[Federal Register Volume 73, Number 247 (Tuesday, December 23, 2008)]
[Notices]
[Pages 78871-78872]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-30381]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

[STB Finance Docket No. 35163]


Kansas City Southern, The Kansas City Southern Railway Company, 
and The Texas Mexican Railway Company--Exemption for Transactions 
Within a Corporate Family

    Kansas City Southern (KCS), The Kansas City Southern Railway 
Company (KCSR), and The Texas Mexican Railway Company (Tex Mex), have 
filed a verified notice of exemption for a transaction within a 
corporate family. The transaction involves: (1) KCSR's acquisition by 
lease and operation of Tex Mex's right-of-way and rail line extending 
between milepost 2.5 (near Rosenberg, TX) and milepost 87.0 (near 
Victoria, TX); and (2) the assignment to KCSR of Tex Mex's overhead 
trackage rights over certain rail lines of Union Pacific Railroad 
Company (UP) (a) between mileposts 0.0 and 2.5 (near Rosenberg), and 
(b) between mileposts 87.0 and 90.8 (near Victoria), along with Tex 
Mex's rights to interchange with BNSF Railway Company at Rosenberg.\1\
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    \1\ The rail line segment between mileposts 2.5 and 87.0 is 
owned by Tex Mex, and the segments between mileposts 0.0 and 2.5 and 
mileposts 87.0 and 90.8 are owned by UP.
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    KCS is a privately held noncarrier holding company, with both rail 
and non-rail assets. KCS currently controls 3 rail common carriers: (1) 
KCSR, a Class I carrier that owns and operates approximately 3,226 
miles of rail line in ten states; (2) Gateway Eastern Railway Company, 
a Class III carrier that owns and operates approximately 17 miles of 
rail line between East Alton and East St. Louis, IL; and (3) Tex Mex, a 
Class II carrier that owns approximately 157 miles of rail line between 
Laredo and Corpus Christi, TX, and approximately 84.5 miles of rail 
line between Rosenberg and Victoria (including overhead trackage rights 
over UP's line between mileposts 0.0 and 2.5 and between mileposts 87.0 
and 90.8), and that possesses overhead trackage rights over UP's rail 
lines between Beaumont, Houston, and Corpus Christi, TX.
    The transaction is expected to be consummated on January 7, 2009 
(30 days after the exemption was filed).
    As a result of this transaction, KCSR will possess sufficient 
rights to operate and provide service over a contiguous rail line 
bounded by Kansas City, MO, at the north end and Laredo, TX, at the 
south end. According to applicants, the transaction will reduce 
operating costs, improve efficiency, and enable KCSR to provide 
seamless service over the various parts of its rail system.
    This is a transaction within a corporate family of the type 
exempted from prior review and approval under 49 CFR 1180.2(d)(3). The 
parties state that the transaction will not result in adverse changes 
in service levels, significant operational changes, or changes in the 
competitive balance with carriers outside the KCS corporate family.
    As a condition to the use of this exemption, any employees 
adversely affected by the lease and operation will be protected by the 
conditions set forth in Mendocino Coast Ry., Inc.--Lease and Operate, 
354 I.C.C. 732 (1978) and 360 I.C.C. 653 (1980), as clarified in 
Wilmington Term. RR, Inc.--Pur. and Lease--CSX Transp., Inc., 6 
I.C.C.2d 799, 814-26 (1990). Any employees adversely affected by the 
assignment of trackage rights will be protected by the conditions set 
forth in Norfolk and Western Ry. Co.--Trackage Rights--BN, 354 I.C.C. 
605 (1978), as modified in Mendocino Coast Ry., Inc.--Lease and 
Operate, 360 I.C.C. 653 (1980).
    If the notice contains false or misleading information, the 
exemption is void ab initio. Petitions to revoke the exemption under 49 
U.S.C. 10502(d) may be filed at any time. The filing of a petition to 
revoke will not automatically stay the transaction. Petitions for stay 
will be due no later than December 31, 2008 (at least 7 days before the 
effective date of the exemption).
    An original and 10 copies of all pleadings, referring to STB 
Finance Docket No. 35163, must be filed with the Surface Transportation 
Board, 395 E Street, SW., Washington, DC 20423-0001. In addition, one 
copy of each pleading must be served on applicants' representatives, 
William A. Mullins, 2401 Pennsylvania Ave., NW., Suite 300, Washington, 
DC 20037, and W. James Wochner, P.O. Box 219335, Kansas City, MO 64121.
    Board decisions and notices are available on our Web site at http://www.stb.dot.gov.

    Decided: December 16, 2008.


[[Page 78872]]


    By the Board, David M. Konschnik, Director, Office of 
Proceedings.

Jeffrey Herzig,
Clearance Clerk.
[FR Doc. E8-30381 Filed 12-22-08; 8:45 am]
BILLING CODE 4915-01-P