[Federal Register Volume 89, Number 101 (Thursday, May 23, 2024)]
[Notices]
[Pages 45727-45728]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-11325]


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SURFACE TRANSPORTATION BOARD

[Docket No. FD 36756]


Peninsula Corridor Joint Powers Board--Acquisition Exemption--San 
Mateo County Transit District

    On February 21, 2024, the Peninsula Corridor Joint Powers Board 
(JPB) \1\ filed a petition under 49 U.S.C. 10502 for exemption from the 
prior approval requirements of 49 U.S.C. 11323-24 to allow JPB to 
acquire all the rights, title, and interest of SamTrans in a line of 
railroad and related right-of-way currently owned by SamTrans as 
tenant-in-common with JPB (the Transaction). The petition is unopposed. 
The Board will grant JPB's petition for exemption, subject to standard 
labor protective conditions.
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    \1\ JPB is an agency created by the State of California and is 
comprised of member agencies San Mateo County Transit District 
(SamTrans), the Santa Clara Valley Transportation Authority, and the 
City and County of San Francisco. (See Pet. 1, 2 n.2.)
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Background

    In 1991, JPB acquired a full ownership interest in the 51.3 miles 
of rail line known as the Peninsula Corridor from the Southern Pacific 
Transportation Company (SP), with the exception of an undivided one-
half tenant-in-common interest for the portion of the rail line from 
milepost 5.2 to milepost 29.7 in the County of San Mateo, Cal. (the 
Line), which was acquired by SamTrans. Peninsula Corridor Joint Powers 
Bd.--Acquis. Exemption--S. Pac. Transp. Co., FD 31980 (ICC served Jan. 
17, 1992). SamTrans is the managing agency responsible for the 
management and operations of passenger rail services along the Line. 
(Pet. 3.) According to JPB, the Transaction will give JPB a 100% 
interest in the Line, including any track, right-of-way, and related 
properties. (Id.)
    JPB explains that rail operations on the Line and the rights and 
obligations of the owners and the freight and passenger operators are 
governed by three key agreements. (Id.) The first is the 1991 Purchase 
and Sale Agreement JBP entered into with SP for the

[[Page 45728]]

Peninsula Corridor, which includes the Line. (Pet. 3; see also id., Ex. 
B.) The second is the 1991 Real Property Ownership Agreement, as 
amended in 2008 (RPOA), which establishes ownership rights with respect 
to the Line and various other properties along the Peninsula Corridor 
among JPB and its member agencies. (Pet. 3; see also id., Exs. C, C-1.) 
Pursuant to Sections 4.1 and 7.8 of the RPOA, SamTrans is to transfer 
its tenant-in-common interest in the Line to JPB upon the fulfillment 
of certain financial conditions. (Pet. 3.) The third is the 1996 Joint 
Powers Agreement between JPB and its member agencies, which delegates 
management and operations of the Line to SamTrans. (Id. at 3-4; see 
also id., Ex. D.)
    With the conditions established in the RPOA and its amendment 
satisfied, pursuant to a memorandum of understanding dated August 5, 
2022, JPB will now acquire all ownership interest in the Line, with 
SamTrans remaining the managing agency for the management and 
operations of the Line. (Pet. 4; see also id., Ex. E.)

Discussion and Conclusions

    Under 49 U.S.C. 11323(a)(3), the acquisition of control of a rail 
carrier by any number of rail carriers requires prior Board approval. 
Under 49 U.S.C. 10502(a), however, the Board shall, to the maximum 
extent consistent with 49 U.S.C. subtitle IV, part A, exempt a 
transaction or service from regulation when it finds that: (1) 
regulation is not necessary to carry out the rail transportation policy 
of 49 U.S.C. 10101 (RTP); and (2) either (a) the transaction or service 
is limited in scope, or (b) regulation is not needed to protect 
shippers from the abuse of market power.
    In this case, an exemption from the prior approval requirements of 
49 U.S.C. 11323-24 is consistent with the standards of 49 U.S.C. 10502. 
Detailed scrutiny of the proposed transaction through an application 
for review and approval under 49 U.S.C. 11323-24 is not necessary here 
to carry out the RTP. Consolidating ownership of the Line in JPB will 
ensure that JPB will be able to further govern the Line as consistent 
with the agreements reached when JPB purchased the Line from SP. The 
Transaction will not have any operational impacts on passenger or 
common carrier service, as SamTrans will remain the managing agency 
overseeing the operation of passenger rail service, and no freight or 
commuter rail common carrier interests will be affected by the transfer 
of SamTrans' ownership interest to JPB. An exemption would promote the 
RTP by: minimizing the need for federal regulatory control over the 
transaction (49 U.S.C. 10101(2)), ensuring the development and 
continuation of a sound rail transportation system that would continue 
to meet the needs of the public (49 U.S.C. 10101(4)), fostering sound 
economic conditions in transportation (49 U.S.C. 10101(5)), encouraging 
efficient management (49 U.S.C. 10101(9)), and providing for the 
expeditious resolution of this proceeding (49 U.S.C. 10101(15)). Other 
aspects of the RTP would not be adversely affected.
    Regulation of this transaction is not needed to protect shippers 
from an abuse of market power.\2\ This acquisition involves no more 
than transferring the ownership interests of one current tenant-in-
common to the other, thus consolidating ownership of the Line in the 
latter. According to JPB, no change in operations will occur, no 
interests of the freight railroads' operation on the corridor will be 
impacted, and no shippers will be adversely affected by the 
Transaction. Nothing in the record indicates that the Transaction would 
result in any shipper losing access to rail service or foreclose any 
transportation options currently available to shippers. Moreover, no 
shipper (or any other entity) has objected to the Transaction.
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    \2\ Given this finding, the Board need not determine whether the 
transaction is limited in scope. See 49 U.S.C. 10502(a).
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    Under 49 U.S.C. 10502(g), the Board may not use its exemption 
authority to relieve a carrier of its statutory obligation to protect 
the interests of employees. Accordingly, as a condition to granting 
this exemption, the Board will impose the standard employee protective 
conditions in New York Dock Railway--Control--Brooklyn Eastern District 
Terminal, 360 I.C.C 60, aff'd New York Dock Railway v. United States, 
609 F.2d 83 (2d Cir. 1979).
    The control transaction is exempt from environmental reporting 
requirements under 49 CFR 1105.6(c)(1)(i) because it will not result in 
any significant change in carrier operations. Similarly, the 
transaction is exempt from the historic reporting requirements under 49 
CFR 1105.8(b)(1), as JPB states it has no plans to dispose of or alter 
properties subject to Board jurisdiction that are 50 years old or 
older.
    The exemption will be effective June 19, 2024, and petitions to 
stay will be due by May 30, 2024. Petitions for reconsideration or 
petitions to reopen will be due by June 10, 2024.
    It is ordered:
    1. Under 49 U.S.C. 10502, the Board exempts from the prior approval 
requirements of 49 U.S.C. 11323-25 the control transaction described 
above, subject to the employee protective conditions in New York Dock 
Railway--Control--Brooklyn Eastern District Terminal, 360 I.C.C 60, 
aff'd New York Dock Railway v. United States, 609 F.2d 83 (2d Cir. 
1979).
    2. Notice of the exemption will be published in the Federal 
Register.
    3. The exemption will become effective on June 19, 2024. Petitions 
for stay must be filed by May 30, 2024. Petitions for reconsideration 
or petitions to reopen must be filed by June 10, 2024.

    Decided: May 18, 2024.

    By the Board, Board Members Fuchs, Hedlund, Primus, and Schultz.
Eden Besera,
Clearance Clerk.
[FR Doc. 2024-11325 Filed 5-22-24; 8:45 am]
BILLING CODE 4915-01-P