B.C.D. 00-43

EMPLOYER STATUS DETERMINATION ^CT 3 1 2000

North Carolina Ports Railway Commission

This is the determination of the Railroad Retirement Board

concerning the status of North Carolina Ports Railway Commission

(Railway Commission)as an employer under the Railroad Retirement

Act (45 U.S.C. § 231 at seq. ) and the Railroad Unemployment

Insurance Act (45 U.S.C. §351 ssq.) .

The evidence is that the Railway Commission was organized in

1979 as an agency of the State of North Carolina to operate,

maintain and control all railway equipment and railway 

operations transferred to it by the State Ports Authority. See 

General Statutes of North Carolina Chapter 143B, Part 11 (N.C.

Gen. Stat. § 143B-469 - 143B-469.3). The Railway Commission was 

previously determined to be a rail carrier employer under the

Acts during the period July 1, 1980 through November 2, 1988.

See Legal Opinion L-81-4. Covered employer status was

determined to have ended in 1988 as a result of a series of

leases whereby the Railway Commission assigned all rail

operations to private rail carriers and became merely a means

through which North Carolina held title to the rail lines. See

Legal Opinion L-89-129.

By letter dated March 7, 2000, Mr. William C. Taylor, General

Manager of the North Carolina Ports Railway Commission (Railway 

Commission) reported to Chief of the Board's Audit and 

Compliance Section that the Surface Transportation Board

approved the acquisition by the Railway Commission of the lease 

and operation of approximately 3 miles of rail line between

Morehead City and Beaufort, North Carolina from the Beaufort and 

Morehead Railway (B&M Railway)* 1. The Railway Commission intended

1 The Beaufort and Morehead Railway (B&M Railway) was held to be

an employer under the Acts effective February 4, 1991, when it

assumed operation of the rail line. Under that arrangement, 

ownership of the rail line remained with the Beaufort and 

Morehead Railroad (B&M Railroad). See B.C.D. 95-46. The B&M 

Railroad itself was owned by the Railway Commission. On April

1, 1997, the Railway Commission transferred ownership of the B&M 

Railroad and its assets to the North Carolina Department of

Transportation (NC Dot). One year later, on April 1, 1998, B&M 

Railroad merged with North Carolina Railroad (BA No. 8055) as

part of a transaction whereby NC DoT gained 100 percent control 

of the North Carolina Railroad. The evidence is thus that the

Beaufort-Morehead City rail line is currently owned by the North

Carolina Railroad.

BA# 4560
-2-

to do business over the line as Beaufort and Morehead Railway.

See: North Carolina Ports Railway Commission d/b/a Beaufort &

Morehead Railway-Acquisition and Operation Exemotion-Beaufort &

Morehead Railway. Inc.. STB Finance Docket No. 33826, 64 Fed.

Reg. 67619, December 2, 1999. Mr. Taylor further stated that the

Railway Commission began operations over the line January 1,

2000 .

Section 1(a)(1) of the Railroad Retirement Act (RRA) (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 

(RUIA) (45 U.S.C. §§ 351(a) and (b) ) contain substantially

similar definitions, as does section 3231 of the Railroad

Retirement Tax Act (RRTA), (26 U.S.C. § 3231).

The evidence of record establishes that by assuming the rail

carrier operations formerly conducted by B&M Railway, the

Railway Commission has again become a carrier operating in

interstate commerce. Accordingly, it is determined that North

Carolina Ports Railway Commission is an employer within the

meaning of section 1(a)(1)(i) of the Railroad Retirement Act (45

U.S.C. § 231(a)(1)(i)) and the corresponding provision of the

Railroad Unemployment Insurance Act as of January 1, 2000, the

date as of which it commenced operation of the Beaufort-Morehead

City rail line. zTTyy 4?

Cherryl/ T. Thomas