STB Denies HolRail Authority to Use CSX ROW for New Rail Line

Date: Feb 12, 2007

In a case we have been following since it was filed more than 3 years ago, the STB today denied HolRail LLC, a subsidiary of cement manufacturer Holcim Inc., authority to use the right-of-way of CSX to construct a new rail line to connect the Holcim plant in South Carolina with NS. HolRail had argued that Section 10901(d) of the statute, which gives the Board power to compel an incumbent carrier to permit its line to be crossed to accommodate a new rail line, allows not only crossing of a line in the literal sense but also operation along the incumbent's ROW parallel to the incumbent's track. HolRail sought to operate over 1.7 miles of CSX's track, constituting almost 75% of the entire route to be established.

HolRail sought the unprecedented interpretation of the line crossing provision of the statute to avoid a slightly longer route over a parallel route which would require HolRail to construct swamp land and would entail substantial environmental remediation. The statute at issue provides that "no other rail carrier may block any construction or extension authorized [by the STB] by refusing to permit the carrier to cross its property . . ." The STB found that Congress did not intend to relieve an applicant for line construction authority from acquiring its own ROW for the principal length of the proposed route. This outcome was forecast in an October 2004 decision by the Board denying a CSX motion to dismiss the HolRail petition for exemption as premature in which Commissioner Buttrey separately commented that the HolRail position on the line crossing authority "appears to be tantamount to a confiscation that is beyond anything contemplated by section 10901."

HolRail may now proceed with its request for authority (or more properly, an exemption) to construct its alternative route. The final scoping of the environmental review, consisting of a full environmental impact statement for a line of approximately 3 miles in length, was issued only a year ago. In giving notice that a full EIS would be prepared, rather than the more limited environmental assessment, the Board referenced the controversial nature of the proposal. One cannot help but wonder how much more quickly this authority application may have proceeded if the unique line crossing approach had not been proposed.