Wisconsin & Southern Railroad, L.L.C.-Acquisition and Operation Exemption-Soo Line Railroad Company
| Published date | 23 December 2020 |
| Citation | 85 FR 84093 |
| Record Number | 2020-28395 |
| Section | Notices |
| Court | Surface Transportation Board |
84093
Federal Register / Vol. 85, No. 247 / Wednesday, December 23, 2020 / Notices
1
The petition for exemption notes that the Lease
Decision listed the Line’s southern limit as milepost
88.4, whereas the Asset Purchase Agreement
governing the sale of the Line here lists it as
milepost 88.41. WSOR states that this ‘‘minimal
difference in mileposts—less than 53 feet—is
believed to be a rounding error, and was not
intended to signify a different point on the Line.’’
(Pet. for Exemption 1 n.1.)
2
WSOR states that its proposed transaction with
Soo Line also includes the transfer of a portion of
Soo Line’s Glendale Yard known as the ‘‘B’’ yard.
(Pet. for Exemption 1.) The 2007 transaction also
included the ‘‘B’’ yard. Lease Decision, FD 35012,
slip op. at 1.
3
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 proposed transaction is limited in
scope. See 49 U.S.C. 10502(a).
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 effectiveness of
the exemption. Petitions for stay must
be filed no later than December 31, 2020
(at least seven days before the
exemption becomes effective).
All pleadings, referring to Docket No.
FD 36456, should be filed with the
Surface Transportation Board via e-
filing on the Board’s website. In
addition, a copy of each pleading must
be served on DUSR’s representative,
Robert A. Wimbish, Fletcher & Sippel
LLC, 29 North Wacker Drive, Suite 800,
Chicago, IL 60606–3208.
According to DUSR, this action is
categorically excluded from
environmental review under 49 CFR
1105.6(c) and from historic reporting
requirements under 49 CFR 1105.8(b).
Board decisions and notices are
available at www.stb.gov.
Decided: December 17, 2020.
By the Board, Allison C. Davis, Director,
Office of Proceedings.
Kenyatta Clay,
Clearance Clerk.
[FR Doc. 2020–28274 Filed 12–22–20; 8:45 am]
BILLING CODE 4915–01–P
SURFACE TRANSPORTATION BOARD
[Docket No. FD 36452]
Wisconsin & Southern Railroad,
L.L.C.—Acquisition and Operation
Exemption—Soo Line Railroad
Company
On November 17, 2020, Wisconsin &
Southern Railroad, L.L.C. (WSOR), a
Class II rail carrier, filed a petition
under 49 U.S.C. 10502 for an exemption
from the prior approval requirements of
49 U.S.C. 10902 to acquire and operate
over approximately 4.79 miles of rail
line owned by Soo Line Railroad
Company (Soo Line). The rail line
extends from milepost 93.20 (at
Hampton Avenue) to milepost 88.41
(south of State Street) in the City of
Milwaukee, Milwaukee County, Wis.
(the Line). WSOR concurrently filed a
petition for waiver of the 60-day
advance notice requirement of 49 CFR
1121.4(h). For the reasons discussed
below, the Board will grant the petition
for exemption and the petition for
waiver.
Background
In 2007, WSOR received Board
authority to lease and operate over the
Line. Wis. & S. R.R.—Lease & Operation
Exemption—Soo Line R.R. (Lease
Decision), FD 35012, slip op. at 1, 3
(STB served July 17, 2007).
1
According
to WSOR, it has continued to lease,
maintain, dispatch, and operate over the
Line since 2007, but now seeks to
purchase the Line from Soo Line.
2
(Pet.
for Exemption 1–2.) WSOR states that,
through ownership of the Line, it ‘‘will
be able to exercise more complete
control over investment decisions, and
will be better positioned to offer
responsive and efficient rail service into
the future.’’ (Id. at 3.) WSOR states that
the parties hope to close on their
transaction before the end of the year
and asks the Board, at Soo Line’s
request, for expedited consideration of
its petition for exemption. (Id. at 2.)
WSOR also petitions the Board for a
waiver of the 60-day notice requirement
under 49 CFR 1121.4(h). Unless waived,
section 1121.4(h) would require WSOR,
at least 60 days before the exemption
becomes effective, to post a notice of its
intent to undertake the proposed
transaction setting forth certain
information at the workplace of the
employees on the affected lines, serve a
copy of the notice on the national
offices of the labor unions with
employees on the affected lines, and
certify to the Board that it has done so.
WSOR argues that the notice
requirement would serve no useful
purpose under the circumstances,
pointing out that no Soo Line employees
have worked on the Line for more than
13 years and that, because WSOR has
operated the Line during that time, there
is no new carrier. (Pet. for Waiver 3.)
WSOR states that it ‘‘has no plans to
modify its operation of the Line once its
leasehold interest is converted to
ownership,’’ and, therefore, no
employees would be adversely affected
by the proposed acquisition. (Id. at 2.)
No opposition to either the petition
for exemption or the petition for waiver
has been filed.
Discussion and Conclusions
Exemption from 49 U.S.C. 10902.
Under 49 U.S.C. 10902, the acquisition
of a rail line by a Class II rail carrier
requires the prior approval of the Board.
Under 49 U.S.C. 10502(a), 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 transportation policy
(RTP) 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.
In this case, an exemption from the
prior approval requirements of section
10902 is consistent with section
10502(a). Detailed scrutiny of the
proposed transaction under section
10902 is not necessary to carry out the
RTP. An exemption from the
application process would minimize the
need for federal regulatory control,
reduce regulatory barriers to entry, and
result in the expeditious handling of
this proceeding. See 49 U.S.C. 10101(2),
(7), (15). Other aspects of the RTP would
not be adversely affected by use of the
exemption process.
Moreover, regulation of the proposed
transaction under section 10902 is not
needed to protect shippers from the
abuse of market power.
3
There would be
no loss of rail competition and no
adverse change in the competitive
balance in the transportation market, as
WSOR has been the carrier providing
service over the Line since 2007. Nor
would there be a change in the level of
service to any shippers because ‘‘WSOR
does not intend as a result of the
proposed transaction to change
materially its existing operations over
the Line.’’ (Pet. for Exemption 3.)
Waiver of 49 CFR 1121.4(h). As noted,
WSOR has petitioned for waiver of the
60-day notification requirement under
49 CFR 1121.4(h). The purpose of that
requirement is to ensure that rail labor
unions and employees who would be
affected by the transfer of a line are
given sufficient notice of the transaction
before consummation. The Board takes
seriously the requirements of the
regulation, but it does not appear that
the purpose behind the notice
requirement would be thwarted if the
requested waiver is granted in this case.
The record indicates that no railroad
employees would be adversely affected
by waiver of the requirement here. As
WSOR explains, ‘‘[n]o Soo [Line]
employees have worked on any portion
of the Line in more than 13 years, and
they (and the unions representing them)
were advised of the transition to WSOR
operation of the Line in connection with
the Lease Decision transaction as of May
24, 2007.’’ (Pet. for Waiver 3.) WSOR
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84094
Federal Register / Vol. 85, No. 247 / Wednesday, December 23, 2020 / Notices
1
A redacted version of the agreement was filed
with the verified notice of exemption. Applicants
simultaneously filed a motion for protective order
under 49 CFR 1104.14(b). That motion will be
addressed in a separate decision.
2
The verified notice lists the railroads as follows:
(1) The Tennessee Southern Railroad Company,
LLC; (2) Rarus Railway, LLC, d/b/a Butte, Anaconda
& Pacific Railway Co.; (3) Utah Central Railway
Company, LLC; (4) Sacramento Valley Railroad,
LLC; (5) The Louisiana and North West Railroad
Company LLC; (6) Temple & Central Texas Railway,
LLC; (7) the Columbia & Cowlitz Railway, LLC; (8)
the DeQueen and Eastern Railroad, LLC; (9) the
Golden Triangle Railroad, LLC; (10) the Patriot
Woods Railroad, LLC; (11) the Texas, Oklahoma &
Eastern Railroad, LLC; (12) Georgia Northeastern
Railroad Company, LLC; (13) the Kingman Terminal
Railroad, LLC; and (14) West Belt Railway LLC
(collectively, the Subsidiary Railroads).
3
The verified notice was initially submitted on
November 17, 2020. Applicants filed supplements
on November 18, December 1, and December 10,
2020. December 10, 2020, therefore, is deemed the
filing date of the verified notice.
also states that ‘‘[n]o Soo [Line]
employees will be displaced[,]’’ and that
WSOR ‘‘will continue in [its] capacity’’
as the operator of the Line following the
proposed transaction. (Id.) Because no
employees would be adversely affected
by the requested waiver of the 60-day
notice period, the Board will grant the
waiver. See, e.g., Wis. & S. R.R.—
Acquis. & Operation Exemption—City of
Fitchburg, Wis., FD 35838, slip op. at 4
(STB served Nov. 18, 2014).
Employee Protection. 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 its employees. Section
10902(d) provides for labor protection
in line acquisitions by Class II rail
carriers. As a condition to this
exemption, any employees affected by
the acquisition will be protected as
required by 49 U.S.C. 10902(d), subject
to the standards and procedures
established in Wisconsin Central Ltd.—
Acquisition Exemption—Lines of Union
Pacific Railroad, 2 S.T.B. 218 (1997),
aff’d in relevant part sub nom.
Association of American Railroads v.
STB, 162 F.3d 101 (DC Cir. 1998).
Environmental and Historic Review.
Under 49 CFR 1105.6(c)(1), this action,
which will not result in significant
changes in carrier operations, is
categorically excluded from
environmental review. Similarly, under
49 CFR 1105.8(b)(1), no historic report
is required because the subject
transaction is for continued rail service,
WSOR has indicated no plans to alter
railroad properties 50 years old or older,
and any abandonment would be subject
to Board jurisdiction.
Effective Date. WSOR requests
authority to acquire and operate the
Line by December 28, 2020, so that the
parties may close the transaction before
the end of the year. The exemption will
take effect on December 28, 2020, unless
it is stayed.
It is ordered:
1. Under 49 U.S.C. 10502, the Board
exempts from the prior approval
requirements of 49 U.S.C. 10902
WSOR’s acquisition of and operation
over the Line, subject to the employee
protective conditions implementing 49
U.S.C. 10902(d) as provided in this
decision.
2. Notice of the exemption will be
published in the Federal Register.
3. WSOR’s request for a waiver of the
advance notice requirement under 49
CFR 1121.4(h) is granted.
4. This exemption will become
effective on December 28, 2020.
5. Petitions to stay must be filed by
December 22, 2020. Petitions to reopen
must be filed by January 4, 2021.
Decided: December 14, 2020.
By the Board, Board Members Begeman,
Fuchs, and Oberman.
Jeffrey Herzig,
Clearance Clerk.
[FR Doc. 2020–28395 Filed 12–22–20; 8:45 am]
BILLING CODE 4915–01–P
SURFACE TRANSPORTATION BOARD
[Docket No. FD 36462]
Patriot Rail Transportation Company,
LLC, Patriot Rail Company LLC, SRTV
Holdings LLC, SteelRiver Transport
Ventures LLC, Global Diversified
Infrastructure Fund (North America)
LP, First State Infrastructure Managers
(International) Limited, and Mitsubishi
UFJ Financial Group, Inc.—Control
Exemption—Salt Lake Garfield and
Western Railway Company
Patriot Rail Transportation Company,
LLC (Patriot), Patriot Rail Company LLC
(PRC), SRTV Holdings LLC, SteelRiver
Transport Ventures LLC, Global
Diversified Infrastructure Fund (North
America) LP, First State Infrastructure
Managers (International) Limited, and
Mitsubishi UFJ Financial Group, Inc.
(collectively, Applicants), all
noncarriers, have filed a verified notice
of exemption under 49 CFR 1180.2(d)(2)
to acquire control of Salt Lake Garfield
and Western Railway Company (SLGW),
a Class III rail carrier operating in Utah.
According to the verified notice, PRC,
on behalf of its subsidiary, Patriot, has
entered into a Purchase and Sale
Agreement with SLGW, Caballero,
L.L.C., and Caballero 2 LLC.
1
Applicants
state that Patriot will acquire a 100%
controlling interest in SLGW. The
verified notice states that Patriot
currently controls 14 class III railroads.
2
The verified notice indicates that: (1)
SLGW will not connect with any of the
Subsidiary Railroads; (2) the acquisition
of control is not part of a series of
anticipated transactions that would
connect SLGW or any of the Subsidiary
Railroads with each other; and (3) the
proposed transaction does not involve a
Class I carrier. Therefore, the transaction
is exempt from the prior approval
requirements of 49 U.S.C. 11323. See 49
CFR 1180.2(d)(2).
The verified notice states that
Applicants intend to control SLGW on
or before December 15, 2020. However,
the earliest this transaction may be
consummated is January 9, 2021, the
effective date of the exemption (30 days
after the verified notice was filed).
3
Under 49 U.S.C. 10502(g), the Board
may not use its exemption authority to
relieve a rail carrier of its statutory
obligation to protect the interests of its
employees. However, 49 U.S.C. 11326(c)
does not provide for labor protection for
transactions under 49 U.S.C. 11324 and
11325 that involve only Class III rail
carriers. Because this transaction
involves Class III rail carriers only, the
Board, under the statute, may not
impose labor protective conditions for
this transaction.
If the verified 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 effectiveness of
the exemption. Petitions to stay must be
filed no later than December 31, 2020 (at
least seven days before the exemption
becomes effective).
All pleadings, referring to Docket No.
FD 36462, should be filed with the
Surface Transportation Board via e-
filing on the Board’s website. In
addition, a copy of each pleading must
be served on Applicants’ representative,
Louis E. Gitomer, Law Offices of Louis
E. Gitomer, LLC, 600 Baltimore Ave.,
Suite 301, Towson, MD 21204.
According to the verified notice, this
action is categorically excluded from
environmental review under 49 CFR
1105.6(c) and from historic preservation
reporting requirements under 49 CFR
1105.8(b).
Board decisions and notices are
available at www.stb.gov.
Decided: December 17, 2020.
By the Board, Allison C. Davis, Director,
Office of Proceedings.
Tammy Lowery,
Clearance Clerk.
[FR Doc. 2020–28286 Filed 12–22–20; 8:45 am]
BILLING CODE 4915–01–P
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