Canadian Pacific Railway Limited; Canadian Pacific Railway Company; Soo Line Railroad Company; Central Maine & Quebec Railway US Inc.; Dakota, Minnesota & Eastern Railroad Corporation; and Delaware & Hudson Railway Company, Inc-Control-Kansas City Southern; The Kansas City Southern Railway Company; Gateway Eastern Railway Company; and The Texas Mexican Railway Company

CourtSurface Transportation Board
Citation86 FR 67571
Record Number2021-25926
Publication Date26 November 2021
67571
Federal Register / Vol. 86, No. 225 / Friday, November 26, 2021 / Notices
38
17 CFR 200.30–3(a)(12), (59).
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.
38
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021–25753 Filed 11–24–21; 8:45 am]
BILLING CODE 8011–01–P
SMALL BUSINESS ADMINISTRATION
[Docket No.: SBA–2020–0048]
Termination of Nonmanufacturer Rule
Class Waiver; Correction Notice
AGENCY
: Small Business Administration.
ACTION
: Correction of notice.
Notification of intent to terminate the
class waiver to the Nonmanufacturer
Rule for radiology equipment.
SUMMARY
: The U.S. Small Business
Administration published a document
in the Federal Register on November 16,
2021, concerning requests for comments
on a proposed termination of a
Nonmanufacturer Rule class waiver for
radiology equipment. That notice did
not include the closing date for
submitting comments.
FOR FURTHER INFORMATION CONTACT
:
Carol Hulme, Attorney Advisor, by
telephone at 202–205–6347 or by email
at Carol-Ann.Hulme@sba.gov.
SUPPLEMENTARY INFORMATION
:
Correction
Published in the Federal Register on
November 16, 2021, in 86 FR 63436, in
the second column, correct the
DATES
caption to read:
DATES
: Comments and source
information must be submitted on or
before 12/31/2021.
Curtis Rich,
Management Analyst.
[FR Doc. 2021–25768 Filed 11–24–21; 8:45 am]
BILLING CODE 8026–03–P
SURFACE TRANSPORTATION BOARD
[Docket No. FD 36500]
Canadian Pacific Railway Limited;
Canadian Pacific Railway Company;
Soo Line Railroad Company; Central
Maine & Quebec Railway US Inc.;
Dakota, Minnesota & Eastern Railroad
Corporation; and Delaware & Hudson
Railway Company, Inc—Control—
Kansas City Southern; The Kansas
City Southern Railway Company;
Gateway Eastern Railway Company;
and The Texas Mexican Railway
Company
AGENCY
: Surface Transportation Board.
ACTION
: Decision No. 11 in Docket No.
FD 36500; Notice of Acceptance of
Application; Issuance of Procedural
Schedule.
SUMMARY
: The Surface Transportation
Board (Board) is accepting for
consideration the application filed on
October 29, 2021 (Application), by
Canadian Pacific Railway Limited
(Canadian Pacific), Canadian Pacific
Railway Company (CPRC), and their
U.S. rail carrier subsidiaries, Soo Line
Railroad Company (Soo Line), Central
Maine & Quebec Railway US Inc.,
Dakota, Minnesota & Eastern Railroad
Corporation, and Delaware & Hudson
Railway Company, Inc. (collectively,
CP) and Kansas City Southern and its
U.S. rail carrier subsidiaries, The Kansas
City Southern Railway Company
(KCSR), Gateway Eastern Railway
Company, and The Texas Mexican
Railway Company (Tex Mex)
(collectively, KCS) (CP and KCS
collectively, Applicants). The
Application seeks Board approval for
the acquisition of control by Canadian
Pacific, through its indirect, wholly
owned subsidiary Cygnus Merger Sub 2
Corporation (Cygnus Merger Sub 2
Corp.), of Kansas City Southern, and
through it, of KCSR and its railroad
affiliates, and for the resulting common
control by Canadian Pacific of its U.S.
railroad subsidiaries, and KCSR and its
railroad affiliates. This proposal is
referred to as the Transaction.
The Board finds that the Application
is complete as it contains all
information required by the Board’s
regulations. Accordingly, the
Application is accepted. The Board
adopts a procedural schedule for
consideration of the Application.
DATES
: The effective date of this
decision is November 26, 2021. Any
person who wishes to participate in this
proceeding as a Party of Record must
file, no later than December 13, 2021, a
notice of intent to participate if they
have not already done so. Applicants
shall file a proposed Safety Integration
Plan (SIP) with the Board’s Office of
Environmental Analysis (OEA) and the
Federal Railroad Administration (FRA)
by December 28, 2021. Descriptions of
anticipated responsive applications,
including inconsistent applications, are
due by January 12, 2022. Petitions for
waiver or clarification with respect to
such applications are also due by
January 12, 2022. Responsive
environmental information and
environmental verified statements for
responsive, including inconsistent,
applicants are due by February 22, 2022.
Comments, protests, requests for
conditions, and any other evidence and
argument in opposition to the
Application are due by February 28,
2022. This includes any comments from
the U.S. Department of Justice (DOJ) and
U.S. Department of Transportation
(USDOT). All responsive applications,
including inconsistent applications, are
also due by February 28, 2022.
Responses to comments, protests,
requests for conditions, and other
opposition—including responses to DOJ
and USDOT filings—are due by April
22, 2022. Rebuttal in support of the
Application is also due by April 22,
2022. Responses to responsive
applications, including inconsistent
applications, are also due by April 22,
2022. Rebuttals in support of responsive
applications, requests for conditions,
and other opposition must be filed by
May 23, 2022. Final briefs will be due
by July 1, 2022. If a public hearing or
oral argument is held, it will be held
after the filing of final briefs on a date
to be determined by the Board.
For further information regarding
dates, see the Appendix to this decision.
ADDRESSES
: Any filing submitted in this
proceeding should be filed with the
Board via e-filing on the Board’s
website. In addition, one copy of each
filing must be sent (and may be sent by
email only if service by email is
acceptable to the recipient) to each of
the following: (1) Secretary of
Transportation, 1200 New Jersey
Avenue SE, Washington, DC 20590; (2)
Attorney General of the United States,
c/o Assistant Attorney General,
Antitrust Division, Room 3109,
Department of Justice, Washington, DC
20530; (3) CP’s representative, David L.
Meyer, Law Office of David L. Meyer,
1105 S Street NW, Washington, DC
20009; (4) KCS’s representative, William
A. Mullins, Baker & Miller PLLC, Suite
300, 2401 Pennsylvania Avenue NW,
Washington, DC 20037; (5) any other
person designated as a Party of Record
on the service list; and (6) the
VerDate Sep<11>2014 20:16 Nov 24, 2021 Jkt 256001 PO 00000 Frm 00142 Fmt 4703 Sfmt 4703 E:\FR\FM\26NON1.SGM 26NON1
jspears on DSK121TN23PROD with NOTICES1
67572
Federal Register / Vol. 86, No. 225 / Friday, November 26, 2021 / Notices
1
A full description of CP’s and KCS’s principal
routes, as well as maps of CP’s and KCS’s respective
systems, is provided in the Application. (See Appl.,
1–22 to 1–26; id., Ex. 13, Operating Plan 8–23; id.,
Ex. 1, Maps.)
2
Citations to the Application refer to the internal
page numbers of the referenced document, which
appear on the bottom left-hand corner of each page.
For example, ‘‘Appl. 1–31’’ refers to Application,
Volume 1, page 31.
3
Applicants state that the portion of line between
Shreveport and Meridian is owned by KCS’s
affiliate Meridian Speedway, LLC, in which NSR
has a 30 percent ownership interest, and is operated
by KCSR. (Appl. 1–25.)
4
Applicants state that the internal transactions
involve a series of steps designed to address matters
relating to tax and corporate law, and all of those
steps, including the placement of Canadian Pacific’s
interest in KCS into a voting trust, would be
completed within moments of the completion of the
Merger and for practical purposes
contemporaneously. Specifically, (a) KCS would
merge with and into Cygnus Merger Sub 1
Corporation (Cygnus Merger Sub 1 Corp.), a direct,
wholly owned subsidiary of Canadian Pacific, with
Cygnus Merger Sub 1 Corp. surviving; (b) Canadian
Pacific would contribute its shares in Cygnus
Merger Sub 1 Corp. to CPRC, a direct, wholly
owned subsidiary of Canadian Pacific; (c) CPRC
would contribute its shares in Cygnus Merger Sub
1 Corp. to Cygnus Holding Corp., an indirect,
wholly owned subsidiary of Canadian Pacific; (d)
CPRC would transfer its shares in Cygnus Holding
Corp. to Canadian Holdco, an indirect, wholly
owned subsidiary of Canadian Pacific; and (e)
Canadian Pacific would cause Cygnus Holding
Corp. to contribute its entire interest in Cygnus
Merger Sub 1 Corp., and thus in KCSR and its
railroad affiliates, to the voting trust. (Appl. 1–3.)
5
Applicants state that CP’s acquisition of KCS’s
shares (and placement of those shares into a voting
trust) is contingent on the approval of the
Transaction by the shareholders of both CP and
KCS—which is expected by the end of 2021—and
the approval of Comisio
´n Federal de Competencia
Econo
´mica (the Mexican competition authority) and
Instituto Federal de Telecomunicaciones (the
Mexican communications regulatory authority),
which is expected by the end of 2021 or at the latest
during the first quarter of 2022. (Appl. 1–5.)
administrative law judge assigned in
this proceeding, the Hon. Thomas
McCarthy, 1331 Pennsylvania Avenue
NW, Washington, DC 20004–1710, and
at ctolbert@fmshrc.gov and zbyers@
fmshrc.gov.
FOR FURTHER INFORMATION CONTACT
:
Valerie Quinn at (202) 245–0283.
Assistance for the hearing impaired is
available through the Federal Relay
Service at (800) 877–8339.
SUPPLEMENTARY INFORMATION
:
Applicants are seeking approval under
49 U.S.C. 11321–26 for a proposed
transaction that involves the acquisition
of control by Canadian Pacific, through
its indirect, wholly owned subsidiary
Cygnus Merger Sub 2 Corp., of Kansas
City Southern, and through it, of KCSR
and its railroad affiliates, and for the
resulting common control by Canadian
Pacific of its U.S. railroad subsidiaries,
and KCSR and its railroad affiliates.
By decision served April 21, 2021, the
Board found the Transaction to be a
‘‘major’’ transaction under 49 CFR
1180.2(a), as it is a control transaction
involving two or more Class I railroads.
Canadian Pacific presently controls Soo
Line, a Class I railroad, and proposes to
acquire common control of KCSR, also
a Class I railroad. See Canadian Pac.
Ry.—Control—Kan. City S. (Decision
No. 3), FD 36500, slip op. at 3 (STB
served Apr. 21, 2021). By decision
served April 23, 2021, following a
public comment period, the Board
found the proposed transaction to be
subject to the regulations set forth at 49
CFR part 1180, subpart A, in effect
before July 11, 2001, pursuant to the
waiver for a merger transaction
involving KCS and another Class I
railroad under 49 CFR 1180.0(b). See
Canadian Pac. Ry.—Control—Kan. City
S. (Decision No. 4), FD 36500, slip op.
at 2–3 (STB served Apr. 23, 2021) (with
Vice Chairman Primus dissenting).
The Transaction. As described in the
Application, the Transaction involves
all of the U.S. mainline and branch line
mileage of the CP and KCS rail
systems.
1
(App.1–31.)
2
The CP rail
network spans Canada from the Pacific
Ocean at Vancouver to the Atlantic
Ocean at Saint John, N.B. In the United
States, CP owns rail property in
Michigan, Illinois, Minnesota, North
Dakota, South Dakota, Wisconsin,
Maine, Vermont, Iowa, Missouri, and
New York, reaching into the U.S.
industrial centers of Chicago, Ill.,
Detroit, Mich., Buffalo, N.Y., Albany,
N.Y., Kansas City, Mo., and
Minneapolis, Minn. (Id. at 1–20; id., Ex.
13, Operating Plan 8.) CP’s principal
routes serving the United States extend
from six Canada/United States border
crossings: North Portal, Sask./Portal,
N.D.; Emerson, Man./Noyes, Minn.;
Windsor, Ont./Detroit; Buffalo; Rouses
Point, N.Y.; and a point near Jackman,
Me., on the Quebec/Maine border. CP
also operates a short stretch of branch
line trackage between Abercorn, Que.,
and Richford, Vt. (Id. at 1–22 to 1–23.)
The KCS rail network extends in a
north-south corridor from Kansas City,
south to the Pacific Ocean at the Port of
Lazaro Cardenas, Mexico. (Id. at 1–24.)
In the United States, KCS owns rail
property in Alabama, Arkansas, Illinois,
Kansas, Louisiana, Mississippi,
Missouri, Oklahoma, Tennessee, and
Texas. (Id. at 1–20.) KCSR’s network is
centered on Shreveport, La., with lines
radiating in five directions. (Id. at 1–24.)
KCSR’s north-south corridor extends
from the Mexican border at Laredo,
Tex., to Kansas City. (Id.) The ‘‘Meridian
Speedway’’ line runs east-west through
Shreveport, between the Dallas, Tex.
area and a connection with Norfolk
Southern Railway Company (NSR) at
Meridian, Miss.
3
(Id. at 1–25.) KCSR
operates a secondary line that extends
southeast from Shreveport to New
Orleans, La. (Id.) KCSR also operates the
former ‘‘Gateway Western’’ lines
extending east from Kansas City to
Springfield, Ill., and East St. Louis, Ill.,
where it connects with the Terminal
Railroad Association of St. Louis and
other Class I railroads. (Id.) KCSR also
operates several former ‘‘MidSouth’’
branch lines in Mississippi and
Tennessee. (Id.)
As set forth in the September 15
Merger Agreement, Canadian Pacific,
through its indirect, wholly owned
subsidiary Cygnus Merger Sub 2 Corp.,
would acquire KCS. (Id. at 1–2.) Upon
receipt of approval by the shareholders
of Canadian Pacific and KCS and the
satisfaction of other customary closing
conditions, Cygnus Merger Sub 2 Corp.
would merge with and into KCS (the
Merger), with KCS surviving the Merger.
(Id.) Upon completion of the Merger,
holders of KCS’s common stock would
become entitled to receive a
combination of Canadian Pacific
common shares and cash in exchange
for their common stock, and holders of
KCS’s preferred stock would become
entitled to receive cash in exchange for
their preferred shares. (Id.) Immediately
following completion of the Merger,
Canadian Pacific would conduct a series
of internal transactions that would
result in its voting interest in the
successor to KCS being placed into a
voting trust,
4
pending review and
approval of the control Transaction by
the Board.
5
(Id.) As a result of the
internal transactions, KCS would legally
be merged with and into Cygnus Merger
Sub 1 Corporation, a wholly owned
subsidiary of CP, with Cygnus Merger
Sub 1 Corporation surviving. (Id.)
However, the successor holding
company of KCS would continue to own
KCS’s railroad and other affiliates, and
would maintain the same name,
governance structure, and other
corporate-level attributes of KCS. (Id.)
Applicants state that, if and when the
Board grants the Application, CP
accepts any conditions imposed by the
Board, and the Board’s approval
becomes administratively final, then the
voting trust would be terminated and
Canadian Pacific would assume control
of KCS. (Id. at 1–3.)
By decision served May 6, 2021, the
Board found that, subject to certain
required modifications described in that
decision, Applicants’ proposed
placement of KCS into a voting trust
during the pendency of the control
proceeding would comply with the
guidelines at 49 CFR part 1013, comport
VerDate Sep<11>2014 20:16 Nov 24, 2021 Jkt 256001 PO 00000 Frm 00143 Fmt 4703 Sfmt 4703 E:\FR\FM\26NON1.SGM 26NON1
jspears on DSK121TN23PROD with NOTICES1
67573
Federal Register / Vol. 86, No. 225 / Friday, November 26, 2021 / Notices
6
Applicants note that, while KCS does not
currently host commuter trains on its network in
the United States, Dallas Area Rapid Transit
(DART) is constructing a new commuter line that
would overlap with 15 miles of KCS trackage rights
over DART-owned trackage west of Wylie, Tex., to
Renner, Tex. (Appl., Ex. 13, Operating Plan 66.)
Applicants assert that there would be no impact on
DART’s proposed operations, as KCS operations
west of Wylie are not expected to see any increase
in train activity. (Id.)
with past agency policy and practice,
and sufficiently ensure that the day-to-
day management and operation of KCS
would not be controlled by Canadian
Pacific or anyone affiliated with
Canadian Pacific while KCS remains in
trust. See Canadian Pac. Ry.—Control—
Kan. City S. (Decision No. 5), FD 36500,
slip op. at 6 (STB served May 6, 2021);
see also Canadian Pac. Ry.—Control—
Kan. City S. (Decision No. 8), FD 36500,
slip op. at 3–5 (STB served Sept. 30,
2021) (with Vice Chairman Primus
dissenting) (finding that the approval
granted in Decision No. 5 for Applicants
to use a voting trust applied to the
voting trust described in Applicants’
amended prefiling notification filed on
September 15, 2021).
Financial Arrangements. According to
Applicants, CP would acquire all of the
voting securities of KCS in a stock and
cash transaction, as detailed in their
September 15 Merger Agreement. (Appl.
1–8.) Applicants state that Canadian
Pacific would fund the stock portion of
the consideration through the issuance
of up to 264,723,997 Canadian Pacific
common shares, which would represent
approximately 28 percent of the issued
and outstanding shares of the combined
entity. (Id.) Applicants state that the
cash portion of the consideration,
together with all related fees and
expenses, is expected to total $8.5
billion, which Canadian Pacific would
fund through a combination of cash on
hand and new debt. (Id.) Applicants
explain that the new debt would be
raised by CPRC issuing senior
unsecured notes on substantially similar
terms to its outstanding unsecured
notes, and that, in the event the entire
amount of debt has not been raised
before the acquisition of KCS shares, CP
has obtained commitments to borrow up
to $8.5 billion via a senior unsecured
364-day bridge loan from Bank of
Montreal and Goldman Sachs Lending
Partners LLC, among other financial
institutions. (Id. at 1–8 to 1–9.)
Passenger Service Impacts.
Applicants assert that the Transaction
would ‘‘not result in any detrimental
impact’’ on the operations of the
National Railroad Passenger Corporation
(Amtrak) or on commuter operations;
rather, the Transaction ‘‘should foster
expansion in passenger operations’’ on
the combined CP–KCS system. (Id., Ex.
13, Operating Plan 61.)
Amtrak Operations. Currently, as
detailed in the Application, CP hosts
Amtrak’s daily Empire Builder long-
distance train between Chicago and St.
Paul, Minn., as well as seven pairs of
Amtrak Hiawatha Service trains
between Chicago and Milwaukee, Wis.
(six pairs on weekends). (Id., V.S. Creel
17–18.) In Upstate New York, CP hosts
two daily pairs of Amtrak trains: The
Adirondack (which operates between
New York City and Montreal) between
Schenectady, N.Y., and the U.S. border
at Rouses Point, and the Ethan Allen
Express (which operates between New
York City and Rutland, Vt.) between
Schenectady and Whitehall, N.Y. (Id.,
V.S. Creel 18.) Applicants note that,
‘‘[w]hile the segments on which Amtrak
operates will see increases in freight
train volumes, CP’s infrastructure
capacity over these routes[,] together
with its scheduling of freight trains to
avoid conflicts with passenger train
schedules[,] will support the increased
traffic without negatively affecting
Amtrak service.’’ (Id., Ex. 13, Operating
Plan 62.) Applicants further state that a
combined CP–KCS system would
‘‘facilitate Amtrak’s planned expansion
of its passenger rail network’’ by
enabling CP to offer Amtrak the
opportunity to increase train
frequencies on its Hiawatha Service and
of its Empire Builder train, as some of
the freight traffic CP would otherwise
interchange in Chicago with Union
Pacific Railroad Company (UP), BNSF
Railway Company (BNSF), and
Canadian National Railway Company
(CN) would bypass Chicago entirely.
(Id., V.S. Creel 19.)
Applicants state that, while KCS does
not host Amtrak in the United States,
Amtrak operates over KCS-owned
trackage to which other Amtrak host
railroads have access under joint facility
and/or trackage rights agreements, and
that Amtrak also operates over trackage
of other carriers to which KCS has
access. (Id., Ex. 13, Operating Plan 63–
64.) For example, Amtrak’s Sunset
Limited operates between Beaumont,
Tex., and Rosenberg, Tex., over UP
trackage that KCS currently uses
pursuant to trackage rights. (Id., Ex. 13,
Operating Plan 64.) At Beaumont, UP
has operating rights across the KCS-
owned Neches River bridge, and Amtrak
operates using those rights. (Id.) While
the Transaction is projected to increase
KCS’s train volumes between Beaumont
and Rosenberg by 8.3 trains per day,
Applicants state that they would
schedule to avoid the time slot during
which the Sunset Limited is scheduled
to operate and anticipate that UP
dispatchers would continue to afford
Amtrak trains appropriate priority over
freight operations. (Id.) Further,
Applicants state that they would
prioritize Amtrak over the Neches River
bridge in coordination with UP to
minimize any adverse impact on
Amtrak’s operations. (Id.) Moreover,
Applicants note that CP has committed
to working with Amtrak to facilitate
establishing Amtrak passenger service
on KCS’s line between Baton Rouge, La.,
and New Orleans once CP acquires
control of KCS. (Id., V.S. Creel 20.)
Commuter Rail Operations.
Applicants state that the operation of
commuter trains on CP-owned lines and
CP freight trains on commuter-owned
lines—specifically, lines owned by the
Northeast Illinois Regional Commuter
Railroad Corporation (Metra), the
Chicago-area commuter rail agency—are
governed by joint facility agreements
that restrict the times of day during
which passenger and freight trains may
operate. (Id., Ex. 13, Operating Plan 65.)
Currently, Metra’s Milwaukee District
North line provides commuter service
between Chicago and Fox Lake, Ill., a
route that includes 17 miles of CP-
owned track between Rondout, Ill., and
Fox Lake. (Id., Ex. 13, Operating Plan
65–66.) CP’s Elgin Subdivision includes
34.3 miles of trackage rights over
Metra’s Milwaukee District West Line,
between Tower A5 in Chicago (also
known as Pacific Junction) and Almora,
Ill. (near Elgin, Ill.). (Id., Ex. 13,
Operating Plan 66.) Applicants assert
that a combined CP–KCS system would
avoid adverse impacts on commuter
service by scheduling additional freight
traffic outside of the time slots reserved
for commuter operations and that ample
capacity on the Elgin Subdivision
would accommodate the projected
increase in freight traffic so as not to
adversely impact commuter operations.
6
(Id., Ex. 13, Operating Plan 65–66.)
Discontinuances/Abandonments.
Applicants state that no lines would be
abandoned and that no facilities would
be rationalized because of the
Transaction. (Appl. 1–7.)
Public Interest Considerations.
According to Applicants, the
Transaction would improve the quality
and availability of rail transportation
services to the public, as a combined
CP–KCS network would offer more
efficient and reliable single-line rail
transportation between points
throughout CP’s service territory in
Canada and the Upper Midwest and
points throughout KCS’s service
territory in the South Central United
States and Mexico. (Appl. 1–14 to 1–15.)
Applicants contend that avoiding an
VerDate Sep<11>2014 20:16 Nov 24, 2021 Jkt 256001 PO 00000 Frm 00144 Fmt 4703 Sfmt 4703 E:\FR\FM\26NON1.SGM 26NON1
jspears on DSK121TN23PROD with NOTICES1
67574
Federal Register / Vol. 86, No. 225 / Friday, November 26, 2021 / Notices
7
Applicants state that KCS is now, and the
combined entity would continue to be, subject to
the conditions related to traffic moving via Laredo
previously imposed by the Board in Kansas City
Southern—Control—The Kansas City Southern
Railway, 7 S.T.B. 933 (2004), as well as terms
related to the Laredo Gateway contained in the
evergreen agreement that KCS entered into with the
National Industrial Transportation League in
conjunction with that transaction. (Appl., V.S.
Ottensmeyer 6, 21; id., V.S. Brooks 21.)
8
In an erratum filed on November 5, 2021,
Applicants corrected information submitted in the
Application, including information contained in
their labor impact analysis.
interchange at Kansas City, which is the
only point where the CP and KCS
networks connect, would reduce cost,
improve transit times, boost reliability
and predictability, and facilitate more
aggressive competition against other
Class I railroads. (Id. at 1–15 to 1–16.)
According to Applicants, the
Transaction would allow for new and
improved train services, including new
intermodal services connecting Dallas
with Chicago and points beyond, as well
as single-line intermodal routes
connecting Mexico with the Upper
Midwest and Canada. (Id. at 1–15.)
Applicants contend that the combined
CP–KCS network would strengthen
competition among rail carriers and
would be more efficient and a more
capable competitor with long-haul
trucks, as Applicants’ new intermodal
rail services would annually divert more
than 60,000 long-haul truck shipments
to rail. (Id. at 1–11, 1–28; id., V.S. Mute
´n
17–22.)
Applicants assert that the Transaction
would also enable more efficient
blocking patterns for manifest traffic
moving between the KCS and CP
systems. (Appl. 1–16.) According to
Applicants, an integrated system would
improve equipment utilization and
allow for more efficient rail
transportation with the same number of
locomotives and railcars, which would
improve cycle times for shippers who
provide their own railcars and benefit
all customers with the greater
availability of railcars. (Id.) Applicants
state that new rail traffic on the
integrated system would support
investment in additional capacity,
service quality, and safety on a CP–KCS
north-south rail artery, transforming a
relatively underutilized route into a
more efficient, higher capacity, and
safer artery of north-south trade in
North America capable of supporting
improved service levels. (Id. at 1–17.)
According to Applicants, the
innovations and improvements enabled
by CP’s operating model, including
improved asset utilization, reduction of
costs, and improved on-time
performance and service reliability,
serve as ‘‘the catalyst for enabling CP/
KCS to serve customers better.’’ (Id.,
V.S. Brooks 11.)
Applicants assert that the Transaction
would ‘‘generate competitive benefits
and cause no competitive harm.’’ (Appl.
1–11.) Applicants contend that, because
the CP and KCS networks do not
overlap, connecting only at Kansas City,
no shippers, stations, or corridors would
‘‘suffer any diminished competition,’’
and also assert that there would be no
reduction in geographic or product
competition. (Id.) Applicants further
assert that shippers would not face any
reduction in routing options or confront
any new ‘‘bottlenecks,’’ as a combined
CP–KCS system would have strong
incentives to maintain all of the efficient
interline routes in which they
participate today. (Id.) Applicants state
that, while they would compete against
KCS’s existing interline routes where
new single-line routes offer advantages
for customers, they would continue to
support, both operationally and
commercially, these existing interline
routes, committing to keep all existing
gateways open on commercially
reasonable terms, including the Laredo
Gateway.
7
(Id. at 1–7; id., V.S.
Ottensmeyer 6; id., V.S. Brooks 18–22.)
Applicants further commit to not
creating any new regulatory
‘‘bottlenecks,’’ by waiving the right to
refuse to quote a separately
challengeable short-haul tariff rate to an
existing interchange with another
carrier, in light of their new ability to
handle traffic in single-line service.
(Appl. 1–7; id., V.S. Brooks 23.)
Schedule for Consummation.
Applicants state that CP would acquire
the shares of KCS from the voting trust
and thereby exercise control over KCS
upon the effectiveness of a Board
decision approving the Transaction.
Applicants further note that integration
of the two systems would begin as soon
as possible and expect full integration to
be completed within three years of the
Board’s decision approving the
Transaction. (Appl. 1–5 to 1–6.)
Environmental Impacts. Applicants
acknowledge that environmental review
under the National Environmental
Policy Act of 1969 (NEPA), 42 U.S.C.
4321–4370m–12, is necessary in this
case. As discussed below, the increased
traffic that would result from this
transaction would exceed the Board’s
thresholds for environmental review.
Due to the potentially significant impact
that the Transaction may have on the
environment and communities in the
affected area, the Board will prepare a
full Environmental Impact Statement
(EIS). Applicants also have agreed to
prepare a Safety Integration Plan (SIP),
pursuant to the Board’s regulations at 49
CFR 1106 and the FRA’s regulations at
49 CFR part 244, which will be
addressed in the EIS. In the SIP,
Applicants will specify how they would
ensure safe operations during the
merger and implementation process.
Historic Impacts. As part of the
approval process, the Board must
evaluate the potential impacts of the
Transaction on historic properties, in
accordance with section 106 of the
National Historic Preservation Act
(NHPA), 54 U.S.C. 306108; the section
106 implementing regulations, 36 CFR
part 800; and the Board’s environmental
regulations, 49 CFR part 1105.
Applicants do not propose to construct
any new rail lines subject to Board
licensing or to abandon any rail lines as
part of the Transaction. However,
Applicants propose to make certain
capital improvements within the
existing rail right-of-way, including
adding approximately four miles of
double track on the KCS Pittsburg
Subdivision, adding approximately five
miles of facility working track adjacent
to the International Freight Gateway
intermodal terminal near Kansas City,
and adding or extending 24 passing
sidings along the combined network.
Labor Impacts. Applicants state that,
given the projected traffic growth
resulting from the Transaction, they
anticipate that over 1,000 operating
positions would be created across CP–
KCS’s North American network, with
more than 800 of those positions in the
United States, and with most of the
anticipated job growth in union-
represented positions. (Appl. 1–17; id.
Ex. 13, Operating Plan 67; id., V.S.
Becker 3, 5.)
8
Applicants state that labor
force changes would include the
relocation of certain operating personnel
(including Soo Line dispatchers)
currently based at CP’s U.S.
headquarters in Minneapolis to the
future CP–KCS U.S. headquarters in
Kansas City. (Id., Ex. 13, Operating Plan
67, id., V.S. Becker 9–10.)
Applicants note that the Transaction
would be subject to the employee
conditions adopted in New York Dock—
Control—Brooklyn Eastern District
Terminal, 360 I.C.C. 60 (1979), and
further note that Applicants would
honor the obligations established in the
‘‘cramdown’’ agreements reached in
2000 and 2001 with certain labor
organizations that represent certain
classes of employees of CP and KCS.
(Appl. 1–18; id., V.S. Becker 14.)
Primary Application Accepted. The
Board finds that Applicants have
provided sufficient information to
satisfy the requirements for a ‘‘major’’
VerDate Sep<11>2014 20:16 Nov 24, 2021 Jkt 256001 PO 00000 Frm 00145 Fmt 4703 Sfmt 4703 E:\FR\FM\26NON1.SGM 26NON1
jspears on DSK121TN23PROD with NOTICES1
67575
Federal Register / Vol. 86, No. 225 / Friday, November 26, 2021 / Notices
9
Hereinafter, all citations to 49 CFR part 1180,
subpart A, refer to the regulations in effect before
July 11, 2001, unless otherwise indicated. See
Decision No. 4, FD 36500, slip op. at 2.
10
49 CFR 1180.10 (2020) requires applicants in
major transactions to identify potential areas of
merger-related service degradation and develop
plans for mitigating instances of degraded service.
11
Cf. CSX Corp.—Control & Merger—Pan Am
Sys., Inc., FD 36472, slip op. at 8–12 (STB served
May 26, 2021) (rejecting a merger application as
incomplete due to numerous deficiencies that
prevented the Board from properly analyzing the
competitive effects of the proposed transaction,
including, in several areas, the absence of any
supporting data).
transaction application. The Board finds
that the Application meets the
requirements of 49 CFR 1180.4, 1180.6,
1180.7, 1180.8, and 1180.9 (2000) and is
therefore complete.
9
See 49 CFR
1180.4(c)(7) (‘‘A complete application
contains all information for all applicant
carriers required by these procedures,
except as modified by advance
waiver.’’).
On November 19, 2021, UP filed a
petition to reject the Application as
incomplete, asserting that the
Application does not include all the
information needed to satisfy the market
analyses and operational data
requirements under 49 CFR 1180.7 &
1180.8. Specifically, UP argues that the
rail-to-rail diversion analysis excludes
32% of potentially divertible traffic,
which UP claims critically undermines
the market analyses and operating plan,
as well as environmental analysis under
NEPA. (UP Pet. 4–8.) UP further
contends that Applicants fail to support
impacts on competition, passenger
services, and freight service on tracks
used jointly with other railroads. (Id. at
8–15.) Lastly, UP asserts that Applicants
should be required to submit a Service
Assurance Plan, as required for cases
filed under the Board’s current rules,
10
in light of representations made in
filings to the Securities and Exchange
Commission regarding possible service
disruptions during the integration
process. (Id. at 16–17.) On November 22,
2021, Applicants filed a reply to UP’s
petition, arguing that UP’s petition was
late-filed and that none of UP’s
arguments warrant rejection of the
Application. Also on November 22,
2021, CN filed a comment in support of
UP’s petition.
The Board’s regulations provide the
‘‘greatest leeway to develop the best
evidence on the impacts of each
individual transaction.’’ 49 CFR 1180.7.
Here, Applicants chose a particular
traffic dataset to be used in their
diversion analysis model and explained
those choices in the Application.
11
UP’s
arguments, submitted near the end of
the Board’s 30-day period to review the
completeness of the Application,
effectively express disagreement with
Applicants’ modeling choices and
question the adequacy of certain
supporting evidence underlying
Applicants’ analysis. But, given that
Applicants have provided explanations
and supporting data and workpapers
regarding those choices, such concerns
are more appropriately raised as a
response to the merits of the
Transaction. The Board finds that UP’s
arguments regarding the diversion
analysis model do not provide a basis
for rejecting the Application as
incomplete. Applicants have presented
a prima facie case, disclosing facts that,
if construed in their most favorable
light, are sufficient to support a finding
that the proposed transaction is
consistent with the public interest. 49
CFR 1180.4(c)(8). UP’s arguments
regarding a Service Assurance Plan also
do not warrant rejection of the
Application because such a plan is not
required under the regulations
governing this transaction. The Board
notes that, while it finds the
Application to be complete, it reserves
the right it has exercised in the past to
require the filing of supplemental
information, as necessary. See Soo Line
Corp.—Control—Cent. Me. & Que. Ry.
US, FD 36368, slip op. at 3 (STB served
May 4, 2020).
Accordingly, the Application is
accepted and, as discussed below, the
Board adopts a procedural schedule for
consideration of the Application.
Procedural Schedule. On March 22,
2021, concurrently filed with their
original notice of intent to file an
application, CP and KCS jointly filed a
petition to establish a procedural
schedule. Applicants’ proposed
procedural schedule provides for a 10-
month period between the date an
application is filed and the date on
which the Board would issue its final
decision on the merits. (Pet. 1.) On
November 2, 2021, the Board issued a
decision that detailed the proposed
procedural schedule, proposed its own
modifications to the schedule, and
requested public comments. See
Canadian Pac. Ry.—Control—Kan. City
S. (Decision No. 9), FD 36500 (STB
served Nov. 2, 2021). The Board noted
that, given the high level of interest in
this proceeding, as well as the
complexity and magnitude of issues that
may potentially arise, the 10-month
schedule proposed by Applicants did
not provide sufficient time. Id. at 2.
Instead, the Board proposed to conform
the schedule to the time frames set forth
in 49 U.S.C. 11325 and 49 CFR 1180.4.
Decision No. 9, FD 36500, slip op. at 2.
Application Filing Date. In Decision
No. 3, the Board provided notice of
Applicants’ intent to file an application
seeking authority for the acquisition of
control by CP of KCS, noting that
Applicants had entered into an
Agreement and Plan of Merger on March
21, 2021 (March 2021 Merger
Agreement). See Decision No. 3, FD
36500, slip op. at 2. On May 21, 2021,
KCS notified the Board that it had
terminated the merger agreement with
Canadian Pacific and had entered into a
merger agreement with CN. (KCS Letter
1, May 21, 2021.) KCS stated that,
accordingly, it was withdrawing as a co-
applicant in this proceeding. (Id. at 2.)
In an amended notice, filed on
September 15, 2021 (Amended Notice),
Applicants stated that KCS rejoins CP as
a co-applicant in this proceeding, as
KCS had since terminated its agreement
to be acquired by CN. (Amended Notice
2.) Applicants stated that they had
executed a definitive Agreement and
Plan of Merger (September 2021 Merger
Agreement), which ‘‘contemplates the
same transaction on terms identical in
nearly every respect to those set forth’’
in the March 2021 Merger Agreement.
(Amended Notice 2–3.) In Decision No.
8, the Board provided notice of receipt
of the Amended Notice. See Decision
No. 8, FD 36500, slip op. at 2–3.
Some commenters assert that, under
the Board’s regulations, Applicants may
not file their application before
December 15, 2021, three months from
the filing of Applicants’ Amended
Notice. (CN Comment 1, Nov. 10, 2021;
BNSF Comment 12, Nov. 12, 2021; UP
Comment 2, Nov. 12, 2021; CSXT
Comment 6 n.23, Nov. 12, 2021.) Given
that the March 2021 Merger Agreement
had been terminated, some commenters
contend that they had no reason to
consider, or devote resources to
considering, the implications of the
Transaction. (CN Comment 2; UP
Comment 3; see also CSXT Comment 2.)
These commenters assert that
Applicants’ Amended Notice effectively
restarted the procedural clock and
requires a minimum three-month
waiting period before their application
may be filed and argue that the Board
therefore should hold the Application in
abeyance and/or treat the Application as
filed on December 15, 2021, to provide
a sufficient notice period. (CN Comment
5; BNSF Comment 12; UP Comment 4–
5.) On November 16, 2021, Applicants
filed a reply to these comments.
The Board finds that the Application
was properly filed and finds no basis for
holding the Application in abeyance.
Under 49 CFR § 1180.4(b)(1), an
applicant shall submit a prefiling
notification to the Board, ‘‘[b]etween 3
to 6 months prior to the proposed filing
of an application in a major
VerDate Sep<11>2014 20:16 Nov 24, 2021 Jkt 256001 PO 00000 Frm 00146 Fmt 4703 Sfmt 4703 E:\FR\FM\26NON1.SGM 26NON1
jspears on DSK121TN23PROD with NOTICES1
67576
Federal Register / Vol. 86, No. 225 / Friday, November 26, 2021 / Notices
transaction.’’ To account for the
possibility that six months would pass
without the application being filed, the
Board’s regulations explicitly provide
that this prefiling notification may be
amended to indicate a change in the
anticipated filing date of the
application. 49 CFR 1180.4(b)(3); see
also R.R. Consolidation Procs., 360
I.C.C. 200, 207 (1980). Here, Applicants
satisfied the 3-to-6-month notice
requirement on March 22, 2021, when
they submitted a prefiling notification
that proposed to file an application on
or about June 28, 2021. In their
Amended Notice, Applicants informed
the Board that they had revised the
projected filing date of the Application,
as contemplated by the Board’s
regulations, noting that they had
executed the September 2021 Merger
Agreement, which was nearly identical
to the March 2021 Merger Agreement
described in Decision No. 3, and
proposed the same control transaction
contemplated in the initial merger
agreement. Nothing in the Board’s
regulations requires an additional notice
period upon the filing of an amended
notice. Further, CP did not withdraw its
original notice or seek dismissal of this
proceeding; rather, it indicated its intent
to go forward with an application to
acquire control of KCS, notwithstanding
the termination of the March 2021
Merger Agreement. (See, e.g., CP Pet. for
Expedited Declaratory Relief 3–4, May
27, 2021 (seeking declaratory relief
pertaining to discovery materials to
enable CP to complete its application
despite KCS’s termination of the initial
merger agreement with CP).) Therefore,
the Board finds that Applicants
appropriately filed their Application on
October 29, 2021.
Evidentiary Record Deadlines. The
Board has considered Applicants’
request for an expedited procedural
schedule, as well as the comments
received. The Board received six
comments regarding the proposed
procedural schedule. Applicants agree
with the Board’s proposal to extend the
evidentiary schedule by 40 days to
allow sufficient time for interested
parties to evaluate the Application and
prepare comments. (CP/KCS Comment
1, Nov. 12, 2021.) However, Applicants
request that the deadlines for submitting
written comments and for submitting
responsive applications be the same. (Id.
at 4.) Applicants argue that
synchronizing the deadlines for
comments and responsive applications
would create certain efficiencies for the
interested parties. (Id. at 2–3.)
The Board also received separate
comments on the proposed procedural
schedule from four railroads: CN on
November 10, 2021, and BNSF, CSX
Transportation, Inc. (CSXT), and UP on
November 12, 2021. In addition, the
American Chemistry Council and The
Fertilizer Institute (ACC/TFI) submitted
joint comments on November 12, 2021.
The four railroads and ACC/TFI request
that the Board extend the time for filing
written comments (and, in some
instances, subsequent deadlines) by
various periods.
BNSF requests that the Board extend
all deadlines, starting with the deadline
for submitting written comments, by 60
days. (BNSF Comment 2.) BNSF argues
that because the Application lacks
certain information, additional time
would be required to develop the
necessary record and analyze the impact
of the transaction on domestic and
transborder movements. (Id. at 3–9.) CN,
CSXT, and UP argue that all deadlines
should be extended so that the
procedural schedule does not
commence before December 15, 2021—
three months after the amended notice
of intent was filed. (See CN Comment 1;
CSXT Comment 6 n.23; UP Comment 2.)
CN otherwise expresses general support
for the schedule as proposed by the
Board. (CN Comment 6.)
CSXT advocates for additional time to
develop and analyze the record before
interested parties are required to
respond to the application. (CSXT
Comment 2.) CSXT includes a proposed
procedural schedule with its comments,
which provides for a written comment
deadline of February 28, 2022—122
days after the date on which the Board
received the application. (Id., Ex. A.)
Similarly, UP requests that the Board
set the deadline for written comments at
120 days after the filing date, consistent
with the deadline to submit responsive
applications. (UP Comment 6.) It states
that the proposed schedule does not
allow interested parties sufficient time
to review the record and provide
comments. (Id. at 5.) UP notes that the
rationale that the Board applied to
extending the deadline for submitting
responsive applications applies equally
to written comments because interested
parties are as likely to raise concerns
about the proposed transaction in
written comments as they are in
responsive applications. (Id. at 5–6.)
ACC/TFI request that the Board
extend the comment period, and all
other deadlines, by two weeks because
the current period for written comments
encompasses the holidays, when many
people would be unavailable. (ACC/TFI
Comment 2, Nov. 12, 2021.) According
to ACC/TFI, a two-week extension
would provide the necessary time to
prepare comments without infringing
upon holiday activities. (Id.) UP
expresses similar concerns about the
proposed schedule and the holidays.
(See UP Comment 6.) In addition, ACC/
TFI, BNSF, CSXT, and UP raise
concerns that, under the proposed
schedule, there is not sufficient time to
resolve potential discovery disputes
before the comment deadline. (ACC/TFI
Comment 2; BNSF Comment 9 n.5;
CSXT Comment 2–3; UP Comment 5
n.13.)
The Board declines to adopt the
expedited procedural schedule
proposed by Applicants and adopts a
procedural schedule pursuant to which
the Board will issue its final decision
within 90 days of the close of the
evidentiary record, consistent with 49
U.S.C. 11325(b)(3), provided that the
environmental review process described
below is complete. The Board’s
procedural schedule, which is longer
than what was proposed by Applicants,
will allow adequate time for comments
regarding this important transaction.
Additionally, in response to concerns
raised by commenters, including
Applicants, the Board will synchronize
the deadlines for written comments and
responsive applications. The Board will
extend the deadline for submitting
written comments to 120 days after the
application filing date to coincide with
the deadline for filing responsive
applications and set the deadline for
responses to written comments at 175
days after the application filing date.
The Board’s schedule also provides that
any necessary oral argument or public
hearing would be held on a date to be
determined by the Board. The full
procedural schedule (Procedural
Schedule) adopted here is set out in the
Appendix to this decision.
Notice of Intent to Participate. Any
person who wishes to participate in this
proceeding as a Party of Record must
file with the Board, no later than
December 13, 2021, a notice of intent to
participate, accompanied by a certificate
of service indicating that the notice has
been properly served on the Secretary of
Transportation, the Attorney General of
the United States, Mr. Meyer
(representing CP), and Mr. Mullins
(representing KCS). Parties who have
already submitted a notice of intent to
participate are not required to resubmit
an additional notice.
If a request is made in a notice of
intent to participate to have more than
one name added to the service list as a
Party of Record representing a particular
entity, the extra name(s) will be added
to the service list as a ‘‘Non-Party.’’ Any
person designated as a Non-Party will
receive copies of Board decisions,
orders, and notices but need not be
VerDate Sep<11>2014 20:16 Nov 24, 2021 Jkt 256001 PO 00000 Frm 00147 Fmt 4703 Sfmt 4703 E:\FR\FM\26NON1.SGM 26NON1
jspears on DSK121TN23PROD with NOTICES1
67577
Federal Register / Vol. 86, No. 225 / Friday, November 26, 2021 / Notices
served with copies of filings submitted
to the Board.
Service on Parties of Record. Each
Party of Record will be required to serve
upon all other Parties of Record, within
10 days of the service date of this
decision, copies of all filings previously
submitted by that party (to the extent
such filings have not previously been
served upon such other parties). Each
Party of Record will also be required to
file with the Board, within 10 days of
the service date of this decision, a
certificate of service indicating that the
service required by the preceding
sentence has been accomplished. Every
filing made by a Party of Record after
the service date of this decision must
have its own certificate of service
indicating that all Parties of Record on
the service list have been served with a
copy of the filing. Members of the
United States Congress and Governors
are not Parties of Record and need not
be served with copies of filings, unless
any Member or Governor has requested
to be, and is designated as, a Party of
Record.
Deadlines Applicable to Appeals and
Replies. Consistent with prior major
merger proceedings, any appeal to a
decision issued by Judge McCarthy must
be filed within three working days of
the date of his decision; any response to
such appeal must be filed within three
working days of the date of filing of the
appeal; and any reply to any motion
filed with the Board itself in the first
instance must be filed within three
working days of the date of filing of the
motion.
Environmental Matters. NEPA
requires that the Board take
environmental considerations into
account in its decision making. Under
both the regulations of the Council on
Environmental Quality (CEQ)
implementing NEPA, and the Board’s
own environmental regulations, actions
are separated into three classes that
prescribe the level of documentation
required in the NEPA process. Actions
that may significantly affect the
environment generally require the Board
to prepare an EIS. See 49 CFR 1105.4(f),
1105.6(a), 1105.10(a). Actions that may
or may not have a significant
environmental impact ordinarily require
the Board to prepare a more limited
Environmental Assessment (EA). See 49
CFR 1105.4(d), 1105.6(b), 1105.10(b).
Actions with environmental effects that
are ordinarily insignificant may be
categorically excluded from NEPA
review, without a case-by-case
environmental review. See 49 CFR
1105.6(c). A merger transaction
generally requires the preparation of an
EA or EIS where certain thresholds
would be exceeded. See 49 CFR
1105.7(e)(5).
The thresholds for assessing
environmental impacts from increased
rail traffic on rail lines in railroad
merger proceedings are an increase in
rail traffic of at least 100 percent
(measured in gross ton miles annually)
or an increase of at least eight trains per
day. 49 CFR 1105.7(e)(5). For air quality
impacts, rail lines located in areas
classified as being in ‘‘nonattainment’’
areas under the Clean Air Act (42 U.S.C.
7401–7671q) are also assessed if they
would experience an increase in rail
traffic of at least 50 percent (measured
in gross ton miles annually) or an
increase of at least three trains per day.
49 CFR 1105.7(e)(5)(ii). Based on the
information provided by Applicants to
date, OEA has identified rail lines in
Illinois, Iowa, Missouri, Kansas,
Oklahoma, Arkansas, Louisiana, and
Texas that would experience increases
in rail traffic that would exceed the
analysis thresholds as a result of the
Transaction.
The NEPA Process. Based on
information provided by Applicants and
in consultation with OEA, the Board has
determined that the preparation of an
EIS is appropriate. Under NEPA, an EIS
is prepared for ‘‘major federal actions
significantly affecting the quality of the
human environment.’’ 42 U.S.C.
4332(2)(C). An EIS is usually not
required in merger cases; a more limited
EA generally is sufficient because there
are not usually significant
environmental impacts from the change
in owners and operators of existing
lines. 49 CFR 1105.6(b)(4). In this case,
however, a full EIS is warranted in light
of the magnitude of the projected traffic
increases on certain line segments and
the potential impacts of the proposed
transaction on a number of communities
that would likely result from the
increased activity levels on rail line
segments and at rail facilities. (See
Appl. 1–29 to 1–31.)
The EIS process will ensure that the
Board takes the hard look at potential
environmental consequences that is
required by NEPA. On November 12,
2021, OEA issued a Notice of Intent to
prepare an EIS and requested comments
on the scope of the EIS, including the
alternatives and issues to be analyzed.
After the close of the comment period
on the scope of the EIS on December 17,
2021, OEA will review all comments
received and issue a final scope of study
for the EIS. Following the issuance of
the final scope, OEA will prepare a Draft
EIS that will analyze in detail the
potential environmental impacts of the
Transaction and make recommendations
for environmental mitigation. OEA
anticipates issuing the Draft EIS in the
spring of 2022. The public will have at
least 45 days to comment on the Draft
EIS. A Final EIS will then be issued that
will respond to all public comments
received, present the results of any
further environmental analysis, and
incorporate final environmental
mitigation recommendations. OEA
anticipates issuing the Final EIS in the
fall of 2022. The Board will consider the
entire environmental record in deciding
whether to authorize the Transaction as
proposed, deny the application, or grant
it with conditions, including
environmental mitigation conditions.
Historic Review. In accordance with
Section 106 of the NHPA, the Board is
required to determine the effects of its
licensing actions on cultural resources.
The Board’s environmental rules
establish exceptions to the need for
historic review in certain cases,
including the sale of a rail line for the
purpose of continued rail operations
where further Board approval is
required to abandon any service and
there are no plans to dispose of or alter
properties subject to the Board’s
jurisdiction that are 50 years old or
older. 49 CFR 1105.8.(b)(1). Applicants
do not propose to construct any new rail
lines subject to Board licensing or to
abandon any rail lines as part of the
Transaction. Applicants also have no
plans to alter or dispose of properties 50
or more years old, and any future line
abandonment or construction activities
by Applicants would be subject to the
Board’s jurisdiction. However,
Applicants intend to make certain
capital improvements within the rail
right-of-way as part of the Transaction,
including adding double track, adding
facility working track, adding new
passing sidings, and extending existing
sidings. Consistent with past practice in
merger cases, OEA will therefore focus
any necessary Section 106 review on the
capital improvement projects that
Applicants would undertake as part of
the Transaction because those projects
are the only components of the
Transaction that could have the
potential to affect cultural resources.
Safety Integration Plan. Applicants
state that they will work with the FRA
to formulate a SIP to address the safe
integration of their rail lines,
equipment, personnel, and operating
practices. (Appl., V.S. Creel 25.) A SIP
is a comprehensive written plan,
prepared in accordance with FRA
guidelines or regulations, explaining the
process by which Applicants intend to
integrate the operation of the properties
involved in a manner that would
maintain safety at every step of the
integration process, in the event the
VerDate Sep<11>2014 20:16 Nov 24, 2021 Jkt 256001 PO 00000 Frm 00148 Fmt 4703 Sfmt 4703 E:\FR\FM\26NON1.SGM 26NON1
jspears on DSK121TN23PROD with NOTICES1
67578
Federal Register / Vol. 86, No. 225 / Friday, November 26, 2021 / Notices
12
The Board will also determine the page limits
for final briefs in a later decision after the record
has been more fully developed.
13
The Board will decide whether to conduct a
public hearing in a later decision after the record
has been more fully developed. See 49 U.S.C.
11324(a) (‘‘The Board shall hold a public hearing
unless the Board determines that a public hearing
is not necessary in the public interest.’’).
14
49 U.S.C. 11325(b)(3) provides that the Board
must issue its final decision within 90 days of the
close of the evidentiary record and that evidentiary
proceedings be completed within one year of the
date of publication of this notice in the Federal
Register. However, under NEPA, the Board may not
issue a final decision until after the required
environmental review is complete. In the event the
EIS process is not able to be concluded in sufficient
time for the Board to meet the 90-day provision set
forth in §11325(b)(3), the Board will issue a final
decision as soon as possible after that process is
complete.
1
Redacted versions of the 1992 agreement and
the 2021 amendment were filed with the verified
notice. Unredacted versions were submitted under
seal concurrently with a motion for protective
order, which is addressed in a separate decision.
Board approves the Transaction. 49 CFR
1106.2; 49 CFR 244.9. The proposed SIP
will be submitted to the Board and to
FRA and will be reviewed by OEA and
made available for public review and
comment during the EIS process,
consistent with the Board’s regulations
at 49 CFR 1106 and with 49 CFR 244.17.
If the Board authorizes the Transaction
and adopts the SIP, the Board requires
compliance with the SIP as a condition
to its authorization. 49 CFR 1106.4(b)(4).
In its petition for a procedural
schedule, Applicants proposed that the
SIP be filed with OEA 30 days after the
filing of the Application. However, the
Board and FRA’s regulations allow for
Applicants to submit the proposed SIP
up to 60 days after the application is
filed, which would be December 28,
2021. Accordingly, the Board will also
allow Applicants the full 60 days to
submit the SIP.
Service of Decisions, Orders, and
Notices. The Board will serve copies of
its decisions, orders, and notices on
those persons who are designated on the
official service list as a Party of Record
or Non-Party. All other interested
persons are encouraged to secure copies
of decisions, orders, and notices via the
Board’s website at www.stb.gov.
Access to Filings. Under the Board’s
rules, any document filed with the
Board (including applications,
pleadings, etc.) shall be promptly
furnished to interested persons on
request, unless subject to a protective
order. 49 CFR 1180.4(a)(3). The
Application and other filings in this
proceeding will be furnished to
interested persons upon request and
will also be available on the Board’s
website at www.stb.gov. In addition, the
Application may be obtained from
Messrs. Meyer and Mullins at the
addresses indicated above.
It is ordered:
1. The Application in Docket No. FD
36500 is accepted for consideration.
2. The parties to this proceeding must
comply with the procedural schedule
adopted by the Board in this proceeding
as shown in the Appendix to this
decision. The parties to this proceeding
must comply with the procedural
requirements described in this decision.
3. UP’s petition to reject the
Application is denied.
4. This decision will be published in
the Federal Register.
5. This decision is effective on
November 26, 2021.
Decided: November 23, 2021.
By the Board, Board Members Begeman,
Fuchs, Oberman, Primus, and Schultz.
Jeffrey Herzig,
Clearance Clerk.
A
PPENDIX
—P
ROCEDURAL
S
CHEDULE
October 29, 2021 ........... Application filed.
November 26, 2021 ....... Board notice of acceptance of Application to be published in the Federal Register.
December 13, 2021 ....... Notices of intent to participate in this proceeding due.
December 28, 2021 ....... Proposed Safety Integration Plan (SIP) to be filed with OEA and FRA.
January 12, 2022 ........... Descriptions of anticipated responsive, including inconsistent, applications due. Petitions for waiver or clarification
with respect to such applications due.
February 22, 2022 ......... Responsive environmental information and environmental verified statements for responsive, including inconsistent,
applicants due.
February 28, 2022 ......... Comments, protests, requests for conditions, and any other evidence and argument in opposition to the Application
due. This includes any comments from the U.S. Department of Justice (DOJ) and U.S. Department of Transpor-
tation (USDOT). Responsive, including inconsistent, applications due.
March 30, 2022 .............. Notice of acceptance of responsive, including inconsistent, applications, if any, published in the Federal Register.
April 22, 2022 ................. Responses to comments, protests, requests for conditions, and other opposition due, including to DOJ and USDOT
filings. Rebuttal in support of the Application due. Responses to responsive, including inconsistent, applications
due.
May 23, 2022 ................. Rebuttals in support of responsive, including inconsistent, applications due.
July 1, 2022 ................... Final briefs due.
12
TBD ................................ Public hearing (if necessary).
13
(Close of the record.)
TBD ................................ Service date of final decision.
14
[FR Doc. 2021–25926 Filed 11–24–21; 8:45 am]
BILLING CODE 4915–01–P
SURFACE TRANSPORTATION BOARD
[Docket No. FD 36564]
BNSF Railway Company—Trackage
Rights Exemption—Union Pacific
Railroad Company
BNSF Railway Company (BNSF), a
Class I rail carrier, has filed a verified
notice of exemption under 49 CFR
1180.2(d)(7) for overhead trackage rights
over approximately 196 miles of rail
line owned by Union Pacific Railroad
Company (UP), between milepost
245.52 at Ft. Worth, Tex., and milepost
440.98 at Tecific, Tex. (the Line).
Pursuant to a written trackage rights
agreement, UP has agreed to extend
overhead trackage rights to BNSF over
the Line. According to the verified
notice, BNSF and its predecessors have
operated over the Line since 1992 under
trackage rights exempted in The
Atchison, Topeka & Santa Fe Railway
Co.—Trackage Rights Exemption—
Missouri Pacific Railroad Co., FD 32134
(ICC served Aug. 31, 1992), and the
parties’ 1992 agreement was amended
on June 25, 2021, to extend the trackage
rights terms.
1
The purpose of this
transaction is to allow UP to continue
its operations over the Line.
The transaction may be consummated
on or after December 10, 2021, the
effective date of the exemption (30 days
after the verified notice was filed).
As a condition to this exemption, any
employees affected by the acquisition of
the trackage rights will be protected by
VerDate Sep<11>2014 20:16 Nov 24, 2021 Jkt 256001 PO 00000 Frm 00149 Fmt 4703 Sfmt 4703 E:\FR\FM\26NON1.SGM 26NON1
jspears on DSK121TN23PROD with NOTICES1

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT