[Federal Register Volume 62, Number 141 (Wednesday, July 23, 1997)]
[Notices]
[Pages 39591-39593]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-19376]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board
[STB Finance Docket No. 33388 (Sub-No. 3)]


CSX Transportation, Inc.--Construction and Operation Exemption--
Connection Tracks at Greenwich, OH

AGENCY: Surface Transportation Board (Board).

ACTION: Notice of exemption; request for comments.

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SUMMARY: On June 23, 1997, CSX Transportation, Inc. (CSXT) and 
Consolidated Rail Corporation (CRC), pursuant to 49 U.S.C. 10502, filed 
a petition for exemption from the prior approval requirements of 49 
U.S.C. 10901 to construct and operate a connection track at Greenwich, 
OH.1 The Board seeks comments from interested persons 
respecting the exemption criteria and any other non-environmental 
concerns 2 involved in our approval of the construction and 
operation of CSXT's and CRC's Greenwich construction project sought in 
STB Finance Docket No. 33388 (Sub-No. 3).
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    \1\ This proceeding is related to STB Finance Docket No. 33388, 
CSX Corporation and CSX Transportation, Inc., Norfolk Southern 
Corporation and Norfolk Southern Railway Company--Control and 
Operating Leases/Agreements--Conrail Inc. and Consolidated Rail 
Corporation (CSX/NS/CR). In CSX/NS/CR, Decision No. 9, served June 
12, 1997, we granted a petition for waiver that would allow CSXT and 
CRC to seek approval for construction of four construction projects, 
including this proposed construction at Greenwich, following the 
completion of our environmental review of the construction projects, 
and our issuance of further decisions exempting or approving the 
proposals, but prior to our approval of the primary application.

    \2\ The handling of environmental issues will be discussed 
below.
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DATES: Written comments must be filed with the Board by August 22, 
1997. Replies may be filed by CSX and CRC on or before September 11, 
1997.

ADDRESSES: An original and 25 copies of all documents must refer to STB 
Finance Docket No. 33388 (Sub-No. 3) and must be sent to the Office of 
the Secretary, Case Control Unit, ATTN: STB Finance Docket No. 33388 
(Sub-No. 3), Surface Transportation Board, 1925 K Street, N.W., 
Washington, DC 20423-0001.3 In addition, one copy of all 
documents in this proceeding must be sent to Administrative Law Judge 
Jacob Leventhal, Federal Energy Regulatory Commission, 888 First 
Street, N.E., Suite 11F, Washington, DC 20426 [(202) 219-2538; FAX: 
(202) 219-3289] and to petitioners' representatives: Charles M. 
Rosenberger, 500 Water Street--J150, Jacksonville, FL 32202; and John 
J. Paylor, 2001 Market Street-16A, Philadelphia, PA 19101. Parties to 
STB Finance Docket No. 33388 will not be automatically placed on the 
service list for this proceeding.

    \3\ In addition to submitting an original and 25 copies of all 
documents filed with the Board, the parties are encouraged to submit 
all pleadings and attachments as computer data contained on a 3.5-
inch floppy diskette formatted for WordPerfect 7.0 (or formatted so 
that it can be converted into WordPerfect 7.0) and clearly labeled 
with the identification acronym and number of the pleading contained 
on the diskette. See 49 CFR 1180.4(a)(2). The computer data 
contained on the computer diskettes submitted to the Board will be 
subject to the protective order granted in Decision No. 1, served 
April 16, 1997 (as modified in Decision No. 4, served May 2, 1997), 
and is for the exclusive use of Board employees reviewing 
substantive and/or procedural matters in this proceeding. The 
flexibility provided by such computer data will facilitate timely 
review by the Board and its staff.
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FOR FURTHER INFORMATION CONTACT: Julia M. Farr, (202) 565-1613. [TDD 
for the hearing impaired: (202) 565-1695.]

SUPPLEMENTARY INFORMATION: On June 23, 1997, CSX Corporation (CSXC), 
CSXT, Norfolk Southern Corporation (NSC), Norfolk Southern Railway

[[Page 39592]]

Company (NSR), Conrail Inc. (CRR), and CRC 4 filed their 
primary application in the CSX/NS/CR proceeding seeking our 
authorization for: (a) the acquisition by CSX and NS of control of 
Conrail; and (b) division of Conrail's assets by and between CSX and 
NS. In Decision No. 9 in that proceeding, we granted the requests by 
applicants, with respect to four CSX construction projects and three NS 
construction projects, for waivers of our otherwise applicable 
``everything goes together'' rule.5 The waivers would allow 
CSX and NS to begin the physical construction following the completion 
of our environmental review of the construction projects, and our 
issuance of further decisions exempting or approving the proposals, but 
prior to our approval of the primary application. This petition for 
exemption for the construction at Greenwich, OH, concerns one of the 
seven construction projects. By this notice, we are inviting comments 
on whether the proposed transaction meets the applicable exemption 
criteria and on any other non-environmental concerns regarding the 
construction and operation of this particular project.
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    \4\ CSXC and CSXT are referred to collectively as CSX. NSC and 
NSR are referred to collectively as NS. CRR and CRC are referred to 
collectively as Conrail. CSX, NS, and Conrail are referred to 
collectively as applicants.
    \5\ See 49 CFR 1180.4(c)(2)(vi).
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    Pursuant to 49 U.S.C. 10502, CSXT and CRC have filed a petition for 
exemption from the prior approval provisions of 49 U.S.C. 10901 to 
construct and operate connection tracks in Greenwich, OH.6 
CSXT and CRC cross each other at Greenwich. CSXT and CRC propose to 
construct connection tracks in the northwest and southeast quadrants 
between CSXT's main line and CRC's main line at Greenwich. The 
connection in the northwest quadrant will extend approximately 4,600 
feet between approximately milepost BG-193.1 on CSXT's main line 
between Chicago, IL, and Pittsburgh, PA, and approximately milepost 
54.1 on CRC's main line between Cleveland and Cincinnati, OH. A portion 
of this connection in the northwest quadrant will be constructed on the 
existing trackage and/or right-of-way of the Wheeling & Lake Erie 
Railway Company. The connection in the southeast quadrant will extend 
approximately 1,044 feet between approximately milepost BG-192.5 on 
CSXT's main line and approximately milepost 54.6 on CRC's main line. 
CSXT anticipates that it must acquire approximately 0.4 acres of right-
of-way to construct these connections. A map showing the proposed 
connections at Greenwich is attached as Exhibit A to CSXT's 
petition.7
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    \6\ CSXT filed a petition for exemption to construct and operate 
connection tracks in Greenwich, OH, as a related filing in Volume 5 
of the primary application filed on June 23, 1997, in the CSX/NS/CR 
proceeding. See CSX/NS-22 (Volume 5) at 114. CSXT and CRC 
concurrently filed a slightly modified version of the petition for 
exemption for construction of connection tracks in Greenwich (CSX-
7). We will consider both filings together here. As we stated in 
CSX/NS/CR, Decision No. 9, at 6-7:
    * * * in reviewing these projects separately, we will consider 
the regulatory and environmental aspects of these proposed 
constructions and applicants' proposed operations over these lines 
together in the context of whether to approve each individual 
physical construction project. The operational implications of the 
merger as a whole, including operations over * * * the seven 
construction projects, will be examined in the context of the 
[Environmental Impact Statement] EIS that we are preparing for the 
overall merger. * * * No rail operations can begin over these seven 
segments until completion of the EIS process and issuance of a 
further decision.
    \7\ The parties indicate that they do not propose to operate 
over the connection at this time, and acknowledge that operation 
over this connection is related to, and contingent upon, the 
proposed control of Conrail by CSX and NS, approval of which is 
being sought in STB Finance Docket No. 33388.
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    Under 49 U.S.C. 10901, a railroad may: (1) Construct an extension 
to any of its railroad lines; (2) construct an additional railroad 
line; or (3) provide transportation over an extended or additional 
railroad line, only if the Board issues a certificate authorizing such 
activity. However, under 49 U.S.C. 10502, the Board shall exempt a rail 
transaction from regulation when it finds that: (1) Application of the 
pertinent statutory provisions is not necessary to carry out the rail 
transportation policy of 49 U.S.C. 10101; and (2) either the 
transaction is of limited scope, or regulation is not needed to protect 
shippers from the abuse of market power.
    CSXT and CRC contend that exemption of its proposed construction 
and operation at Greenwich meets all of the elements of the rail 
transportation policy. Petitioners maintain that, by minimizing the 
regulatory expense and time inherent in a full application under the 
provisions of section 10901, exemption will expedite regulatory 
decisions and reduce regulatory barriers to entry into the industry. 
They state that exemption will also foster efficient management and 
promote a safe and efficient rail system. They also indicate that, if 
the Board approves the primary application, one of CSXT's most 
important service lanes will be its Northeastern Gateway route 
extending from Chicago to Albany, NY, with branches eastward to Boston 
and southward to Newark, NJ. This service lane will combine CSXT's 
current main line route from Chicago to Greenwich, and CRC's line 
between Greenwich and Albany. The lines comprising this service lane 
currently contain some of the most heavily traveled track on the 
proposed CSXT combined system. CSXT anticipates that traffic on this 
corridor will be as high as 50 trains per day within the next 3 years.
    CSXT and CRC state that the proposed connections at Greenwich are 
of paramount importance if CSXT's Northeastern Gateway service lane is 
to operate as anticipated. The connection track to be constructed in 
the northwest quadrant will connect these two main lines and allow the 
traffic to flow between Chicago and points in the East. CSXT 
anticipates that an average of 35 trains per day will operate over this 
connection.
    To compete effectively for traffic moving to and from Chicago and 
points in the East, CSXT intends to establish a second auxiliary route 
from the East into Chicago. This service lane will be created from the 
existing NS line between Chicago and Fort Wayne, which CSXT will 
operate, and CRC's existing lines between Fort Wayne and Crestline, and 
between Crestline and Greenwich. CSXT states that this auxiliary route 
will handle primarily bulk traffic that is less time sensitive. The 
connection track to be constructed in the southeast quadrant at 
Greenwich will allow this traffic to be routed through Crestline. CSXT 
anticipates that an average of 9 trains per day will operate over this 
connection. Petitioners maintain that, without these two connections, 
CSXT cannot physically handle traffic between its current rail line to 
Chicago and the CRC lines CSXT will operate.
    Petitioners state that the exemption will promote effective 
competition among rail carriers and with other modes, and meet the 
needs of the shipping public. According to petitioners, the creation of 
two competitive rail routes between the Northeast and Chicago is one of 
the most important public benefits of the proposed division of 
Conrail's assets. CSXT states that, by improving its operation in the 
Chicago area, the connections at Greenwich will assist CSXT in its 
competition with NSR and other modes of transportation.
    The environmental report covering the proposed construction and 
operation of the connection tracks at Greenwich is contained in the 
Environmental Report filed with the Board in STB Finance Docket No. 
33388. In addition, as we required in

[[Page 39593]]

CSX/NS/CR, Decision No. 9, CSX must submit, no later than September 5, 
1997 (Day F+75), a preliminary draft environmental assessment (PDEA) 
for each individual construction project covered by our waiver 
decision. Each PDEA must comply with all of the requirements for 
environmental reports contained in our environmental rules at 49 CFR 
1105.7. Also, the PDEA must be based on consultations with our Section 
of Environmental Analysis (SEA) and the federal, state, and local 
agencies set forth in 49 CFR 1105.7(b), as well as other appropriate 
parties. If a PDEA is insufficient, we may require additional 
environmental information or reject the document. See CSX/NS/CR, 
Decision No. 9, at 8.
    As part of the environmental review process, SEA will independently 
verify the information contained in each PDEA, conduct further 
independent analysis, as necessary, and develop appropriate 
environmental mitigation measures. For each project, SEA plans to 
prepare an EA, which will be served on the public for review and 
comment. The public will have 20 days to comment on the EA, including 
the proposed environmental mitigation measures. After the close of the 
public comment period, SEA will prepare Post Environmental Assessments 
(Post EAs) containing SEA's final recommendations, including 
appropriate environmental mitigation. Therefore, in deciding whether to 
grant petitioners' exemption request, we will consider the entire 
environmental record, including all public comments, the EA, and the 
Post EA. Id. at 8.
    Should we determine that the Greenwich construction project could 
potentially cause, or contribute to, significant environmental impacts, 
then the project will be incorporated into the EIS for the proposed 
control transaction in STB Finance Docket No. 33388. Id. at 8. As we 
have previously emphasized, our consideration of the seven construction 
projects does not, and will not, in any way, constitute approval of, or 
even indicate any consideration on our part respecting approval of, the 
primary application in STB Finance Docket No. 33388. See CSX/NS/CR, 
Decision No. 9, at 6; and Decision No. 5, served and published in the 
Federal Register on May 13, 1997, 62 FR 26352, slip op. at 3. If we 
grant any exemptions for these seven construction projects, applicants 
will not be allowed to argue that, because we have granted an exemption 
and applicants may have expended resources to construct a connection 
track, we should approve the primary application. Applicants have 
willingly assumed the risk that we may deny the primary application, or 
approve it subject to conditions unacceptable to applicants, or approve 
the primary application but deny an applicant's request to operate over 
any or all of the seven connections. Id.
    This action will not significantly affect either the quality of the 
human environment or the conservation of energy resources.
    It is ordered:
    1. Comments on whether the proposed transaction meets the exemption 
criteria of 49 U.S.C. 10502 and on any other non-environmental concerns 
regarding the construction and operation of the connection tracks in 
Greenwich are due August 22, 1997.
    2. Replies are due September 11, 1997.
    3. This decision is effective on the date of service.

    Decided: July 16, 1997.

    By the Board, Chairman Morgan and Vice Chairman Owen.
Vernon A. Williams,
Secretary.
[FR Doc. 97-19376 Filed 7-22-97; 8:45 am]
BILLING CODE 4915-00-P