EMPLOYER STATUS DETERMINATION

Tracks Traffic and Management Services, Inc.

APR 0 4 2001

This is the determination ofthe Railroad Retirement Board concerning the status of

Tracks Traffic and Management Services, Inc. (Tracks), as an employer under the

Railroad Retirement Act (45 U.S.C. § 231 et seg.) and the Railroad Unemployment 

Insurance Act (45 U.S.C. § 351 et seq.).

Information regarding Tracks was provided by Mr. Robert N. Gentile, Vice

President -Law, General Counsel and Secretary. Tracks was incorporated in 1988

and is owned by Transtar, Inc. Transtar also owns Birmingham Southern Railroad

Company (B.A. No. 4507), Elgin, Joliet & Eastern Railway Company (B.A. No.

1309), The Lake Terminal Railroad Company (B.A. No. 4221), McKeesport

Connecting Railroad (B.A. No.4334), and Union Railroad Company (B.A.

No.4351). Prior to October 2000, Transtar owned Bessemer and Lake Erie 

Railroad Company (B.A. No. 1303), Duluth, Missabe and Iron Range Railway

Company (B.A. No. 1617), and Pittsburgh & Conneaut Dock Company (B.A. No.

4249), as well. Also prior to October 2000, Transtar was jointly owned by USX 

Corporation and Transtar Holdings, Inc. In October 2000, USX Corporation

acquired Transtar Holdings’ interest in Transtar, and Transtar Holdings, Inc.,

acquired Bessemer and Lake Erie Railroad Company, Duluth, Missabe and Iron

Range Railway Company, and Pittsburgh & Conneaut Dock Company.

Mr. Gentile states that Tracks “provides consolidated support functions, including

payroll, claims, operating systems, engineering, benefits and information systems'"

to all eight ofthe above-named railroads. Mr. Gentile states that more than 90

percent of Tracks’ “total business time” is spent doing business with the eight rail

carriers mentioned above.

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 ofthe

Surface Transportation Board under Part A of subtitle IV oftitle 49,

United States Code;

(ii) any company w'hich is directly or indirectly owned or

controlled by, or under common control with, one or more employers

as defined in paragraph (i) ofthis subdivision, and which operates any

BA# 9247
Tracks Traffic and Management Services, Inc.

equipment or facility or performs any service (except trucking service,

casual service, and the casual operation of equipment or facilities) in

connection with the transportation of passengers or property by

railroad * * *.

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

351(a) and (b)) contain substantially similar definitions, as does section 3231 ofthe 

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

There is no evidence that Tracks is an employer within the meaning of section

l(a)(l)(i) ofthe Railroad Retirement Act. Accordingly, we turn to section

l(a)(l)(ii) in order to determine whether it is an employer within the meaning of

that section. Under section 1(a)(1)(h), a company is a covered employer ifit

provides "service in connection with" rail transportation and ifit is owned by or

under common control with a rail carrier employer.

Section 202.7 ofthe Board's regulations provides that service is in connection with

railroad transportation:

* * * ifsuch service or operation is reasonably directly related,

functionally or economically, to the performance of obligations which

a company or person or companies or persons have undertaken as a

common carrier by railroad, or to the receipt, delivery, elevation,

transfer in transit, refrigeration or icmg, storage, or handling of

property transported by railroad. (20 CFR 202.7).

Tracks does not dispute that the services it provides to the railroads mentioned

above are provided in connection with rail transportation. Prior to the October

2000 transaction, Tracks was owned by Transtar, which also owned the eight

railroads mentioned above. Accordingly, Tracks was owned by the same company

which owned the eight railroads and was therefore under common control with

those eight railroads at that time. As a result ofthe October 2000 transaction,

Transtar was divested of three ofthose railroads. However, it continued to own

Tracks and five ofthose railroads. Accordmgly, Tracks contmued to be under

common control with those five railroads after the transaction. Therefore, it is

determined that Tracks is an employer under the Railroad Retirement and Railroad

Unemployment Insurance Acts as ofJanuary 1, 1988. Service and compensation
Tracks Traffic and Management Services, Inc.

of Tracks employees may be credited to the extent permitted by section 9 ofthe

Railroad Retirement Act and section 211.16 ofthe Board’s regulations.

Cherryl'd'. Thomas