[Federal Register Volume 88, Number 34 (Tuesday, February 21, 2023)]
[Notices]
[Page 10617]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-03537]



[[Page 10617]]

=======================================================================
-----------------------------------------------------------------------

SURFACE TRANSPORTATION BOARD

[Docket No. FD 36644]


Mid-Atlantic Gateway LLC--Lease and Operation Exemption--Certain 
Rail Line Assets of J.P. Rail, Inc. D/B/A Southern RR Company of New 
Jersey

    In this decision, for the reasons discussed below, the Board will 
decline to institute a revocation proceeding to address the petition to 
revoke filed by J.P. Rail, Inc. d/b/a Southern RR Company of New Jersey 
(J.P. Rail). Pursuant to 49 U.S.C. 10502(d), the Board's decision will 
be published in the Federal Register.

Background

    On October 28, 2022, Mid-Atlantic Gateway LLC (MAG) filed a 
verified notice of exemption under 49 CFR 1150.31 to acquire by lease 
and operate over approximately 0.12 miles (634 linear feet) of track, 
located between mileposts 56.99 and 56.87 on the Pleasantville Branch 
Line in Atlantic County, N.J., owned by J.P. Rail. The verified notice 
stated that MAG had reached an agreement ``in principle'' with J.P. 
Rail under which MAG would acquire by lease and operate over the Line, 
and that MAG would hold itself out to provide common carrier rail 
freight service pursuant to the agreement. Notice of the exemption was 
served and published in the Federal Register on November 10, 2022 (87 
FR 67,990), and the exemption became effective on November 27, 2022.
    On November 18, 2022, J.P. Rail filed a short letter petitioning 
the Board to revoke the lease and operation exemption and stating that 
``[t]he parties have not reached an agreement to acquire by lease and 
operate over the line at this time.'' (Pet. 1.) MAG did not file a 
response.

Discussion and Conclusions

    The notice of exemption here has already become effective, as no 
party sought a stay. Under 49 U.S.C. 10502(d), an already-effective 
exemption may be revoked, in whole or in part, if regulation is 
necessary to carry out the rail transportation policy of 49 U.S.C. 
10101. Furthermore, pursuant to Sec.  10502(d), the Board shall, within 
90 days after receipt of a request for revocation, determine whether to 
begin an appropriate proceeding. The party seeking revocation bears the 
burden of showing that regulation is necessary to carry out the rail 
transportation policy. See 49 CFR 1121.4(f). A petition to revoke must 
be based on reasonable, specific concerns that demonstrate that 
reconsideration of the exemption is warranted and more detailed 
scrutiny of the transaction is necessary. Grand Elk R.R.--Lease & 
Operation Exemption--Norfolk S. Ry., FD 35187, slip op. at 2 (STB 
served July 13, 2009). Finally, if the Board decides not to begin a 
proceeding to revoke a class exemption, the reasons for the decision 
shall be published in the Federal Register.
    J.P. Rail does not articulate reasonable, specific concerns with 
the notice of exemption and does not argue why Board regulation is 
necessary to carry out any particular provision of the rail 
transportation policy. It states only that ``[t]he parties have not 
reached an agreement to acquire by lease and operate over the line at 
this time.'' (Pet. 1.) This lone statement, however, does not 
demonstrate that more detailed scrutiny of the transaction is required. 
There is no requirement that a party have a final agreement in place 
before obtaining a class exemption. Moreover, the authority granted 
under a notice of exemption is permissive and cannot be exercised 
unless the parties agree to go forward with the transaction. See Chi., 
Lake Shore & S. Bend Ry.--Acquis. & Operation Exemption--Norfolk S. 
Ry., FD 34960, slip op. at 4 (STB served Feb. 14, 2008). The grant of 
the exemption here does not require the parties to complete the 
transaction, and revoking the exemption is not necessary simply because 
the parties have not reached a final agreement to go forward.\1\
---------------------------------------------------------------------------

    \1\ This is not a situation where there are questions whether 
the proposed acquisition would involve an actual agreement, as that 
term is understood, to transfer an existing rail line. See, e.g., 
James Riffin--Acquis. and Operation Exemption--In York Cnty., Pa., 
FD 36548 (STB served April 21, 2022) (rejecting a notice of 
exemption where there were questions concerning whether there was an 
actual agreement to transfer an existing rail line), pet. for 
reconsideration pending. In Riffin, the Board rejected a notice of 
exemption because, inter alia, it was unclear whether the rail line 
still existed on the property at issue (i.e., whether the line had 
been abandoned), whether the previous rail carrier owner and 
operator understood that a rail line might still exist on the 
property, and whether a determination in a quiet title action could 
constitute an agreement. Id. None of those concerns exist here.
---------------------------------------------------------------------------

    Accordingly, the Board will decline to institute a revocation 
proceeding to address J.P. Rail's petition.
    It is ordered:
    1. The Board declines to institute a proceeding to address J.P. 
Rail's petition for revocation.
    2. This decision will be published in the Federal Register.
    3. This decision is effective on its service date.

    Decided: February 14, 2023.

    By the Board, Board Members Fuchs, Hedlund, Oberman, Primus, and 
Schultz.
Brendetta Jones,
Clearance Clerk.
[FR Doc. 2023-03537 Filed 2-17-23; 8:45 am]
BILLING CODE 4915-01-P