[Federal Register Volume 62, Number 42 (Tuesday, March 4, 1997)]
[Rules and Regulations]
[Pages 9714-9717]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-5149]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

49 CFR Parts 1002 and 1180

[STB Ex Parte No. 556]


Railroad Consolidation Procedures--Modification of Fee Policy

AGENCY: Surface Transportation Board (Board), DOT.

ACTION: Interim rules with a request for comments.

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SUMMARY: In this proceeding the Board adopts interim rules relating to 
the fee policy for proceedings involving major railroad consolidations 
under the Board's regulations at 49 CFR part 1180 and corresponding 
modifications in the Board's fee regulations at part 1002. The Board 
also adopts technical amendments to conform part 1180 to the ICC 
Termination Act of 1995.

DATES: Interim rules are effective on March 4, 1997; comments must be 
filed by April 3, 1997.

ADDRESSES: Send comments (an original and 10 copies) referring to STB 
Ex Parte No. 556 to: Surface Transportation Board, Office of the 
Secretary, Case Control Unit, 1201 Constitution Avenue, NW., 
Washington, DC 20423-0001.<SUP>1

    \1\ The Board is scheduled to relocate its offices over the 
weekend of March 15-16, 1997. Its new address will be: Surface 
Transportation Board, 1925 K Street NW., Washington, DC 20423-0001. 
We note that mail will not be received from March 13-18, 1997 (mail 
delivery will resume thereafter at the new location).

FOR FURTHER INFORMATION CONTACT: Kathleen M. King, (202) 927-5249 or 
David T. Groves, (202) 927-6395 [after March 16, 1997, (202) 565-1551]. 
[TDD for the hearing impaired: (202) 927-5721. (after March 16, 1997, 
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(202) 565-1695).]

SUPPLEMENTARY INFORMATION: The Independent Office Appropriation Act of 
1952, 31 U.S.C. 9701 (IOAA), is the basis for user fees charged by 
federal government agencies, including this one. Under the IOAA, 
agencies are required to ensure that ``. . . each service or thing of 
value provided by an agency . . . to a person . . . is to be self-
sustaining to the extent possible.'' 31 U.S.C. 9701(a). Administrative 
guidance for implementation of the IOAA is provided in the Office of 
Management and Budget Circular A-25 User Fees, as revised July 8, 1993 
(Circular A-25). Circular A-25 states that the general policy of the 
federal government is as follows: ``A reasonable charge should be made 
to each identifiable recipient for a measurable unit or amount of 
Government service or property from which he derives a special 
benefit.''
    According to our current user fee policy, the filer of a primary 
application under our merger and consolidation regulations at 49 CFR 
part 1180 is not required to pay additional filing fees for directly 
related proceedings that are filed along with the primary application. 
Recently, in Union Pacific Corporation, et al.--Control and Merger--
Southern Pacific Rail Corporation, et al., Finance Docket No. 32760 
(UP-SP Merger), there were 30 directly related proceedings filed 
concurrently with the application. Of the 30 transactions, 21 were 
railroad abandonment or discontinuance of service applications, 
petitions for exemption, and notices of exemption.<SUP>2 The directly 
related proceedings in UP-SP Merger engendered substantial additional 
staff work, such as the environmental review process that was required 
for each abandonment or discontinuance proceeding. Under our current 
fee policy, no additional filing fees were assessed for those 
proceedings at the time of the their filing.<SUP>3
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    \2\ In Regulations Governing Fees For Services, 1 I.C.C.2d 60 
(1984), two proceedings, Union Pacific-Control-Missouri Pacific; 
Western Pacific, 366 I.C.C. 459 (1982) (Union Pacific), and Norfolk 
Southern Corp.-Control-Norfolk & W. Ry. Co., 366 I.C.C. 171 (1982) 
(Norfolk Southern), formed the basis for computing the original fees 
for railroad consolidation proceedings. Those cases did not include 
nearly as many directly related proceedings as UP-SP Merger. In the 
Norfolk Southern proceeding, there were only eight directly related 
transactions filed concurrently with the primary application. They 
involved four construction and operation transactions, two railroad 
abandonments, one issuance of common stock, and one acquisition of a 
motor carrier. The Union Pacific proceeding included thirteen 
directly related transactions that entailed five trackage rights 
requests, three poolings of operations, three issuances of common 
stock, and two motor carrier acquisitions.
    \3\ Subsequently, however, the Secretary of the Board requested 
payment from the applicants of filing fees for the 21 abandonment or 
discontinuance of service proposals in UP-SP Merger, and the 
applicants paid those fees.
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    The current railroad consolidation fees understate the costs 
associated with processing directly related proceedings filed by the 
primary applicant(s). Therefore, to ensure that the costs associated 
with these directly related proceedings are borne by the primary 
applicant (the direct beneficiary of the Board's action), we are 
modifying our fee policy to require a separate fee for each and every 
directly related application, petition and/or notice that is filed with 
the primary application. The fee for a directly related proceeding will 
be the same as it would be if the directly related application, 
petition and/or notice were filed separately. For example, if the 
directly related proceeding involves a petition for exemption for 
abandonment or discontinuance of a rail line, the $3,800 fee currently 
set forth at fee item (21)(iii), would be assessed for that proceeding. 
Appropriate modifications are being made at 49 CFR 1002.2(d) and 
1180.4(c) to reflect this fee policy change.
    In addition, under the Board's existing fee policy regulations, the 
same fee of $4,700 is applied to any type of responsive application, 
including an inconsistent application. This policy, however, does not 
allow us to recover the full cost of handling an inconsistent 
application. The additional staff work required to review and analyze 
an

[[Page 9715]]

inconsistent application is in most cases comparable to the work 
expended to process the primary application. Consequently, we are 
adding the regulations at 49 CFR 1180.4(d)(4)(ii) to state that, for 
fee purposes, a responsive application that is considered an 
inconsistent application will be classified as a major, significant, or 
minor transaction under 49 CFR 1180.2(a)-(c), and the fee for an 
inconsistent application will be based on the classification of the 
transaction at 49 CFR 1002.2(f)(38)-(41). As an example, under this new 
policy, an inconsistent application classified as a major transaction 
for a noncarrier to acquire two or more carriers would require a fee of 
$889,500, as currently set forth in fee item (39)(i).
    Our existing fee schedule applies a $4,700 fee to all other types 
of responsive applications that are filed in railroad consolidation 
proceedings. The Board's costs for handling the various types of 
transactions, ranging from trackage rights requests to construction 
applications, are not accurately reflected by a single-set fee. 
Therefore, we are modifying our fee policy as set forth at 49 CFR 
1180.4(d)(4)(ii) to provide that the fee for all other responsive 
applications will be whatever fee is set forth in our fee schedule for 
that particular type of filing submitted as a responsive application. 
For example, if the responsive application is a petition for exemption 
involving trackage rights, the $5,600 fee currently set forth in fee 
item (40)(vi) would be assessed for that proceeding. We are retaining 
the general $4,700 fee for responsive applications in fee items (38)-
(41)(v) to cover any type of responsive application that does not 
currently have a corresponding fee elsewhere in the fee schedule.
    In addition to the fee application policy changes outlined above, 
we also are making some technical changes to part 1180. We are removing 
the provision at 49 CFR 1180.4(d)(4)(ii) that responsive applications 
that are not major transactions are presumed to be significant 
transactions because, under current Board practice, responsive 
applications may also be found to be minor transactions. We also are 
revising the statutory references contained in part 1180 to reflect the 
statutory changes resulting from the passage of the ICC Termination Act 
of 1995, Pub. L. 104-88 (Dec. 29, 1995) (ICCTA). And, throughout part 
1180, we are changing references to the Interstate Commerce Commission 
and Commission to the Surface Transportation Board and Board, 
respectively. Finally, we are removing references in part 1180 to 
transactions involving the issuance of stock or the acquisition of 
control of motor carriers, which are matters no longer under the 
Board's jurisdiction.
    Because these fee policy changes involve agency procedure, they are 
exempt from the notice and comment requirements of the Administrative 
Procedure Act. See 5 U.S.C. 553(b)(A). With respect to the fee policy 
changes, we also find that notice and comment are impracticable. See 5 
U.S.C. 553(b)(B). The Board expects to receive at least one major rail 
consolidation application in the immediate future. The application 
likely will include directly related applications, and generate 
responsive applications. Under the IOAA, the Board is obligated to 
ensure that services be self-sustaining to the extent possible. Thus, 
our fees need to be in place as soon as possible so that appropriate 
fees are received for services that will be rendered when the 
application is filed. Other changes are merely technical amendments to 
reflect the new fee policy or to conform our rules to the ICCTA. 
Therefore, we are adopting these changes as interim rules. However, we 
are providing an opportunity for public comment on these changes. After 
review of those comments, we will consider whether adjustments need to 
be made to this new policy.
    We conclude that the fee and other changes adopted here will not 
have a significant economic impact on a substantial number of small 
entities. Our regulations provide for waiver of filing fees for those 
entities that can make the required showing of financial hardship.
    This action will not significantly affect either the quality of 
human environment or the conservation of energy resources.
    Notice of the interim rules adopted here will be transmitted to 
Congress pursuant to Pub. L. 104-121 (Mar. 29, 1996).

List of Subjects

49 CFR Part 1002

    Administrative practice and procedure, Common carriers, Freedom of 
information, User fees.

49 CFR Part 1180

    Administrative practice and procedure, Bankruptcy, Railroads, 
Reporting and recordkeeping requirements.

    Decided: February 24, 1997.

    By the Board, Chairman Morgan and Commissioner Owen.
Vernon A. Williams,
Secretary.

    For the reasons set forth in the preamble, title 49, chapter X, 
parts 1002 and 1180, of the Code of Federal Regulations are amended as 
follows:

PART 1002--FEES

    1. The authority citation for part 1002 continues to read as 
follows:

    Authority: 5 U.S.C. 552(a)(4)(A) and 553; 31 U.S.C. 9701 and 49 
U.S.C. 721(a).

    2. Section 1002.2 is amended by revising paragraphs (d)(1) and 
(f)(38) through (f)(41) to read as follows:


Sec. 1002.2  Filing fees.

* * * * *
    (d) Related or consolidated proceedings. (1)(i) Except as provided 
for in paragraph (d)(1)(ii) of this section, separate fees need not be 
paid for related applications filed by the same applicant that would be 
the subject of one proceeding.
    (ii) In proceedings filed under the rail consolidation procedures 
at 49 CFR part 1180, the applicable filing fee must be paid for each 
proceeding submitted concurrently with the primary application. The fee 
for each type of proceeding is set forth in the fee schedule contained 
in paragraph (f) of this section.
* * * * *
    (f) Schedule of filing fees.

------------------------------------------------------------------------
                                                                 Fee    
------------------------------------------------------------------------
                     TYPE OF PROCEEDING                                 
                                                                        
                                                                        
*                  *                  *                  *              
                                     *                                  
                                                                        
Part IV * * *                                                           
                                                                        
(38) An application or inconsistent application for two or              
 more carriers to consolidate or merge their properties or              
 franchises (or a part thereof) into one corporation for                
 ownership, management, and operation of the properties                 
 previously in separate ownership. 49 U.S.C. 11324:                     
    (i) Major transaction..................................     $889,500

[[Page 9716]]

                                                                        
    (ii) Significant transaction...........................      177,900
    (iii) Minor transaction................................        4,700
    (iv) Notice of an exempt transaction under 49 CFR                   
     1180.2(d).............................................        1,000
    (v) Responsive application for which a fee is not                   
     otherwise provided in this schedule...................        4,700
    (vi) Petition for exemption under 49 U.S.C. 10502......        5,600
(39) An application or inconsistent application of a                    
 noncarrier to acquire control of two or more carriers                  
 through ownership of stock or otherwise. 49 U.S.C. 11324:              
    (i) Major transaction..................................      889,500
    (ii) Significant transaction...........................      177,900
    (iii) Minor transaction................................        4,700
    (iv) A notice of an exempt transaction under 49 CFR                 
     1180.2(d).............................................          850
    (v) Responsive application for which a fee is not                   
     otherwise provided in this schedule...................        4,700
    (vi) Petition for exemption under 49 U.S.C. 10502......        5,600
(40) An application or inconsistent application to acquire              
 trackage rights over, joint ownership in, or joint use of              
 any railroad lines owned and operated by any other carrier             
 and terminals incidental thereto. 49 U.S.C. 11324:                     
    (i) Major transaction..................................      889,500
    (ii) Significant transaction...........................      177,900
    (iii) Minor transaction................................        4,700
    (iv) Notice of an exempt transaction under 49 CFR                   
     1180.2(d).............................................          750
    (v) Responsive application for which a fee is not                   
     otherwise provided in this schedule...................        4,700
    (vi) Petition for exemption under 49 U.S.C. 10502......        5,600
(41) An application or inconsistent application of a                    
 carrier or carriers to purchase, lease, or contract to                 
 operate the properties of another, or to acquire control               
 of another by purchase of stock or otherwise. 49 U.S.C.                
 11324:                                                                 
    (i) Major transaction..................................      889,500
    (ii) Significant transaction...........................      177,900
    (iii) Minor transaction................................        4,700
    (iv) Notice of an exempt transaction under 49 CFR                   
     1180.2(d).............................................          850
    (v) Responsive application for which a fee is not                   
     otherwise provided in this schedule...................        4,700
    (vi) Petition for exemption under 49 U.S.C. 10502......        3,900
------------------------------------------------------------------------

* * * * *

PART 1180--RAILROAD ACQUISITION, CONTROL, MERGER, CONSOLIDATION 
PROJECT, TRACKAGE RIGHTS, AND LEASE PROCEDURES

    3. The authority citation for part 1180 is revised to read as 
follows:

    Authority: 5 U.S.C. 553 and 559; 11 U.S.C. 1172; 49 U.S.C. 721, 
10502, 11323-11325.


Sec. 1180.0  [Amended]

    4. Section 1180.0 is amended by removing the words ``49 U.S.C. 
11343'' and adding in its place the words ``49 U.S.C. 11323'', removing 
the word ``Commission'' and adding in its place the word ``Board'' and 
removing the words ``Commission's Rules'' and adding in their place the 
words ``Board's Rules''.


Sec. 1180.1  [Amended]

    5. Section 1180.1 is amended as follows:
    a. In paragraph (a) remove the words ``Interstate Commerce 
Commission'' and add in their place the words ``Surface Transportation 
Board'' and remove the word ``Commission'' wherever it appears and add 
in its place the word ``Board''.
    b. In the introductory text of paragraph (b) remove the word 
``Commission's'' and add in its place the word ``Board's'', remove the 
words ``49 U.S.C. 11344'' and add in their place the words ``49 U.S.C. 
11324'' and remove the words ``49 U.S.C. 10101a'' and add in their 
place the words ``49 U.S.C. 10101''.
    c. In the introductory text of paragraph (b)(1) remove the words 
``Section 11344'' and add in their place ``Section 11324'' and remove 
the word ``Commission'' wherever it appears and add in its place the 
word ``Board''.
    d. In paragraph (b)(2) remove the word ``Commission'' and add in 
its place the word ``Board''.
    e. In paragraph (c) remove the word ``Commission'' wherever it 
appears in that paragraph and add in its place the word ``Board'' and 
remove the word ``Commission's'' wherever it appears in that paragraph 
and add in its place the word ``Board's''.
    f. In paragraphs (d) and (e) remove the word ``Commission'' 
wherever it appears in those paragraphs and add in its place the word 
``Board''.
    g. In paragraph (f) remove the word ``Commission'' wherever it 
appears in that paragraph and add in its place the word ``Board'' and 
remove the words ``(49 U.S.C. 11347)'' and add in their place the words 
``(49 U.S.C. 11326)''.
    h. In paragraphs (g) and (h) remove the word ``Commission'' 
wherever it appears in those paragraphs and add in its place the word 
``Board''.


Sec. 1180.2  [Amended]

    6. Section 1180.2 is amended as follows:
    a. In the introductory text of this section remove the words ``49 
U.S.C. 11343'' and add in their place the words ``49 U.S.C. 11323''.
    b. In the introductory text of paragraph (b) remove the words ``49 
U.S.C. 11345 (a)(2) and (c)'' and add in their place the words ``49 
U.S.C. 11325 (a)(2) and (c)''.
    c. In the introductory text of paragraph (d) remove the word 
``Commission'' and add in its place the word ``Board'', remove the 
words ``49 U.S.C. 10101a'' and add in their place the words ``49 U.S.C. 
10101'', remove the words ``49 U.S.C. 10505'' and add in their place 
the words ``49 U.S.C. 10502'', remove the words ``49 U.S.C. 10505(g)(2) 
and 11347'' and add in their place the words ``49 U.S.C. 10502(g) and 
11326''.
    d. In paragraphs (d)(1) and (d)(4) remove the word ``Commission'' 
wherever it appears in those paragraphs and add in its place the word 
``Board''.


Sec. 1180.3  [Amended]

    7. Section 1180.3 is amended as follows:
    a. In paragraphs (d) and (e) remove the word ``Commission'' where 
it appears in those paragraphs and add in its place the word ``Board''.
    b. In paragraph (f) remove the words ``49 U.S.C. 11343'' and add in 
their place the words ``49 U.S.C. 11323'' and remove the word 
``Commission'' and add in its place the word ``Board''.

[[Page 9717]]

    c. In paragraph (g) remove the words ``49 U.S.C. 10102(18)-(19)'' 
and add in their place the words ``49 U.S.C. 10102(5)-(6)''.
    d. Section 1180.3 is further amended by revising paragraph (h) to 
read as follows:


Sec. 1180.3  Definitions.

* * * * *
    (h) Responsive applications. Applications filed in response to a 
primary application are those seeking affirmative relief either as a 
condition to or in lieu of the approval of the primary application. 
Responsive applications include inconsistent applications, inclusion 
applications, and any other affirmative relief that requires an 
application, petition, notice, or any other filing to be submitted to 
the Board (such as trackage rights, purchases, constructions, 
operation, pooling, terminal operations, abandonments, and other types 
of proceedings not otherwise covered). For fees for responsive 
applications see 49 CFR 1002.2(f)(38)-(41) and 1180.4(d)(4)(ii).
* * * * *


Sec. 1180.4  [Amended]

    8. Section 1180.4 is amended as follows:
    a. In paragraphs (a)(3) and (a)(4) and (b)(1) and (b)(2) remove the 
word ``Commission'' wherever it appears in those paragraphs and add in 
its place the word ``Board''.
    b. In paragraph (c)(2)(ii) remove the words ``Interstate Commerce 
Commission'' and add in their place the words ``Surface Transportation 
Board''.
    c. In paragraphs (c)(2)(iv) and (c)(2)(v) remove the word 
``Commission'' and add the word ``Board'' in its place.
    d. In paragraph (c)(6)(iii) remove the word ``Commission's'' and 
add in its place the word ``Board's'' and in paragraphs (c)(6)(iii) and 
(c)(6)(iv) remove the word ``Commission'' wherever it appears in those 
paragraphs and add in its place the word ``Board''.
    e. In paragraph (c)(7)(i) remove the word ``Commission'' wherever 
it appears and add in its place the word ``Board'', remove the words 
``49 U.S.C. 11345(b)'' and add in its place the words ``49 U.S.C. 
11325(b)'', remove the words ``49 U.S.C. 11345(c)'' and add in their 
place the words ``49 U.S.C. 11325(c)'' and remove the words ``49 U.S.C. 
11345(d)'' and add in their place the words ``49 U.S.C. 11325(d)''.
    f. In paragraph (c)(7)(ii) remove the word ``Commission'' wherever 
it appears and add in its place the word ``Board''.
    g. In paragraphs (d)(1)(ii)(D), (d)(1)(iii)(G), (d)(1)(iii)(I)(3), 
(d)(2), (d)(3), and (d)(4)(iii) remove the word ``Commission'' wherever 
it appears in those paragraphs and add in its place the word ``Board''.
    h. In paragraphs (e)(1) and (e)(4) remove the word ``Commission'' 
wherever it appears in those paragraphs and add in its place the word 
``Board''.
    i. In paragraph (f)(1) remove the word ``Commission'' add in its 
place the word ``Board''.
    j. In paragraph (g) remove the words ``INTERSTATE COMMISSION'' and 
add in its place the words ``SURFACE TRANSPORTATION BOARD'', and remove 
the words ``49 U.S.C. 10505(d)'' wherever they appear and add in their 
place the words ``49 U.S.C. 10502(d)'', remove the word ``Commission'' 
and add in its place the word ``Board'' and remove the word 
``Commission's'' wherever its appears and add in its place the word 
``Board's''.
    k. In paragraph (h) remove the word ``Commission'' and add in its 
place the word ``Board'' and remove the word ``ICC'' wherever it 
appears and add in its place the word ``STB'.
    l. Paragraph (i) is removed.
    m. Section 1180.4 is further amended by revising paragraphs (c)(1), 
(c)(2)(vi) and (d)(4)(ii) and (g)(1)(iii) to read as follows:


Sec. 1180.4  Procedures.

* * * * *
    (c) Application. (1) The fees for filing applications, petitions, 
or notices under these procedures are set forth in 49 CFR 1002.2.
    (2) * * *
    (i) * * *
    (vi) Applicant shall file concurrently all directly related 
applications, e.g., those seeking authority to construct or abandon 
rail lines, obtain terminal operations, acquire trackage rights, etc.
* * * * *
    (d) * * *
    (4) * * *
    (ii) For filing fee purposes, a responsive application that is an 
inconsistent application will be classified as a major, significant, or 
minor transaction as provided for in Sec. 1180.2(a)-(c). The fee for an 
inconsistent application will be the fee for the type of transaction 
involved. See 49 CFR 1002.2(f)(38)-(41). The fee for any other types of 
responsive applications is the fee for the particular type of 
proceeding set forth in 49 CFR 1002.2(f).
* * * * *
    (g) * * *
    (1) * * *
    (iii) Other exemptions that may be relevant to a proposal under 
this provision are codified at 49 CFR part 1150, subpart D, which 
governs transactions under 49 U.S.C. 10901.
* * * * *


Sec. 1180.6  [Amended]

    9. Section 1180.6 is amended as follows:
    a. In the introductory text of paragraph (a) remove the words ``49 
U.S.C. 11343'' and add in their place the words ``49 U.S.C. 11323''.
    b. In paragraph (a)(2)(vi) remove the words ``49 U.S.C. 11344'' and 
add in their place the words ``49 U.S.C. 11324''.
    c. In paragraphs (a)(4) and (a)(6) remove the word ``Commission'' 
wherever it appears in those paragraphs and add in its place the word 
``Board''.
    d. In paragraph (a)(8) remove the words ``Commission's Section of 
Energy and Environment'' and add in their place the words ``Board's 
Section of Environmental Analysis''.
    e. In paragraph (b)(6) remove the word ``Commission'' wherever it 
appears and add in its place the word ``Board''.


Sec. 1180.7  [Amended]

    10. Section 1180.7 is amended as follows:
    In the introductory text of this section remove the words ``(49 
U.S.C. 11344 (b) or (d),'' and add in their place the words ``(49 
U.S.C. 11324 (b) or (d),'' and remove the word ``Commission'' wherever 
it appears and add in its place the word ``Board''.


Sec. 1180.9  [Amended]

    11. Section 1180.9 is amended as follows:
    In the introductory text of this section remove the word 
``Commission's'' and add in its place the word ``Board's'' and in 
paragraph (e) remove the word ``Commission'' wherever it appears and 
add the word ``Board''.


Sec. 1180.20  [Amended]

    12. Section 1180.20 is amended as follows:
    a. In paragraph (a)(2)(ii) remove the words ``49 U.S.C. 11343, et 
seq.'' and add in their place the words ``49 U.S.C. 11323, et seq.''.
    b. In paragraphs (b), (c), and (d) remove the word ``Commission'' 
wherever it appears in those paragraphs and add in its place the word 
``Board'' and in paragraph (c) remove the words ``49 U.S.C. 11347'' and 
add in its place the words ``49 U.S.C. 11326''.

[FR Doc. 97-5149 Filed 3-3-97; 8:45 am]
BILLING CODE 4915-00-P