83 FR 23326 - Iowa Pacific Holdings, LLC, Permian Basin Railways, and San Luis & Rio Grande Railway-Corporate Family Transaction Exemption-Grenada Railroad, LLC

SURFACE TRANSPORTATION BOARD

Federal Register Volume 83, Issue 97 (May 18, 2018)

Page Range		23326-23326
FR Document		2018-10664
Federal Register, Volume 83 Issue 97 (Friday, May 18, 2018)
[Federal Register Volume 83, Number 97 (Friday, May 18, 2018)]
[Notices]
[Page 23326]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-10664]



[[Page 23326]]

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SURFACE TRANSPORTATION BOARD

[Docket No. FD 36191]


Iowa Pacific Holdings, LLC, Permian Basin Railways, and San Luis 
& Rio Grande Railway--Corporate Family Transaction Exemption--Grenada 
Railroad, LLC

    Iowa Pacific Holdings, LLC (IPH), Permian Basin Railways (PBR), and 
San Luis & Rio Grande Railway (SLRG) (collectively, the Parties) have 
jointly filed a verified notice of exemption under 49 CFR 1180.2(d)(3) 
for an intra-corporate family transaction.
    According to the Parties, IPH is a noncarrier established for the 
purpose of owning and operating common carrier short line railroads and 
non-common carrier excursion passenger railroads. The Parties state 
that PBR is a wholly owned corporate subsidiary of IPH established for 
the purpose of owning common carrier short line railroads. The Parties 
further state that PBR directly controls the following Class III common 
carrier short line railroads: Chicago Terminal Railroad, Mount Hood 
Railroad, and SLRG. According to the Parties, through SLRG, PBR 
controls three additional Class III common carrier short line 
railroads: Saratoga & North Creek Railway, Grenada Railroad, LLC (GRR), 
and an 80% interest in Massachusetts Coastal Railroad.
    The Parties state that GRR was initially established as a direct 
subsidiary of PBR; however, on or about October 13, 2015, IPH's 
management decided to place control of GRR under SLRG rather than 
directly under PBR. The Parties state that IPH and PBR transferred 
their direct ownership of GRR to their subsidiary, SLRG, without 
realizing that authority from the Surface Transportation Board (Board) 
would be required. According to the Parties, upon learning that 
authority was required, the Parties instructed their counsel to seek 
Board approval.
    According to the Parties, IPH's management transferred ownership of 
GRR from PBR to SLRG for business and tax reasons. The Parties further 
state that they propose to sell a majority interest in GRR to a third 
party ``that will invest substantial assets in the Line to more fully 
develop its potential.'' \1\
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    \1\ This notice of exemption applies only to the intra-corporate 
family transfer of GRR from PBR to SLRG, not to any proposed sale of 
GRR to a third party.
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    The Parties certify that the transaction involved no provision or 
agreement that would limit future interchange with a third-party 
connecting carrier.\2\
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    \2\ The Parties' certification cites to 49 CFR 1180.3(g)(4); 
however, the correct cite is 49 CFR 1180.4(g)(4).
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    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).\3\ Unless stayed, the exemption will be effective on June 
3, 2018 \4\ (30 days after the verified notice was filed).\5\
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    \3\ Section 1180.2(d)(3) exempts transactions within a corporate 
family that do not result in adverse changes in service levels, 
significant operational changes, or a change in the competitive 
balance with carriers outside the corporate family.
    \4\ The Parties did not request retroactive authorization, and 
the exemption invoked by the Parties does not provide for 
retroactive effectiveness. See Wendelin--Continuance in Control--RMW 
Ventures, LLC, FD 35801, slip op. at 2 n.1 (STB served Mar. 21, 
2014) (noting that the authority for a continuance in control 
exemption under 49 CFR 1180.2(d)(2) would be effective prospectively 
only); see also Kan. City S. Lines, Inc.--Corp. Family Transaction 
Exemption--KCS Transp. Co., FD 33510, slip op. at 1 n.1 (STB served 
Dec. 10, 1997) (``no class exemption provides for retroactive 
application''). Accordingly, the authority will be effective 
prospectively only.
    \5\ The Parties initially filed their verified notice of 
exemption on April 27, 2018, but supplemented it on May 4, 2018. 
Therefore, May 4, 2018, is the official filing date.
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    Under 49 U.S.C. 10502(g), the Board may not use its exemption 
authority to relieve a rail carrier of its statutory obligation to 
protect the interests of its employees. Section 11326(c), however, does 
not provide for labor protection for transactions under sections 11324 
and 11325 that involve only Class III rail carriers. Accordingly, the 
Board may not impose labor protective conditions here, because all the 
carriers involved are Class III carriers.
    If the verified notice contains false or misleading information, 
the exemption is void ab initio. Petitions to revoke the exemption 
under 49 U.S.C. 10502(d) may be filed at any time. The filing of a 
petition to revoke will not automatically stay the exemption. Petitions 
for stay must be filed no later than May 25, 2018 (at least seven days 
before the exemption becomes effective).
    An original and 10 copies of all pleadings, referring to Docket No. 
FD 36191, must be filed with the Surface Transportation Board, 395 E 
Street SW, Washington, DC 20423-0001. In addition, one copy of each 
pleading must be served on John D. Heffner, Clark Hill Strasburger, 
1025 Connecticut Ave. NW, Suite 717, Washington, DC 20036.
    According to the Parties, this action is categorically excluded 
from environmental review under 49 CFR 1105.6(c).
    Board decisions and notices are available on our website at 
``WWW.STB.GOV.''

    Decided: May 15, 2018.

    By the Board, Scott M. Zimmerman, Acting Director, Office of 
Proceedings.
Jeffrey Herzig,
Clearance Clerk.
[FR Doc. 2018-10664 Filed 5-17-18; 8:45 am]
 BILLING CODE 4915-01-P
23326 Federal Register / Vol. 83, No. 97 / Friday, May 18, 2018 / Notices

SURFACE TRANSPORTATION BOARD would limit future interchange with a Board decisions and notices are
third-party connecting carrier.2 available on our website at
[Docket No. FD 36191] This is a transaction within a ‘‘WWW.STB.GOV.’’
corporate family of the type specifically Decided: May 15, 2018.
Iowa Pacific Holdings, LLC, Permian exempted from prior review and By the Board, Scott M. Zimmerman, Acting
Basin Railways, and San Luis & Rio approval under 49 CFR 1180.2(d)(3).3 Director, Office of Proceedings.
Grande Railway—Corporate Family Unless stayed, the exemption will be Jeffrey Herzig,
Transaction Exemption—Grenada effective on June 3, 2018 4 (30 days after Clearance Clerk.
Railroad, LLC the verified notice was filed).5
[FR Doc. 2018–10664 Filed 5–17–18; 8:45 am]
Under 49 U.S.C. 10502(g), the Board
BILLING CODE 4915–01–P
Iowa Pacific Holdings, LLC (IPH), may not use its exemption authority to
Permian Basin Railways (PBR), and San relieve a rail carrier of its statutory
Luis & Rio Grande Railway (SLRG) obligation to protect the interests of its SURFACE TRANSPORTATION BOARD
(collectively, the Parties) have jointly employees. Section 11326(c), however,
does not provide for labor protection for [Docket No. AB 55 (Sub-No. 783X)]
filed a verified notice of exemption
under 49 CFR 1180.2(d)(3) for an intra- transactions under sections 11324 and
11325 that involve only Class III rail CSX Transportation, Inc.—
corporate family transaction. Discontinuance of Service
carriers. Accordingly, the Board may not
According to the Parties, IPH is a impose labor protective conditions here, Exemption—in Baldwin and Hancock
noncarrier established for the purpose of because all the carriers involved are Counties, GA
owning and operating common carrier Class III carriers. CSX Transportation, Inc. (CSXT), has
short line railroads and non-common If the verified notice contains false or filed a verified notice of exemption
carrier excursion passenger railroads. misleading information, the exemption under 49 CFR pt. 1152 subpart F–
The Parties state that PBR is a wholly is void ab initio. Petitions to revoke the Exempt Abandonments and
owned corporate subsidiary of IPH exemption under 49 U.S.C. 10502(d) Discontinuances of Service to
established for the purpose of owning may be filed at any time. The filing of discontinue service over an
common carrier short line railroads. The a petition to revoke will not approximately 25-mile rail line on its
Parties further state that PBR directly automatically stay the exemption. Atlanta Division, Camak Subdivision
controls the following Class III common Petitions for stay must be filed no later between milepost YYM 22.0 and
carrier short line railroads: Chicago than May 25, 2018 (at least seven days milepost YYM 47.0 in Baldwin and
Terminal Railroad, Mount Hood before the exemption becomes Hancock Counties, Ga. (the Line). The
Railroad, and SLRG. According to the effective). Line traverses United States Postal
Parties, through SLRG, PBR controls An original and 10 copies of all Service Zip Codes 31087 and 31061.
three additional Class III common pleadings, referring to Docket No. FD CSXT has certified that: (1) No local
carrier short line railroads: Saratoga & 36191, must be filed with the Surface traffic has moved over the Line for at
North Creek Railway, Grenada Railroad, Transportation Board, 395 E Street SW, least two years; (2) any overhead traffic
LLC (GRR), and an 80% interest in Washington, DC 20423–0001. In on the Line can be rerouted over other
Massachusetts Coastal Railroad. addition, one copy of each pleading lines; (3) no formal complaint filed by
The Parties state that GRR was must be served on John D. Heffner, a user of rail service on the Line (or by
initially established as a direct Clark Hill Strasburger, 1025 Connecticut a state or local government entity acting
subsidiary of PBR; however, on or about Ave. NW, Suite 717, Washington, DC on behalf of such user) regarding
October 13, 2015, IPH’s management 20036. cessation of service over the Line is
decided to place control of GRR under According to the Parties, this action is either pending with the Surface
SLRG rather than directly under PBR. categorically excluded from Transportation Board (Board) or with
The Parties state that IPH and PBR environmental review under 49 CFR any U.S. District Court or has been
transferred their direct ownership of 1105.6(c). decided in favor of a complainant
GRR to their subsidiary, SLRG, without within the two-year period; and (4) the
realizing that authority from the Surface 2 The Parties’ certification cites to 49 CFR requirements at 49 CFR 1105.12
Transportation Board (Board) would be 1180.3(g)(4); however, the correct cite is 49 CFR (newspaper publication) and 49 CFR
1180.4(g)(4). 1152.50(d)(1) (notice to governmental
required. According to the Parties, upon 3 Section 1180.2(d)(3) exempts transactions
learning that authority was required, the agencies) have been met.
within a corporate family that do not result in
Parties instructed their counsel to seek adverse changes in service levels, significant
As a condition to this exemption, any
Board approval. operational changes, or a change in the competitive employee adversely affected by the
balance with carriers outside the corporate family. discontinuance of service shall be
According to the Parties, IPH’s 4 The Parties did not request retroactive
protected under Oregon Short Line
management transferred ownership of authorization, and the exemption invoked by the Railroad—Abandonment Portion
GRR from PBR to SLRG for business and Parties does not provide for retroactive
effectiveness. See Wendelin—Continuance in Goshen Branch Between Firth &
tax reasons. The Parties further state Control—RMW Ventures, LLC, FD 35801, slip op. at Ammon, in Bingham & Bonneville
that they propose to sell a majority 2 n.1 (STB served Mar. 21, 2014) (noting that the Counties, Idaho, 360 I.C.C. 91 (1979). To
interest in GRR to a third party ‘‘that authority for a continuance in control exemption address whether this condition
will invest substantial assets in the Line under 49 CFR 1180.2(d)(2) would be effective
prospectively only); see also Kan. City S. Lines, adequately protects affected employees,
to more fully develop its potential.’’ 1 a petition for partial revocation under
daltland on DSKBBV9HB2PROD with NOTICES

Inc.—Corp. Family Transaction Exemption—KCS
The Parties certify that the transaction Transp. Co., FD 33510, slip op. at 1 n.1 (STB served 49 U.S.C. 10502(d) must be filed.
Dec. 10, 1997) (‘‘no class exemption provides for Provided no formal expression of
involved no provision or agreement that retroactive application’’). Accordingly, the authority
will be effective prospectively only.
intent to file an offer of financial
1 This notice of exemption applies only to the 5 The Parties initially filed their verified notice of assistance (OFA) 1 to subsidize
intra-corporate family transfer of GRR from PBR to exemption on April 27, 2018, but supplemented it
SLRG, not to any proposed sale of GRR to a third on May 4, 2018. Therefore, May 4, 2018, is the 1 The Board modified its OFA procedures

party. official filing date. effective July 29, 2017. Among other things, the

VerDate Sep<11>2014 16:38 May 17, 2018 Jkt 244001 PO 00000 Frm 00075 Fmt 4703 Sfmt 4703 E:\FR\FM\18MYN1.SGM 18MYN1
Document Created: 2018-05-18 02:16:23
Document Modified: 2018-05-18 02:16:23
Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
FR Citation		83 FR 23326