The system average loaded car miles per car, as determined from
the railroad's records, shall be calculated by dividing:
(A) Revenue ton-miles by
(B) Revenue tons.
(vi) The railroad shall complete a URCS Phase III ``Movement
Costing Program'' based on the application of URCS data for the
appropriate region. The following data shall be inputs to the Phase III
program application.
(A) The carrier code, either ``REG 4'' or ``REG 7'', shall
correspond to the appropriate region.
(B) The type of shipment shall be designated as ``OD'' in order for
the movement to be costed as an interline movement.
(C) The distance shall be the system average loaded car miles per
car as developed in paragraph (n)(4)(v) of this section.
(D) The type of freight car shall be identified as a Box, General
Service Equipped, which has an input user code of ``3''. If all of the
traffic on the branch line is transported in a single type of car, and
it is not a Box, General Service Equipped, the code for that type of
car may be substituted.
(E) The number of freight cars shall be ``1''.
(F) The car ownership factor shall be designated as ``R'' for
railroad owned cars unless all of the branch line traffic is moved in
privately owned cars, in which case the code ``P'' for privately owned
cars would be the input.
(G) The program requires a loss and damage input. The code ``48'',
representing the average of all commodities, shall be used.
(H) The input for shipment weight shall be the system average
shipment weight per car developed in paragraph (n)(4)(iv) of this
section.
(I) The input for type of movement shall be ``1'', representing an
individual car movement.
(vii) The ratios employed to separate the total estimated system
variable expenses, as determined in paragraph
[[Page 67911]]
(n)(4)(i) of this section, among terminal, interchange, and line-haul
operations shall be based on the procedures outlined in this paragraph
(n)(4)(vii). This separation shall reflect the variable costs resulting
from the application of the URCS Phase III program based on the input
factors specified in paragraph (n)(4)(vi) of this section. The ratios
shall be calculated in the following manner:
(A) The terminal expenses calculated by the application of the
Phase III program shall consist of the following:
(1) ``Carload and Clerical Costs'' shall be calculated as the sum
of lines 256, 258, 260, 262, 264, 266, and 268.
(2) Switching expenses based on ``Total SEM-Industry'' shall be
calculated by multiplying:
(i) The sum of lines 315, 317, and 319, by
(ii) Line 311.
(3) Car mile yard cost ``CM(Y)-Industry'' shall be calculated by
multiplying:
(i) The sum of lines 426, 428, and 430, by
(ii) Line 422.
(4) Car day yard cost ``CD(Y)-Industry'' and ``CD(Y)-L&UL'' shall
be calculated by multiplying:
(i) The sum of lines 452, 454, and 456, by
(ii) The sum of lines 446 and 450.
(5) The expenses for accessorial services for railroad owned cars
shall be calculated as the sum of:
(i) The product of line 422 and the sum of lines 464, 466, and 468;
plus
(ii) The product of the sum of lines 446 and 450 and the sum of
lines 476, 478, and 480.
(B) The interchange expenses calculated by the application of the
Phase III program shall consist of the following:
(1) Switching expenses based on ``Total SEM-Interchange'' shall be
calculated by multiplying
(i) The sum of lines 315, 317, and 319, by
(ii) Line 312.
(2) Car mile cost in interchange ``CM(Y)-Interchange'' shall be
calculated by multiplying:
(i) The sum of lines 426, 428, and 430, by
(ii) Line 423.
(3) Car day cost in interchange ``CD(Y)-Interchange (L&E)'' shall
be calculated by multiplying:
(i) The sum of lines 452, 454, and 456, by
(ii) Line 447.
(4) The expenses for accessorial services for railroad owned cars
shall be calculated as the sum of:
(i) The product of line 423 and the sum of lines 464, 466, and 468;
plus.
(ii) The product of line 447 and the sum of lines 476, 478, and
480.
(C) The line-haul expenses resulting from the application of the
Phase III program shall be calculated by subtracting the sum of:
(1) The terminal expenses as determined in paragraph (n)(4)(vii)(A)
of this section, and
(2) The interchange expenses as determined in paragraph
(n)(4)(vii)(B) of this section, from
(3) The total variable cost excluding loss and damage as calculated
in the Phase III program at line 696.
(D) The ratio for terminal expenses shall be calculated by dividing
the terminal expenses as determined in paragraph (n)(4)(vii)(A) of this
section by the total variable cost excluding loss and damage as
calculated in the Phase III program at line 696.
(E) The ratio for interchange expenses shall be calculated by
dividing the interchange expenses as determined in paragraph
(n)(4)(vii)(B) of this section by the total variable cost excluding
loss and damage as calculated in the Phase III program at line 696.
(F) The ratio for line-haul expenses shall be calculated by
dividing the line-haul expenses as determined in paragraph
(n)(4)(vii)(C) of this section by the total variable cost excluding
loss and damage as calculated in the Phase III program at line 696.
(viii) The railroad's total estimated system variable expenses
shall be separated as follows:
(A) The total terminal variable expenses shall be calculated by
multiplying the total estimated system variable expenses as determined
in paragraph (n)(4)(i) of this section by the ratio for terminal
expenses as determined in paragraph (n)(4)(vii)(D) of this section.
(B) The total interchange variable expenses shall be calculated by
multiplying the total estimated system variable expenses as determined
in paragraph (n)(4)(i) of this section by the ratio for interchange
expenses as determined in paragraph (n)(4)(vii)(E) of this section.
(C) The total line-haul variable expenses shall be calculated by
multiplying the total estimated system variable expenses as determined
in paragraph (n)(4)(i) of this section by the ratio for line-haul
expenses as determined in paragraph (n)(4)(vii)(F) of this section.
(ix) The railroad's unit costs shall be determined for terminal,
interchange, and line-haul operations as follows:
(A) The terminal cost per carload shall be calculated by dividing
the total terminal variable expenses as determined in paragraph
(n)(4)(viii)(A) of this section by the total number of revenue carload
terminal handlings as determined in paragraph (n)(4)(ii) of this
section.
(B) The interchange cost per carload shall be calculated by
dividing the total interchange variable expenses as determined in
paragraph (n)(4)(viii)(B) of this section by the total number of
revenue carload interchange handlings as determined in paragraph
(n)(4)(iii) of this section.
(C) The line-haul cost per car mile shall be calculated by dividing
the total line-haul variable expenses as determined in paragraph
(n)(4)(viii)(C) of this section by the total system freight car miles,
loaded and empty, as determined from the railroad's records.
(x) The modified terminal cost per carload is a composite of costs
developed in the Phase III program and costs determined in accordance
with paragraph (g) of this section and this paragraph. The modified
terminal cost per carload shall be calculated for each type of car as
follows:
(A) The station clerical cost per carload shall be developed in the
following manner:
(1) The station clerical expense ratio shall be calculated by
dividing the total clerical cost (the sum of lines 256, 258, 260, 262,
264, 266, and 268) by the terminal expenses as determined in paragraph
(n)(4)(vii)(A) of this section.
(2) The station clerical cost per carload shall be calculated by
multiplying the terminal cost per carload as determined in paragraph
(n)(4)(ix)(A) of this section by the station clerical expense ratio.
(B) The interchange switching cost per carload shall be developed
in the following manner:
(1) The total interchange switching expense shall be calculated by
multiplying the sum of lines 315, 317, and 319 by line 312.
(2) The interchange switching ratio shall be calculated by dividing
the total interchange switching expense by the interchange expenses as
determined in paragraph (n)(4)(vii)(B) of this section.
(3) The interchange switching cost per carload shall be calculated
by multiplying the interchange cost per carload as determined in
paragraph (n)(4)(ix)(B) of this section by the interchange switching
ratio.
(C) The freight car cost element shall be the freight car cost per
car day for 2 days as developed for each car type in paragraph (g)(3)
of this section.
(D) The modified terminal cost per carload shall be the total of
the costs developed in paragraphs (n)(4)(x)(A),
[[Page 67912]]
(n)(4)(x)(B), and (n)(4)(x)(C) of this section.
(xi) The terminal costs shall be calculated by multiplying the
terminal cost per carload as determined in paragraph (n)(4)(ix)(A) of
this section by the number of carloads that both:
(A) Originated or terminated on the branch, and
(B) Are local to the railroad serving the branch.
(xii) The interchange costs shall be calculated by multiplying the
interchange cost per carload as determined in paragraph (n)(4)(ix)(B)
of this section by the number of carloads that both:
(A) Originated or terminated on the branch; and
(B) Are received in or forwarded through interchange with other
railroads.
(xiii) The line-haul costs shall be calculated by multiplying the
line-haul cost per car mile as determined in paragraph (n)(4)(ix)(C) of
this section by the total loaded and empty car miles generated on the
railroad's system off the branch by cars that originated or terminated
on the branch.
(xiv) The modified terminal costs shall be calculated by
multiplying the modified terminal cost per carload as determined in
paragraph (n)(4)(x)(D) of this section by the number of carloads that
originated or terminated on the branch.
(o) Locomotive depreciation. The depreciation cost for locomotives
used on the line shall be calculated using the following procedure:
(1) The current replacement cost for each type of locomotive used
to serve the line will be based on the most recent purchase of that
particular type and size locomotive by the carrier indexed to the
midpoint of the year or on an amount quoted by the manufacturer.
(2) The depreciation rate that will be applied to the replacement
cost shall be the carrier's component rate for each type of locomotive
as reported in the latest Annual Report Form R-1 submitted to the Board
or from the company records. Carriers using depreciation rates based on
company records must explain why composite rates are inappropriate;
provide a detailed explanation of the methodology used to compute the
alternate depreciation rate; and demonstrate that these rates have been
used consistently.
(3) The annual depreciation cost for each type of locomotive shall
be calculated by multiplying the replacement cost(s) developed in
paragraph (o)(1) of this section by the rate from paragraph (o)(2) of
this section.
(4) The depreciation expense for each type of locomotive shall be
assigned to the line on the ratio of the hours incurred serving the
line to the average system locomotive unit hours in service by each of
the following categories of locomotives: yard-diesel; yard-other; road-
diesel; and road-other. The ratio for each type of locomotive used to
serve the line shall be the same as that developed in paragraph (h)(4)
of this section.
(5) The depreciation shall be calculated by multiplying the annual
depreciation expense for each type of locomotive developed in paragraph
(o)(3) of this section by the ratio(s) developed in paragraph (o)(4) of
this section.
(p) Opportunity costs. Applicant-carrier may, at its discretion,
present evidence of its opportunity costs, if the assets engaged in the
line proposed to be abandoned could be used more profitably in some
other capacity.
Opportunity costs may be calculated in accordance with the
methodology established in Sec. 1152.34 of this part, or by using any
other reasonable, fully explained method. Opportunity costs are not
included as costs on Exhibit 1 described at Sec. 1152.36. These costs
should be submitted as a separate exhibit to the application.
(q) Labor costs. (1) The salaries, wages and fringe benefits of
personnel exclusively assigned to the line segment shall be deemed
attributable costs of the segment. The salaries, wages, and fringe
benefits of personnel not exclusively assigned to the line segment
shall be deemed attributable costs of the segment to the extent they
are shown to be apportionable to the segment to be abandoned.
(2) These costs shall be deemed attributable notwithstanding any
obligation of applicant to provide employee protection for employees
after the abandonment.
Sec. 1152.33 Apportionment rules for the assignment of expenses to on-
branch costs.
The accounts specified under Sec. 1152.32 (a), (b), (c), and (d) as
having an assignment basis other than ``Actual'' shall be apportioned
according to the rules contained in this section.
(a) Maintenance of way and structures--(1) Roadway machines. All
accounts designated XX-13-36 shall be assigned to the branch on the
basis of the average repair costs, for each type of machine, included
in the daily rental fees charged by the operating railroad or as
published by the General Manager's Association of Chicago (GMA), based
on the actual number of days each type of machine is used on the
branch.
(2) Small tools and supplies. All accounts designated XX-13-37
shall be assigned to the branch as follows:
(i) The costs of supplies, consumed in the operation of roadway
machines, shall be assigned to the branch on the basis of the average
costs of supplies per day, included in the daily rental fees charged by
the operating railroad or as published by the GMA, multiplied by the
actual number of days that the machine is used on the branch;
(ii) The costs of small tools shall be assigned to the branch on
the basis of the ratio that the branch amounts in Accounts 11-11-10
through 11-11-17 and 11-11-48, plus 11-12-10 through 11-12-17 and 11-
12-48, bear to the railroad's system total for the same accounts.
(3) Fringe benefits. Fringe benefits shall be assigned to the
branch separated between running, switching and other, on the ratio
that the total branch salary and wages bear to the total system
salaries and wages for each activity as follows:
(i) Fringe benefits--Running, Account 12-11-00, total of all 11-11-
XX accounts branch to system;
(ii) Fringe benefits--Switching, Account 12-12-00, total of all 11-
12-XX accounts branch to system; and
(iii) Fringe benefits--Other, Account 12-13-00, total of all 11-13-
XX accounts branch to system.
(b) Maintenance of equipment--(1) Locomotive repairs and
maintenance. All accounts designated XX-21-41 shall be separated
between yard and road with a further separation between diesel and
other (electric). The costs for these accounts for yard locomotives
shall be assigned to the branch separately for diesel and electric
locomotives on the basis of the ratio of branch diesel and electric
yard locomotive unit-hours to the total system diesel and electric yard
locomotive unit-hours. The costs for these accounts for road
locomotives shall be assigned to the branch separately for diesel and
electric locomotives on the basis of the ratio of branch diesel and
electric locomotive gross ton-miles in road service to the total system
diesel and electric locomotive gross ton-miles in road service. The
costs assigned under these accounts for specialized equipment devoted
exclusively to branch line service shall be theactual costs for the
specific equipment used.
(2) Locomotive depreciation. Locomotive depreciation shall be
calculated and assigned in accordance with the procedures set forth in
Sec. 1152.32(o).
[[Page 67913]]
(3) Fringe Benefits. Fringe benefits for locomotives and other
equipment shall be assigned to the branch on the ratio that the total
branch salary and wages bear to the system total salaries and wages for
each type of equipment as follows:
(i) Locomotives--Account 12-21-00, total of all 11-21-XX accounts
branch to system.
(ii) Other Equipment--Account 12-23-00, total of all 11-23-XX
accounts branch to system.
(iii) Fringe benefits for freight cars shall be calculated by first
estimating the total in Account 11-22-42, Freight car repairs--salaries
and wages, that is included in the total on branch costs for freight
cars as determined from the car-day and car-mile cost calculations in
Sec. 1152.32(g) of these regulations. To this amount is added the
branch totals in the balance of all 11-22-XX accounts. The ratio of
this total branch account to the system total for all 11-22-XX accounts
is applied to Account 12-22-00, Fringe Benefits--Freight Cars.
(c) Transportation--(1) Train operations--(i) Engine Crews-
Materials. Account 21-31-56; Train Crews-Materials, Account 21-31-57;
Train Inspection and Lubrication-Salaries and Wages, Account 11-31-62;
and Train Inspection and Lubrication-Materials, Account 21-31-62. If
the branch is served by a local/way or through train, the costs in
these accounts shall be assigned to the branch on the weighted ratio of
the loaded freight train cars on the branch to the total system loaded
freight train cars, and the loaded and empty car-miles on the branch to
the total system loaded and empty car-miles. This shall be calculated
as follows:
(A) To determine the car-mile portion of these accounts:
(1) Multiply the total amounts in these accounts (from the R-1
Annual Report, Schedule 410) by 69 percent, which is the ratio of
train-mile and running expenses;
(2) Divide the amount in paragraph (c)(1)(i)(A)(1) of this section
by the total system loaded and empty car-miles; and
(3) Multiply the car-mile unit cost factor from paragraph
(c)(1)(i)(A)(2) of this section by the on-branch car-miles (loaded and
empty).
(B) To determine the carload portion of these accounts:
(1) Multiply the total amounts in these accounts by 31 percent,
which is the ratio of terminal expenses;
(2) Divide the amount in paragraph (c)(1)(i)(B)(1) of this section
by the total system carloads; and
(3) Multiply the carload unit cost factor from paragraph
(c)(1)(i)(B)(2) of this section by the on-branch carloads.
(C) To determine the total costs assignable to the branch for these
accounts, add the amounts developed in paragraphs (c)(1)(i)(A)(3) and
(c)(1)(i)(B)(3) of this section.
(ii) All accounts designated xx-31-67 shall be assigned to the
branch in accordance with the following procedure. The dollar amounts
used in the determination of locomotive fuel costs shall be based on
data contained in the most recent publication issued by the General
Managers Association (GMA) relating to the rental of locomotives. The
total number of locomotive unit hours incurred by the locomotive(s)
shall then be categorized according to the applicable GMA horsepower
classification group. The fuel cost is derived from the Repairs and
Supplies Expenses element of the locomotive rental rates published by
the GMA. The fuel cost per locomotive unit hour shall be determined for
each GMA horsepower classification group by multiplying the latest GMA
fuel cost percentage by the Repairs and Supplies Expense per hour
included in each group. The fuel cost update ratio is determined by
using the indices for fuel from the Association of American Railroad's
(AAR's) Railroad Cost Recovery Index (RCR). The indices shall be taken
from the district to which the railroad is assigned by the Board. The
index for the current period is divided by the index of the period
representative of the GMA publication to develop the fuel update ratio.
The fuel cost per locomotive unit hour developed for each GMA
horsepower group shall be multiplied by the fuel update ratio to
determine the fuel cost per locomotive hour for each horsepower group.
The updated fuel cost per locomotive unit hour for each applicable GMA
group shall be multiplied by the number of locomotive unit hours
incurred in serving the branch by locomotives of that GMA horsepower
classification group. The total cost developed under this procedure for
each horsepower classification shall be the locomotive fuel cost
assignable to the branch line.
(iii) Electric power purchased or produced for motive power--All
accounts designated XX-31-68 shall be assigned to the branch on the
ratio of road electric locomotive unit hours on the branch to the total
system road electric locomotive unit hours.
(iv) Servicing locomotives--All accounts designated XX-31-69 shall
be assigned to the branch on the ratio of road locomotive unit miles on
the branch to the total system road locomotive unit miles.
(2) Yard operations--(i) Switch Crews--Materials, Account 21-32-64,
and Servicing Locomotives, all accounts designated XX-32-69. The costs
for these accounts shall be assigned to the branch on the ratio of yard
locomotive unit hours on the branch to the system total yard locomotive
unit hours.
(ii) Locomotive fuel--All accounts designated XX-32-67 shall be
assigned to the branch on the ratio of yard diesel locomotive unit
hours on the branch to the total system yard diesel locomotive unit
hours.
(iii) Electric power purchased or produced for motive power--All
accounts designated XX-32-68 shall be assigned to the branch on the
ratio of yard electric locomotive unit hours on the branch to the total
system yard electric locomotive unit hours.
(3) Administrative support operations--(i) Loss and damage claims
processing--All accounts designated XX-35-78 shall be assigned to the
branch on the ratio of the number of claims processed for loss or
damage occurring on the branch to the total number of claims processed
by the railroad.
(ii) [Reserved]
(4) Transportation fringe benefits. Fringe benefits shall be
assigned to the branch separated between train operations, yard
operations, train and yard operations common, specialized service
operations, and administrative support operations. The costs for each
activity shall be assigned to the branch on the ratio that the total
branch salary and wages bear to the total system salary and wages for
each activity shown below.
(i) Train Operations, Account 12-31-00, total of all 11-31-XX
accounts branch to system.
(ii) Yard Operations, Account 12-32-00, total of all 11-32-XX
accounts branch to system.
(iii) Train and Yard Operations Common, Account 12-33-00, total of
all 11-33-XX accounts branch to system.
(iv) Specialized Service Operations, Account 12-34-00, total of all
11-34-XX accounts branch to system.
(v) Administrative Support, Account 12-35-00, total of all 11-35-XX
accounts branch to system.
(d) General administrative. (1) Fringe Benefits, Account 12-61-00,
shall be assigned to the branch on the ratio that the total branch
salary and wages in all 11-61-XX accounts bear to the system total
salary and wages in all 11-61-XX accounts.
(2) [Reserved]
[[Page 67914]]
Sec. 1152.34 Return on investment.
Return on investment for road property shall be computed according
to the procedures set forth in this section.
(a) [Reserved]
(b) [Reserved]
(c) Return on investment--road properties. Return on investment--
road properties shall be computed according to the following
procedures:
(1) The investment base to which the nominal return element shall
apply shall be the sum of:
(i) The allowable working capital computed at 15 days on-branch
cash avoidable costs (on branch avoidable costs less depreciation).
(ii) The amount of current income tax benefits resulting from
abandonment of the line which would have been applicable to the period
of the subsidy agreement. (Conversely, if the railroad would incur an
income tax liability from abandonment, the liability should be deducted
from the investment base.) This information is to be furnished by the
railroad and subject to audit by the person offering the subsidy.
(iii) The net liquidation value for the highest and best use for
non-rail purposes of the rail properties on the line to be subsidized
which are used and required for performance of the services requested
by the persons offering the subsidy. This value shall be determined by
computing the current appraised market value of such properties for
other than rail transportation purposes, less all costs of dismantling
and disposition of improvements necessary to make the remaining
properties available for their highest and best use and complying with
applicable zoning, land use, and environmental regulations. If
rehabilitation has been performed along the line during a subsidy year
and rehabilitation expenses have been paid by the subsidizer under 49
CFR 1152.32(m)(2), the investment base shall exclude the increment to
the net liquidation value of the line caused by the rehabilitation
project. For these purposes:
(A) In calculating the net liquidation values for the Forecast
Year, no asset on the line shall be excluded from the determination of
net liquidation value because it contributes negatively to that value,
i.e., the removal costs exceed the market value after removal. All such
assets shall be included in the net liquidation value determination if
the carrier is required by law to remove them or if the carrier intends
to remove them, even if it is not required to do so. The parties shall
fully support and explain the exclusion for net liquidation purposes of
all assets having a negative salvage value.
(1) In calculating the net liquidation value of railroad properties
for the purpose of determining the operating subsidy under an offer of
financial assistance, any asset with a negative salvage value shall be
included at a value of zero (0).
(2) Determination of the net liquidation value of rail properties
for the purpose of purchasing the rail properties under an offer of
financial assistance shall include any asset with a negative salvage
value at a value of zero (0).
(B) All adjustments to the appraised fair market value of right-of-
way land, including a downward adjustment to reflect an imputed real
estate commission or selling expense, shall be fully supported and
explained.
(C) Parties shall fully support and explain their use of unadjusted
across-the-fence (ATF) values as a surrogate for the value of railroad
right-of-way land, given that the physical and economic characteristics
(grading and elevation) usually are different from those of surrounding
parcels. All adjustments to ATF values to arrive at the right-of-way
values shall also be supported and explained.
(2) [Reserved]
(d) Reasonable return. A rail carrier shall furnish to the Board,
and to any financially responsible person considering making an offer
of a rail service continuation payment, a substantiated statement
showing its current nominal cost of capital. The railroad's nominal
cost of capital shall be the current before tax cost of capital,
weighted to the capital structure, and adjusted for the effects of the
combined statutory Federal and state income tax rates. This rate of
return expressed as a percent, shall be calculated as follows:
(1) The railroad shall determine its permanent capital structure
ratio for debt and equity capital such that the two numbers total 100
percent. This capital structure will be the actual capital structure of
the railroad. If this calculation is not possible or also not
representative because the railroad is part of a conglomerate, the
debt-equity ratio from the Board's latest Determination of Adequate
Railroad Revenues will be used. However, if the debt-equity ratio for
the railroad industry is used then the industry average equity and debt
rate from the Board's latest revenue adequacy finding must also be used
in paragraphs (d)(2) and (d)(3) of this section.
(2) The current nominal cost of debt shall be determined by taking
the average of all debt instruments (including bonds, equipment trust
certificates, financial lease arrangements, et cetera) issued by the
carrier in the most recent 12-month period. The debt cost calculated by
this procedure is a before-tax rate and is not adjusted for inflation
or income taxes.
(3) The current nominal after tax cost of equity shall be an amount
equal to that which a prudent investor would expect to earn through
investment in the market place. The current after tax nominal cost of
equity is divided by 1 minus the combined statutory Federal and state
income tax rates. This will develop the nominal cost of equity on a
before tax basis.
(4) The current nominal before-tax cost of debt is multiplied by
the current percentage of debt to total capital to obtain a weighted
before-tax nominal cost of current debt.
(5) The current nominal before-tax cost of equity is multiplied by
the current percentage of equity to total capital to obtain a weighted
nominal before-tax cost of current equity.
(6) The results of paragraphs (d)(4) and (d)(5) of this section are
added together to determine the current nominal cost of capital.
(e) Holding gain (loss)-road properties. The railroad shall
determine the holding gain (loss) that is projected to occur during the
forecast and/or subsidy year. In any instance where the holding gain is
not specifically determined for road properties, the Gross Domestic
Product deflator calculated by the U.S. Department of Commerce shall be
used.
Sec. 1152.35 [Reserved]
Sec. 1152.36 Submission of revenue and cost data.
The following information shall be submitted by applicant as
Exhibit 1 to an abandonment or discontinuance application
(Sec. 1152.22(d)) and shall be developed in accordance with the
methodology established in Secs. 1152.31 through 1152.35, as
applicable. Such information, form and methodology shall also be used
by an offeror of financial assistance to formulate a Proposed Subsidy
Payment (Sec. 1152.27).
[[Page 67915]]
----------------------------------------------------------------------------------------------------------------
Forecast year Projected subsidy year
Base year operations operations operations
----------------------------------------------------------------------------------------------------------------
Revenues attributable for:
1. Freight originated and/or
terminated on branch
2. Bridge traffic
3. All other revenue and income
4. Total revenues attributable
(lines 1 through 3)
Avoidable costs for:
5. On-branch costs (lines 5a
through 5k)
a. Maintenance of way and
structures
b. Maintenance of equipment
c. Transportation
d. General administrative
e. Deadheading, taxi, and
hotel
f. Overhead movement
g. Freight car costs (other
than return on freight cars)
h. Return on value-locomotives
i. Return on value-freight
cars
j. Revenue taxes
k. Property taxes
6. Off-branch costs
a. Off-branch costs (other
than return on freight cars)
b. Return on value-freight
cars
7. Total avoidable costs (line 5
plus line 6)
Subsidization costs for:
8. Rehabilitation \1\
9. Administration costs (subsidy
year only) \2\
10. Casualty reserve account \2\
11. Total subsidization costs
(lines 8 through 10)
Return on value:
12. Valuation of property (lines
12a through 12c)
a. Working capital............ XXXX...................
b. Income tax consequences.... XXXX...................
c. Net liquidation value...... XXXX...................
13. Nominal rate of return........ XXXX...................
14. Nominal return on value (line XXXX...................
12 times line 13) \3\.
15. Holding gain (loss)........... XXXX...................
16. Total return on value (line 14 XXXX...................
minus 15) \3\.
17. Avoidable loss from operations
(line 4 minus line 7)
18. Estimated forecast year loss
from operations (line 4 minus
lines 7 and 16)
19. Estimated subsidy (line 4
minus lines 7, 11 and 16)
----------------------------------------------------------------------------------------------------------------
\1\ This projection shall be computed in accordance with Sec. 1152.32(m).
\2\ Omit in applications pursuant to Secs. 1152.22 and 1152.23.
\3\ If the amount in line 12c is a negative for the ``Forecast Year operations'' insert ``0'' in this line.
Sec. 1152.37 Financial status reports.
Within 30 days after the end of each quarter of the subsidy year,
each carrier which is party to the financial assistance agreement shall
submit to the subsidizer a Financial Status Report for each line
operated under subsidy. Such Financial Status Report shall be in the
form prescribed below. Significant deviations from the negotiated
estimates must be explained. All data shall be developed in accordance
with the methodology set forth in Secs. 1152.31 through 1152.35. In the
quarterly reports, the actual data for the year to date and a
projection to the end of the subsidy year shall be shown for each item.
----------------------------------------------------------------------------------------------------------------
Actual Projected
----------------------------------------------------------------------------------------------------------------
Revenues for:
1. Freight originated and/or
terminated on branch
2. Bridge traffic
3. All other revenue and income
4. Total revenues (lines 1 through 3)
Avoidable costs for:
5. On-branch costs (lines 5a through
5j)
a. Maintenance of way and
structures
b. Maintenance of equipment
c. Transportation
d. General administrative
e. Deadheading, taxi, and hotel
f. Overhead movement
g. Freight car costs
h. Return on investment--
locomotives
i. Revenue taxes
j. Property taxes
[[Page 67916]]
6. Off-branch costs
7. Total avoidable costs (line 5 plus
line 6)
Subsidization costs for:
8. Rehabilitation
9. Administrative costs
10. Casualty
11. Total subsidization costs (lines
8 through 10)
Return on value:
12. Valuation of property (lines 12a
through 12c)
a. Working capital
b. Income tax consequences
c. Net liquidation value
13. Rate of return
14. Total return on value (line 12
times line 13)
Subsidy payment:
15. Subsidy payment (line 4 minus
lines 7, 11, and 14)
----------------------------------------------------------------------------------------------------------------
Subpart E--[Reserved]
Subpart F--Exempt Abandonments and Discontinuances of Service and
Trackage Rights
Sec. 1152.50 Exempt abandonments and discontinuances of service and
trackage rights.
(a)(1) A proposed abandonment or discontinuance of service or
trackage rights over a railroad line is exempt from the provisions of
49 U.S.C. 10903 if the criteria in this section are satisfied.
(2) Whenever the Board determines a proposed abandonment to be
exempt from the requirements of 49 U.S.C. 10903, whether under this
section or on the basis of the merits of an individual petition, the
provisions of Secs. 1152.27, 1152.28, and 1152.29 as they relate to
exemption proceedings shall be applicable.
(b) An abandonment or discontinuance of service or trackage rights
is exempt if the carrier certifies that no local traffic has moved over
the line for at least 2 years and any overhead traffic on the line can
be rerouted over other lines and that no formal complaint filed by a
user of rail service on the line (or a state or local government entity
acting on behalf of such user) regarding cessation of service over the
line either is pending with the Board or any U.S. District Court or has
been decided in favor of the complainant within the 2-year period. The
complaint must allege (if pending), or prove (if decided) that the
carrier has imposed an illegal embargo or other unlawful impediment to
service.
(c) The Board has found:
(1) That its prior review and approval of these abandonments and
discontinuances is not necessary to carry out the rail transportation
policy of 49 U.S.C. 10101; and
(2) That these transactions are of limited scope and continued
regulation is unnecessary to protect shippers from abuse of market
power. 49 U.S.C. 10502. A notice must be filed to use this class
exemption. The procedures are set out in Sec. 1152.50(d). This class
exemption does not relieve a carrier of its statutory obligation to
protect the interests of employees. 49 U.S.C. 10502(g) and 10903(b)(2).
This also does not preclude a carrier from seeking an exemption of a
specific abandonment or discontinuance that does not fall within this
class.
(d) Notice of exemption. (1) At least 10 days prior to filing a
notice of exemption with the Board, the railroad seeking the exemption
must notify in writing:
(i) The Public Service Commission (or equivalent agency) in the
state(s) where the line will be abandoned or the service or trackage
rights discontinued;
(ii) Department of Defense (Military Traffic Management Command,
Transportation Engineering Agency, Railroads for National Defense
Program);
(iii) The National Park Service, Recreation Resources Assistance
Division; and
(iv) The U.S. Department of Agriculture, Chief of the Forest
Service.
The notice shall name the railroad, describe the line involved,
including United States Postal Service ZIP Codes, indicate that the
exemption procedure is being used, and include the approximate date
that the notice of exemption will be filed with the Board. The notice
shall include the following statement ``Based on information in our
possession, the line (does) (does not) contain federally granted
rights-of-way. Any documentation in the railroad's possession will be
made available promptly to those requesting it.''
(2) The railroad must file a verified notice using its appropriate
abandonment docket number and subnumber (followed by the letter ``X'')
with the Board at least 50 days before the abandonment or
discontinuance is to be consummated. The notice shall include the
proposed consummation date, the certification required in
Sec. 1152.50(b), the information required in Secs. 1152.22(a) (1)
through (4), (7) and (8), and (e)(5), the level of labor protection,
and a certificate that the notice requirements of Secs. 1152.50(d)(1)
and 1105.11 have been complied with.
(3) The Board, through the Director of the Office of Proceedings,
shall publish a notice in the Federal Register within 20 days after the
filing of the notice of exemption. The notice shall include a statement
to alert the public that following any abandonment of rail service and
salvage of the line, the line may be suitable for other public use,
including interim trail use. Petitions to stay the effective date of
the notice on other than environmental or historic preservation grounds
must be filed within 10 days of the publication. Petitions to stay the
effective date of the notice on environmental or historic preservation
grounds may be filed at any time but must be filed sufficiently in
advance of the effective date in order to allow the Board to consider
and act on the petition before the notice becomes effective. Petitions
for reconsideration, comments regarding environmental, energy and
historic preservation matters, and requests for public use conditions
under 49 U.S.C. 10905 and 49 CFR 1152.28(a)(2) must be filed within 20
days after publication. Requests for a trail use condition under 16
U.S.C. 1247(d) and 49 CFR 1152.29 must be filed within 10 days after
publication. The exemption will be effective 30 days after publication,
unless stayed. If the notice of exemption contains false or misleading
information, the use of the exemption is
[[Page 67917]]
void ab initio and the Board shall summarily reject the exemption
notice.
(4) In out-of-service rail line exemption proceedings under 49 CFR
1152.50, the Board, on its own motion, will stay the effective date of
individual notices of exemption when an informed decision on pending
environmental and historic preservation issues cannot be made prior to
the date that the exemption authority would otherwise become effective.
(5) A notice or decision to all parties will be issued if use of
the exemption is made subject to environmental, energy, historic
preservation, public use and/or interim trail use and rail banking
conditions.
(6) To address whether the standard labor protective conditions set
forth in Oregon Short Line R. Co.--Abandonment--Goshen, 360 I.C.C. 91
(1979), adequately protect affected employees, a petition for partial
revocation of the exemption under 49 U.S.C. 10502(d) must be filed.
(e) Consummation notice. As provided in Sec. 1152.29(e)(2), rail
carriers that receive authority to abandon a line under Sec. 1152.50
must file with the Board a notice that abandonment has been
consummated.
Subpart G--Special Rules Applicable to Petitions for Abandonments
or Discontinuances of Service or Trackage Rights Filed Under the 49
U.S.C. 10502 Exemption Procedure
Sec. 1152.60 Special rules.
(a) This section contains special rules applicable to any
proceeding instituted under the 49 U.S.C. 10502 exemption procedure for
either the abandonment of a rail line or the discontinuance of service
or trackage rights over a rail line. General rules applicable to any
proceeding filed under the 49 U.S.C. 10502 exemption procedure may be
found at 49 CFR part 1121, but the rules in part 1152 control in case
of any conflict with the general exemption rules. In the case of
petitions for exemption for abandonment, notice of the filing of the
petition will be published in the Federal Register 20 days after the
petition is filed. There will be no further Federal Register
publication later if and when a petition is granted.
(b) Any petition filed under the 49 U.S.C. 10502 exemption
procedure for either the abandonment of a rail line or the
discontinuance of service or trackage rights over a rail line must be
accompanied by a map that meets the requirements of Sec. 1152.22(a)(4)
of this part.
(c) A petitioner for an abandonment exemption shall submit, with
its petition, a draft Federal Register notice of its petition according
to the form prescribed below:
Draft Federal Register Notice. The petitioner shall submit a
draft notice of its petition to be published by the Board within 20
days of the petition's filing with the Board. The petitioner must
submit a copy of the draft notice as data contained on a computer
diskette compatible with the Board's current word processing
capabilities. The draft notice shall be in the form set forth below:
STB No. AB-______ (Sub-No.______)
Notice of Petition for Exemption to Abandon or to Discontinue Service
On (insert date petition was filed with the Board) (name of
petitioner) filed with the Surface Transportation Board, Washington,
D.C. 20423, a petition for exemption for the abandonment of (the
discontinuance of service on) a line of railroad known as______,
extending from railroad milepost near (station name) to (the end of
line or rail milepost) near (station name), which traverses through
______ (ZIP Codes) United States Postal Service ZIP Codes, a
distance of ______ miles, in [County(ies), State(s)]. The line for
which the abandonment (or discontinuance) exemption request was
filed includes the stations of (list all stations on the line in
order of milepost number, indicating milepost location).
The line (does) (does not) contain federally granted rights-of-
way. Any documentation in the railroad's possession will be made
available promptly to those requesting it.
The interest of railroad employees will be protected by (specify
the appropriate conditions).
Any offer of financial assistance will be due no later than 10
days after service of a decision granting the petition for
exemption.
All interested persons should be aware that following
abandonment of rail service and salvage of the line, the line may be
suitable for other public use, including interim trail use.
Any request for a public use condition and any request for trail
use/rail banking will be due no later than 20 days after notice of
the filing of the petition for exemption is published in the Federal
Register.
Persons seeking further information concerning abandonment
procedures may contact the Surface Transportation Board or refer to
the full abandonment or discontinuance regulations at 49 CFR part
1152. Questions concerning environmental issues may be directed to
the Board's Section of Environmental Analysis.
An environmental assessment (EA) (or environmental impact
statement (EIS), if necessary) prepared by the Section of
Environmental Analysis will be served upon all parties of record and
upon any agencies or other persons who commented during its
preparation. Any other persons who would like to obtain a copy of
the EA (or EIS) may contact the Section of Environmental Analysis.
EAs in these abandonment proceedings normally will be made available
within 60 days of the filing of the petition. The deadline for
submission of comments on the EA will generally be within 30 days of
its service.
(d) A petitioner for an abandonment exemption must serve a copy
of the petition on the persons receiving notices of exemption under
Sec. 1152.50(d). The petition must include the following statement:
``Based on information in our possession, the line (does) (does not)
contain federally granted right-of-way. Any documentation in
petitioner's possession will be made available promptly to those
requesting it.''
(e) As Provided in Sec. 1152.29(e)(2), rail carriers that
receive authority to abandon a line by individual exemption under 49
U.S.C. 10502 must file with the Board a notice that abandonment has
been consummated.
[FR Doc. 96-32229 Filed 12-23-96; 8:45 am]
BILLING CODE 4915-00-P