B.C.D. 01-41 MAY 1 0 2001

EMPLOYER STATUS DETERMINATION

Trans-Global Solutions, Inc. d/b/a Austin Area Terminal

Railroad

Austin Area Terminal Railroad, Inc.

This is the determination of the Railroad Retirement Board concerning

the status of Trans-Global Solutions, Inc. d/b/a Austin Area Terminal

Railroad (“AATR Division”) and the status of Austin Area Terminal

Railroad, Inc. (“AATR Inc.”) as employers under the Railroad

Retirement Act (45 U.S.C. §231 et seq.) (RRA) and the Railroad

Unemployment Insurance Act (45 U.S.C. §351 et seq.) (RUIA).

In Surface Transportation Board (STB) Finance Docket No. 33860,

decided March 28, 2000, AATR Division filed a notice of exemption

under 49 CFR 1150.31 to operate approximately 162 miles of rail line

owned by Capital Metropolitan Transportation Authority1 (“CMTA”)

between milepost AUNW-MPO.O (SPT MP57.00), west of Giddings,

Texas, and milepost AUMW - MP 154.07 (SPT - MP99.04), at Llano, 

Texas, including the Marble Falls Branch (6.43 miles), the Scobee Spur

(3.3 miles), and the Burnet Spur (0.93 miles), in Bastrop, Burnet, Lee,

Llano, Travis and Williamson Counties, Texas. The lines were

previously operated by Central of Tennessee Railway & Navigation

Company Incorporated d/b/a the Longhorn Railway Company (BA No.

5550).

Information about AATR Division was furnished by the law firm of

Galland, Kharasch, Greenberg, Fellman & Swirsky, P. C. AATR

Division was created as an operating division of Trans-Global Solutions,

Inc. (“Trans-Global”)2 when it was awarded a temporary (i.e., fourmonth) contract to operate over a rail line owned by CMTA. AATR

1 Capital Metropolitan Transportation Authority (“CMTA”) is the Austin, Texas regional 

transit authority, a body corporate and political subdivision of the State of Texas. In

STB Finance Docket No 33596, decided May 20, 1998, CMTA obtained authority to

acquire this line of railroad and advised the STB that the line would continue to be

operated by the Central of Tennessee Railway & Navigation Company, Inc. d/b/a the

Longhorn Railway.

2 Trans-Global Solutions, Inc. is a national and international provider of railroad and bulk

material logistical services and has a number of operating divisions.

BA# 2886
Trans-Global Solutions, Inc. d/b/a Austin Area Terminal Railroad

Austin Area Terminal Railroad, Inc.

Division began operating the railroad April 1, 2000, with 36 employees.

The initial four-month contract with CMTA was extended for an

additional period, the term of which was to expire in February 2001.

AATR Division provided rail freight service to customers located along

the line of railroad owned by CMTA and interchanged with the Union

Pacific Railroad Company and the Burlington Northern Santa Fe

Railroad Company.

In a letter dated December 8, 2000, attorney Edward D. Greenberg of 

the law firm of Galland, Kharasch, Greenberg, Fellman & Swirsky, P.C.

advised the Board’s Audit and Compliance Section that CMTA and

Trans-Global had agreed that the responsibility for providing the

railroad services over CMTA’s rail line should be transferred from an

operating division of Trans-Global to a new wholly-owned subsidiary of

Trans-Global named the Austin Area Terminal Railroad, Inc. (“AATR,

Inc.”). CMTA, Trans-Global, and AATR, Inc. entered into a Novation

Agreement, by which AATR, Inc. would acquire all assets and

obligations and liabilities of Trans-Global necessary to perform this

service. On December 6, 2000, AATR, Inc. filed a Notice of Exemption

with the STB to obtain authority to become the new operator on the

subject line (Finance Docket No. 33972). On December 13, 2000, AATR

Division transferred its employees to AATR, Inc. and AATR, Inc. took

over the railroad operations. The December 8 letter also advised the

Board’s Audit and Compliance Section that CMTA had recently notified

Trans-Global and AATR, Inc. that CMTA had been somewhat delayed

in issuing a Request for Proposals to operate CMTA’s rail line after

February 3, 2001 and inquired whether AATR, Inc. would be willing to

continue to provide service under its existing contract for up to an

additional 30 days. AATR, Inc. had advised that it was amenable to

CMTA’s request.

In a letter dated April 9, 2001, attorney Greenberg advised that AATR,

Inc. had just received notice that it was awarded a five-year extension

of its contract to provide rail freight services to CMTA.
Trans-Global Solutions, Inc. d/b/a Austin Area Terminal Railroad

Austin Area Terminal Railroad, Inc.

Section 1(a)(1) of the RRA defines the term “employer” to include:

(i) any carrier by railroad subject to the jurisdiction of the

Surface Transportation Board under part A of subtitle IV of

Title 49. 45 U.S.C. §231(a)(l)(i).

Sections 1(a) and (b) of the RUIA(45 U.S.C. §351(a) and (b)) contain

essentially the same definition, as does section 3231 of the Railroad

Retirement Tax Act (26 U.S.C. §3231).

Section 202.2 of the Board’s regulations provides that:

Any company or person principally engaged in carrier

business is an employer. 20 CFR 202.2

Section 202.3 of the Board’s regulations provides in pertinent part that:

(a) With respect to any company or person principally engaged

in business other than carrier business, but which, in

addition to such principal business, engages in some carrier

business, the Board will require submission of information

pertaining to the history and all operations of such company

or person with a view to determining whether some

identifiable and separable enterprise conducted by the

person or company is to be considered to be the employer. * *

* * *

(b) In the event that the employer is found to be an aggregate of

persons or legal entities or less than the whole of a legal

entity or a person operating in only one of several capacities,

then the unit or units competent to assume legal obligations

shall be responsible for the discharge of the duties of the

employer. 20 CFR 202.3.

The information summarized above indicates that from April 1, 2000

until December 13, 2000, a division of Trans-Global Solutions, Inc.
Trans-Global Solutions, Inc. d/b/a Austin Area Terminal Railroad

Austin Area Terminal Railroad, Inc.

conducted railroad operations over the 162 miles of track described

earlier in this decision. The main business of Trans-Global Solutions,

Inc., is not and was not, however, the operation of the railroad.

Pursuant to section 202.3 of the Board’s regulations, the Board finds

that only the division of Trans-Global which conducted railroad

operations over CMTA’s rail line, i.e., Trans-Global Solutions, Inc. d/b/a 

Austin Area Terminal Railroad, was a rail carrier employer within the

definition of section l(a)(l)(i) of the RRA and the corresponding section

of the RUIA from April 1, 2000 until December 13, 2000.

Effective December 13, 2000, a subsidiary of Trans-Global Solutions,

Inc. began to conduct railroad operations over the 162 miles of track.

The Board finds that Austin Area Terminal Railroad, Inc. became a rail

carrier employer under the RRA and the RUIA effective December 13,

2000.

Jerome F. Kever