Notice2022-02144
BNSF Railway Company-Lease Exemption-Union Pacific Railroad Company
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
February 2, 2022
Issuing agencies
Surface Transportation Board
Full Text
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<title>Federal Register, Volume 87 Issue 22 (Wednesday, February 2, 2022)</title>
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[Federal Register Volume 87, Number 22 (Wednesday, February 2, 2022)]
[Notices]
[Pages 5930-5931]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-02144]
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SURFACE TRANSPORTATION BOARD
[Docket No. FD 36560]
BNSF Railway Company--Lease Exemption--Union Pacific Railroad
Company
On November 9, 2021, BNSF Railway Company (BNSF) filed a petition
under 49 U.S.C. 10502 seeking exemption from the prior approval
requirements of 49 U.S.C. 11323-25 for BNSF to lease from Union Pacific
Railroad Company (UP) approximately 25 miles of rail line extending
from Sterling, Colo., near UP milepost 56.71, to Union, Colo., near UP
milepost 81.1, on UP's Julesburg Subdivision (the Line).\1\
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\1\ An executed, redacted version of the lease agreement was
filed with the petition for exemption. An unredacted version was
submitted to the Board under seal along with a motion for protective
order, which was granted by decision served on November 24, 2021.
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The petition explains that BNSF and its predecessors have operated
over the Line since 1900, and that, concurrently with the petition,
BNSF filed a verified notice of exemption pursuant to 49 CFR
1180.2(d)(7) pertaining to a trackage rights agreement to supersede the
agreement that had been in effect since 1951. (Pet. 2.) \2\ According
to the petition, BNSF and UP have agreed to enter into a lease that
would modify certain roles and responsibilities set forth in the new
trackage rights agreement; in particular, the lease would ``allow BNSF
to occupy UP's property for the purposes of maintenance, construction,
repair, and renewal of the track and appurtenant structures and
facilities on the Line.'' (Pet. 2.) \3\ BNSF states that by permitting
maintenance responsibilities to shift to BNSF, the sole user of the
Line, the lease will streamline maintenance activity and produce more
efficient rail operations. (Pet. 2.) According to BNSF, the lease
transaction will have no adverse impact on commercial or operational
access to the Line. (Id. at 5; see also id. at 6-7 (stating that the
lease ``is simply intended to produce more efficient rail operations by
streamlining the Line's maintenance activities'' and ``will have no
adverse impact on the national, regional, or local rail industry'').)
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\2\ Notice of the trackage rights exemption was published in the
Federal Register on November 24, 2021 (86 FR 67111), and the
exemption took effect on December 9, 2021. See BNSF Ry.--Trackage
Rts. Exemption--Union Pac. R.R., FD 36561 (STB served Nov. 24,
2021).
\3\ BNSF's reference to ``construction'' is in connection with
the planned repair and maintenance of the existing Line. (See Pet.
2.) Therefore, the Board does not construe that reference as
involving any new line of railroad for which construction authority
would be needed pursuant to 49 U.S.C. 10901, and this decision does
not grant any such authority.
\4\ Pursuant to 49 CFR 1121.3(d), BNSF certifies that the lease
does not contain a provision or agreement that may limit future
interchange with a third-party connecting carrier. (Pet. 7-8.)
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BNSF asserts that the Board has previously exempted similar lease
agreements from the prior approval requirements of sections 11323-25
pursuant to section 10502, and that the Board should grant this
petition and exempt the lease for the same reasons. (Pet. 3.)
Discussion and Conclusions
Under 49 U.S.C. 11323(a)(2), prior Board approval is required for a
rail carrier to lease the property of another rail carrier. Under 49
U.S.C. 10502, however, the Board must exempt a transaction or service
from regulation when it finds that: (1) Regulation is not necessary to
carry out the rail
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transportation policy of 49 U.S.C. 10101; and (2) either (a) the
transaction or service is of limited scope, or (b) regulation is not
needed to protect shippers from the abuse of market power.
Detailed scrutiny of the proposed transaction through an
application for review and approval under 49 U.S.C. 11323-25 is not
necessary here to carry out the rail transportation policy. The
proposed transaction would simply permit maintenance responsibilities
for the Line to shift to BNSF, the sole user of the Line. As described
in the petition, the lease is intended to streamline maintenance
activity and would produce more efficient rail operations over the Line
with no adverse competitive impacts. Therefore, the proposed
transaction would promote a safe and efficient rail transportation
system, (49 U.S.C. 10101(3)), foster sound economic conditions in
transportation and ensure effective competition, (49 U.S.C. 10101(5)),
encourage honest and efficient management, (49 U.S.C. 10101(9)), and
promote energy conservation, (49 U.S.C. 10101(14)). Further, an
exemption from the application process would expedite regulatory
action, (49 U.S.C. 10101(2)), and reduce regulatory barriers to entry
and exit, (49 U.S.C. 10101(7)). Other aspects of the rail
transportation policy would not be adversely affected.
Regulation of the proposed transaction is also not necessary to
protect shippers from the abuse of market power.\5\ Nothing in the
record indicates that any shipper would lose an existing rail service
option as a result of the proposed lease transaction. According to the
petition, the transaction will have no adverse impact on commercial or
operational access to the Line. (See Pet. 5 (noting that the lease
agreement specifically states that nothing contained in the lease would
``amend, change or supersede the commercial access . . . terms as
provided for in the Trackage Rights Agreement'').) BNSF states that it
will continue to provide common carrier service to shippers over the
Line and that there will be no material change in the service provided
to shippers, because the lease simply shifts the Line's maintenance
responsibilities to BNSF, the sole user of the Line. (Id. at 6.)
Indeed, the lease transaction should benefit shippers by producing more
efficient rail operations by streamlining the Line's maintenance
activities. Moreover, no shippers or other parties have filed any
objections to the proposed transaction.
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\5\ Because the Board concludes that regulation is not needed to
protect shippers from the abuse of market power, it is unnecessary
to 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 Norfolk & Western Railway--Trackage Rights--Burlington
Northern, Inc., 354 I.C.C. 605 (1978), as modified in Mendocino Coast
Railway--Lease & Operate--California Western Railroad, 360 I.C.C. 653
(1980).
The proposed lease is exempt from both the environmental reporting
requirements under 49 CFR 1105.6(c) and the historic reporting
requirements under 49 CFR 1105.8(b).
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 BNSF's lease of the Line, subject to
the employee protective conditions in Norfolk & Western Railway--
Trackage Rights--Burlington Northern, Inc., 354 I.C.C. 605 (1978), as
modified in Mendocino Coast Railway--Lease & Operate--California
Western Railroad, 360 I.C.C. 653 (1980).
2. Notice of the exemption will be published in the Federal
Register on February 2, 2022.
3. The exemption will become effective on March 4, 2022.
4. Petitions to stay must be filed by February 14, 2022.
5. Petitions for reconsideration and petitions to reopen must be
filed by February 22, 2022.
Decided: January 25, 2022.
By the Board, Board Members Fuchs, Hedlund, Oberman, Primus, and
Schultz.
Jeffrey Herzig,
Clearance Clerk.
[FR Doc. 2022-02144 Filed 2-1-22; 8:45 am]
BILLING CODE 4915-01-P
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</html>Indexed from Federal Register on February 2, 2022.
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