Opinion ID: 2526
Heading Depth: 3
Heading Rank: 1

Heading: The Interstate Commerce Commission Termination Act

Text: Congress has exercised broad regulatory authority over rail transportation for 122 years. In 1887, the Interstate Commerce Act (ICA) created the Interstate Commerce Commission (ICC). The ICA was among the most pervasive and comprehensive of federal regulatory schemes and has consequently presented recurring pre-emption questions from the time of its enactment. Chi. & N.W. Transp. Co. v. Kalo Brick & Tile Co., 450 U.S. 311, 318, 101 S.Ct. 1124, 67 L.Ed.2d 258 (1981). In January 1996, ICCTA abolished the ICC and replaced it with the Surface Transportation Board (STB), which continues to perform many of the functions formerly performed by the ICC. See ICC Termination Act of 1995, Pub.L. No. 104-88, 109 Stat. 803 (codified generally at 49 U.S.C. §§ 10101-16106). The STB is vested with broad jurisdiction over transportation by rail carriers. 49 U.S.C. § 10501(b)(1). Generally speaking, ICCTA repealed much of the economic regulation previously conducted by the ICC and by state railroad regulators working in conjunction with the ICC. In so doing, Congress recognized that continuing state regulationof intrastate rail rates, for examplewould risk the balkanization and subversion of the Federal scheme of minimal regulation for this intrinsically interstate form of transportation. Iowa, Chi. & E. R.R. Corp. v. Wash. County, 384 F.3d 557, 559 (8th Cir.2004) (quoting H.R.Rep. No. 104-311, at 96, reprinted in 1995 U.S.C.C.A.N. 793, 808). ICCTA's jurisdictional provision also contains an express pre-emption clause the remedies provided under this part with respect to regulation of rail transportation are exclusive and preempt the remedies provided under Federal or State law. 49 U.S.C. § 10501(b). [8] Rail transportation is defined to include: (A) a locomotive, car, vehicle, vessel, warehouse, wharf, pier, dock, yard, property, facility, instrumentality, or equipment of any kind related to the movement of passengers or property, or both, by rail, regardless of ownership or an agreement concerning use; and (B) services related to that movement, including receipt, delivery, elevation, transfer in transit, refrigeration, icing, ventilation, storage, handling, and interchange of passengers and property. 49 U.S.C. § 10102(9) (emphasis added). ICCTA preempts all `state laws that may reasonably be said to have the effect of managing or governing rail transportation, while permitting the continued application of laws having a more remote or incidental effect on rail transportation.' N.Y. Susquehanna & W. Ry. Corp. v. Jackson, 500 F.3d 238, 252 (3d Cir.2007) (quoting Fla. E. Coast Ry. Co. v. City of W. Palm Beach, 266 F.3d 1324, 1331 (11th Cir. 2001)). The pre-emption inquiry focuses on the degree to which the challenged regulation burdens rail transportation. N.Y. Susquehanna, 500 F.3d at 252. The district court premised its pre-emption conclusion on its determination that a rail crossing falls within ICCTA's definition of transportation by rail carriers. 2007 WL 1851784, at  (citing 49 U.S.C. § 10501(b)). The court observed that the term transportation is defined broadly and includes property ... of any kind related to the movement of passengers or property, or both, by rail, regardless of ownership or an agreement concerning use. Id. (quoting 42 U.S.C. § 10102(9)). The court then employed its own definition of rail crossingan improvement to railroad tracks that allows vehicles, equipment, and persons to traverse the tracks. Id. According to the court, [a]ny physical improvements made to railroad tracks such as those made to construct a crossingwill necessarily impact and be involved in the movement of passengers and property passing over those tracks. Id. Thus, the court held that the rail crossing closure was within the STB's jurisdiction. Id. The district court further noted that other courts have long recognized Congress's general intent to ensure the pervasive and comprehensive federal regulation of railroad operations, and the ICCTA's broad preemptive effect. Id. at . The court determined that the closure order was not the type of predictable, generally applicable regulation that the [Second] Circuit envisioned withstanding the ICCTA's preemption clause. Id. (citing Green Mountain, 404 F.3d at 643). In our view, the term rail transportation does not encompass the closure of this private rail crossing. Rail transportation does include property ... related to the movement of passengers or property... by rail, 49 U.S.C. § 10102(9)(A), [9] and a rail crossing does constitute an improvement to railroad tracks that allows vehicles, equipment, and persons to traverse the tracks. 2007 WL 1851784, at . But we cannot conclude that all state action related to a railroad crossing is pre-empted. The appropriate questions are: what does the state seek to regulate and does the proposed regulation burden rail transportation? Here, the state wants to terminate the use of a private roadway that traverses railroad tracks. New York does not seek to impose its authority over the tracks themselves or over rail carriers that use the tracks. Rather, the result of the state regulation at issue here is the termination of Island Park's use of the crossing. If we adopted a definition of rail transportation for pre-emption purposes that includes the movement of people and property across railroad tracks, then any entityan automobile, bicycle or even a pedestrian passing over the crossingwould arguably be beyond the reach of state regulatory authority. [10] NYSDOT's order closing the rail crossing does not relate[] to the movement of passengers or property ... by rail. 49 U.S.C. § 10102(9)(A) (emphasis added). To the extent there is an impact on rail transportation, it is confined to eliminating the risk of a collision between a train and one of Island Park's vehicles or equipment attempting to cross the tracks. As the ALJ noted, the Hudson Line entertains significant rail traffic, often including high speed trains. Because of that traffic and the poor sight distance caused by the curvature and elevation of the tracks, the ALJ determined that it was dangerous for Island Park's vehicles to cross the tracks. Instead of burdening rail transportation, see N.Y. Susquehanna, 500 F.3d at 252, the closure order facilitates rail transportation by removing a potential hazard. [11] In a recent case from the Fifth Circuit, which noted the paucity of precedent ... relating to ICCTA preemption vel non for railroad crossings, the court held that ICCTA expressly pre-empted a property owner's state-law action to enjoin a railroad from removing four private railroad crossings on its right of way. Franks Inv. Co. v. Union Pac. R.R. Co., 534 F.3d 443, 447 (5th Cir.2008). The Fifth Circuit took the view that the case turned on whether railroad crossings fit within the purview of `transportation by rail carriers,' thereby evincing Congress' intent to preempt state-law claims relating to ownership of the crossings. Id. at 445-46. The court concluded that railroad crossings fell within ICCTA's pre-emption provision because they met the extremely broad definition of transportation, which covered all property... or equipment of any kind related to the movement of passengers or property, or both, by rail. Id. at 449 (quoting 49 U.S.C. § 10102(9)) (emphasis in original). The court also endorsed the district court's finding that crossings affect safety, drainage, and maintenance, which necessarily affect rail travel, id. at 446, and cited the district court opinion in the present case for the proposition that rail crossings fall within the definition of rail transportation. Id. But Franks involved a private individual's attempt to prevent a railroad from closing private rail crossings, thereby interfering with railroad operational decisions. This case, however, measures the ability of a state to order the closure of a crossing for safety reasons. We think it important to emphasize that although ICCTA's pre-emption language is unquestionably broad, it does not categorically sweep up all state regulation that touches upon railroads-interference with rail transportation must always be demonstrated. For example, in Friberg v. Kansas City S. Ry. Co., the Fifth Circuit held that ICCTA pre-empted a Texas Anti-Blocking Statute that prohibited a railroad from allowing a standing train to block a crossing for more than five minutes. 267 F.3d 439, 443-44 (5th Cir.2001). The court explained that [r]egulating the time a train can occupy a rail crossing impacts, in such areas as train speed, length and scheduling, the way a railroad operates its trains, with concomitant economic ramifications. Id. at 444. [12] However, several courts and the STB have declined to find pre-emption where the state or local regulation does not interfere with rail operations. See N.Y. Susquehanna, 500 F.3d at 253-54 (holding that ICCTA does not pre-empt state regulation where the regulation does not unreasonably burden rail operations and does not discriminate against railroads); Fla. E. Coast Ry. Co., 266 F.3d at 1326, 1339 (holding that ICCTA does not pre-empt a city's application of zoning and occupational license ordinances against the operations of a railroad lessee because it does not constitute `regulation of rail transportation' and it does not frustrate the objectives of federal railroad policy); MAUMEE & W. R.R. CORP. AND RMW VENTURES, LLCPETITION FOR DECLARATORY ORDER, STB Finance Docket No. 34354, 2004 WL 395835, , 2004 STB LEXIS 140,  (S.T.B. March 2, 2004) (observing that state and local regulation [affecting railroad property] is permissible where it does not interfere with interstate rail operations, and localities retain certain police powers to protect public health and safety). In this case, Island Park simply cannot show that the state regulation at issuethe closure of a private rail crossing to a non-rail carrier interferes with or burdens rail operations. Finally, Island Park argues that our decision in Green Mountain supports the district court's decision. The district court took the view that the closure procedure constituted a lengthy administrative process, directed at a particular railroad crossing in which state officials were vested with broad discretion to determine the closure question. See 2007 WL 1851784, at . Citing Green Mountain, 404 F.3d at 643, the district court concluded that this was not the type of predictable, generally applicable regulation that [we] envisioned withstanding the ICCTA's preemption clause. 2007 WL 1851784, at . In Green Mountain, a railroad sought to build trans-loading facilities on its property in Vermont. The State argued that this type of facility was subject to a state environmental land use statute mandating pre-construction permits. See 404 F.3d at 638, 640. We held that the pre-construction permit requirement was pre-empted by ICCTA because it (i) unduly interfere[d] with interstate commerce by giving the local body the ability to deny the carrier the right to construct facilities or conduct operations; and (ii) it can be time-consuming, allowing a local body to delay construction of railroad facilities almost indefinitely. Id. at 643 (internal citation and quotation marks omitted). We recognized that states and towns may exercise traditional police powers over the development of railroad property, at least to the extent that the regulations protect public health and safety, are settled and defined, can be obeyed with reasonable certainty, entail no extended or open-ended delays, and can be approved (or rejected) without the exercise of discretion on subjective questions. Id. We further noted that [e]lectrical, plumbing and fire codes, direct environmental regulations enacted for the protection of the public health and safety, and other generally applicable, non-discriminatory regulations and permit requirements would seem to withstand preemption. Id. We explained that the legislative history of ICCTA supported this approach, noting [a]lthough States retain the police powers reserved by the Constitution, the Federal scheme of economic regulation and deregulation is intended to address and encompass all such regulation and to be completely exclusive. Id. (quoting H.R.Rep. No. 104-311, at 96 (1995), reprinted in 1995 U.S.C.C.A.N. 793, 808). In Green Mountain, it was unnecessary for us to draw a line that divide[d] local regulations between those that are preempted and those that are not. Id. The state pre-construction permit law was pre-empted because it restrained the railroad from development until a permit is issued; the requirements for the permit are not set forth in any schedule or regulation that the railroad can consult in order to assure compliance; and the issuance of the permit awaits and depends upon the discretionary rulings of a state or local agency. Id. Federal regulation of the railroad industry trumped local concerns that were vague, time consuming, and limited only by the discretion of local officials whose provincial concerns may not appreciate the need for the railroad's proposed action. Although N.Y. Railroad Law § 97(3) vests NYSDOT with broad discretion to determine whether a rail crossing should be altered or closed, Green Mountain nevertheless does not control for one fundamental reasonthe state action in this case does not interfere with railroad operations. See N.Y. Susquehanna, 500 F.3d at 252. In Green Mountain, we determined that the proposed transloading and storage facilities [were] integral to the railroad's operation, and thus, the permit process necessarily interfere[d] with Green Mountain's ability to construct facilities and conduct economic activities. 404 F.3d at 644 (internal citation and quotations omitted). No such operational interference exists here.