EMPLOYER SERVICE DETERMINATION 

BCD 2024-28

Ohio Rail Development Commission (ORDC) 

August 26, 2024

This is a decision of the Railroad Retirement Board concerning the status of Ohio Rail 

Development Commission (ORDC) as an employer under the Railroad Retirement Act (RRA) 

and the Railroad Unemployment Insurance Act (RUIA) (collectively, “the Acts”). RRA, 45 

U.S.C. § 231 et seq.; RUIA, 45 U.S.C. § 351 et seq. 

On February 2, 2022, Crystal M. Zorbaugh, attorney for ORDC, provided information pertaining 

to ORDC. Ms. Zorbaugh stated that ORDC is an independent commission within the Ohio 

Department of Transportation, which represents the state in non-regulatory interactions with the 

railroad industry. She stated that Matthew Dietrich is the Executive Director for ORDC. She 

stated that ORDC replaced the City of Jackson, Ohio, as the owner and holder of a residual 

common carrier obligation for the rail line at issue in this decision. Ms. Zorbaugh also stated that 

ORDC’s ownership became effective February 1, 2022, upon all relevant deeds being properly 

recorded. At the request of the agency’s Office of General Counsel, Ms. Zorbaugh, in a response 

dated February 9, 2024, provided a copy of the Assignment of Lease Agreement (Lease 

Agreement) between the City of Jackson and ORDC, as well as copy of the original Lease and 

Operating Agreement between the City of Jackson and Indiana Eastern Railroad dba Ohio South 

Central Railroad (IERR) (B.A. No. 3391). The Lease Agreement states that the City of Jackson 

agreed to convey its railroad and Lease and Operating Agreement with IERR to ORDC.

Ms. Zorbaugh reported that ORDC acquired from the City of Jackson and began operations on

approximately 60.36 miles of rail line between milepost 0.00/127.0 at Hamden, Ohio, and 

milepost 32.76 at Firebrick, Ohio; between milepost 112.3 at West Junction, Ohio, and milepost 

127.0 at Hamden; between milepost 127.71 at Hamden and milepost 136.71 at Red Diamond, 

Ohio; between milepost 91.6 at RA Junction, Ohio; and milepost 95.5 at West Junction, which is 

also known as milepost 112.3 (“the Lines”). She further stated that ORDC also obtained 

authority to acquire the following spur lines off the Hamden-Firebrick portion of the main line: 

the Buckeye Branch (an approximately 0.8 mile spur at milepost 2.6), the Meadow Run Branch 

(an approximately 1.3 mile spur at milepost 4.4), the Huron Branch (East) (an approximately 1.0 

mile spur at milepost 13.1), the Huron Branch (West) (an approximately 4.8 mile spur at 

milepost 13.4), and the Pyro Spur (a 1.1 mile spur at milepost 23.6), as well as incidental 

trackage rights over 5.9 miles of the former B&O/C&O rail lines (currently owned by CSX 

Transportation, Inc.) for interchange purposes, from milepost 91.6 at RA Junction to milepost 

85.7 at VA Junction, near Vauces, Ohio. Although ORDC has no intention of operating over the

Lines, ORDC will maintain a residual common carrier obligation should the current operator 

cease operations. Since 2013, and continuing to the present day, the operator of the rail lines has 

been IERR. ORDC will not conduct any of the operations, does not have employees performing 

common carrier responsibilities, and its annual expected volume of freight traffic is none.
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In STB Finance Docket No. FD 36537, ORDC filed a verified notice of exemption to assume 

operation of the Lines. Ohio Rail Development Commission – Acquisition and Operation 

Exemption – City of Jackson, Ohio, 2021 STB Fin. Dkt. 36537. Pursuant to the STB’s decision, 

ORDC filed a verified notice of exemption to acquire from the City of Jackson and operate

approximately 60.36 miles of rail line and acquire incidental trackage rights over 5.9 miles of rail 

lines currently owned by CSX Transportation (B.A. No. 1524). The decision also noted that 

ORDC reached an agreement with the City of Jackson to acquire and operate the rail lines and

that IERR will continue to provide operations on the rail lines. 

Under section 1(a)(1)(i) of the RRA, insofar as relevant here, a covered employer is defined as 

“any carrier by railroad subject to the jurisdiction of the Surface Transportation Board under Part 

A of subtitle IV of title 49, United States Code.” RRA § 1(a)(1)(i), 45 U.S.C. § 231(a)(l)(i). 

Section 1 of the RUIA and section 3231(a) of the Railroad Retirement Tax Act (RRTA) contain 

substantially similar definitions. RUIA § 1, 45 U.S.C. § 351; RRTA, 26 U.S.C. § 3231. 

In the Board’s decision on reconsideration in Railroad Ventures, Inc., B.C.D. 00-47 (Nov. 7, 

2000), the Board held that an entity that has STB authority to operate a rail line, but leases or 

contracts with another to operate the line in question, is covered under the Acts administered by 

the Board unless the Board determines that the entity is not a carrier. The Board enunciated a 

three-part test to be applied in making this determination. An entity that leases a line to another 

company or contracts with another company to operate the line is a carrier under the RRA unless 

the Board finds that all three of the following factors exist: (1) the entity does not have as a 

primary business purpose to profit from railroad activities; (2) the entity does not operate or 

retain the capacity to operate the rail line; and (3) the operator of the rail line is already covered 

or would be found to be covered under the Acts administered by the Board. 

The information provided establishes that ORDC is not a covered employer under the Acts based 

on the three-part test enunciated in Railroad Ventures, Inc. As the evidence of record shows, 

ORDC is an independent commission within the Ohio Department of Transportation. The history 

of the commission as established in the submitted materials does not indicate that its primary 

mission is to profit from railroad activities; rather, the record reflects that it acquired the tracks 

and incidental trackage rights to maintain a corridor for operations. In addition, ORDC does not 

have the ability to commence rail operations as it does not have any equipment, railroad 

infrastructure, or employees; rather, it contracts with IERR to perform railroad service. While 

ORDC has a residual common carrier obligation, it represents that it has no intention of 

operating the rail lines itself, but instead will have an obligation to arrange for replacement 

operations over the lines should the current operator cease operations. Moreover, the STB has 

recognized IERR as the contract operator of the line, and IERR is a covered entity under the 

RRA. In a similar circumstance, the Board declined to cover an entity with a residual common 

carrier obligation when that entity (i) did not have as its primary business purpose to profit from 

its railroad activities, but instead arranged for reactivation of rail service over the lines; (ii) did not 

operate the line but instead contracted with another entity to operate the line; and (iii) contracted with 

an operator that already was covered by the Acts. See Geaux Geaux Railroad, LLC, (GGRL), B.C.D. 

14-22 (November 5, 2014). The facts here compel the same result.
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The Board concludes that ORDC is not a rail carrier within the meaning of the Railroad 

Retirement Act and the Railroad Unemployment Insurance Act. Should ORDC terminate its 

contract and commence rail operations on any part of the rail lines, ORDC must notify the Board 

and the Board will reassess ORDC’s status under the Acts.