DEC 0 3 2004

EMPLOYER STATUS DETERMINATION

East Brookfield & Spencer Railroad, LLC (EBSR)

This is a determination ofthe Railroad Retirement Board concerning the

status ofthe East Brookfield & Spencer Railroad, LLC (EBSR) as an

employer under the Railroad Retirement Act (45 U.S.C. §231 et seep) and

the Railroad Unemployment Insurance Act (45 U.S.C. §351 et seep).

In Surface Transportation Board (STB) Finance Docket No. 34505, decided 

June 1,2004, EBSR filed a verified notice of exemption to lease from CSX

Transportation, Inc. (CSXT) (BA No. 1524) and operate approximately 4

miles ofrail line. The line is a portion ofCSXT’s passing track located

between mileposts 60 and 64 in East Brookfield and Spencer, Worcester

County, Massachusetts, together with approximately 270 feet oflead track 

running from the passing track at milepost 63.08 to the property line ofthe

proposed New England Automotive Gateway Facility in East Brookfield,

Massachusetts.

Information regarding EBSR was furnished by Mr. Robert Amrine, Vice 

President of EBSR. In a letter dated August 13, 2004, Mr. Amrine stated 

that the Chief Executive Officer is Mr. George W. Bell, II. Mr. Amrine 

additionally stated that EBSR is owned by Mr. Bell and Mr. Steven

Pugliese. ESBR, is a Delaware limited liability company, which began rail

operations on October 1, 2004, according to Mr. Amrine. According to

information provided by Mr. Amrine, EBSR anticipated hiring 8 employees, 

with the first employee hired on or about August 26, 2004. Mr. Amrine 

stated that EBSR will provide switching services and perform mechanical 

repairs for an annual expected volume of 23,100 multi-level railcars. 

According to Mr. Amrine, EBSR interchanges with CSXT and 100 percent

of EBSR’s total business is with CSXT. Additionally, a Track Lease

Agreement between CSXT and EBSR shows that, by Interchange

Agreement, CSXT and EBSR have provided for the orderly interchange 

between them ofrailcars.

Section 1(a)(1) of the Railroad Retirement Act (45 U.S.C. §231(a)(1)),

insofar as relevant here, defines a covered employer as:

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

Surface Transportation Board under part A ofsubtitle IV of

Title 49, United States Code.

Section 1 ofthe RUIA contains essentially the same definition. (45 U.S.C.

§ 351, as does section 3231 ofthe Railroad Retirement Tax Act (26 U.S.C. §

3231).

The evidence ofrecord establishes that EBSR is a rail carrier operating in

interstate commerce. Accordingly, it is determined that the East Brookfield 

& Spencer Railroad, EEC (EBSR) became an employer within the meaning 

ofsection l(a)(l)(i) ofthe Railroad Retirement Act (45 U.S.C. §231 (a)( 1 )(i))

and the corresponding provision ofthe Railroad Unemployment Insurance 

Act effective August 26, 2004, the date as of which it hired its first 

employees. Cf. Rev. Ruling 82-100, 1982-1C.B. 155, wherein the Internal

Revenue Service ruled that a company becomes an employer under the

Railroad Retirement Tax Act on the date it hires employees to perform

functions directly related to its commencement ofrailroad carrier operations.

Michael S. Schwartz