B.C.D. 01-7

EMPLOYER STATUS DETERMINATION

Bellingham International Railroad, LLC

JAN 1 0 2001

This is the determination of the Railroad Retirement Board regarding the

status of Bellingham International Railroad, LLC (BIR) as an employer under

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

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

Information regarding BIR was provided by Ms. Cynthia Thomas, attorney for

BIR. Ms. Thomas stated that BIR was formed on April 24, 1998. It is a

privately held limited liability company owned by the Bellingham Cold Storage

Co. BIR reportedly has no employees and owns the track and signaling

equipment between milepost 2.98 and 4.98 in Bellingham, Washington. In a

decision in Surface Transportation Board (STB) Finance Docket No. 33635 

entered on July 27, 1998. the STB indicated that BIR had filed an exemption

under 49 CFR 1150.31 to acquire from the Burlington Northern and Santa Fe

Railway Company (B.A. No. 1621) (BNSF) the exclusive rail freight easement

and all track, track materials, and related structures and to operate 2.0 miles of

rail line between the above cited mileposts. Information obtained indicates

that on December 11, 1998. BIR began operating, via an Agency Agreement

with BNSF. under which BNSF operates the rail line for BIR. BIR received

reporting marks from the Association of American Railroads (AAR) and is 

considered to be a class III rail carrier by both the AAR and the STB. [See

letter to Attorney Thomas from J. J. Carroll, of the AAR dated January 15, 1999,

and footnote 1 to STB Finance Docket No. 33635 (63 F R. 41619, Aug. 4, 1998)].

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:

(i) 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;

Sections 1(a) and 1(b) of the Railroad Unemployment Insurance Act (45 U.S.C.

§§ 351(a) and (b)) contain substantially the same definition, as does section 3231

of the Railroad Retirement Tax Act (26 U.S.C. § 3231).

In its decision regarding the employer status of Railroad Ventures, Inc. (B.C.D.

00-47), 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 in B.C.D. No. 00-47 to be applied in making this determination. An entity

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Bellingham International Railroad, LLC

that leases a line to another company or contracts with another company to

operate the line, is a carrier under the Railroad Retirement Act 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 Surface Transportation Board (STB) decision cited above notes that BIR

certified to the STB that its projected revenues would not exceed those that

would qualify it as a Class III rail carrier and that its revenues were not

projected to exceed $5 million. There is no information that would indicate

that Bellingham International Railroad. LLC's intent in purchasing the line is 

primarily designed to preserve rail service rather than profit from railroading

activities. The Board therefore finds that BIR is an enterprise which is

intended to profit from railroad activities. The Board therefore finds that BIR

became a rail carrier employer under the RRA and RUIA effective

December 11, 1998, the date rail operations began on its rail line.

Cherryl T: Thomas

V. M. CDpeakman. Jr.