EMPLOYER STATUS DETERMINATION

Port of Palm Beach District

Decision on Reconsideration

This is the determination on reconsideration of the Railroad Retirement Board

concerning the status of the Port of Palm Beach District (BA No.4567).

Procedural and Historical Background

In Legal Opinion L-89-1 56, dated December 8, 1 989, the Port of Palm Beach

District (the "District") was held to be a covered employer under the Railroad

Retirement Act (45 U.S.C. §231 etsegj (RRA) and the Railroad Unemployment

Insurance Act (45 U.S.C. §351 et sea.) (RUIA) with respect to its rail

operations, effective March 1, 1989. Legal Opinion L-89-156 stated that the

District is a special taxing district established in 1915 under the Laws of

Florida. On March 19, 1946, a Certificate of Public Convenience and Necessity

was issued by the Interstate Commerce Commission (ICC), authorizing the

District to operate terminal railroad facilities which it had apparently already

been operating for several years. Since the District had operated a railroad for

more than forty years before the Railroad Retirement Board (RRB) inquired into

the question of whether it was covered by the RRA and the RUIA, L-89-1 56

determined to start coverage under the Acts effective March 1, 1989, the first

day of the month after the month in which the issue of employer status was

first raised.

In a petition dated June 7, 1990, the District submitted a request that the RRB

either defer until a prospective date, or stay the effect of, the ruling in L-89-1 56

until the ICC ruled on the District's Petition for Exemption from ICC regulation.

On November 7, 1991, in Finance Docket No. 31694, the ICC issued a decision

exempting the District from the obligations of 49 U.S.C. Subtitle IV (the former

Interstate Commerce Act, amended by P.L. 104-88). The ICC decision became

effective December 18, 1991.

Discussion

Legal Opinion L-89-1 56 found that the District was an employer under section

1 of the RRA and section 1 of the RUIA. At the time that Legal Opinion L-89-

1 56 was issued, Section 1 (a)(1)(i) of the RRA defined an "employer" under the

Act to include:

BCD 1996-59 BA # 4567
Port of Palm Beach District

Decision on Reconsideration

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any express company, sleeping car company, and carrier by

railroad, subject to subchapter I of chapter 105 of Title 49 [(45

U.S.C. §231 (a)(1 )(i)].

Section 1 of the RUIA contained the same definition. Subchapter 1 of chapter

105 of Title 49 was that portion of the Interstate Commerce Act governing ICC

jurisdiction over railroad transportation. The ICC Termination Act of 1 995 (P.L. 

104-88) abolished the ICC and transferred many of its functions to a new

entity, the Surface Transportation Board, within the Department of

Transportation. P.L. 104-88 did not affect the coverage provisions of the RRA

or the RUIA, but it did make a conforming amendment to the definition of

"employer" in those Acts. Section 1 (a)(1)(i) of the RRA now provides that

"employer" includes:

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.

Essentially the same amendment was made in section 1 of the RUIA.

In its decision in Finance Docket No. 31694, the ICC noted that the District is

engaged in rail switching only as an ancillary activity to its main governmental

purpose, which is the administration of the maritime facilities of the Port of

Palm Beach. The ICC concluded that, "Since the Port does not hold itself out

to the public as a railroad, no need exists for it to be subject to regulation as a

common carrier."

The Board has followed the distinction made by the Interstate Commerce

Commission between common and private carriers, which is also judicially

supported in The Tap Line Cases. 234 U.S. 1, 58 L.Ed. 1185 (1913). See, 

also, International Detective Service. Inc, v. Interstate Commerce Commission.

595 F.2d 862, 865 (D.C. Cir. 1979). The definition of "employer" in both the

RRA and the RUIA encompasses a common carrier by railroad; Le^, one which

holds itself out to the public as engaging in the business of transporting people

or property from place to place for compensation. In contrast, a private carrier

is one which, without making it a vocation or holding itself out to the public as
Port of Palm Beach District

Decision on Reconsideration

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ready to act for all who desire the service, undertakes by special agreement in

a particular instance only, to transport property or persons from place to place.

A private carrier thus undertakes not to carry for all persons indiscriminately,

but rather to transport only for those with whom the private carrier sees fit to

contract individually. [See GWI Switching Services, L.P., B.C.D. No. 96-19,

decision on reconsideration, January 26, 1996, and B.C.D. No. 94-11 3, initial

decision, December 6, 1994.]

Since the ICC found that the Port of Palm Beach District does not hold itself out

to the public as a common carrier by railroad, the Board finds that the District

is not now and never has been a rail carrier employer under the RRA and the

RUIA. The decision in Legal Opinion L-89-156 is reversed.

Glen L. Bower

V. M.-Speakman, Jr. /

erome F. Kever