[Federal Register: November 29, 2007 (Volume 72, Number 229)]
[Notices]
[Page 67622-67630]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29no07-49]
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DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
[STB Finance Docket No. 35087]
Canadian National Railway Company and Grand Trunk Corporation--
Control--EJ&E West Company \1\
AGENCY: Surface Transportation Board, DOT.
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\1\ This decision also embraces Elgin, Joliet and Eastern
Railway Company--Corporate Family Exemption--EJ&E West Company, STB
Finance Docket No. 35087 (Sub-No. 1); Chicago, Central & Pacific
Railroad Company--Trackage Rights Exemption--EJ&E West Company, STB
Finance Docket No. 35087 (Sub-No. 2); Grand Trunk Western Railroad
Incorporated--Trackage Rights Exemption--EJ&E West Company, STB
Finance Docket No. 35087 (Sub-No. 3); Illinois Central Railroad
Company--Trackage Rights Exemption--EJ&E West Company, STB Finance
Docket No. 35087 (Sub-No. 4); Wisconsin Central Ltd.--Trackage
Rights Exemption--EJ&E West Company, STB Finance Docket No. 35087
(Sub-No. 5); EJ&E West Company--Trackage Rights Exemption--Chicago,
Central & Pacific Railroad Company, STB Finance Docket No. 35087
(Sub-No. 6); and EJ&E West Company--Trackage Rights Exemption--
Illinois Central Railroad Company, STB Finance Docket No. 35087
(Sub-No. 7).
ACTION: Decision No. 2 in STB Finance Docket No. 35087; Notice of
Acceptance of Primary Application and Related Filings; Issuance of
Procedural Schedule.
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SUMMARY: The Surface Transportation Board (Board) is accepting for
consideration the primary application filed October 30, 2007, by
Canadian National Railway Corporation (CNR) and Grand Trunk Corporation
(GTC), a noncarrier holding company through which CNR controls its U.S.
rail subsidiaries, and seven related filings. The primary application
seeks Board approval under 49 U.S.C. 11321-26 of the acquisition of
control of EJ&E West Company (EJ&EW), a wholly owned noncarrier
subsidiary of Elgin, Joliet and Eastern Railway Company (EJ&E), by CNR
and GTC. This proposal is referred to as the Control Transaction, and
CNR and GTC are referred to collectively as applicants.
The related filings are notices of exemption involving an intra-
corporate family transaction and the granting of trackage rights. The
Sub-No. 1 filing provides for EJ&E to transfer property to EJ&EW,
which, at that time, would become a rail common carrier, prior to
applicants acquiring control of EJ&EW. The Sub-Nos. 2 through 7 filings
provide for grants of trackage rights by EJ&EW to Grand Trunk Western
Railroad (GTW), Illinois Central Railroad Company (IC), Chicago,
Central & Pacific Railroad Company (CCP), and Wisconsin Central Ltd.
(WCL), and by IC and CCP to EJ&EW, promptly upon applicants'
acquisition of control of EJ&EW, should the Board approve the proposed
Control Transaction.
The Board finds that the Control Transaction is a ``minor
transaction'' under 49 CFR 1180.2(c), and adopts a procedural schedule
for consideration of the application. In finding that the transaction
is a minor transaction, the Board has preliminarily determined that any
anticompetitive effects of the transaction will clearly be outweighed
by the transaction's anticipated contribution to the public interest in
meeting significant transportation needs. 49 CFR 1180.2(b)(2). The
Board makes this determination based solely on evidence presented in
the application. The Board stresses that this is not a final
determination, and its finding may be rebutted by filings and evidence
submitted into the record for this proceeding. The Board will give
careful consideration to any claims that the transaction will have
anticompetitive effects that are not apparent from the application
itself.
Moreover, the Board has determined to prepare an Environmental
Impact Statement (EIS) with respect to the transaction.
DATES: The effective date of this decision is November 29, 2007. Any
person who wishes to participate in this proceeding as a party of
record (POR) must file, no later than December 13, 2007, a notice of
intent to participate. All comments, protests, requests for conditions,
and any other evidence and argument in opposition to the primary
application and related filings, including filings by the U.S.
Department of Justice (DOJ) and the U.S. Department of Transportation
(DOT), must be filed by January 28, 2008. Responses to comments,
protests, requests for conditions, and other opposition, and rebuttal
in support of the primary application or related filings must be filed
by March 13, 2008. If a public
[[Page 67623]]
hearing or oral argument is held, it will be held on a date to be
determined by the Board. Under 49 U.S.C. 11325(d)(2), a final decision
would be issued by April 25, 2008; however, the Board is also required
to accommodate in its decisionmaking the requirements of the National
Environmental Policy Act (NEPA), 42 U.S.C. 4321 et seq. Thus, the Board
will not issue a final decision on the merits of the application until
the environmental review is completed, including preparation of an EIS
and a substantial opportunity for public comment and participation. For
further information respecting dates, see Appendix A (Procedural
Schedule).
ADDRESSES: Any filing submitted in this proceeding must be submitted
either via the Board's e-filing format or in the traditional paper
format. Any person using e-filing should attach a document and
otherwise comply with the instructions found on the Board's Web site at
http://www.stb.dot.gov at the ``E-FILING'' link. Any person submitting
a filing in the traditional paper format should send an original and 10
paper copies of the filing (and also an electronic version) to: Surface
Transportation Board, 395 E Street, SW., Washington, DC 20423-0001. In
addition, one copy of each filing in this proceeding must be sent (and
may be sent by e-mail only if service by e-mail 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)
Paul A. Cunningham (representing CNR and GTC), Harkins Cunningham LLP,
1700 K Street, NW., Suite 400, Washington, DC 20006-3804; and (4) any
other person designated as a POR on the service list notice (as
explained below, the service list notice will be issued as soon after
December 13, 2007, as practicable).
FOR FURTHER INFORMATION CONTACT: Julia M. Farr, (202) 245-0359.
[Assistance for the hearing impaired is available through the Federal
Information Relay Service (FIRS) at 1-800-877-8339.]
SUPPLEMENTARY INFORMATION: CNR is one of Canada's two major railroads,
extending from Halifax, Nova Scotia, on the Atlantic to Vancouver and
Prince Rupert, British Columbia, on the Pacific. Through its GTC
subsidiary, CNR controls the following rail carriers: GTW, IC, CCP,
WCL, Duluth, Winnipeg and Pacific Railway Company (DWP), St. Clair
Tunnel Company (SCTC), Cedar River Railroad Company (CRRC), Waterloo
Railway Company (Waterloo), Sault Ste. Marie Bridge Company (SSMB),
Wisconsin Chicago Link Ltd. (WCLL), Duluth, Missabe and Iron Range
Railway Company (DMIR), Bessemer and Lake Erie Railroad Company (B&LE),
and The Pittsburgh & Conneaut Dock Company (P&C Dock). DWP extends the
applicants' system from the international border at Duluth Junction/
Ranier over DWP's own lines to Nopeming Junction, MN. GTW also extends
applicants' system to Chicago from the international border at Port
Huron/Sarnia and Detroit/Windsor. In 1999, applicants acquired IC, thus
extending applicants' system from Chicago to the Gulf Coast, and
becoming part of a North American Free Trade Agreement (NAFTA) rail
network offering shippers access to Kansas City Southern de Mexico,
S.A. de C.V. (KCSM), Mexico's largest rail system. In 2001, applicants
acquired WCL and its affiliates, and in 2004 applicants acquired the
Great Lakes Transportation LLC (GLT) carriers including DMIR, thus
providing applicants with a connection between Chicago and applicants'
lines west of the Great Lakes. In the GLT transaction, applicants also
acquired B&LE and P&C Dock, which, together with applicants' ownership
of DMIR and Great Lakes Fleet, LLC (a water carrier operating on the
Great Lakes), provides applicants a continuous supply chain for iron
ore moving from the Missabe Iron Range of Minnesota to the Union
Railroad Company, which serves the Edgar Thompson Steel Works of United
States Steel Corporation (USS) in Braddock, PA.
EJ&EW is an Illinois corporation formed on August 16, 2007, and is
a wholly owned noncarrier subsidiary of EJ&E. EJ&E is a Class II
railroad that currently operates over 198 miles of track in
Northeastern Illinois and Northwestern Indiana, consisting primarily of
an arc around Chicago, IL, extending from Waukegan, IL, southwards to
Joliet, IL, then eastward to Gary, IN, and then northwest to South
Chicago along Lake Michigan. EJ&E provides rail service to
approximately 100 customers, including steel mills, coal utilities,
plastics, and chemical producers, steel processors, distribution
centers, and scrap processors. EJ&E is a wholly owned indirect
subsidiary of USS, a noncarrier. USS owns all of the issued and
outstanding stock of Transtar, Inc. (Transtar), a noncarrier holding
company, which owns all of the issued and outstanding stock of seven
common carrier railroads, including EJ&E.\2\
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\2\ In 2001, Transtar spun off its interest in B&LE, DMIR, P&C
Dock, and a water carrier, Great Lakes Fleet, to GLT, which became a
holding company controlled by the Blackstone Group. In 2004, in a
transaction unrelated to USS, applicants acquired the GLT
subsidiaries.
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Before applicants acquire control of EJ&EW, EJ&E plans to transfer
all of its land, rail, and related assets located west of the
centerline of Buchanan Street in Gary (together with the real property
and related fixtures associated with the hump and Dixie leads located
east of Buchanan Street) to EJ&EW, which at that time would become a
rail common carrier. As noted above, this transaction is the subject of
the Sub-No. 1 related filing. EJ&E would retain its land, rail, and
related assets east of the centerline (other than the real property and
related fixtures associated with the hump and Dixie leads). It is
expected that, if the Control Transaction is approved and applicants
acquire control of EJ&EW, EJ&E would change its name to Gary Railway
Company, and EJ&EW would assume the Elgin, Joliet & Eastern Railway
Company name.
In order to permit trains of its operating subsidiaries--GTW, IC,
CCP, and WCL--to operate over EJ&EW's line and provide for maximum
operational flexibility, applicants intend to cause EJ&EW to grant
trackage rights to those subsidiaries over the entire length of EJ&EW
from Waukegan to Gary. Applicants also intend to grant EJ&EW trackage
rights over selected portions of its CCP and IC subsidiaries. These
proposed trackage rights are the subjects of notices of exemption in
the related filings Sub-Nos. 2 through 7, providing for grants of
trackage rights by EJ&EW to GTW, IC, CCP, and WCL and by IC and CCP to
EJ&EW.
GTC and EJ&E have entered into a Stock Purchase Agreement
(Agreement), dated as of September 25, 2007. The Agreement provides
that, subject to Board authorization of the Control Transaction, and
other conditions, GTC will purchase from EJ&E all of the issued and
outstanding common stock of EJ&EW for an overall purchase price of $300
million, subject to adjustments as provided for in the Agreement.
Applicants state three primary purposes for pursuing the Control
Transaction. First, they believe the Control Transaction would improve
their operations in and beyond the Chicago area by providing CNR with a
continuous rail route around Chicago, under applicants' ownership, that
would connect the five CNR lines that presently radiate from Chicago.
Second, acquiring EJ&E's rail assets would make
[[Page 67624]]
available to applicants EJ&E's Kirk Yard--an automated classification
facility in Gary--as well as smaller facilities in Joliet and Whiting,
IN, thus enabling applicants to consolidate car classification work at
Kirk and East Joliet Yards and to reduce use of the Belt Railway
Company of Chicago's (BRC) Clearing Yard. Lastly, applicants state that
their system would benefit from the fact that EJ&E provides an
important supply line for North American steel, chemical, and
petrochemical industries, as well as for Chicago area utilities and
others, which would allow applicants to develop closer and more
extensive relationships with companies in and serving those industries.
Financial Arrangements. No new securities have been or would be
issued in connection with applicants' acquisition of control of EJ&EW.
Under the Agreement, the purchase price would be paid in cash on the
closing date. Applicants anticipate that they would finance the Control
Transaction with debt and cash on hand.
Passenger Service Impacts. Applicants state that the Control
Transaction would not affect passenger rail service operating on CNR
rail lines today; rather, applicants anticipate reduced freight train
traffic on CNR lines inside the EJ&E arc, which would benefit passenger
operations over those lines. Once applicants cease operations on the
St. Charles Air Line Route, applicants state that the National Railroad
Passenger Corporation (Amtrak) would be the only remaining regular user
of that route. Before the line can be formally abandoned, Amtrak trains
would need to be re-routed to Norfolk Southern Railway Company's line,
as has been planned in connection with the Chicago Region Environmental
and Transportation Efficiency (CREATE) Project. Applicants state that
EJ&E lines are not used for intercity or commuter passenger rail
service, though EJ&E does cross, at grade, several corridors of the
Commuter Rail Division of the Regional Transportation Authority of
Northeast Illinois (Metra). Applicants state that they would work with
Metra and the host freight operators to coordinate operations and
adjust operating windows so that the needs of all users can be met.
Applicants also note that they are aware that Metra is studying the
feasibility of using a portion of the EJ&E corridor for future light-
rail commuter service. Applicants state that they would explore options
to further Metra's goal of extended commuter train service while
accommodating applicants' need to move its freight traffic more
efficiently through and around Chicago.
Market Analysis. The primary application included market analyses
that contend that there would be no reduction in direct rail
competition between CNR and EJ&E as a result of this acquisition.
Applicants analyzed stations and interchange points served by both CNR
and EJ&E and concluded that there are no cases of 2 to 1 or 3 to 2
reductions in shipper rail options. In addition, applicants submitted a
detailed geographic market study of origin and destination markets
showing that the acquisition would not increase market concentration.
Discontinuances/Abandonments. Applicants state that they do not
anticipate any transaction-related line abandonments. Although
applicants intend to re-route all their trains currently operating over
the St. Charles Air Line, a formal abandonment of that line would
require coordination with BNSF Railway Company (BNSF) and Union Pacific
Railroad Company, which own the line jointly with applicants, and with
existing users such as Amtrak.
Public Interest Considerations. Applicants state that the Control
Transaction would promote the public interest in a more efficient and
reliable rail transportation system, and would have no adverse
competitive, safety, or other effects. Applicants assert that the
Control Transaction would have no anticompetitive effects in that it
would connect two transportation systems that do not compete but
instead complement each other and would together create a stronger
network. Applicants assert that there would be no 2-to-1 shippers, nor
3-to-2 shippers, on the CNR/EJ&EW system. Moreover, applicants state
that the Control Transaction would bring about no vertical foreclosure,
no reduction in effective geographic competition, and no increase in
market power. Applicants state that, as in past transactions, they are
committed to keeping gateways open and honoring trackage rights and
haulage agreements with all connecting carriers.
Applicants assert that, even if the Control Transaction had any
adverse impacts on competition, those effects would be outweighed by
its transportation benefits. The Control Transaction, applicants
assert, would ensure more efficient and reliable rail transportation at
a lower cost and would, over time, reduce rail traffic congestion,
increase rail capacity for carriers operating in Chicago, and reduce
traffic density in Chicago's urban core. Applicants state that the
Control Transaction would provide CNR with a continuous route around
Chicago, which would make it possible for CNR traffic to bypass the
congested Chicago terminal. Applicants maintain that this rerouting
would benefit CNR-served customers in the Chicago area and customers
served by other Class I railroads by reducing the demand on the
capacity of BRC, Indiana Harbor Belt Railroad (IHB), and other CNR
lines through the central Chicago terminal area. Further, applicants
note, the availability of a continuous CNR route around Chicago would
greatly improve the fluidity of intermodal and other CNR traffic that
must move to, from, or through Chicago. Also, the availability of a
continuous CNR route around Chicago would advance the congestion-
reducing objectives of the CREATE Project and make it possible for
applicants to more quickly cease operations over the St. Charles Air
Line. The Control Transaction, applicants state, would also eliminate
interchanges between EJ&E and CNR, making possible single-line service
for approximately 10,000 carloads that the two railroads now carry in
interline service each year. Applicants also note that the public would
benefit from applicants' plans to spend approximately $100 million to
upgrade EJ&E's infrastructure.
Time Schedule for Consummation. Applicants intend to consummate
control of EJ&EW as soon as possible after the effective date of the
final order, should the Board authorize the proposed Control
Transaction. Applicants expect to have fully implemented the Control
Transaction within three years after consummation of their acquisition
of control over EJ&EW.
Environmental Impacts. Applicants concede that environmental review
under NEPA is necessary in this case. As discussed below, the increased
traffic that would result from this transaction would substantially
exceed the Board's thresholds for environmental review. Due to the
potentially significant impact that this transaction may have on the
environment and communities in the affected area, the Board will
prepare a full EIS. Applicants also have agreed to prepare a Safety
Integration Plan (SIP), pursuant to the Board's regulations at 49 CFR
1106, which will be addressed in the EIS. In the SIP, applicants will
specify how they would ensure safe operations during the acquisition
and implementation process. Applicants state that the transaction would
have no adverse impact on historic properties, as there are no line
abandonments and no elimination of duplicative rail facilities involved
in the proposed transaction,
[[Page 67625]]
and that, therefore, there is no need for historic review under the
National Historic Preservation Act of 1966 (NHPA), 16 U.S.C. 470. Based
on the available information, it does not appear that historic review
is required in this case.
Labor Impacts. Applicants anticipate two principal labor impacts as
a result of the Control Transaction: The elimination of redundant
positions and the organization/integration of forces to realize the
efficiencies of the transaction. Applicants estimate that the Control
Transaction would result in the elimination of 114 positions.
Applicants anticipate that, to the extent the transaction leads to the
elimination of positions, most of these impacts could be accommodated
through normal attrition during the implementation period. Applicants'
continuing need for experienced, skilled railroaders at its neighboring
Chicago operations makes it highly likely that most of the affected
employees would have the opportunity to fill other positions opening up
elsewhere in applicants' Chicago operation. Applicants state they would
work with the respective collective bargaining units to attempt to
secure labor implementing agreements that would provide for the
flexibility to fully employ any potentially adversely impacted
employee. Applicants further acknowledge that the Control Transaction
would be subject to employee protective conditions and other procedures
adopted in New York Dock Ry.--Control--Brooklyn Eastern District
Terminal, 360 I.C.C. 60, aff'd sub nom. New York Dock Ry. v. United
States, 609 F.2d 83 (2d Cir. 1979) (New York Dock).
Related Filings. In connection with this transaction, several
notices of exemption were filed under 49 CFR 1180.2(d)(3) and
1180.2(d)(7).
Sub-No. 1. In Sub-No. 1, EJ&E filed a verified notice of exemption
under 49 CFR 1180.2(d)(3) for a transaction within a corporate family.
Under this notice of exemption, EJ&E will transfer all its land, rail,
and related assets located west of the centerline of Buchanan Street in
Gary, IN (together with the real property and related fixtures
associated with the hump and Dixie leads located east of Buchanan
Street), to EJ&EW, which upon completion of the transfers would become
a rail carrier. EJ&E will retain its land, rail, and related assets
east of the centerline (other than the real property and related
fixtures associated with the hump and Dixie leads). EJ&E intends to
consummate the transaction with EJ&EW immediately before CNR and GTC
acquire control of EJ&EW, which would not occur until after approval of
the Control Transaction by the Board. The purpose of the transaction is
that it would allow EJ&E to segregate into a separate corporate entity
(EJ&EW) the rail properties to be acquired by GTC, thus facilitating
the transaction described in the primary application. According to
EJ&E, this is a transaction within a corporate family of the type
specifically exempted from prior review and approval under 49 CFR
1180.2(d)(3). As a condition to use of this exemption, EJ&E states that
any employees adversely affected by the transaction will be protected
by the conditions set forth in New York Dock.
Sub-No. 2. In Sub-No. 2, CCP submits a verified notice of exemption
under 49 CFR 1180.2(d)(7). Pursuant to a written trackage rights
agreement, EJ&EW would grant CCP trackage rights over all of EJ&EW's
line, which runs between milepost 74.6 at Waukegan, IL, and milepost
45.4 at Gary, IN, including all trackage west of the centerline of
Buchanan Street in Gary, IN, plus trackage associated with the hump and
Dixie leads located east of Buchanan Street, a distance approximately
120 miles. Parties intend to execute the trackage rights agreement
promptly upon applicants' acquisition of control of EJ&EW, should the
Board approve the proposed Control Transaction. As a condition to this
exemption, CCP states that any employees affected by the acquisition of
the temporary trackage rights will be protected by the conditions
imposed in Norfolk and Western Ry. Co.--Trackage Rights--BN, 354 I.C.C.
605 (1978), as modified in Mendocino Coast Ry., Inc.--Lease and
Operate, 360 I.C.C. 653 (1980).
Sub-No. 3. In Sub-No. 3, GTW submits a verified notice of exemption
under 49 CFR 1180.2(d)(7). Pursuant to a written trackage rights
agreement, EJ&EW would grant GTW trackage rights over EJ&EW's lines
between milepost 74.6 at Waukegan, IL, and milepost 45.4 at Gary, IN,
including all trackage west of the centerline of Buchanan Street in
Gary, IN, plus trackage associated with the hump and Dixie leads
located east of Buchanan Street.\3\ Parties intend to execute the
trackage rights agreement promptly upon applicants' acquisition of
control of EJ&EW, should the Board approve the proposed Control
Transaction. As a condition to this exemption, GTW states that any
employees affected by the acquisition of the temporary trackage rights
will be protected by the conditions imposed in Norfolk and Western Ry.
Co.--Trackage Rights--BN, 354 I.C.C. 605 (1978), as modified in
Mendocino Coast Ry., Inc.--Lease and Operate, 360 I.C.C. 653 (1980).
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\3\ GTW currently has trackage rights over EJ&E lines between
milepost 36.2 at Griffith, IN, and milepost 24.0 at Eola, IL, which
EJ&EW would acquire under Sub-No. 1.
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Sub-No. 4. In Sub-No. 4, IC submits a verified notice of exemption
under 49 CFR 1180.2(d)(7). Pursuant to a written trackage rights
agreement, EJ&EW would grant IC trackage rights over EJ&EW's lines
between milepost 74.6 at Waukegan, IL, and milepost 45.4 at Gary, IN,
including all trackage west of the centerline of Buchanan Street in
Gary, IN, plus trackage associated with the hump and Dixie leads
located east of Buchanan Street. Parties intend to execute the trackage
rights agreement promptly upon applicants' acquisition of control of
EJ&EW, should the Board approve the proposed Control Transaction. As a
condition to this exemption, IC states that any employees affected by
the acquisition of the temporary trackage rights will be protected by
the conditions imposed in Norfolk and Western Ry. Co.--Trackage
Rights--BN, 354 I.C.C. 605 (1978), as modified in Mendocino Coast Ry.,
Inc.--Lease and Operate, 360 I.C.C. 653 (1980).
Sub-No. 5. In Sub-No. 5, WCL submits a verified notice of exemption
under 49 CFR 1180.2(d)(7). Pursuant to a written trackage rights
agreement, EJ&EW would grant WCL trackage rights over EJ&EW's lines
between milepost 74.6 at Waukegan, IL, and milepost 45.4 at Gary, IN,
including all trackage west of the centerline of Buchanan Street in
Gary, IN, plus trackage associated with the hump and Dixie leads
located east of Buchanan Street. Parties intend to execute the trackage
rights agreement promptly upon applicants' acquisition of control of
EJ&EW, should the Board approve the proposed Control Transaction. As a
condition to this exemption, WCL states that any employees affected by
the acquisition of the temporary trackage rights will be protected by
the conditions imposed in Norfolk and Western Ry. Co.--Trackage
Rights--BN, 354 I.C.C. 605 (1978), as modified in Mendocino Coast Ry.,
Inc.--Lease and Operate, 360 I.C.C. 653 (1980).
Sub-No. 6. In Sub-No. 6, CNR submits a verified notice of exemption
under 49 CFR 1180.2(d)(7). Pursuant to a written trackage rights
agreement, CCP would grant EJ&EW trackage rights over CCP's lines
between milepost 35.7 at Munger, IL, and milepost 8.3 at Belt Crossing,
IL. Parties intend to execute the trackage rights agreement promptly
upon applicants' acquisition of control of EJ&EW, should the Board
approve the
[[Page 67626]]
proposed Control Transaction. As a condition to this exemption, CNR
states that any employees affected by the acquisition of the temporary
trackage rights will be protected by the conditions imposed in Norfolk
and Western Ry. Co.--Trackage Rights--BN, 354 I.C.C. 605 (1978), as
modified in Mendocino Coast Ry., Inc.--Lease and Operate, 360 I.C.C.
653 (1980).
Sub-No. 7. In Sub-No. 7, CNR submits a verified notice of exemption
under 49 CFR 1180.2(d)(7). Pursuant to a written trackage rights
agreement, IC would grant EJ&EW trackage rights over IC's lines between
milepost 17.9 at Highlawn, IL, and milepost 31.4 at University Park,
IL, and between milepost 36.7 at Joliet, IL, and milepost 7.9 at
Lemoyne, IL. Parties intend to execute the trackage rights agreement
promptly upon applicants' acquisition of control of EJ&EW, should the
Board approve the proposed Control Transaction. As a condition to this
exemption, CNR states that any employees affected by the acquisition of
the temporary trackage rights will be protected by the conditions
imposed in Norfolk and Western Ry. Co.--Trackage Rights--BN, 354 I.C.C.
605 (1978), as modified in Mendocino Coast Ry., Inc.--Lease and
Operate, 360 I.C.C. 653 (1980).
Primary Application and Related Filings Accepted. The Board finds
that the proposed Control Transaction would be a ``minor transaction''
under 49 CFR 1180.2(c), and the Board accepts the primary application
for consideration because it is in substantial compliance with the
applicable regulations governing minor transactions. See 49 U.S.C.
11321-26; 49 CFR part 1180. The Board is also accepting for
consideration the seven related filings, which are also in compliance
with the applicable regulations. The Board reserves the right to
require the filing of supplemental information as necessary to complete
the record.
The Board has received comments in support of the Control
Transaction, as well as comments both opposing and supporting the
``minor transaction'' designation.\4\ On November 8, 2007, Congressman
Peter J. Visclosky submitted a comment with his notice of intent to
participate in the proceeding, stating his belief that the Board should
treat the Control Transaction as a significant transaction, in order to
give those affected in Northwestern Indiana ample opportunity to
analyze the impacts of the proposed purchase and comment accordingly.
On November 21, 2007, Congresswoman Melissa L. Bean also submitted a
comment with her notice of intent to participate urging the Board to
treat the Control Transaction as a significant transaction. In
addition, Congresswoman Bean requested that an EIS be prepared in
connection with the proposed transaction and supported a local field
hearing where the concerns of affected citizens and communities could
be heard.
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\4\ Several parties have provided statements in support of the
transaction. On November 9, 2007, applicants submitted the verified
statements of Consumers Energy Company, Erco Worldwide, and Millar
Western Forest Products Ltd, in support of the proposed Control
Transaction. On November 19, 2007, applicants submitted verified
statements in support of the Control Transaction from A&R Transport,
Inc., Behr Iron & Steel, Inc., Consolidated Grain and Barge
Enterprises, Inc., Hapag-Lloyd (America) Inc., Louisiana Pacific
Corporation, Major-Prime Plastics, Inc., Ozinga Transportation,
Inc., Parkdale International Ltd., and Verso Paper. Also on November
19, 2007, Metropolitan Milwaukee Association of Commerce (MMAC)
submitted a verified statement in support of the Control
Transaction. On November 20, 2007, applicants submitted the verified
statement of ATC Pembroke, Inc., in support of the proposed
transaction. In a letter filed on November 21, 2007, the Chicagoland
Chamber of Commerce (Chicagoland Chamber) expressed its support of
the Control Transaction. Also on November 21, 2007, the Fond du lac
Area Chamber of Commerce submitted a verified statement supporting
the transaction and applicants submitted a letter from Michigan
Governor Jennifer M. Granholm supporting the transaction. Governor
Granholm, A&R Transport, Inc., MMAC, Chicagoland Chamber, and the
Fond du lac Area Chamber of Commerce urge the Board to treat the
proposed transaction as a minor transaction.
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On November 19, 2007, Aux Sable Liquid Products, Inc. (Aux Sable)
filed a reply in opposition to applicants' request that the Control
Transaction be considered a minor transaction. Aux Sable argues that
the Control Transaction should be found to be a significant transaction
because the proposed transaction would eliminate EJ&E as a neutral
switching carrier that provides efficient, economical, and
nondiscriminatory access to numerous Class I railroads and short lines.
On November 21, 2007, applicants filed a reply in opposition to the
arguments offered by Congressman Visclosky and Aux Sable to the effect
that the proposed transaction should be deemed significant. Applicants
assert that these parties' arguments present no justification for
finding the proposed transaction to be anything other than minor.
The statute and Board regulations treat a transaction that does not
involve two or more Class I railroads differently depending upon
whether or not the transaction would have ``regional or national
transportation significance.'' 49 U.S.C. 11325. Under our regulations,
at 49 CFR 1180.2, a transaction that does not involve two or more Class
I railroads is to be classified as ``minor''--and thus not having
regional or national transportation significance--if a determination
can be made either: (1) That the transaction clearly will not have any
anticompetitive effects, or (2) that any anticompetitive effects will
clearly be outweighed by the anticipated contribution to the public
interest in meeting significant transportation needs. A transaction not
involving the control or merger of two or more Class I railroads is
``significant'' if neither of these determinations can clearly be made.
The Board finds the proposed Control Transaction to be a ``minor
transaction'' because it appears on the face of the application that
the efficiency and other public interest benefits would clearly
outweigh whatever anticompetitive effects may exist. Today much of
CNR's traffic moving between its various components must travel through
downtown Chicago. With this acquisition, applicants propose to reroute
most of their traffic around Chicago, relieving congestion on crowded
downtown track. According to applicants' operating plan, the EJ&E is
currently lightly used. Applicants indicate that they could increase
use of EJ&E's line by adding more CNR traffic while maintaining
existing levels of other traffic. Further, the transaction does not
appear to pose any significant anticompetitive effects. There is
virtually no overlap; EJ&E and the applicants' rail lines do not appear
to serve any shippers in common. Applicants also state their commitment
to keeping gateways open and honoring trackage rights and haulage
agreements with all connecting carriers so that other railroads would
be able to continue to use their trackage rights on the EJ&E after
completion of the Control Transaction.
The Board reiterates, however, that its findings regarding the
anticompetitive impact are preliminary. The Board will give careful
consideration to any claims that the transaction will have
anticompetitive effects that are not apparent from the application
itself. Moreover, the schedule established by the Board gives Aux Sable
the opportunity to present its evidence on the issue of
nondiscriminatory access and for the Board to consider the issue. In
response to Congressman Visclosky's comment, the Board notes that the
proposed schedule is contingent upon completion of a full environmental
review process. As discussed, the Board has decided to prepare a full
EIS in this proceeding that will ensure that the Board takes the hard
look at environmental consequences required
[[Page 67627]]
by NEPA, which is warranted in view of the large 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. As part of the NEPA process, the Board will consider
whether to impose specific environmental conditions, should it decide
to authorize this proposal, to mitigate potential environmental impacts
resulting from the proposed transaction.
Although the Board finds that the application is in substantial
compliance with the applicable regulations, applicants have not
submitted the information required under 49 CFR 1180.11. Applicants
should submit this information to the Board by December 6, 2007.
Public Inspection. The primary application and related filings are
available for inspection in the library (Room 131) at the offices of
the Surface Transportation Board, 395 E Street, SW., in Washington, DC.
In addition, the primary application and related filings may be
obtained from Mr. Cunningham (representing CNR and GTC) at the address
indicated above.
Procedural Schedule. The Board has considered applicants' request
(filed October 30, 2007) for an expedited procedural schedule, under
which the Board would issue its final decision before the statutory
deadline of 180 days after the filing of the primary application.
On November 19, 2007, the Village of Barrington, IL (Barrington)
filed a reply, urging the Board to develop an EIS and adopt a schedule
that allows sufficient time to prepare an EIS, including sufficient
time for preparation of a scoping notice, a Draft EIS, and Final EIS.
On November 21, 2007, applicants responded, contending that the Board
lacks sufficient information to decide now whether an EIS is needed in
this case.
On November 20, 2007, BNSF submitted comments on applicants'
suggested expedited procedural schedule, requesting that the Board set
a procedural schedule that provides for sufficient time for
consideration of the potential impacts of the proposed transaction and
for negotiations with applicants to ensure that the interests of
connecting railroads and their shippers are protected. On November 21,
2007, applicants responded, arguing that BNSF's concerns do not warrant
lengthening the procedural schedule proposed by the applicants.
The Board denies applicants' request for an expedited procedural
schedule and is adopting a procedural schedule, under which the Board
would issue its final decision by April 25, 2008, provided that the
environmental review process described below is complete. The Board's
schedule also provides that any necessary oral argument or public
hearing will be held on a date to be determined by the Board.
Under the procedural schedule adopted by the Board: any person who
wishes to participate in this proceeding as a POR must file a notice of
intent to participate no later than December 13, 2007; all comments,
protests, requests for conditions, and any other evidence and argument
in opposition to the primary application or related filings, including
filings by DOJ and DOT, must be filed by January 28, 2008; and
responses to comments, protests, requests for conditions, and other
opposition and rebuttal in support of the primary application or
related filings must be filed by March 13, 2008. As in past
proceedings, DOJ and DOT will be allowed to file, on the response due
date (here, March 13), their comments in response to the comments of
other parties, and applicants will be allowed to file (as quickly as
possible thereafter) a response to any such comments filed by DOJ and/
or DOT. Under this schedule, a public hearing or oral argument may be
held on a date to be determined by the Board. The Board plans to issue
its final decision by April 25, 2008, and make any such approval
effective by May 25, 2008, but those dates may be extended as required
to accommodate completion of the environmental review process under
NEPA, including preparation of an EIS and a full opportunity for public
comment and participation. For further information respecting dates,
see Appendix A (Procedural Schedule).
Notice of Intent to Participate. Any person who wishes to
participate in this proceeding as a POR must file with the Board, no
later than December 13, 2007, 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, and Mr. Cunningham (representing CNR and
GTC).
If a request is made in the notice of intent to participate to have
more than one name added to the service list as a POR representing a
particular entity, the extra name will be added to the service list as
a ``Non-Party.'' The list will reflect the Board's policy of allowing
only one official representative per party to be placed on the service
list, as specified in Press Release No. 97-68 dated August 18, 1997,
announcing the implementation of the Board's ``One Party-One
Representative'' policy for service lists. Any person designated as a
Non-Party will receive copies of Board decisions, orders, and notices
but not copies of official filings. Persons seeking to change their
status must accompany that request with a written certification that he
or she has complied with the service requirements set forth at 49 CFR
1180.4, and any other requirements set forth in this decision.
Service List Notice. The Board will serve, as soon after December
13, 2007, as practicable, a notice containing the official service list
(the service-list notice). Each POR will be required to serve upon all
other PORs, within 10 days of the service date of the service-list
notice, copies of all filings previously submitted by that party (to
the extent such filings have not previously been served upon such other
parties). Each POR also will be required to file with the Board, within
10 days of the service date of the service-list notice, a certificate
of service indicating that the service required by the preceding
sentence has been accomplished. Every filing made by a POR after the
service date of the service-list notice must have its own certificate
of service indicating that all PORs on the service list have been
served with a copy of the filing. Members of the United States Congress
(MOCs) and Governors (GOVs) 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 POR.
Comments, Protests, Requests for Conditions, and Other Opposition
Evidence and Argument, Including Filings by DOJ and DOT. All comments,
protests, requests for conditions, and any other evidence and argument
in opposition to the primary application or related filings, including
filings by DOJ and DOT, must be filed by January 28, 2008.
Because the Transaction proposed in the application is a minor
transaction, no responsive applications will be permitted. See 49 CFR
1180.4(d)(1).
Protesting parties are advised that, if they seek either the denial
of the application or the imposition of conditions upon any approval
thereof, on the theory that approval (or approval without conditions)
would harm competition and/or their ability to provide essential
services, they must present substantial evidence in support of their
positions. See Lamoille Valley R.R. Co. v. ICC, 711 F.2d 295 (D.C. Cir.
1983).
Responses to Comments, Protests, Requests for Conditions, and Other
[[Page 67628]]
Opposition; Rebuttal in Support of the Primary Application or Related
Filings. Responses to comments, protests, requests for conditions, and
other opposition submissions, and rebuttal in support of the primary
application or related filings must be filed by March 13, 2008.
Public Hearing/Oral Argument. The Board may hold a public hearing
or an oral argument in this proceeding on a date to be determined by
the Board.
Discovery. Discovery may begin immediately. The parties are
encouraged to resolve all discovery matters expeditiously and amicably.
Environmental Matters. NEPA requires that the Board take
environmental considerations into account in its decisionmaking. Under
both the regulations of the President's Council on Environmental
Quality implementing NEPA and the Board's own environmental rules,
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.\5\ Actions that may or may not have a significant
environmental impact ordinarily require the Board to prepare a more
limited Environmental Assessment (EA).\6\ Finally, actions whose
environmental effects are ordinarily insignificant may be excluded from
NEPA review across the board, without a case-by-case review. As
pertinent here, an acquisition transaction normally requires the
preparation of an EA or EIS where certain thresholds would be exceeded.
---------------------------------------------------------------------------
\5\ See 49 CFR 1105.4(f), 1105.10(a).
\6\ See 49 CFR 1105.4(d), 1105.10(b).
---------------------------------------------------------------------------
The thresholds differ depending on whether a rail line segment is
in an area designated as in ``attainment'' or ``nonattainment'' with
the National Ambient Air Quality Standards established under the Clean
Air Act. Because the EJ&E lines that currently move through Chicago,
and the lines of the proposed EJ&EW, are located in nonattainment
areas, environmental documentation typically is required where the
proposed action would result in: (1) An increase of at least 3 trains
per day, (2) an increase in rail traffic of at least 50 percent
(measured in annual gross ton miles), or (3) an increase in carload
activity at rail yards of at least 20 percent. See 49 CFR
1105.7(e)(5)(ii).\7\ The application indicates that the thresholds for
environmental review would be exceeded here, and applicants agree that
the preparation of either an EA or EIS is warranted in this
proceeding.\8\
---------------------------------------------------------------------------
\7\ For rail lines located in attainment areas, environmental
documentation normally will be prepared if the proposed action would
result in (1) an increase of at least 8 trains per day, (2) an
increase in rail traffic of at least 100 percent (measured in annual
gross ton miles), or (3) an increase in carload activity at rail
yards of at least 100 percent. See 49 CFR 1105.7(e)(5)(i).
\8\ See Application at p. 33.
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Applicants explain that the most notable change that would result
from the proposed transaction is the shifting of rail traffic. Although
rail traffic on CNR lines inside the EJ&E arc would generally decrease,
these decreases in rail traffic would be offset by substantial
increases in the number of trains operated on the EJ&EW line outside
Chicago. Following the full implementation of the proposed transaction
(which would be phased in), the EJ&EW line outside Chicago would gain
approximately 9,695 carloads of extended haul traffic within
approximately 3 years of consummation.\9\ Applicants state that they
would also use the EJ&EW line as a cross-connecting corridor.
Accordingly, applicants anticipate that 14 of the existing 18 segments
of the EJ&EW line would experience increases of between 15.0 and 26.6
trains per day.\10\ These increases in trains per day would
significantly exceed the 3 or 8 trains per day thresholds in the
Board's environmental rules.
---------------------------------------------------------------------------
\9\ See Application at p. 192. Applicants state that there would
be no quantifiable traffic gains from trucks or from rail traffic
not presently handled in part by the applicants. See Application at
p. 209.
\10\ See Applicants' Operating Plan, Attachment A.2, p. 247.
---------------------------------------------------------------------------
Applicants also project large increases in annual gross ton miles
per day (gtm/d) on most of the affected line segments, which would
exceed the Board's tonnage increase thresholds. For example,
applicants' Operating Plan shows that on the Munger to West Chicago
line segment gtm/pd would change by as much as 1,185 percent.\11\
Applicants state that the proposed transaction would not impair CNR's
ability to handle commuter trains, passenger trains, or trackage/
haulage trains currently operating on its lines.
---------------------------------------------------------------------------
\11\ Id.
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Finally, on the integrated CNR/EJ&EW system, four train pairs would
be added to EJ&E terminals (three inbound and three outbound switch
trains at Kirk Yard, and one inbound and one outbound switch train at
East Joliet Yard). The estimated proposed increase of 1,355 car
handlings daily at the Kirk Yard (currently 685 car handlings) and the
estimated addition of 709 daily car handlings at East Joliet (currently
500 car handlings) would exceed the Board's thresholds for increased
car load activity at rail yards.
The NEPA Process. Based on the information provided in the
application and on a number of expressions of concern for the possible
impact of the proposed transaction on potentially affected communities,
and after consultation with the Section of Environmental Analysis
(SEA), the Board has decided that it will prepare a full EIS in this
proceeding. Although this proposed transaction is deemed to be minor
and is thus entitled to an abbreviated review process on the merits,
the schedule will not limit the environmental review process. The
Board's proposed final decision date of April 25, 2008, and effective
date of May 25, 2008, will be extended as needed to complete the full
environmental review process, including preparation of the EIS and
public comment as discussed below.
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 normally is not required in acquisition
cases; a more limited EA generally is sufficient because there are not
usually significant environmental impacts from the change in ownership
of the operation of existing lines. 49 CFR 1105.6(b)(4). In this case,
however, a full EIS is warranted in view of the large 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 lines segments and at
rail facilities.\12\
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\12\ Contrary to applicants' claims, the Board has enough
information about the potential environmental impacts of this
project to support the decision to prepare a full EIS. Moreover,
making this determination at this point should result in a shorter
NEPA review than if the Board began the EA process, only to find
that the potential environmental impacts warranted an EIS, and it
then had to begin again with the procedural steps required for an
EIS.
---------------------------------------------------------------------------
The EIS process will ensure that the Board takes the hard look at
environmental consequences required by NEPA. After issuing a notice of
intent to prepare an EIS, the Board will determine the scope of work
for the EIS and will provide opportunities for public participation and
consultation with appropriate federal, state, and local agencies and
governmental entities. A Draft EIS will be prepared that will analyze
in detail the potential environmental impacts of the proposed
transaction and will make recommendations for environmental
[[Page 67629]]
mitigation.\13\ 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 the
public comments, present the results of any further environmental
analysis, and incorporate final environmental mitigation
recommendations.\14\ The Board will consider the entire environmental
record in deciding whether to authorize the transaction as proposed,
deny the proposal, or grant it with conditions, including environmental
mitigation conditions.
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\13\ During the environmental review process, railroad
applicants have sometimes negotiated mutually acceptable agreements
with affected communities and other entities, addressing specific
local environmental concerns. The Board encourages voluntary
agreements of this nature because they can be extremely effective in
addressing specific local environmental and safety concerns. See 49
CFR 1180.1(f)(2).
\14\ The environmental analysis will focus on the potential
environmental impacts resulting from changes in activity levels on
particular line segments and facilities. The Board's general
practice has been to mitigate only impacts resulting directly from a
proposed transaction, and not to require mitigation for existing
conditions and existing railroad operations. See 49 CFR
1180.1(f)(1).
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The time the EIS will take to prepare cannot be determined ahead of
time because there is no way to predict in advance all of the specific
issues that may arise. In prior cases, the EIS process has ranged from
approximately 18 months to several years.\15\
---------------------------------------------------------------------------
\15\ Sometimes, environmental work has been suspended for
reasons unrelated to the environmental review process.
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Safety Integration Plan. Applicants state that they will work with
the Federal Railroad Administration (FRA) to formulate a SIP \16\ to
address the safe integration of their rail lines, equipment, personnel,
and operating practices. The proposed SIP will be submitted to the
Board and made available for public review and comment during the EIS
process, consistent with the Board's regulations at 49 CFR 1106 and
1180.1(f)(3).
---------------------------------------------------------------------------
\16\ See 49 CFR 244.17(a) and 1106.4(a).
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Historic Review. Finally, in accordance with Section 106 of the
NHPA the Board is required to determine the effects of its licensing
actions on cultural resources.\17\ 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.\18\
Applicants state that the proposed transaction fits within this
exception.\19\ They assert that they have no plans to alter or dispose
of properties 50 or more years old, and that any future line
abandonment or construction activities by applicants would be subject
to the Board's jurisdiction. Based on this information, it does not
appear that historic review under the NHPA is required in this case.
---------------------------------------------------------------------------
\17\ See 49 CFR 1105.8.
\18\ See 49 CFR 1105.8(b)(1).
\19\ See Application at p. 33.
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Filing/Service Requirements. Persons participating in this
proceeding may file with the Board and serve on other parties: A notice
of intent to participate (due by December 13); a certificate of service
indicating service of prior pleadings on persons designated as PORs on
the service-list notice (due by the 10th day after the service date of
the service-list notice); any comments, protests, requests for
conditions, and any other evidence and argument in opposition to the
primary application or related filings (due by January 28); and any
responses to comments, etc., and any rebuttal in support of the primary
application or related filings (due by March 13).
Filing Requirements. Any document filed in this proceeding must be
filed either via the Board's e-filing format or in the traditional
paper format as provided for in the Board's rules. Any person using e-
filing should attach a document and otherwise comply with the
instructions found on the Board's Web site at http://www.stb.dot.gov at
the ``E-FILING'' link. Any person filing a document in the traditional
paper format should send an original and 10 paper copies of the
document (and also an electronic version) to: Surface Transportation
Board, 395 E Street, SW., Washington, DC 20423-0001.
Service Requirements. One copy of each document filed in this
proceeding must be sent to each of the following (any copy may be sent
by e-mail only if service by e-mail is acceptable to the recipient):
(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) Paul A. Cunningham (representing
CNR and GTC), Harkins Cunningham LLP, 1700 K Street, NW., Suite 400,
Washington, DC 20006-3804; and (4) any other person designated as a POR
on the service-list notice.
Service of Decisions, Orders, and Notices. The Board will serve
copies of its decisions, orders, and notices only on those persons who
are designated on the official service list as either POR, MOC, GOV, or
Non-Party. All other interested persons are encouraged either to secure
copies of decisions, orders, and notices via the Board's Web site at
http://www.stb.dot.gov under ``E-LIBRARY/Decisions & Notices'' or to
make advance arrangements with the Board's copy contractor, ASAP
Document Solutions (mailing address: Suite 103, 9332 Annapolis Rd.,
Lanham, MD 20706; e-mail address: asapdc@verizon.net; telephone number:
202-306-4004), to receive copies of decisions, orders, and notices
served in this proceeding. ASAP Document Solutions will handle the
collection of charges and the mailing and/or faxing of decisions,
orders, and notices to persons who request this service.
Access to Filings. An interested person does not need to be on the
service list to obtain a copy of the primary application or any other
filing made in this proceeding. 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 primary application and
other filings in this proceeding will also be available on the Board's
Web site at http://www.stb.dot.gov under ``E-LIBRARY/Filings.''
This action will not significantly affect either the quality of the
human environment or the conservation of energy resources.
It is ordered:
1. The primary application in STB Finance Docket No. 35087 and the
related filings in STB Finance Docket No. 35087 (Sub-Nos. 1 through 7)
are 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 Appendix
A.
3. The parties to this proceeding must comply with the procedural
requirements described in this decision.
4. This decision is effective on November 29, 2007.
Decided: November 23, 2007.
By the Board, Chairman Nottingham, Vice Chairman Buttrey, and
Commissioner Mulvey. Commissioner Mulvey dissented with a separate
expression.
Vernon A. Williams,
Secretary.
COMMISSIONER MULVEY, dissenting:
I would have preferred that the Board categorize this transaction
as ``significant.'' In light of the configuration of Class I railroad
lines, traffic flows, critical junctures the EJ&E offers in the Chicago
area, and the
[[Page 67630]]
applicants' less than thorough treatment of how their consolidation
would impact other carriers, I do not believe applicants have satisfied
the standards necessary for the Board to categorize this transaction as
``minor.'' I recognize that the substantive standard for Board approval
of ``significant'' and ``minor'' transactions is the same under 49
U.S.C. 11324(d). However, a ``significant'' categorization would have
allowed interested parties and the Board to take advantage of the
additional procedural safeguards provided by 49 U.S.C. 11325(c).
I have long been concerned about why the agency's categorization of
consolidation transactions includes virtually no ``significant''
transactions, and only one since the early 1990's. The current
standards for determining whether a consolidation transaction is
``significant'' or ``minor'' were adopted at a time when many more
Class I carriers existed than do today, when the railroad industry was
in a different financial posture than it is in today, and when the
agency was viewed as an impediment to economic recovery of the
industry. That is no longer the environment in which we consider the
merits of transactions such as this. As a result, I would have
preferred we handle this transaction \20\ as a ``significant'' one.\21\
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\20\ Under 49 U.S.C. 11325(d)(2), a final decision would be
issued by April 25, 2008; however, the Board also is required to
accommodate NEPA in its decisionmaking. Therefore, a final decision
here will be issued as soon as possible after completion of the EIS
process.
\21\ The final decision will become effective 30 days after it
is served.
Appendix A: Procedural Schedule
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------------------------------------------------------------------------
October 3, 2007........................... Motion for Protective Order
filed.
October 22, 2007.......................... Protective Order issued.
October 30, 2007.......................... Primary Application, Related
Filings, and Motion to
Establish Procedural
Schedule filed.
November 29, 2007......................... Board notice of acceptance
of application published in
the Federal Register.
December 13, 2007......................... Notices of intent to
participate in this
proceeding due.
January 28, 2008.......................... All comments, protests,
requests for conditions,
and any other evidence and
argument in opposition to
the primary application or
related filings, including
filings of DOJ and DOT,
due.
March 13, 2008............................ Responses to comments,
protests, requests for
conditions, and other
opposition due. Rebuttal in
support of the primary
application or related
filings due.
TBD....................................... A public hearing or oral
argument may be held.
TBD \20\.................................. Date by which a final
decision will be served.
TBD \21\.................................. Date by which a final
decision will become
effective.
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[FR Doc. E7-23151 Filed 11-28-07; 8:45 am]
BILLING CODE 4915-01-P