N.C., VPRA Seek to Acquire NS Assets for Passenger Use (UPDATED, 6/26)

(CATS photo)

The City of Charlotte, N.C., and the Virginia Passenger Rail Authority (VPRA) have each filed separate petitions for exemptions to the Surface Transportation Board (STB) to acquire and operate certain assets of Norfolk Southern’s (NS) track in North Carolina’s Mecklenburg and Iredell Counties and in Virginia’s Fairfax and Prince William Counties, respectively.

According to Charlotte’s petition for exemption (download below), the city seeks to acquire from NS certain interests in roughly 29.04 miles of railroad right-of-way—part of NS’s “O Line”—located in Mecklenburg and Iredell Counties, N.C., and extending between mileposts O-0.04 at Charlotte, N.C., and O29.08 at Mooresville, N.C., as part of the planned expansion of the Charlotte Area Transit System (CATS) regional transit network “to better link northern suburban communities with the City of Charlotte.”

Charlotte will acquire the assets from NS subject to the Class I’s “retention of a permanent and exclusive easement as necessary for NS to continue to fulfill its common carrier and related freight services.”

Notably, the purchase agreement and comprehensive agreement expressly prohibit Charlotte from:

• “Providing freight service to customers located along the assets; and
• “Unreasonably interfering with NS’s exercise of its retained freight service rights and obligations over the assets.”

NS, according to the petition for exemption, will continue to operate over and provide freight service to customers over, on, and connecting to the assets after Charlotte’s purchase of the assets pursuant to the retained easement. Charlotte, through CATS, will provide commuter transit service over the assets. Charlotte will be contractually foreclosed from:

• “Providing freight rail service over the assets, and
• “Unreasonably interfering with NS’s provision of freight service over the assets.”

The STB on June 26 announced that the transaction may be consummated on or after July 10, 2024, the effective date of exemption (30 days after the verified notice of exemption was filed).

If the verified notice contains false or misleading information, the exemption is void ab initio. Petitions to revoke the exemption under 49 U.S.C. 10502(d) maybe filed at any time. The filing of a petition to revoke will not automatically stay the effectiveness of the exemption. Petitions for stay must be filed no later than July 3, 2024 (at least seven days before the exemption becomes effective).

Separately, the VPRA is petitioning the STB for an exemption from the requirements of 49 U.S.C. § 10901 for the acquisition by VPRA of certain real property, track, other improvements and a passenger rail service easement from NS located in Fairfax and Prince William Counties, and the cities of Manassas Park, Manassas and Alexandria, Va. Rail Regulatory Law, headed by noted attorney Kevin M. Sheys, filed the petition (download below).

According to the petition for exemption, VPRA and NS have reached an agreement pursuant to which VPRA will acquire from NS the land, tracks, and other improvements between (1) approximately MP 10.76 and MP 32.75 (the “Manassas Line”) and (2) approximately MP 9.25 and MP 10.76 (the “Seminary Passage”).

NS will retain an easement on the subject property to fulfill its common carrier obligation and other freight rail services pursuant to transportation agreements under 49 U.S.C. 10709 or other rights and responsibilities under the ICC Termination Act of 1995.4 VPRA also will acquire a passenger rail operating easement on the lines between approximately MP 32.75 and MP 33.6 (the “Manassas Segment”).

VPRA, according to the petition for exemption, also will acquire other land, track and improvements, including (1) a continuous strip of land defined in the CRA as the Broad Run Corridor, adjacent to the NS line of railroad between approximately MP 33.6 and MP 36.23, (2) land, tracks, and other improvements defined in the CRA as the NRV Station Parcel adjacent to the NS line of railroad between approximately MP N289.86 and MP N290.20, and (3) land, tracks, and other improvements at or near MP NB300.0 in Radford, Va. However, unlike the subject property, all of the other land to be acquired by VPRA either does not include track or the included track constitutes spur or sidetracks within the meaning of 49 U.S.C. § 10906.

Accordingly, the acquisition of this land, track and improvements does not require STB exemption or approval under 49 U.S.C. § 10901, according to VPRA.

VPRA also will have contractual passenger rail operating rights, including: (1) additional intercity passenger rail frequencies on NS lines between Alexandria and Roanoke, later extended to a new station (the NRV Station) in Radford, Va.; (2) operating rights on the line between approximately MP N257.5 (Roanoke Station) and either MP N289.86 (to a station parcel in Christiansburg, Va.)10 or MP NB300.0 (to a parcel in Radford, Va.) for a passenger trail layover facility; and (3) operating rights on the lines between approximately MP 33.6 and MP 36.0 for temporary access to Broad Run Station while a new access track is constructed.

The acquisition of these contractual rights does not require STB exemption or approval under 49 U.S.C. § 10901 because they “do not involve the acquisition of a line of railroad under the statute,” according to VPRA.