Petition for Writ of Certiorari — Public Utilities Commission of Ohio v. CSX Transportation, Inc.

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In The WL 12

Supreme Court of the Unig Stas”

OCTOBER TERM, 1989 —

“Supreme cour US |

> FILED

THE PUBLIC UTILITIES COMMISSION OF OHIO, et al.,

Petitioners,

v.

CSX TRANSPORTATION, INC., et al.,

Respondents.

Petition for a Writ of Certiorari

to the United States Court of Appeals

for the Sixth Circuit

and

Appendix

ANTHONY J. CELEBREZZE, JR.

Attorney General of Ohio

ROBERT S. TONGREN

Assistant Attorney General

Counsel of Record

JAMES B. GAINER

Assistant Attorney General

Office of the Ohio Attorney General

Public Utilities Section

180 East Broad Street

Columbus, OH 43266-0573

(614) 466-4397

Attorneys for Petitioners,

The Public Utilities Commission

of Ohio, et al.

QUESTION PRESENTED

Whether the United States Court of Appeals for the Sixth

Circuit erred in concluding that a provision of the Federal Railroad

Safety Act, 45 U.S.C. § 434, may be construed as the express

intention of Congress to preempt Ohic statutes and administrative

regulations that are expressly preserved by the federal Hazardous

Materials Transportation Act, 49 U.S.C.App. § 1811(a).

LIST OF PARTIES

The Public Utilities Commission of Ohio, and,

Jolynn Barry Butler, Chair

J. Michael Biddison, Commissioner

Ashiey C. Brown, Commissioner

Richard M. Fanelly, Commissioner

Lenworth Smith, Commissioner,

in their respective capacities as Chair and Commissioners of the

Public Utilities Commission of Ohio

CSX Transportation, Inc.

Consolidated Rail Corporation

Norfolk and Western Railway Company

Grand Trunk Western Railroad Company

AMICUS CURIAE

The State of Washington

The State of Tennessee

The State of Texas

The State of Oregon

The State of Nevada

The State of Missouri

The State of California

TABLE OF CONTENTS

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asi cenieescinandabachoreatmnninasbearnienennin 2

acct lis gtsschbndnsaeasaneaseubiasineraniebens 2

STATUTORY PROVISIONS AT ISSUE...............::ccccsssssssseseseseseees 2

did ddeaneentanacensnsicngesnrecvaredcrarsneneised 2

REASONS FOR GRANTING THE WRIT..............:.::::eseeee0 eee 7

I. The decision of the lower court conflicts with applicable

cal nae eeednnbananannananenbennennens 7

A. Inenacting the HMTA, Congress established a dual

system of federal and consistent state regulation....... 7

B. This Court has consistently held that preemption is

precluded where a state acts within its sphere of

authority under a dual system of federal and state

regulation established by Congress ...............s0e00e 8

C. The decision of the lower court conflicts with the

decisions of this Court in Louisiana and Pacific Gas ... 10

Il. The decision of the lower court raises an important

question of federal law that should be settled by this

NAb attendant naciectninponininnscuinasnansnieannwiserannesen 14

iii

TABLE OF CONTENTS

A. _Inenacting the HMTA, Congress expressly

required that the transportation of hazardous

materials be regulated only on an intermodal

RES aceeeccvecevwsncecnsssvecesnsravarcovanerencsoncsnnscanenecncssenenensecencecenes 15

B. Congress has specifically defined the scope of

preemption under the FRSA to exclude state

laws expressly preserved by the HMTA ............-.-..--- 18

C. The decision of the lower court created a

statutory conflict between the HMTA and

the FRSA, and resolved that conflict by

nullifying the requirements of the HMTA.............----. 27

CONCLUSION ........cccscscsssssssessssesscssnensnsnenenenesesenensnsnenenenentsnsnnenennsenes 30

APPENDIX

iv

TABLE OF AUTHORITIES

Page(s)

Cases:

CSX Transp., Inc. v. Public Utilities Comm'n of Ohio,

701 F. Supp. 608 (S.D. Ohi0 1988) ..........0.ceseseseeseeeesneeeseeneenees 2, 4,5

CSX Transp., Inc. v. Public Utilities Comm'n of Ohio,

Se a re et, SD perentieiccieivintnsininrsernenennnsisieneiansneniiinn 2, 5,

11, 14, 17, 19, 20, 28

Jones v. Rath Packing Co., 430 U.S. 519 (1977) .......ccccecececeeseeeeesees 11

Louisiana Public Service Comm'n v. FCC, 476 U.S. 355 (1986) ..... 8, 9,

10, 11, 12, 13, 27

Merrill Lynch v. Ware, 414 U.S. 117 (1973) ........cccccceseseeeeseneeeseenees 27

Pacific Gas and Elec. Co. v. State Energy Resources

Conservation & Development Comm'n, 461 U.S. 190 (1983)...10, 13

Rice v. Santa Fe Elevator Corp., 331 U.S. 218 (1947) .......ccccceeee 11

Silver v. New York Stock Exchange, 373 U.S. 341 (1963) ...........0+ 27

Statutes:

Federal Railroad Safety Authorization Act of 1980,

Pub. L. No. 96-423, 94 Stat. 1811 (1980), (amending

eID easecncieesicainttnsstsanetnitneeptanatiennincanannemnneses 20

Federal Railroad Safety Authorization Act of 1980,

Pub. L. No. 96-423, 94 Stat. 1811 (1980)

I siietctensinnepereneensntanennnencnerrnancanes 20

Federal Railroad Safety Authorization Act of 1980, § 10(e),

Pub. L. No. 96-423, 94 Stat. 1811 (1980)

ge Oe a an Op CI rnrniicanecesecnenenencesinnsintanborlinncnie 25

TABLE OF AUTHORITIES

Page(s)

"ENTRAR, TEE, aia Meme ere 2

EERIE TONE A ia Rees ier 2

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19

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SALE AERA Ue reeae ca ether 25

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a li a ae 22, 26

a 26

SRR LU a Oe A ~~ &

45 U.S.C. § 439(a) .cccossssersonee siuidenieleniasl hidden ane 26

EE AIEEE OIE TINE 6, 12,

18

49 U.S.C. § 103(c)(1) (1982 & Supp. V 1987) .cccccocssseeeseeeeeereeen 26

PIII ipa soncnssniciigoaisiaetenabensiumaibabtbsoeionas 6

vi

TABLE OF AUTHORITIES

Page(s)

49 U.S.C.App. § 1655(e) (repealed in part 1983) .............0.008 23

49 U.S.C.App. § 1655 (e)(1), (e)(2), (@MG)A) .....ecccecenecreeneennenns 22, 24,

25, 26

49 U.S.C.App. § 1055(e)(4) (repealed 1983) ...........eeeeeneeens 24

49 U.S.C. § 1655(F(3)(A) (repealed 1983)... 19, -

Oe ie eireenicrtensnenvesennesevamncncenteresnmersensencsestincessiiiinh 2,3,

12, 14,15

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Se Oe GID errerenvinnesintnnssnsinnaonsnseninctaicsnnianseseansicatenbigith 3

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Se gs EID crrenrnersvenvenacennenssccnsnttnnnrananenessesstacneniineitiat 6, 15,

29

a SD eticcitentennencenecceniinensivintannabticmsindoninanscecensatith 6

tr SD ereentcrecntnensensnsecsinenininnnnstvanssnsenseinianeiatiiith 4, 8,

9, 12, 14

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SP re Ge CA, re reneivrrrnerinnenen 4

vii

TABLE OF AUTHORITIES

Page(s)

Administrative Regulations:

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DCRR. BABII vere nwnnnwnrennnnnnnnnnenmnnmnnen 24

DCRR. 8B WO BGB wore wnnnnnnnnnnnmnnn 6

Ohio Admin. Code §§ 4901:2-7-01 through 4901:2-7-22 «0.0.0... 5

Ohio Admin. Code § 4901:3-1-10 ......ccccceccecseneeneenennnnaneens 5

Other Authorities:

H. R. Rep. No. 1025, 96th Cong., 2d Sess., reprinted in 1980 ee

US. Code Cong. & Admin. News 3830 ............cccccecennneens

viii

No.

In The

Supreme Court of the Anited States

OCTOBER TERM, 1989

THE PUBLIC UTILITIES COMMISSION OF OHIO, et al.,

Petitioners,

v.

CSX TRANSPORTATION, INC, et al.,

Respondents.

Petition for a Writ of Certiorari

to the United States Court of Appeals

for the Sixth Circuit

Petitioners respectfully pray that a writ of certiorari issue to

review the judgment and opinion of the United States Court of

Appeals for the Sixth Circuit issued on April 13, 1990.

OPINIONS BELOW

The judgment and opinion of the United States Court of

Appeals for the Sixth Circuit, issued on April 13, 1990, is reported at

901 F 2d 497 (6th Cir. 1990). The judgment and opinion in the

original action giving rise to this Petition was issued by the United

States District Court for the Southern District of Ohio, Eastern

Division, on December 12, 1988, and is reported at 701 F. Supp. 608

(S.D. Ohio 1988).

JURISDICTION

The jurisdiction of this Court is invoked under 28 U.S.C. §

1254(1). The judgment of the United States Court of Appeals for

the Sixth Circuit was issued on April 13, 1990.

STATUTORY PROVISIONS AT ISSUE

The relevant portions of the Hazardous Materials

Transportation Act (HMTA), 49 U.S.C.App. §§ 1801 et seq., and the

Federal Railroad Safety Act (FRSA), 45 U.S.C. §§ 421 et seq., are

reproduced in full in the proceeding Statement and Reasons For

Granting the Writ.

STATEMENT

Thousands of tons of highly toxic or explosive "hazardous

materials" are transported through the communities of this Nation

on a daily basis. Accidents do happen. One recent railroad disaster

near Miamisburg, Ohio ignited a rail car of phosphorous, spreading

a cloud of toxic gas throughout the area and causing the evacuation

of 40,000 state citizens. See CSX Transp., Inc. v. Public Utilities

Comm'n of Ohio, 701 F. Supp. 608, 610 (S.D. Ohio 1988).

In 1974, Congress recognized the inherent problems of

regulating these dangerous substances that are moved by several

different modes of transportation, and called upon the states for

help in enforcing the federal standards. The federal Hazardous

Materials Transportation Act (HMTA) requires that the transport of

hazardous materials, by any mode of transportation, be regulated

on an "intermodal" basis:

It is declared to be the policy of Congress in this

chapter to improve the regulatory and enforcement

authority of the Secretary of Transportation to

protect the Nation adequately against the risks to life

and property which are inherent in the

transportation of hazardous materials in commerce.

49 U.S.C.App. § 1801.

‘hazardous material’ means a substance or material

in a quantity and form which may pose an

unreasonable risk to health and safety or property

when transported in commerce;

‘transports’ or ‘transportation’ means any movement

of property by any mode, and any loading,

unloading, or storage incidental thereto.

49 US.C.§ 1802(2), (6).

Further, the HMTA establishes a dual system of federal and

state regulation, specifically preserving state laws that are

consistent with the HMTA, and requiring that federal preemption

questions be determined under the HMTA:

(a) Except as provided in subsection (b) of this

section, any requirement, of a State or political

subdivision thereof, which is inconsistent with any

requirement set forth in this chapter, or in a

regulation issued under this chapter, is preempted.

(b) Any requirement, of a State or political

subdivision thereof, which is not consistent with any

requirement set forth in this chapter, or in a

regulation issued under this chapter, is not

preempted if, upon the application of an appropriate

State agency, the Secretary determines, in accordance

with procedures to be prescribed by regulation, that

such requirement (1) affords an equal or greater

level of protection to the public than is afforded by

the requirements of this chapter or of regulations

issued under this chapter and (2) does not

unreasonably burden commerce. Such requirement

shall not be preempted to the extent specified in such

determination by the Secretary for so long as such

State or political subdivision thereof continues to

administer and enforce effectively such requirement.

49 U.S.C.App. § 1811(a), (b).

Following the Miamisburg disaster, the State of Ohio

undertook a detailed study of federal enforcement of the

intermodal hazardous materials regulations under the HMTA and

found federal enforcement to be inadequate. CSX, 701 F Supp. at

610. Pursuant to the express requirements of the¢ederal HMTA, on

September 26, 1988, the Ohio General Assembly enacted the Ohio

Hazardous Materials Transportation Act, providing that:

The public utilities commission may adopt safety

rules governing the transportation and offering for

transportation of hazardous materials by railroad.

The rules adopted under this section shall be consistent

with, and equivalent in scope, coverage, and content to,

the provisions of the ‘Hazardous Materials

Transportation Act,’ 88 Stat. 2156 (1975), 49 U.S.C.A.

1801, as amended, and regulations adopted under it.

No person shall violate a rule adopted under this

section or any order of the commission issued to

secure conipliance with any such rule.

Ohio Rev. Code Ann. § 4907.64 (emphasis added).

On December 10, 1988, the Public Utilities Commission of

Ohio adopted the federal hazardous materials administrative

regulations, promulgated under the federal HMTA, in order to

provide for state enforcement of the intermodal federal rules:

For the purpose of enforcing federal rules for

railroads and shippers by railroad, the commission

hereby adopts those portions of the hazardous

materials transportation regulations contained in

Title 49, Parts 171 through 179, CFR, as are

applicable to transportation or offering for

transportation by railroad including future

modifications or additions. These federal rules shall

be applicable to all railroads operating within or

through this state, their agents and employees, as

well as to any person offering hazardous materials

for transportation within or through this state by

4

railroad. These federal rules shall be enforced so as to

impose no operating requirements upon railroads or

shippers by railroad to which these person have not been

made subject under federal rules. Enforcement of these

federal rules shall be subject to any exemptions

granted by the U.S. department of transportation

pursuant to Title 49, Part 107, CFR, and shall be

consistent with interpretations issued by the research

and special programs administration, U.S.

department of transportation.

Ohio Admin. Code § 4901:3-1-10 (emphasis added).

On December 12, 1988, the United States District Court for the

Southern District of Ohio, Eastern Division, granted summary

judgment to the plaintiff railroads, finding the Ohio statutes and

regulations to be preempted by the Federal Railroad Safety Act

(FRSA), 45 U.S.C. § 434. Specifically, the District Court held that

the FRSA preempted Sections 4905.83 and 4907.64 of the Ohio

Revised Code, and Sections 4901:2-7-01 through 4901:2-7-22 and

4901:3-1-10 of the Ohio Administrative Code, and permanently

enjoined the Public Utilities Commission of Ohio from enforcing

the state laws. CSX, 701 F. Supp. at 617. The State of Ohio

appealed.

On April 13, 1990, the United States Court of Appeals for the

Sixth Circuit affirmed the decision of the District Court, finding that

the foregoing state administrative regulations and statutes were

preempted by the general railroad safety requirements of the

Federal Railroad Safety Act, and that preemption under such modal

safety requirements did not frustrate the mandate of the federal

HMITA requiring that the transportation of hazardous materials be

regulated only on an intermodal basis. CSX Transp., Inc. v. Public

Utilities Comm'n of Ohio, 901 F. 2d 497 (6th Cir. 1990). The

preemption provision of the FRSA provides that:

The Congress declares that laws, rules,

regulations, orders, and standards relating to

railroad safety shall be nationally uniform to the

extent practicable. A State may adopt or continue in

force any law, rule, regulation, order, or standard

relating to railroad safety until such time as the

Secretary has adopted a rule, regulation, order, or

standard covering the subject matter of such State

requirement. A State may adopt or continue in force

an additional or more stringent law, rule, regulation,

order, or standard relating to railroad safety when

necessary to eliminate or reduce an essentially local

safety hazard, and when not incompatible with any

Federal law, rule, regulation, order, or standard, and

when not creating an undue burden on interstate

commerce.

45 US.C.§ 434.

Under the federal statutory scheme, the United States

Secretary of Transportation (Secretary) is required to regulate the

transportation of hazardous materials on an intermodal basis. 49

U.S.C.App. § 1804(a). Pursuant to this grant of authority, the

Secretary has promulgated administrative rules applicable to all

modes of transportation. See 49 C.F.R. §§ 171-79. The Secretary

may delegate authority to enforce the intermodal regulations to the

separate modal administrations comprising the Department of

Transportation, such as the Federal Railroad Administration (FRA).

49 U.S.C.App. § 1808(c).

The modal administrations, including the FRA, are limited by

statute to administering the statutory authority of the Secretary

related to the general safety of the respective modes, and such

enforcement authority as is delegated by the Secretary. See, e.g., 49

U.S.C. § 103(c) (1982 & Supp. V 1987). For example, the FRA is

limited to administering the "duties and powers related to railroad

safety vested in the Secretary . . . and additional duties and powers

prescribed by the Secretary." 49 U.S.C. §103(c) (1982 & Supp.

V 1987). Thus, the FRA is responsible for exercising the Secretary's

statutory regulatory authority related to railroad safety under the

FRSA, and has promulgated general rail safety regulations

applying only to railroad safety (49 C.ER. §§ 200-268). Under the

HMTA, the FRA is limited to enforcement of the intermodal

regulations pertaining to rail transportation (49 C.ER. §§ 171-179).

Neither the Secretary, nor the FRA, has statutory authority to

promulgate intermodal hazardous materials regulations under the

FRSA. 45 U.S.C. § 431; 49 U.S.C. § 103(c) (1982 & Supp. V 1987).

The Secretary is expressly forbidden from varying this statutory

scheme of intermodal regulation and delegated modal enforcement

authority. 49 U.S.C. § 103(d).

REASONS FOR GRANTING THE WRIT

I. The decision of the lower court conflicts with

applicable decisions of this Court.

In order to find preemption in the case below, the lower court

overruled the express requirements of a federal statute. The state

statutes and regulations found to be preempted are identical to the

federal HMTA and implementing federal regulations, providing

only for state enforcement of the federal requirements.

Unlike the lower court, in enacting the HMTA, Congress

recognized the impossibility of effective federal enforcement, given

the incredible volume of hazardous materials transported in this

country on a daily basis. Congress invited and encouraged state

enforcement of consistent hazardous materials requirements. The

HMTA preempts inconsistent state requirements, expressly

preserves consistent state requirements, and provides a statutory

means to resolve jurisdictional conflicts in the dual system of

federal and state enforcement of intermodal hazardous materials

requirements. The decision of the lower court has precluded any

state enforcement, ieaving to state citizens across the nation only

the meager protection offered by an overburdened federal

bureaucracy. See CSX Transp., Inc. v. Public Utilities Comm'n of Ohio,

701 F. Supp. 608, 610 (S.D. Ohio 1988).

The purpose of federal preemption, as consistently held by

this Court, is to avoid frustrating the purpose of Congress with a

multiplicity of inconsistent state regulations. Louisiana Public

Service Comm'n v. FCC, 476 U.S. 355, 368-69 (1986). In the case at

bar, the federal and state regulations are identical, and the Ohio

regulations expressly require consistent enforcement. Thus, the

purpose served by the lower court's decision is not that of

Congress; rather, it is the economic interest of the nation's railroads,

hoping to avoid effective enforcement of the existing federal

regulations.

A. In enacting the HMTA, Congress established a dual

system of federal and consistent state regulation.

The HMTA expressly limits federal preemption of state

hazardous materials laws to state requirements that are inconsistent

with the HMTA, or a regulation issued under the HMTA. 49

US.C.App. § 1811(a). Accordingly, the police power of the states to

protect citizens through consistent regulation, or as in this case,

enforcement of the federal regulations, is expressly preserved. 49

US.C.App. § 1811(a).

Congress confirmed this reservation of police power authority

to the states by providing a statutory means within the HMTA to

resolve jurisdictional tensions between the federal and state

governments. In this regard, Congress authorized the Secretary,

upon application of a state, to determine that even "inconsistent"

state requirements might survive preemption, so long as such state

requirements provide an equal or greater level of protection to the

public and avoid placing an unreasonable burden on interstate

commerce. 49 U.S.C.App. § 1811(b).

Thus, the manifest intent of Congress is clear on the face of the

HMTA: avoid inconsistent state regulation, but foster the help of

the states to consistently enforce the federal requirements in order

to better protect the public. The decision of the lower court has

frustrated this congressional purpose, and has violated the

precedential decisions of this Court.

B. This Court has consistently held that preemption is

precluded where a state acts within its sphere of

authority under a dual system of federal and state

regulation established by Congress.

As noted by this Court, the "critical question in any pre-

emption analysis is always whether Congress intended that federal

regulation supersede state law." Louisiana Public Service Comm'n v.

FCC, 476 U.S. 355, 369 (1986). The lower court avoided answering

this question by ignoring the intention of Congress expressed in the

HMITA, and by attempting to distinguish the applicable decisions of

this Court. The precedents established by this Court dictate a

different result.

In Louisiana Public Service Comm'n v. FCC, 476 U.S. 355 (1986),

this Court addressed the issue of federal preemption in the

telecommunications industry. In order to determine the issue, the

Court compared the general authority vested in the federal

government to regulate interstate telecommunications, with a

specific reservation of state intrastate regulatory authority. Id. at

8

369-70.!_ The Court held that the broad authority over interstate

telecommunications conveyed to the federal government in the

“declaration of purpose” provision of the Communications Act

could not be construed to supersede an express reservation of state

authority. Id. at 370. Further, the Court found in Louisiana that

jurisdictional tensions arising under the dual system of federal and

state regulation should be resolved by reference to the statute itself,

which both established the dual system of regulation, and provided

a statutory process to resolve areas of conflicting regulatory

jurisdiction. Id. at 375.

Despite the protestations of the telephone companies, hoping

to avoid state regulation by asserting that the "federal purpose" of

the statute to ensure national uniformity was frustrated by state

regulation, the Court refused in Louisiana to impose federal

preemption over the clear intent of Congress to preserve a measure

of state regulatory authority. Id. at 370. The Court noted that a

tangential relationship between federal and state regulation did not

amount to an express intent to preempt. Id. at 375-76. With regard

to the protestants, the Court had a short answer: "As we so often

admonish, only Congress can rewrite this statute." id. at 376.

In the case at bar, as in Louisiana, Congress has clearly

expressed an intention to preserve the authority of the states to

regulate. The only stricture placed by Congress upon the states’

authority is that such regulation must be consistent with federal

regulation. 49 U.S.C.App. § 1811(a). As was the case in Louisiana,

in enacting the HMTA, Congress tempered its preemption by

preserving a measure of state authority, and by including a

statutory means to resolve jurisdictional tensions that might arise.

49 U.S.C.App. § 1811(a), (b).

The Court noted the relevant statutory provisions of the Communications

Act of 1934:

The Act establishes, among other things, a system of dual state

and federal regulation over telephone service, and it is the

nature of that division of authority that these cases are about. In

broad terms, the Act grants to the FCC the authority to regulate

"interstate and foreign commerce in wire and radio

communication,” 47 USC § 151 [47 USCS § 151], while expressly

denying that agency “jurisdiction with respect to . . . intrastate

communication service ...." 47 USC § 152(b) [47 USCS §

152(b)].

Louisiana, 476 U:S. at 360.

Similarly, in Pacific Gas and Elec. Co. v. State Energy Resources

Conservation & Development Comm'n, 461 U.S. 190 (1983), this Court

found that the federal government had completely occupied the

field of general safety regulation covering every aspect of nuclear

energy generation. Id. at 212-13. Against the backdrop of complete

federal preemption over “all matters nuclear," the Court examined

the language and history of the controlling federal statute, and

found an explicit congressional purpose to preserve traditional

state authority to regulate the economics of energy production,

including the production of nuclear energy. Id. at 213-17. In the

face of a clear congressional intent to establish such a dual system

of federal and state regulation, the Court concluded that federal

preemption could not be imposed over the intent of Congress to

preserve state regulatory authority. Id. at 216. In reaching this

conclusion, the Court noted that an express reservation of state

authority obviates any need to inquire into the tangential effects

that state regulation might have on federal regulatory jurisdiction.

Id.

Thus, this Court has examined statutory schemes similar to

the HMTA, and has consistently held that broad preemption

language, such as the FRSA preemption of state “laws relating to

railroad safety," cannot be interpreted as overriding a specific

statutory reservation of state authority. The HMTA clearly provides

such an express reservation of state authority to consistently

regulate the intermodal transportation of hazardous materials.

C. The decision of the lower court conflicts with the

decisions of this Court in Louisiana and Pacific Gas.

The lower court declined to apply the decisions of this Court,

based upon an illusory distinction. In this regard, the lower court

found that:

In this case, federal power to regulate

transportation of hazardous materials is absolute;

state power is limited. Thus, unlike Louisiana Public

Service where the Court was concerned that. . . a

federal agency may preempt state law only when

and if acting within the scope of its congressionally

delegated authority,’ 476 U.S. at 374, 106 S.Ct. at

_ 1901, we have no qualms about the scope of the

10

DOT's authority to promulgate hazardous material

transportation regulations. The only question is

whether the PUCO also may do so for railroads.

In Pacific Gas & Electric, the state had express

power to regulate the economics of nuclear

production. 461 U.S. at 205-06, 103 S.Ct. at 1722-23.

The federal law, the Atomic Energy Act, did not

explicitly prohibit states from exercising economic

regulation. The question before the Pacific Gas &

Electric Court was whether federal regulatory

authority over nuclear production preempted a state

regulation which arguably came within the express

state authority. Again, the question before us is

different. The federal government clearly has the

power to regulate all aspects of railroad safety; state

power is limited. Thus, the HMTA does not present

the same type of dual regulatory authority presented

in Louisiana Public Service or Pacific Gas & Electric.

CSX Transp., Inc. v. Public Utilities Comm'n of Ohio, 901 F. 2d at 497,

502 (6th Cir. 1990). The effect of the lower court's analysis of

Louisiana and Pacific Gas is to deny the states’ historic police power,

and limit the Court's decisions to the specific statutory schemes

examined in those cases. No such limitation was imposed by this

Court.

Rather, this Court has consistently emphasized that in

reviewing preemption cases, courts must start with the assumption

that the historic police power of the states is not to be superceded

by federal enactments “unless that was the clear and manifest

purpose of Congress." jones v. Rath Packing Co., 430 U.S. 519, 525

(1977) (quoting Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230

(1947)). Clearly, an express grant of federal statutory authority to

the states is not necessary to avoid preemption. The states’ police

power is assumed; the only relevant question is whether Congress

has exhibited an intention to displace that police power.

Thus, regarding the applicability of the Louisiana decision, the

lower court simply begged the question by noting that with respect

to hazardous materials, “federal power . . . is absolute; state power

is limited." CSX, 901 F. 2d at 502. In Louisiana, the decision of this

Court turned upon the fact that Congress had specifically preserved

state authority from preemption, not the fact that federal power

11

was limited by such a reservation of authority to the states.

Louisiana, 476 U.S. at 373. The limitation on federal authority was

examined in order to determine what authority Congress had

reserved to the states. Thus, this Court noted that "the best way of

determining whether Congress intended the regulations of an

administrative agency to displace state law is to examine the nature

and scope of the authority granted by Congress to the agency."

Louisiana, 476 US. at 374.

Had the lower court applied the Louisiana test, a different result

would have been reached. The "nature and scope” of the authority

granted by Congress to the Secretary under the HMTA was limited

to regulating the transportation of hazardous materials on an

intermodal basis, and preempting inconsistent state regulations.

See 49 US.C.App. §§ 1801, 1802, 1811(a). The FRSA clearly does

not convey congressional authority upon the Secretary to either

regulate the intermodal transportation of hazardous materials, or to

preempt state requirements that are preserved by the HMTA. See

45 US.C.§ 434; 49 U.S.C. § 103(c) (1982 & Supp. V 1987).

The lower court recognized that with enactment of the

HMTA, “the regulation of the transportation of hazardous materials

moved from a modal to an intermodal basis." CSX, 901 F. 2d at 500.

Further, the lower court recognized that the "HMTA allows state

regulations which are consistent with federal regulations." Id. at

501. Nonetheless, the lower court found preemption, and

attempted to distinguish Louisiana, based upon the authority

granted to the Secretary by the FRSA, a modal enabling statute

applying only to railroad safety.

Contrary to the lower court's analysis, this Court found in

Louisiana that like the HMTA, the Communications Act required a

dual system of regulation in an area where federal and state

jurisdictions necessarily overlap:

However, while the Act would seem to divide the

world of domestic telephone service neatly into two

hemispheres—one comprised of interstate service,

over which the FCC would have plenary authority,

and the other made up of intrastate service, over

which the States would retain exclusive juris-

diction—in practice, the realities of technology and

economics belie such a clean parceling of

responsibility. This is so because virtually all

12

a

telephone plant that is used to provide intrastate

service is also used to provide interstate service, and

is thus conceivably within the jurisdiction of both state

and federal authorities. Moreover, because the same

carriers provide both interstate and intrastate

service, actions taken by federal and state regulators

within their respective domains necessarily affect the

1 financial health of those carriers, and hence

their ability to provide service, in the other

“hemisphere.”

Louisiana, 476 US. at 360 (emphasis added). Thus, the fact that

“federal power is absolute” and "state oe is limited" under the

HMTA, has no bearing on the applicability of Louisiana. By limiting

federal preemption to inconsistent state laws, Congress expressly

preserved a measure of state police power authority to enforce

consistent state requirerrents. In the case at bar, as in Louisiana, the

“dual system of regulation” established by Congress applies to the

joint regulation of one subject, defines the reach of federal

jurisdiction, and preserves a measure of the states’ police power to

regulate that same subject. There is simply no basis for the lower

court's conclusion that the system of regulation created by the

HMITA “is of a different character than that at issue in Louisiana."

CSX, 901 F. 2d at 502.

Similarly, in Pacific Gas, the fact that federal power was

“absolute” had no bearing on this Court's decision. Specifically, this

Court found that "the Federal Government has occupied the entire

field of nuclear safety concerns, except the limited powers expressly

ceded to the States." Pacific Gas, 461 U.S. at 212. Despite such

“absolute” federal power, the Court declined to preempt state laws

within the sphere of statutory authority reserved to the states by

Congress. Id. at 213-16.

Further, in Pacific Gas, this Court expressly held that an

affirmative grant of congressional authority to the states was not

necessary in order to avoid preemption. The Court noted that

although Congress had not affirmatively granted regulatory

authority to the states, by reserving state authority to regulate the

economics of nuclear energy production, Congress “underscored

the distinction . . . between the spheres of activity left respectively

to the Federal Government and the States." Pacific Gas, 461 U.S. at

210.

13

In enacting the HMTA, Congress created the same type of

distinction found by this Court in Louisiana and Pacific Gas. The

federal government was granted authority to “Try the

intermodal transportation of hazardous materials. 49 U.S.C.App.

§§ 1801, 1802. Although affirmative regulatory authority was not

granted to the states, the authority of the federal government was

expressly limited to preemption of inconsistent state intermodal

hazardous materials requirements. 49 U.S.C.App. § 1811(a). In the

case below, the lower court expanded the authority of the federal

government, beyond that conferred by the HMTA, to preempt all

state intermodal hazardous materials requirements related to rail

transportation, whether consistent with the HMTA or not. This

Court should not permit its precedential decisions, and the express

requirements of the HMTA, to be ignored.

Il. The decision of the lower court raises an important

question of federal law that should be settled by this

Court.

The lower court correctly found that the HMTA requires that

the transportation of hazardous materials, by any mode, including

rail, must be regulated on an intermodal basis. CSX Transp., Inc. v.

Public Utilities Comm'n of Ohio, 901 F. 2d 497, 500 (6th Cir. 1990).

Further, the lower court correctly found that "the HMTA allows

state regulations which are consistent with federal regulations.” Id .

at 501.

With regard to the FRSA, the lower court correctly found that

the statutory authority of the United States Secretary of

Transportation, and the Federal Railroad Administration, is

expressly limited under the FRSA to the modal regulation of

railroad safety. Id. at 500. Further, the lower court correctly found

that in enacting the HMTA in 1974, Congress expressly removed the

transportation of hazardous materials from the purview of the

FRSA. Id.

The lower court framed the legal issue, as follows:

The question before us is simply this: should a

train carrying a load of hazardous waste be

considered a railroad which happens to be carrying

hazardous waste (thus suggesting application of the

FRSA preemption provision) or hazardous waste

14

which happens to be carried by rail (thus suggesting

application of the HMTA preemption provision)?

CSX, 901 F. 2d at 501. Congress answered this question by

requiring intermodal regulation of the transportation of hazardous

materials under the A; by expressly removing the HMTA from

the “laws relating to railroad safety" comprising the Secretary's

authority under the FRSA; and, by expressly preserving state

in 1 hazardous materials laws that are consistent with the

HMTA.

The lower court erred by concluding that the general

preemption provision of the FRSA may be construed as the

intention of Congress to preempt state intermodal hazardous

materials laws that are expressly preserved by the HMTA. Id. The

effect of the lower court decision is to render null the express

requirements of the HMTA preserving consistent state laws, and

requiring that the transportation of hazardous materials be

regulated only on an intermodal basis.

A. In enacting the HMTA, Congress expressly required

that the transportation of hazardous materials be

regulated only on an intermodal basis.

The very purpose of enactinent of the HMTA was to require

that the tra tion of hazardous materials be regulated only on

an intermodal basis. As expressly noted in the first section of the

HMTA, it is "the policy of Congress in this chapter to improve the

regulatory and enforcement authority of the Secretary of

Transportation to protect the Nation adequately against the risks to

life and property which are inherent in the transportation of

hazardous materials in commerce.” 49 U.S.C.App. § 1801.

In recognition of the fact that a single shipment of hazardous

maierials is routinely transported by several different modes of

transportation (ie, motor carrier to railroad), Congress applied the

HMTA to “any movement of property by any mode, and any

loading, unloading, or storage incidental thereto." 49 U.S.C.App.

§ 1802(6). Thus, the HMTA governs the regulation of shippers of

hazardous materials, manufacturers of containers by which such

materials are shipped, and transporters by any mode.

49 U.S.C.App. § 1804(a).

15

Prior to enactment of the HMTA, the transportation of

hazardous materials was regulated, on a separate modal basis, by

several modal administrations of the Department of Transportation,

exercising the statutory authority of the Secretary. In this regard,

the statutory authority of the Secretary to regulate the

transportation of hazardous materials, the Explosives and Other

Dangerous Articles Act, was delegated to the Federal Railroad

Administration. The lower court correctly noted this legislative

history of the HMTA:

In 1966, Congress created the Department of

Transportation (DOT). See 49 U.S.C. §§ 1651-1660, as

amended. The DOT received the authority under

several laws previously vested in a number of

government agencies and departments to regulate,

among other things, the transportation of hazardous

materials. P.L. 89-670, 49 U.S.C. 1651 (1966). The

authority to regulate under one of these laws, the

Explosives and Other Dangerous Articles Act, was

transferred from the Interstate Commerce

Commission. 49 U.S.C. § 1655(e)(4).

This authority to regulate, among other things,

the transportation of hazardous materials transferred

to the Secretary was delegated by statute to modal

administrations (in this case, the Federal Railroad

Administration and the Federal Highway

Administration). The Federal Railroad

Administration (FRA) had authority to promulgate

hazardous material transportation regulations for

railroads through its administration of the

Explosives Act. 49 U.S.C. § 1665(f)(3)(A) (1966),

amended by 49 U.S.C. § 1655(f)(3)(A) (1974). The

Federal Highway Administration (FHA) had similar

authority for motor carriers. 49 U.S.C. §

1655(f)(3)(B) (1966), amended by 49 U.S.C. §

1655(f)(3)(B) (1974). In both cases, the Secretary had

no power either to retain the authority or transfer it

to a modal administration other than the FRA (for

railroads) or FHA (for motor carriers). 49 U.S.C. §

1655(f)(3) (1966), amended by 49 U.S.C. § 1655(f)(3)

(1974).

16

CSX, 901 F. 2d at 499-500.

Further, the lower court correctly found that with the

enactment of the HMTA in 1974, Congress expressly removed the

authority of the Secretary to regulate the transportation of

hazardous materials on a modal basis. As noted by the lower court:

The HMTA amended the DOT enabling act to

prohibit the Secretary from delegating the functions,

powers, and duties to administer the Explosives Act

to the FRA or the FHA. Pub. L. 93-633, § 113(e)(1),

(2). The amended provision read in relevant part for

the FRA:

The Federal Railroad Administrator

shall carry out the functions, powers,

and duties of the Secretary pertaining

to railroad safety as set forth in the

statutes transferred to the Secretary

by subsection (e) of this section (other

than [the Explosives and Other

Dangerous Articles Act)).

49 U.S.C. § 1655(f)(3)(A). Thus, the regulation of the

transportation of hazardous materials moved from a

modal to an intermodal basis.

CSX, 901 F. 2d at 500 (emphasis added).

Notwithstanding its own findings that with the enactment of

the HMTA Congress expressly withdrew the statutory authority of

the Secretary to regulate the transportation of hazardous materials

on a modal basis, and expressly required intermodal regulation

under the HMTA, the lower court failed to apply its own correct

analysis. In this regard, the lower court reached the anomalous

conclusion that the Secretary may preempt state hazardous

materials lawvs pursuant to the FRSA, regardless of the fact that the

Secretary has no statutory authority to regulate the transportation

of hazardous materials under the FRSA:

Although we credit the PUCO's compelling

argument that the creation of the HMTA in 1974

removed promulgation (though not enforcement) of

regulations under the Explosives Act from the FRA,

we do not believe that such removal changes the fact

that FRSA preemption relates to all rules and

regulations regarding railroad safety promulgated by

17

the Secretary, whether or not such regulations are

promulgated by the FRA through power delegated

by the Secretary. See 45 U.S.C. § 434. Clearly, the

HMTA is a law relating to railroad safety, even if

regulations pursuant to it are promulgated by the

Secretary directly, not by the FRA.

CSX, 901 F. 2d at 501.

The analysis by the lower court overlooked the fact that the

HMITA did not merely transfer regulatory @uthority over hazardous

materials from the FRA to the Secretary. In enacting the HMTA,

Congress expressly removed the regulatory authority of the

Secretary from the general modal safety statutes, including the

FRSA, and required that the regulation of hazardous materials

transportation be addressed on an intermodal basis.

The Secretary is required by statute to delegate regulatory

authority over general modal safety to the modal administrations.

See, e.g., 49 U.S.C. § 103(c) (1982 & Supp. V 1987). The Secretary

has no statutory authority under the FRSA separate from that

exercised by the Federal Railroad Administration. Id. It is

incongruous to conclude, as did the lower court below, that

Congress intended to preempt state intermodal hazardous

materials regulations by means of a statue under which the

authority of the Secretary to regulate hazardous materials

transportation was expressly removed. The only statutory

authority granted to the Secretary to regulate hazardous materials

transportation is contained in the HMTA, under which Congress

expressly required intermodal regulation, and expressly preserved

consistent state laws.

B. Congress has specifically defined the scope of

preemption under the FRSA to exclude state laws

expressly preserved by the HMTA.

The lower court was able to reach the inconsistent conclusion

that Congress intended the FRSA to preempt state intermodal

hazardous materials laws only by ignoring the express provisions

of the HMTA, and by misconstruing the preemption provision of

the FRSA. The court fourd that the following ianguage of the

FRSA exhibited the manifest intent of Congress to preempt state

intermodal hazardous materials laws: "A State may adopt or

18

| . |

continue in force any law, rule, regulation, order, or standard

relating to railroad safety until such time as the Secretary has adopted

a rule, regulation, order, or standard covering the subject matter of

such State requirement." 45 U.S.C. § 434 (emphasis added).

Specifically, the lower court mistakenly concluded "that FRSA

ion relates to all rules and regulations regarding railroad

, and that "the HMTA is a law relating to railroad safety."

, 901 F 2d at 501. In reaching this conclusion, the lower court

disregarded the fact that Congress has expressly defined the "laws

relating to railroad safety" that comprise the Secretary's statutory

authority under the FRSA, and has specifically excluded the

HMTA.

The congressional purpose to preempt state laws "relating to

railroad safety," as expressed in 45 U.S.C. § 434, is clearly defined

and delimited by the general authority conveyed upon the

Secretary by the FRSA to "prescribe, as necessary, appropriate rules,

regulations, orders, and standards for all areas of railroad safety

supplementing provisions of law and regulations in effect on

October 16, 1970." 45 U.S.C. § 431(a). When the FRSA was enacted

in 1970, the only existing statute governing the transportation of

hazardous materials, the Explosives and Other Dangerous Articles

Act, was included within the statutes supplemented by the FRSA.

In 1974, statutory authority for the regulation of hazardous

materials was expressly removed from the FRSA, and consolidated

on an intermodal basis in the HMTA. 49 U.S.C. § 1655(f)(3)(A)

(1966), amended by 49 U.S.C. § 1655(f)(3)(A) (1974) (repealed 1983).

Congress limited the authority of the Secretary to preempt state

hazardous materials requirements to the intermodal authority

granted by the HMTA, by expressly excluding the Explosives Act

from the list of laws relating to railroad safety that comprised the

Secretary's authority under the FRSA.

In this regard, with enactment of the HMTA, Congress limited

the statutory authority of the Secretary that could be delegated for

administration under the FRSA, as follows:

The Federal Railroad Administrator shall carry

out the functions, powers, and duties of the

Secretary pertaining to railroad safety as set forth in the

statutes transferred to the Secretary by subsection (e)

of this section (other than [the Explosives and Other

Dangerous Articles Act)).

19

49 U.S.C. § 1655(f)(3)(A) (1966) amended by 49 U.S.C. § 1655(f)(3)(A)

(1974) (repealed 1983) (emphasis added).

The lower court recognized that "[t]he HMTA amended the

DOT enabling act to prohibit the Secretary from delegating the

functions, powers, and duties to administer the Explosives Act to

the FRA ...." CSX, 901 F 2d at 500. Accordingly, the lower court's

finding of FRSA preemption was based upon the statutory

authority of the Secretary, under a statute that Congress clearly

amended to exclude any authority to regulate the intermodal

transportation of hazardous materials.

In 1980, Congress again amended several provisions of the

FRSA. Federal Railroad Safety Authorization Act of 1980, Pub. L.

No. 96-423, 94 Stat. 1811 (1980), (amending 45 U.S.C. §§ 431-443).

The 1980 amendments clarified the congressional intention to limit

both preemption and state participation to the specific "laws related

to railroad safety" supplemented by the FRSA. In this regard, the

1980 amendments expanded both the authority of the Secretary,

and the authority of the states to participate in certified

enforcement under the FRSA, by incorporating those laws which

had only been "supplemented" in the original 1970 enactment.

Once again, the regulation of hazardous materials transportation

was not considered germane to either the authority of the Secretary,

or to the preemption and participation of the states, under the

FRSA definition of "laws relating to railroad safety."2 This fact was

expressly noted in the legislative history:

: Previously, state enforcement of federal railroad safety requirements was

limited to regulations promulgated under the FRSA: “A state may participate

in carrying out investigative and surveillance activities in connection with any

rule . . . under this subchapter.” 45 U.S.C. § 435(a) (emphasis added). The 1980

amendments clarified state authority under the FRSA “laws relating to

railroad safety," excluding any state enforcement of regulations promulgated

under the HMTA:

In addition to the provisions for State participation set forth in

subsections (a) and (c) of this section, the Secretary may enter

into agreements with any State to provide investigative and

surveillance activities with respect to those functions transferred

to the Secretary by section 1655(e)(1), (e)(2), and (e)(6)(A) of Title

49 ["railroad safety laws” listed in the Department of

Transportation Act].

Federal Railroad Safety Authorization Act of 1980, Pub. L. No. 96-423, 94 Stat.

1811 (1980) (enacting 45 U.S.C. § 435(g)).

20

Section 4 changes existing law by expanding the

permissible scope of state participation in railroad

safety activity under the State safety participation

program. Currently, states can only participate in

investigation and enforcement activity under the

1970 Safety Act and regulations thereunder. Existing

law does not allow state participation with regard to

the earlier safety laws. These laws are the Safety

Appliance Acts (45 U.S.C. 1-16), Locomotive

Inspection Act (45 U.S.C. 22-34), Signal Inspection

Act (49 U.S.C. 26), Hours of Service Act (45 U.S.C.

61-64b), and Accident Reports Act (45 U.S.C. 38-43).

This section would make it clear that the states could

participate in investigation and enforcement

activities under these other railroad safety laws.

Since the Hazardous Materials Transportation Act is not

directed specifically and solely at railroad safety, that Act

is not within the scope of the amendment.

H. R. Rep. No. 1025, 96th Cong., 2d Sess. 13, reprinted in 1980 U.S.

Code Cong. & Admin. News 3830, 3837-38 (emphasis added).

Similarly, Congress granted the same authority to the

Secretary, and clarified the duties of the Secretary with respect to

"railroad safety" under the FRSA without regard to the intermodal

regulation of hazardous materials transportation. As noted in the

legislative history:

Section 6 [amending 45 U.S.C. § 437] would

consolidate and clarify the general powers available

to the Secretary in carrying out his duties with respect to

railroad safety within the [Federal Railroad] Safety Act.

Subsection 6(a) of the bill includes within section

208(b) of the Safety Act (45 U.S.C. 437(b)) the

inspection authority available to the Secretary for the

purpose of carrying out his duties under the Safety

Appliance Acts, the Locomotive Inspection Act, the

Hours of Service Act, the Accident Reports Act, and

the Signal Inspection Act. These duties had been

transferred to the Secretary from the Interstate

Commerce Commission by the Department of

Transportation Act.

Id. at 3839 (emphasis added).

21

Thus, both the authority of the Secretary and participating

states under the FRSA was clarified by reference to the Department

of Transportation Act, which incorporated "laws relating generally

to safety appliances and equipment on railroad engines and cars,"

and transferred the administration of such laws from the ICC to the

Secretary. In this regard, both of the 1980 amendments clarifying

the purpose of the FRSA referred to the functions transferred to the

Secretary by sections 6(e)(1), (e)(2), and (e)(6)(A) of the Department

of Transportation Act (49 U.S.C.App. §§ 1655 (e)(1), (e)(2), and

(e)(6)(A)). See 45 U.S.C. §§ 435(g), 437(b). The Department of

Transportation Act, in pertinent part, provided that:

(e) There are hereby transferred to and vested in

the Secretary all functions, powers, and duties of the

Interstate Commerce Commission, and of the

Chairman, members, officers, and offices thereof,

under ---

(1) the following laws relating generally to

safety appliances and equipment on railroad engines

and cars, and protection of employees and

travelers:

(A) The Act of March 2, 1893, as

amended (27 Stat. 531; 45 U.S.C. 1 et seq.)

[Safety Appliance Act].

(B) The Act of March 2, 1903, as

amended (32 Stat. 943; 45 U.S.C. 8 et seq.)

[Safety Appliance Act].

(C) The Act of April 14, 1910, as

amended (36 Stat. 298; 45 U.S.C. 11 et

seq.) [Safety Appliance Act].

(D) The Act of May 30, 1908, as

amended (35 Stat. 476; 45 U.S.C. 17 et

seq.) [Safety Apptiance Act].

(E) The Act of February 17, 1911, as

amended (36 Stat. 913; 45 U.S.C. 22 et

seq.) [Locomotive Inspection Act].

(F) The Act of March 4, 1915, as

amended (38 Stat. 1192; 45 U.S.C. 30)

[Locomotive Inspection Act].

(G) Reorganization Plan No. 3 of 1965

(79 Stat. 1320).

(H) Joint Resolution of June 30, 1906,

as amended (34 Stat. 838; 45 U.S.C. 35)

[Accident Reports Act].

(I) The Act of May 27, 1908, as

amended (35 Stat. 325; 45 U.S.C. 36 et

seq.) [Accident Reports Act].

(J) The Act of March 4, 1909, as

amended (35 Stat. 965; 45 U.S.C. 37)

[Accident Reports Act].

(K) The Act of May 6, 1910, as

amended (36 Stat. 350; 45 U.S.C. 38 et

seq.) [Accident Reports Act].

(2) the following law relating generally to

hours of service of employees: The Act of

March 4, 1907, as amended (34 Stat. 1415; 45

US.C. 61 et seq.) [Hours of Service Act).

(4) the following provisions of law relating

generally to explosives and other dangerous

articles: Sections 831-835 of Title 18 [the

Explosives and Other Dangerous Articles Act].

(6) the following provisions of the

Interstate Commerce Act, as amended ---

(A) relating generally to safety

appliances methods and systems: Section

25 (49 App.U.S.C. 26) [Safety Appliance

Act].

49 U.S.C.App. § 1655(e) (repealed in part 1983) (emphasis added).

Three aspects of the 1980 amendments of the Department of

Transportation Act are especially noteworthy. First, Congress

expressly indicated that the purpose of the amendments was to

"clarify the general powers available to the Secretary in carrying out

his duties with respect to railroad safety within the [Federal

Railroad] Safety Act."3 Secondly, Congress expressly noted that the

HMTA was not within the scope of the clarifying amendments.

And finally, Congress clarified the intent of the FRSA by reference

to "laws relating generally to safety appliances and equipment on

railroad engines and cars, and protection of employees and

travelers," and specifically excluded any reference to either the

Explosives and Other Dangerous Articles Act, a hazardous

materials transportation statute within the same subsection as the

referenced “laws relating generally to safety appliances and

equipment," or to the HMTA. Compare 49 U.S.C.App. § 1655(e)(1),

(e)(2), (e)(6)(A) with 49 U.S.C.App. § 1655(e)(4) (repealed 1983).

Thus, the "list of other railroad safety statutes" to be supplemented

by the FRSA was expressly incorporated into the FRSA, and the

statutory basis for intermodal hazardous materials regulation was

expressly excluded from the “laws relating to railroad safety" that

comprise the Secretary's statutory authority under the FRSA.

Finally, in amending the FRSA in 1980, Congress conclusively

demonstrated that the HMTA was not to be considered as a "law

relating to railroad safety" under the FRSA, unless Congress

expressly required otherwise. In this regard, Congress included the

HMITA within only one section of the FRSA:

As used in this section, the term ‘Federal railroad

safety laws' means this Act, the Hazardous Materials

Transportation Act (49 U.S.C. 1801 et seq.), and those

laws transferred to the jurisdiction of the Secretary of

Transportation by subsection (e)(1), (2), and (6)(A) of

section 6 of the Department of Transportation Act (49

U.S.C. 1655(e)(1), (2), and (6)(A)).

$ H.R. Rep. No. 1025, 96th Cong., 2d Sess. 13, reprinted in 1980 U.S. Code

Cong. & Admin. News 3830, 3839. It is important to note that in defining its

own authority, the FRA expressly recognizes its limited authority to enforce

regulations under the HMTA, separate from its general regulatory authority for

railroad safety under the FRSA statutorily delegated from the Secretary:

By delegation from the Secretary of Transportation, the

Administrator has responsibility for: (a) Enforcement of

Subchapters B and C of Chapter I, Subtitle B, Title 49, CFR, with

respect to the transportation or shipment of hazardous materials

by railroad (49 CFR 1.4%s)); (b) Exercise of the authority vested in

the Secretary by the Federal Railroad Safety Act of 1970, 45

U.S.C. 421, et seq. (49 CFR 1.49(m)).

49 C.ER. § 209.1 (emphasis added).

24

_— ” |

Federal Railroad Safety Authorization Act of 1980, § 10(e), Pub. L.

No. 96-423, 94 Stat. 1811 (1980) (codified at 45 U.S.C. § 441(e))

(emphasis added).

Clearly, had Congress considered the FRSA to be generally

applicable to the intermodal regulation of hazardous materials

transportation, there would have been no need to expressly include

the HMTA in one specific section of the FRSA, or to limit the

definition to that particular section. Neither the FRSA generally,

nor the preemption provision of the FRSA, was intended by

Congress to apply to consistent state enforcement of federal

intermodal hazardous materials requirements.

It is difficult to imagine a more conclusive expression of the

legislative intention to separate the general safety authority over

railroads under the FRSA, from the specific intermodal authority

over the regulation of hazardous materials transportation contained

within the HMTA. Unquestionably, the authority of the Secretary

under the FRSA, state participation authority under the FRSA, and

federal preemption of state laws under the FRSA, were intended by

Congress to exclude any consideration of the transportation of

hazardous materials. Congress expressly recognized and reserved

the intermodal regulation of hazardous materials to the HMTA.

As it stands today, the Secretary is empowered under the

FRSA to "prescribe, as necessary, appropriate rules, regulations,

orders, and standards for all areas of railroad safety supplementing

provisions of law and regulations in effect on October 16, 1970." 45

U.S.C. § 431(a) (emphasis added). “All areas of railroad safety" is

expressly defined without reference to the regulation of hazardous

materials transportation. 45 U.S.C. § 431(k). The HMTA, enacted

in 1974, is clearly not a law that was "in effect on October 16, 1970."

As noted by Congress, "the general powers available to the

Secretary in carrying out his duties with respect to railroad safety

within the [Federal Railroad] Safety Act,” is clarified by 45 U.S.C. §

437. H.R. Rep. No. 1025, 96th Cong., 2d Sess. 14, reprinted in USS.

Code Cong. & Admin. News 3830, 3839. In this regard, the

Secretary has broad authority "to issue orders directing compliance

with this chapter or with any railroad safety rule, regulation, order,

or standard issued under this chapter." 45 U.S.C. § 437(a) (emphasis

added). The FRSA conveys broad inspection authority "[t]o carry

out the Secretary's responsibilities under this subchapter and under

the functions transferred by section 1655(e)(7’, (e)(2), and (e)(6)(A) of

{

25

Title 49." 45 U.S.C. § 437(b) (emphasis added). Neither the

Secretary, nor the FRA by statutory delegation, has any authority to

ate the intermodal transportation of hazardous materials as an

area of “railroad safety" under the FRSA.

The authority of the states to participate in “investigative and

surveillance activities" under the FRSA is also defined "with respect

to those functions transferred to the Secretary by section 1655(e)(1),

(e)(2), and (e)(6)(A)." 45 U.S.C. § 435(g). See also 45 U.S.C. §

436(a)(1), (b)(1). Similarly, the jurisdiction of the United States

district courts to enforce the orders of the Secretary is defined by

reference to orders "under this subchapter," and under the laws

transferred by section 1655(e)(1), (e)(2), and (e)(6)(A) of Title 49. 45

US.C. § 437(a), (d)(1), (d)(2); 45 U.S.C. § 439(a).

Thus, in requiring preemption of state "laws, rules,

regulations, orders, and standards relating to railroad safety,"

Congress clearly defined “railroad safety" as the specific subjects

addressed by the provisions of the FRSA and Sections 1655(e)(1),

(e)(2), and (e)(6)(A) of Title 49. 45 U.S.C. § 434. Congress expressly

excluded intermodal hazardous materials regulations from the

definition of “Igws. . . relating to railroad safety." 49 U.S.C. §

103(c)(1) (1982 & Supp. V 1987). As recently as 1983, Congress

recodified 49 U.S.C. § 1655(f)(3)(A), and again expressly defined

“railroad safety" as excluding hazardous materials regulation under

the HMTA:

(c) The [Federal Railroad] Administrator shall carry

out—

(1) duties and powers related to railroad safety

vested in the Secretary by section 6(e)(1), (2), and

(6)(A) of the Department of Transportation Act (49

App.U.S.C. 1655(e)(1), (2), and (6)(A)).

49 U.S.C. § 103(c)(1) (1982 & Supp. V 1987). Neither the Explosives

Act, nor the HMTA, were included by Congress in the statutes

comprising the authority over "railroad safety vested in the

Secretary" under the FRSA. The preemption of state hazardous

materials requirements has clearly been left to the express

provisions of the HMTA.

The clear and manifest intent of Congress requires that

questions of federal preemption of state intermodal hazardous

materials laws be resolved by reference to the only federal statute

that governs the intermodal transportation of hazardous materials,

26

the HMTA. In enacting the HMTA, Congress expressly removed

from the FRSA any statutory authority to either regulate the

transportation of hazardous materials, or to preempt state

hazardous materials laws. Congress expressly required that

hazardous materials transportation be regulated under the HMTA

on an intermodal basis, and expressly preserved the authority of

the states to regulate the intermodal transportation of hazardous

materials in a manner consistent with the HMTA.

C. The decision of the lower court created a statutory

conflict between the HMTA and the FRSA, and

resolved that conflict by nullifying the requirements

of the HMTA.

Despite finding that in enacting the HMTA, Congress

removed the statutory authority of the Secretary from the respective

modal safety statutes, including the FRSA, the lower court applied

the preemption provision of the FRSA to state intermodal

hazardous materials requirements. The effect of this

misconstruction is to defeat beth the congressional purpose of the

HMTA to require intermodal regulation, and the express

congressional intent to provide for consistent state regulation.

The rule of statutory construction that should govern this case

is that such a preemption analysis “is also to be tempered by the

conviction that the proper approach is to reconcile 'the operation of

both statutory schemes with one another rather than holding one

completely ousted.'" Merrill Lynch v. Ware, 414 U.S. 117, 127 (1973)

(quoting Silver v. New York Stock Exchange, 373 U.S. 341, 357 (1963)

(citations omitted)). Thus, in Louisiana, this Court held that where a

finding of preemption necessitated a finding that two federal

statutes were in conflict, the statutory provisions should be

reconciled, if possibli:, to preserve the authority of the state, and to

avoid the conflict. Louisiana, 476 U.S. at 370. The lower court

agreed with this rule of statutory construction, but then ignored it.

CSX, 901 F. 2d at 502.

Specifically, the lower court found that:

A failure to follow the preemption provision of the

HMITA in no respect ousts the HMTA. In this case,

the decision of the district court, applying the FRSA

preemption provision to regulations promulgated

27

under the HMTA, retains the essential character and

purpose of both statutes. The national character of

railroad regulation and the need for regulation of

hazardous material transportation on an intermodal

basis are both respected.

CSX, 901 F. 2d at 503.

The conclusion of the lower court is wrong. In expressly

requiring that the transportation of hazardous materials, by any

mode, be regulated under the HMTA, Congress did not create an

exception for hazardous materials transported by rail. By expressly

preserving consistent state intermodal hazardous materials

regulatio.is, Congress did not intend to preempt those same state

requirements by means of an earlier statute that addresses a

different subject.

By first concluding that the HMTA is a "law relating to

railroad safety" under the FRSA, the lower court necessarily

concluded that the two federal statutes were in conflict. CSX, 901 F

2d at 501. As the lower court noted, “unlike the preemption

provision of the FRSA, which forbids state regulation on subject

matter on which the Secretary has already adopted a regulation, the

HMITA allows state regulations which are consistent with federal

regulations." Id. The lower court "resolved" this conflict by

nullifying the express requirements of the HMTA.

If the HMTA is not properly considered to be one of the

“railroad safety laws" comprising the Secretary's authority under

the FRSA, there is no conflict between the respective preemption

provisions. The FRSA preempts state laws "relating to railroad

safety" where the Secretary has promulgated a regulation under the

FRSA "covering the subject matter." The HMTA preempts

inconsistent state intermodal hazardous materials requirements,

and preserves the states’ authority to enforce consistent intermodal

regulations.

While the lower court was correct that its decision does not

completely oust the HMTA, it certainly does so with respect to any

state enforcement of federal intermodal regulations that apply to

the transportation of hazardous materials by rail. The effect of this

decision is to render the statutory scheme of the HMTA anomalous,

and unworkable, subjecting state citizens to the harm that congress

intended to preclude through enactment of the HMTA.

;

28

. | | -

Under the provisions of the HMTA left undisturbed by the

lower court, states retain the right to regulate, consistent with the

requirements of the HMTA, s ge of hazardous materials,

manufacturers of containers such materials are shipped,

and transporters by any mode, except railroad. 49 U.S.C.App.

§ 1804(a). , Thus, the decision of the lower court results in the

anomalous situation of consistent state regulations applying to the

container in which a particular shipment of hazardous materials is

packaged, to the shipper, to the motor carrier who would transport

the shipment to the railyard, and to the motor cartier who would

transport the shipment from the railyard—but not to the

transporting railroad. It defies reason to believe that Congress

would have required this result without creating an express

exception for railroads.

Thus, “the need for regulation of hazardous materials

transportation on an intermodal basis," expressly recognized by

Congtess, was clearly not "respected" by the lower court. In

contravention of the intent of Congress, the lower court prohibited

the states from enforcing intermodal hazardous materials

requirements that are consistent with the HMTA. The decision of

the lower court should be reversed.

CONCLUSION

The decision of the lower court defeats the manifest

intention of Congress, prohibiting the sovereign states from

protecting their citizens from the very real threat posed by the daily

transportation of toxic and explosive substances through their

communities. Congress clearly did not envision such a result, and

this Court should not permit it to stand.

For the foregoing reasons, Petitioners respectfully submit

that this petition for certiorari to the United States Court of Appeals

for the Sixth Circuit should be granted.

Respectfully submitted,

ANTHONY J. CELEBREZZE, JR.

Attorney General of Ohio

ROBERT S. TONGREN

Assistant Attorney General

Counsel of Record

JAMES B. GAINER

Assistant Attorney General

Office of the Ohio Attorney General

Public Utilities Section

180 East Broad Street

Columbus, OH 43266-0573

(614) 466-4397

Attorneys for Petitioners,

The Public Utilities Commission

of Ohio, et al.

In The

Supreme Court of the United States

OCTOBER TERM, 1989

THE PUBLIC UTILITIES COMMISSION OF OHIO, et al.,

Petitioners,

v.

CSX TRANSPORTATION, INC., et al.,

Respondents.

Appendix

ANTHONY J. CELEBREZZE, JR.

Attorney General of Ohio

ROBERT S. TONGREN

Assistant Attorney General

Counsel of Record

JAMES B. GAINER

Assistant Attorney General

Office of the Ohio Attorney General

Public Utilities Section

180 East Broad Street

Columbus, OH 43266-0573

(614) 466-4397

Attorneys for Petitioners,

The Public Utilities Commission

of Ohio, et al.

TABLE OF CONTENTS

CSX Transp., Inc. v. Public Utilities Comm'n of Ohio,

701 F. Supp. 608 (S.D. Ohi0 1988)...........ssessecesecnessesseeneesnenneens

CSX Transp., Inc. v. Public Utilities Comm'n of Ohio,

901 F. 2d 497 (6th Cir. 1990)..........scssesesssesessssssesessnsnsnsseessesnenes

CSX TRANSPORTATION, INC.,

et al., Plaintiffs,

Vv.

The PUBLIC UTILITIES COMMISSION

OF OHIO, et al., Defendants.

No. C2-88-1023.

United States District Court,

S.D. Ohio, E.D.

Dec. 12, 1988.

OPINION AND ORDER

GRAHAM, District Judge.

In 1970 Congress enacted the Federal Railroad Safety Act

(FRSA), 45 U.S.C. § 421 et seq. which authorized the Secretary of the

Department of Transportation to adopt railroad safety regulations.

Congress included in that act broad preemption provisions

excluding the states from legislating in any area of railroad safety

already cuvered by regulations adopted by the Secretary. In 1974

Congress enacted the Hazardous Materials Transportation Act

(HMTA), 49 U.S.C.App. § 1801 et seq. authorizing the Secretary to

adopt rules and regulations governing the transportation of

hazardous materials by any mode of transportation. The

preemption provisions of the HMTA permit the states to adopt and

enforce their own laws and rules regulating the transportation of

hazardous materials so long as they are not inconsistent with

federal rules adopted under the HMTA. This case presents the

question of whether state legislation regulating the transportation

of hazardous materials by rail is governed by the strict preemption

provisions of the FRSA or by the more liberal preemption

provisions of the HMTA.

The State of Ohio has recently passed legislation

incorporating into Ohio law the federal regulations adopted by the

Secretary of Transportation under the HMTA relating to the

transportation of hazardous materials by rail. See Ohio Rev.Code §

4907.64 (effective September 26, 1988) (authorizing the Public

A-1

Utilities Commission of Ohio (PUCO) to adopt railroad safety laws

"consistent with, and equivalent in scope, coverage, and content to,

the provisions of the [HMTA], and regulations adopted under it.");

Ohio Admin.Code § 4901:3-1-10 (effective December 10, 1988)

(adopting the provisions of the HMTA regulations contained in 49

C.F.R. §§ 171-179 governing the transportation of hazardous

materials by rail). Ohio seeks to enforce these rules against

railroads through its own system of enforcement, which includes

civil penalties. See Ohio Rev.Code § 4905.83; Ohio Admin.Code §§

4902:2-7-01 through 4901:2-7-22.

This legislation resulted from a study of state and federal

hazardous materials regulation, enforcement and emergency

response conducted by a group of state agencies collectively known

as the Ohio Hazardous Substances Emergency Team (OHSET)

which was formed in response to the July, 1986 disaster in

Miamisburg, Ohio when a number of railroad cars operated by

plaintiff CSX Transportation, Inc., derailed near Miamisburg, Ohio.

A rail car containing phosphorous ignited and burned, spreading a

cloud of toxic gas throughout the area and forcing the evacuation of

40,000 citizens. The Ohio act reflects the judgment of the executive

and legislative branches of state government that federal

enforcement of regulations governing hazardous materials

transported by rail is inadequate.

Plaintiffs are four major railroads engaged in interstate rail

transportation in and through Ohio who challenge the

constitutionality of the newly enacted Ohio statutes and

administrative regulations. Defendants are the PUCO, its chairman

and commissioners. Plaintiffs challenge the Ohio statutes and

regulations on the grounds that they violate the Supremacy Clause

of the United States Constitution, the preemption provisions of the

FRSA and the HMTA and on the further grounds that they impose

an undue burden on interstate commerce. The matter is now before

the Court on the plaintiffs' motion for summary judgment and the

defendants’ cross motion for summary judgment. In their motions,

the parties seek summary judgment on the issue of federal

preemption.

The United States Supreme Court has recently summarized

the various tests enunciated for determining whether federal law

has preempted state legislation:

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The Supremacy Clause of Art. VI of the

Constitution provides Congress with the power to

pre-empt state law. Pre-emption occurs when

Congress, in enacting a federal statute, expresses a

clear intent to pre-ernpt state law, Jones v. Rath Packing

Co., 430 US. 519, [97 S.Ct. 1305, 51 L.Ed.2d 604] (1977),

when there is outright or actual conflict between

federal and state law, e.g., Free v. Bland, 369 U.S. 663,

[82 S.Ct. 1089, 8 L.Ed.2d 180] (1962), where

compliance with both federal and state law is in effect

physically impossible, Florida Lime & Avocado Growers,

Inc. v. Paul, 373 U.S. 132 [83 S.Ct. 1210, 10 L.Ed.2d

248] (1963), where there is implicit in federal law a

barrier to state regulation, Shaw v. Delta Air Lines, Inc.,

& 463 US. 85 [, 103 S.Ct. 2890, 77 L.Ed.2d 490] (1983),

where Congress has legislated comprehensively, thus

occupying an entire field of regulation and leaving no

room for the States to supplement federal law, Rice v.

Santa Fe Elevator Corp., 331 U.S. 218 [67 S.Ct. 1146, 91

L.Ed. 1447] (1947), or where the state law stands as an

obstacle to the accomplishment and execution of the

full objectives of Congress. Hines v. Davidowitz, 312

U.S. 52 [, 61 S.Ct. 399, 85 L.Ed. 581] (1941).

Pre-emption may result not only from action taken by

Congzess itself; a federal agency acting within the

scope of its congressionally delegated authority may

pre-empt state regulation. Fidelity Federal Savings &

Loan Assn. v. De la Cuesta, 458 U.S. 141 [, 102 S.Ct. 3014,

73 L.Ed.2d 664] (1982); Capital Cities Cable, Inc. v.

Crisp, 467 U.S. 691 [ ,104 S.Ct. 2694, 81 L.Ed.2d 580)

(1984).

Louisiana Public Service Commission v. FCC, 476 U.S. 355 358-369, 106

S.Ct. 1890, 1989-99, 90 L.Ed.2d 369 (1986).

At the heart of each of these standards is the discernment of

the true purpose of Congress. "The critical question in any

pre-emption analysis is always whether Congress intended that

federal regulation supersede state law.";, Louisiana Public Service

Commission, 476 U.S. at 369, 106 S.Ct. at 1899.

The stated purpose of the FRSA is "to promote safety in all

areas Of railroad operations." 45 U.S.C. § 421. The Act requires the

Secretary of Transportation to prescribe appropriate rules,

A-3

regulations, orders and standards for all areas of railroad safety and

to conduct research, development, testing, evaluation and training

in all areas of railroad safety. In 45 U.S.C. § 434 Congress declared

its intention that laws, rules, regulations, orders and standards

relating to railroad safety should be nationally uniform to the extent

practicable. The statute reads as follow:

The Congress declares that laws, rules,

regulations, orders, and standards relating to railroad

safety shall be nationally uniform to the extent

practicable. A State may adopt or continue in force

any law, rule, regulation, order, or standard relating to

railroad safety until such time as the Secretary has

adopted a rule, regulation, order, or standard covering

the subject matter of such State requirement. A State

may adopt or continue in force an additional or more

stringent law, rule, regulation, order, or standard

relating to railroad safety when necessary to eliminate

or reduce an essentially local safety hazard, and when

not incompatible with any Federal law, rule,

regulation, order, or standard, and when not creating

an undue burden on interstate commerce.

Thus, under 45 U.S.C. § 434, a state may legislate in areas relating

to railroad safety only until such time as the Secretary has adopted

a rule, regulation, order or standard covering the same subject

matter. A state, within limitation, may adopt an additional or more

stringent rule only when necessary to address a local safety hazard.

This exception does not apply to this case.

The FRSA, however, does contemplate a limited state role in

enforcement. Title 45, U.S.C. § 435 provides that a state may

participate in investigation and surveillance in connection with any

rule or standard prescribed by the Secretary under the FRSA

pursuant to certification provisions contained in the statute. The

section provides, however, that "the Secretary shall retain the

exclusive authority to assess and compromise penalties ... for the

violation of rules, regulations, orders, and standards prescribed by

the Secretary" under the FRSA.

The stated purpose of the HMTA is "to improve the regulatory

and enforcement authority of the Secretary of Transportation to

protect the Nation adequately against the risks to life and property

which are inherent in the trarsportation of hazardous materials in

A-4

commerce." 49 U.S.C.App. § 1801. The Act authorizes the

Secretary to issue regulations for the safe transportation of

hazardous materials which "shall be applicable to any person who

transports ... a hazardous material." 49 U.S.C.App. § 1804(a).

The Act authorizes the Secretary to issue regulations governing not

only the transportation of hazardous materials, but also their

handling and the manufacture, repair and testing of the containers

in which they are transported. 49 U.S.C.App. §§ 1804, 1805.

In 49 U.S.C.App. § 1811, Congress provided for preemption

of state laws on the subjects covered by the HMTA only when they

are inconsistent with the Act or regulations adopted pursuant to it.

(a) Except as provided in subsection (b) of this

section, any requirement, of a State or political _

subdivision thereof, which is inconsistent with any

requirement set forth in this chapter, or in a regulation

issued under this chapter, is preempted.

Section 49 U.S.C.App. § 1811(b) provides a procedure whereby a

state may request the Secretary of Transportation to make an

administrative determination whether or not a state requirement is

inconsistent with the HMTA or a regulation adopted pursuant to it.

The Secretary has delegated this authority to the Office of

Hazardous Materials Transportation, Research and Special

Programs Administration (RSPA), 49 C.ER. § 107.201 et seq.

Acting pursuant to the HMTA, the Secretary has adopted a

body of regulations defining hazardous materials, establishing

requirements for the containers they are transported in, and

regulating their transportation by any mode, including air, water,

rail and highway. These regulations are known as the Hazardous

Materials Rules (HMR) and they are found at 49 C.F.R. §§ 171-179.

The HMR's which relate specifically to railroads are found at 49

C.ER. § 174.

Plaintiffs contend that this case is controlled by the broad

preemption provisions of FRSA and that Congress intended to

preclude state regulation of the transportation of hazardous

materials by rail. Plaintiffs argue that regulations relating to the

transportation of hazardous materials by rail are regulations

“relating to railroad safety" within the meaning of 45 U.S.C. § 434

and that the states are precluded thereby from adopting or

enforcing dual standards which relate to the transportation of

hazardous materials by rail. Defendants contend, on the other

A-5

hand, that Congress intended that the FRSA and its preemption

provisions should apply only to general railroad safety regulations

pertaining essentially to equipment, track and operating procedures

whereas Congress addressed the subject of hazardous materials in

the HMTA and intended that its preemption provisions should

apply to such regulations.

It is clear that when Congress enacted the FRSA in 1970 it

addressed not only general rail safety but also specifically

addressed the transportation of hazardous materials.

The Congress declares that the purpose of this

Chapter [FRSA] is to promote safety in all areas of

railroad operations . . . and to reduce deaths and

injuries to persons and to reduce damage to property

caused by accidents involving any carrier of hazardous

materials.

45 U.S.C. § 421 (emphasis added). There is no dichotomy, as

defendants suggest, between the FRSA and the HMTA, with the

former limited to general railroad safety and the latter directed

specifically toward the intermodal regulation of the transportation

of hazardous materiais. Indeed the regulation of the transportation

of hazardous materials by rail is inextricably intertwined with the

regulation of railroad equipment and operating procedures.

The legislative history of the FRSA evidences a clear

Congressional intent that rail safety regulations be nationally

uniform and that all enforcement should be by federal authorities.

With the exception of industrial or plant

railroads, the railroad industry has very few local

characteristics. Rather, in terms of its operations, it has

a truly interstate character calling for a uniform body

of regulations and enforcement. It is a national

system. ... In addition to the obvious areas of rolling

stock and employees, such elements as operating

rules, signal systems, power supply systems, and

communication systems of a single company normally

cross many State lines. To subject a carrier to

enforcement before a number of different State

administrative and judicial systems in several areas of

operation could well result in an undue burden on

interstate commerce.

H.R.Rep. No. 1194, 91st Cong., 2d Sess., reprinted in 1970 U.S.Code

A-6

%

a tre ; mn -

Cong. & Admin.News 4104, 4110-4111.

The Committee does not believe that safety in the

Noton's railroads would be advanced sufficiently by

suvjecting the national rail system to a variety of

enforcement in 50 different judicial and administrative

systems. Accordingly, while it has preserved the

framework of certification, it has modified the concept

insofar as it applies to the nation's rail system to make

all enforcement Federal in nature. The Secretary will

have exclusive authority to assess and compromise

penalties and to recommend court action for recovery of

such penalties .. . [States] will have no authority to

assess and compromise penalties or to seek State judicial

action.

Id. at 4109.

The scope of preemption under the FRSA has been broadly

construed by the courts. See National Association of Regulatory

Utility Commissioners v. Coleman, 542 F.2d 11 (3d Cir.1976);

Chesapeake & Ohio Railway Co. v. City of Bridgman, 669 FSupp. 823,

825 (W.D.Mich.1987); Consolidated Rail Corp. v. Pennsylvania Public

Utility Commission, 536 FSupp. 653 (E.D.Pa.), aff'd mem., 696 F.2d

981 (3rd Cir. 1982), aff'd mem. 461 U.S. 912, 103 S.Ct. 1888, 77

L.Ed/2d 280 (1983); Missouri Pacific Railroad Co. v. Railroad

Commission of Texas, 671 F.Supp. 466 (W.D.Tex.1987), aff'd, 850 F2d

264 (5th Cir.1988).

As noted above, the preemption clause of the FRSA provides

in part as follows:

A State may adopt or continue in force any law, rule,

regulation, order, or standard relating to railroad

safety until such time as the Secretary has adopted a

rule, regulation, order or standard covering the subject

matter of such State requirement.

45 US.C. § 434. A central issue in this case is the meaning of the

phrase "any law, rule, regulation, order or standard relating to

railroad safety." The key components of the phrase are: “any law,

etc.," "relating to," “railroad safety." These are words of broad

meaning and in ordinary usage they would certainly include rules

relating to the transportation of hazardous materials by rail.

Defendants have a heavy burden to show that the phrase should be

interpreted so as to exclude such rules.

A-7

The legislative history of FRSA indicates that Congress

intended the phrase, “relating to railroad safety," as used in 45

U.S.C. § 434, to include intermodal safety regulations insofar as

they apply to rail transport. For instance, Congress included in a

list of “existing railroad safety laws" the Explosives and Other

Dangerous Articles Act, a predecessor of the HMTA which

provided for intermodal regulation of the transportation of

hazardous materials. H.R.Rep. No. 1194, 9ist Cong., 2d Sess.

(Appendix B).

In 1980 when Congress defined the term “railroad safety laws"

in the context of a “whistle blower" statute, the definition expressly

included the HMTA. See 45 U.S.C. § 441(e). The statutes listed in

this section are the same statutes set forth in the list mentioned in

the preceding paragraph, except for the substitution of the HMTA

for the Explosives Act.

The legislative history of the FRSA shows that the issue of

federal preemption was vigorously debated, leaving a clear record

of Congressional intent for virtually complete federal preemption in

the area of railroad safety laws. The legislative history of HMTA,

which was enacted just four years later, is devoid of any debate or

discussion on the standard of preemption applicable to rules which

regulate the transportation of hazardous materials by rail.

Representative Springer observed during the hearings on

FRSA:

I think this [preemption] is the great area or problem, Mr.

Secretary where there would be a possibility, this is

just opinion, but I think I can read that this would be

the area probably where we might have the most

agreement or disagreement about what ought to be

done. | think this is really what the turning point of ihe

bill will be, in my opinion.

Hearings Before the Subcommittee on Transportation and Aeronautics of

the Committee on Interstate and Foreign Commerce, 91st Cong., 2d Sess.

43 (1970) (emphasis added).

Representative Kuykendall made the following comment:

Yes. Mr. Reed, I think you have gathered-I know you

were here this morning and heard the testimony and

probably at least had representatives at some of the

other sessions. There is not much disagreement with

this bill and it seems to me that almost thesentire area of

A-8

disagreement has now been pretty well isolated.

Disagreeing with your position on the overal! goals of

this bill would be just like disagreeing with God and

motherhood. You just don't do it. So let's get to the

area of discussion of what we are faced with, the problem of

preemption and authority of the different levels of

regulatory agencies.

See id. at 141 (emphasis added).

It would certainly seem that if Congress had intended rail

safety regulations adopted under the HMTA to be subject to a

different standard than the one so recently and vigorously debated

during the adoption of the FRSA, then the legislative history would

reflect such a decision. The absence of debate or comment on the

issue of preemption of railroad regulations in the legislative history

of the HMTA leads to the conclusion that in enacting the HMTA

Congress must have intended that any rail safety regulations

adopted pursuant to it would fall under the same preemption

standard already established for all rail safety regulations under the

FRSA.

Defendants are unable to point to any specific provision of the

HMTA which negates the express preemption provisions of the

FRSA. Defendants’ argument is based upon an implied repeal of

the preemption provisions of the FRSA by the more liberal

preemption provisions of the HMTA. The implied repeal of an

earlier statute by the mere enactment of a later, even potentially

conflicting one, is disfavored and should be avoided whenever

possible. See, e.g., Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1013,

194 S.Ct. 2862, 2878, 81 L.Bd.2d 815 (1984); TVA v. Hill, 437 U.S. 153,

189-190, 98 S.Ct. 2279, 2299-2300, 57 L.Ed.2d 117 (1987); United

States v. United Continental Tuna Corp., 425 U.S. 164, 168-169, 96 S.Ct.

1319, 1322-23, 47 L.Ed.2d 653 (1976); Davis v. Devine, 736 F.2d 1108,

1114 (6th Cir.), cert. denied., 469 U.S. 1020, 105 S.Ct. 436, 83 L.Bd.2d

362 (1984). Here, the most logical way to resolve any conflict is to

give effect to the specific preemption language of the FRSA (which

by its literal language applies to al! rai! safety regulations adopted

by the Secretary) while applying the more liberal preemption

standard of the HMTA to regulations adopted with respect to other

modes of transportation.

Defendants point out that the HMTA transferred regulatory

authority over hazardous materials transportation from the Federal

A-9

Railroad Administration (FRA) to the Secretary of the Department

of Transportation and argue that this signifies a Congressional

intent that Stich regulations should not be governed by the

preemption provisions of the FRSA. Defendants overlook the fact

that the preemption provisions of the page ig to rail safety

measures adopted by the Secretary, not the FRA. By transferring

hazardous materials regulation from the FRA to the Secretary,

Congress did not in any way sepatate tailroad safety regulation

from hazatdous materials regulation, rather, the Secretary is

responsible for both. Indeed, as noted, the FRSA preemption

provision is tied to railroad safety regulations adopted by the

Secretary, not by the FRA. Defendants’ argument woild make

sense only if FRSA preemption was in fact tied to regulations

adopted by the FRA and plainly it is not.

Every court which has specifically addressed the | goers has

held that the preemption standards of the FRSA apply to

regulations adopted by the Secretary under the HMTA. See

Atchison, Topeka & Santa Fe Railway Company v. Illinois Commerce

Commission, 453 FSupp. 920 (N.D.111.1977); Missouri Pacific Railroad

Co. v. Railroad Commission of Texas, 671 FSupp. 466 (W.D.Tex.1987),

aff'd, 850 F.2d 264 (5th Cir.1988) (affirmed solely on FRSA

preemption; Fifth Circuit found it unnecessary to rule on HMTA

preemption issue); CSX Transportation, Inc., v. City of Tullahoma, Case

No. CIV4-87-47, Slip Op. at 11, + F.Supp. -- (E.D.Tenn.Feb. 17,

1988). In Atchison, at 924, the court said:

However, these statutes do not require the overly

technical interpretation which would subject orders

and regulations issued by the Secretary under one law

to a different preemption standard than those under

another. [FRSA and HMTA] The Railroad Safety Act

of 1970 provides that state action is preempted when

the Secretary has issued orders or tegulations covering

the field. This is not limited merely to those

promulgated under that Act, but refers instead to any

action takea by the Secretary ....

Any more narftow interpretation of the Railroad

Safety Act would frustrate its stated purpose of

establishing uniform national standards.

Similarly in Missouri Pacific, the court said:

Section 434 refers to acts by “the Secretary,” referring to

A-10

the Secretary of Transportation, and does not confine

itself to acts pursuant to the FRSA. Thus, an act by the

Secretary putsuant to, for example, the HMTA could

preempt state law under the terms of section 434.

671 F.Supp. at 471 n. 1.

And finally, in CSX Transportation, at 11, the court held:

1. Transportation of hazardous material is regulated

by the Secretary of Transportation under both the

MTA afd the FRSA. Although the preemption

standard is somewhat different under the two acts,

under the FRSA, state action is preempted when the

Secretary has isstied orders ot regulations covering the

field. Preemption is not limited to those regulations

a urder the FRSA, but refer instead to any

other rule, regulation, order, or standard covering the

subject matter and adopted by the Secretary.

The legislative history of Congressional actions taken since

the enactment of the HMTA reinforce the conclusion that Congress

intended the preeinption provisions of FRSA to apply to

regulations adopted under the HMTA insofar as they apply to rail

transport. During a joint hearing before the House of

Representatives in 1979, the House Committee submitted written

questions to the Department of Transportation about state

involvement in the regulation 0” transportation of hazardous

materials. The arswets were given by the director of RSPA and

included a discussion of the differing preemption standards of the

FRSA and the HMTA:

The preemption provisions of the Hazardous Materials

Transportation Act operate to preempt any State or

local requitement that is “inconsistent” with the

Federal regiilations. Unless it is “inconsistent,” a State

of local requitement is not preempted. /n the case of a

State ot local restriction directed at rail transport, there is a

second Federal statutory provision that acts to further limit

the legal authority of States ard localities. Under the

Railroad Safety Act, a State of locality is expressly

preempted from any “additional or more stringent" rail

safety requiterent titless it is “necessary to eliminate

of reduce a local safety hazard."

Hazardous Materials Transportation Act Amendments: Joint Hearing

A-11

Before the Subcommittee on Surface Transportation and Subcommittee on

Aviation of the Committee on Public Works and Transportation on H.R.

3502, 96th Cong., 1st Sess. 33 (1979) (emphasis added in part).

This statement was made in the context of hearings with

respect to appropriations for enforcement of the HMTA and in

response to specific questions by the Congressional Subcommittee

relating to the role of the states in the regulation of the

transportation of hazardous materials. Viewed in this context, it is

a clear statement to Congress that the Department of Transportation

interprets the preemption provisions of the FRSA to apply to

hazardous materials regulations adopted under the HMTA.

Although amendments have been made to both the FRSA and the

HMITA since that time, none of them have changed the preemption

provisions of either statute.

Likewise, Congress has taken no action to overturn the

decision of the District Court for the Northern District of Illinois in

Atchison, Topeka & Santa Fe Railway Company v. Illinois Commerce

Commission, 453 F.Supp. 920 (N.D.I11.1977) The United States was an

intervening plaintiff in Atchison and there was no appeal from the

district court's decision. As noted above, the Atchison court held

that the preemption provisions of FRSA apply to regulations

adopted under the HMTA. "Congress is deemed to know the

executive and judicial gloss given to certain language and thus

adopts the existing interpretation unless it affirmatively acts to

change the meaning." Florida National Guard v. Federal Labor

Relations Authority, 699 F.2d 1082, 1087 (11th Cir.), cert. denied, 464

U.S. 1007, 104 S.Ct. 524, 78 L.Ed.2d 708 (1983), citing Lorillard v.

Pons, 434 U.S. 575, 580-81, 98 S.Ct. 866, 869-70, 55 L.Ed.2d 40 (1978),

and Albermarle Paper Co. v. Moody, 422 U.S. 405, 414 n. 8, 95 S.Ct.

2362, 2370 n. 8, 45 L.Ed.2d 280 (1975).

Congress's failure to amend the FRSA or the HMTA

preemption provisions in response to either the Atchison decision or

RSPA's position in its response to the House Committee in May of

1979 can be read as acceptance of those interpretations. Indeed

Congress's Office of Technology Assessment has accepted this

interpretation in a report entitled Transportation of Hazardous

Materials, OTA-SET-304 (Washington, D.C.; U.S. Government

Printing Office, July 1986). In the context of a discussion of a

federally financed program for training state inspectors, this

comment appears at page 213 of the report:

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Even where State inspectors have been trained in rail

safety procedures, they cannot conduct hazardous

materials inspections, because authority to do so has

not been granted to States.

The author of the report attributed this interpretation to the

FRA. See Defendants’ Motion for Leave to File Supplement to Prior

Affidavit or to File Supplemental Pleading, Docket 26.

Defendants further argue that Congress's treatment of the role

of the states in surveillance and inspection under the FRSA

demonstrates its intent that regulation of the transportation of

hazardous materials by rail should be governed by the preemption

standards of the HMTA.

When the HMTA was enacted in 1974, Congress also

amended the FRSA. The legislative history indicates Congressional

displeasure with the performance of the F~.A.

The Committee found that after three and one

half years, the FRA inspection of rail equipment and

plant seems to be a stepchild of the Department's low

key safety approach. by April 1974, the FRA had only

12 track inspectors for over 300,000 miles of rail track,

16 signal and train control inspectors, and only 50

inspectors for more than 1.7 million freight cars and

25,000 locomotives. There were only 8 inspectors for

hazardous materials. When questioned about bridges

and tunnels, the FRA witness revealed his department

had only one bridge and tunnel expert in Washington,

and yet he stated that there were 192,000 bridges.

Many of these bridges are old, and one, which crosses

the Mississippi River, was first opened in 1856 and is

still in operation today.

H.R.Rep. No. 1083, 93rd Cong., 2nd Sess., reprinted in 1974

U.S.Code Cong. & Admin.News 7669, 7672.

Congress also criticized the FRA's delay in implementing

provisions designed to involve the state in the enforcement of

safety regulations within the scope of FRSA, as authorized by 45

US.C. § 435. Id. at 7673. Congress responded to these concerns by

increasing the appropriations to administer the FRSA and requiring

that a greater percentage of such appropriations be directed to

enforcement activities. Transportation Safety Act of 1974, 1974

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U.S.Code Cong. & Admin.News 7669 et seq. (codified as amended

at45 U.S.C. § 444).

In 1980 Congress again amended the state participation

program under FRSA. Federal Railroad Safety Authorization Act of.

1980, Pub.L. No. 96-423, 1980 U.S.Code Cong. & Admin.News (94

Stat.) 1811 (amending 45 U.S.C. §§ 431-443). This amendment

expanded the scope of state participation under the inspection and

surveillance provisions of FRSA, 45 U.S.C. § 435, but specifically

excluded the HMTA from this program. Defendants argue that this

indicates Congress's intention that the regulation of the

transportation of hazardous materials by rail should be subject to

the preemption provisions of the HMTA, otherwise the exclusion of

the HMTA from the state certified inspection and surveillance

provisions of FRSA would exclude the states from any role

whatsoever in the enforcement of regulations regarding the

transportation of hazardous materials by rail. Defendants argue

that it would not be logical for Congress to have excluded the states

_from any role in this important area when it included them in the

enforcement of other areas of railroad safety.

The Court agrees that it may have been logical or even

desirable for Congress to have provided a meaningful state role in

regulating the transportation of hazardous materials by rail.

However, the issue before the Court is not the wisdom of the

Congressional enactments, but what Congress intended. Based

upon a considered analysis of the statutory language and the

legislative history, the Court is satisfied that Congress intended that

the strict preemption provisions of the FRSA apply to hazardous

materials regulations applicable to railroads adopted under the

HMTA. This means that the only role of the states in the regulation

of the transportaticn of hazardous materials by rail is that narrow

role permitted by the preemption provisions of the FRSA.

Defendants cite a decision of the District Court of Nevada in

the case of Southern Pacific Transportation Co. v. Public Service

Commission of Nevada, No. CV-N-86-444-BRT Slip Op. (D.Nev. Sept.

28, 1988) (attached as Appendix G to Defendants’ Cross Motion For

Partial Summary Judgment, Docket 16) and Inconsistency Ruling

IR-19, 52 Fed.Reg. 24404, 24410, 24411 (1987), aff'd 53 Fed.Reg. 11600

(1988) (attached as Appendix F, Defendants’ Cross Motion For

Partial Summary Judgment, Docket 16).

In its brief opinion in Southern Pacific Transportation, the

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District Court for the District of Nevada upheld regulations of the

Public Service Commission of Nevada which governed the

temporary storage of hazardous materials on railroad property.

The Court found that the federal regulations did not address the

manner of storage of hazardous materials and that there was no

inconsistency between the Nevada regulations and the federal

regulations. The court considered only the preemption provisions

of the HMTA. No mention was made of the preemption provisions

of the FRSA, thus it appears that the central issue in the present

case was neither presented to, nor decided by the Nevada District

Court.

Nor did the RSPA inconsistency ruling cited by defendants

address the issue presented by the present case. By law RSPA is

limited to a consideration of inconsistency under the preemption

standards of HMTA. RSPA inconsistency rulings contain an explicit

acknowledgment of this limitation upon its decision making:

Since these precedings are conducted pursuant to the

HMTA, only the question of statutory preemption

under the HMTA will be considered. A Federal court

might find a non-Federal requirement statutorily

preempted under another statute.

See, e.g., Inconsistency Ruling IR-19, 52 Fed.Reg. 24404, 24405

(1987), aff'd, 53 Fed.Reg. 11600 (1988) (emphasis added). See also 49

C.FR. § 107.209. The statement in this RSPA ruling that "RSPA

encourages states to adopt and enforce the HMR as state

requirements" does not relate to railroads. Rather, it is based on

another RSPA ruling dealing with highway vehicles, an area in

which RSPA has indeed encouraged an active state role. See IR-17,

51 Red.Reg. at 20931.

Finally, although defendants assert that at least 12 other states

have adopted the federal HMR as state requirements applied to

railroads, there is no evidence that such statutes are being enforced,

that their constitutionality has been tested or that Congress or the

Department of Transportation has in any way sanctioned their

existence.

Ohio has attempted to do precisely that which Congress

sought to prohibit. Ohio Rev.Code §§ 4907.64 and 4905.83 grant to

the PUCO the authority to establish both a statewide system of

railroad safety standards that duplicate the regulations adopted by

the Secretary of Transportation under the HMTA and a procedure

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for enforcement of those standards by the PUCO, including the

imposition of forfeitures of up to $10,000.00 for each day of each

violation. The Ohio statutes and administrative regulations fall

squarely within the preemption provisions of the FRSA because the

Secretary of Transportation has adopted rules and regulations

covering the same subject matter.

Plaintiffs’ Motion For Partial Summary Judgment is well

taken. Ohio Rev.Code §§ 4905.83 and 4907.64 and Ohio

Admin.Code §§ 4901:2-7-1 through 4901:2-7-22 and 4901:3-1-10 are

preempted by the Federal Railroad Safety Act of 1970 and plaintiffs

are entitled to an order enjoining defendants from enforcing such

provisions.

By this opinion and order the Court has resolved plaintiffs’

claims that the Ohio statutes and administrative regulations at issue

are preempted by the FRSA. However, the Court has not addressed

plaintiffs’ claims that the statutes and administrative regulations are

preempted by the HMTA or that they violate the Commerce Clause

because they impose an undue burden on interstate commerce.

Nevertheless, the Court determines pursuant to Fed.R.Civ.P. 54(b)

that there is no just reason for delay in entering final judgment for

the plaintiffs granting the relief demanded in the complaint. In

making this determination the Court has considered the following

factors: The Court's findings on the issue of preemption under the

FRSA is completely dispositive of this action; a determination of the

remaining claims, particularly the claim that the Ohio statutes and

rules impose an undue burden on interstate commerce, will require

an evidentiary hearing and an extensive and complicated analysis

of the facts and law which will be unnecessary if the case can be

decided solely on the preemption issue; the claim of FRSA

preemption is entirely separate and distinct from the remaining

claims and there is no possibility that the reviewing court could be

required to consider the same issue a second time; the interests of

judicial economy will be served by an immediate appeal and the

parties may be spared the expense of litigating moot issues; finally,

both sides in this controversy, as well as the citizens of Ohio, have a

legitimate interest in a prompt determination of the important

issues presented by this case which may well be facilitated by an

immediate appeal.

Plaintiffs’ Motion For Partial Summary Judgment is granted.

Defendants’ Cross Motion For Partial Summary judgment is denied.

The Clerk shall enter final judgment in favor of the plaintiffs,

A-16

permanently enjoining the defendants from enforcing Ohio

Rev.Code §§ 4905.83 and 4907.64 and Ohio Admin.Code §§

4901-2-7-1 through 4901:2-7-22 and 4901:3-1-10. :

It is so ORDERED.

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CSX TRANSPORTATION, INC., Consolidated Rail Corporation,

Norfolk and Western Railway Company, and Grand Trunk

Western Railroad Company, Plaintiffs-Appellees,

V.

The PUBLIC UTILITIES COMMISSION OF OHIO, and Thomas

V. Chema, Ashley C. Brown, Gloria Gaylord, Alan R. Schriber, _

and Lenworth Smith, Jr., in their respective capacities as

Chairman and Commissioners of the Public Utilities Commission

of Ohio, Defendants-Appellants.

No. 88-4185.

United States Court of Appeals,

Sixth Circuit.

Argued Aug. 17, 1989.

Decided April 13, 1990.

Before GUY, BOGGS, and NORRIS, Circuit Judges.

BOGGS, Circuit Judge.

Plaintiff railroads sought and received summary judgment for

declaratory and injunctive relief against defendants Public Utilities

Commission of Ohio, its Chairman, and its Commissioners, against

state regulation of hazardous materials transportation, claiming

that such regulation was preempted by the Federal Railroad Safety

Act, 45 U.S.C. § 421 et seq. 701 FSupp. 608. The defendants

appealed, and we now affirm.

I.

The Hazardous Materials Transportation Act (49 U.S.C.App.

§ 1801 et seq.) (HMTA) governs the intermodal regulation of

hazardous material transportation; the Secretary of Transportation

(Secretary) has authority to promulgate rules and regulations under

it. Under the HMTA, states can implement regulations governing

the transportation of hazardous material if such regulations are

A-18

consistent with federal provisions promulgated under the HMTA.

49 US.C.App. § 1811(b).

Pursuant to the HMTA, Ohio enacted the Ohio Hazardous

Materials Transportation Act (OHMTA) on September 26, 1988.

See Am.Sub.H.B. No. 428, 1988 Ohio Legislative Service at 5-820

(Baldwin). The OHMTA authorized the Public Utilities

Commission of Ohio (PUCO) to adopt and enforce as state

requirements the federal rules regulating the intermodal

transportation of hazardous materials; the statute provided in

relevant part that "[t]he rules adopted under this section shall be

consistent with, and equivalent in scope, coverage, and content to,

the provisions of the "Hazardous Materials Transportation Act’... ."

Ohio Rev.Code Ann. § 4907.64.

On September 27, 1988, CSX Transportation Incorporated,

Consolidated Rail Corporation, Norfolk & Western Railroad

Company, and Grand Trunk Western Railroad Company

(collectively, the Railroads) filed suit in the United States District

Court for the Southern District of Ohio, Eastern Division, against

the PUCO and its commissioners, Thomas V. Chema, Ashley C.

Brown, Gloria Gaylord, Alan R. Schriber, and Lenworth Smith, Jr.

(collectively, the PUCO). The Railroads operate in and through the

state of Ohio, and thus would be subject to the proposed

regulations.

The Railroads sought declaratory relief and temporary and

permanent injunctive relief against the enactment of the OHMTA

and its implementing administrative regulations on the ground that

they are preempted by the Federal Railroad Safety Act (FRSA) and

a burden of interstate commerce in violation of article I of the

United States Constitution. The FRSA, 45 U.S.C. § 421 et seq.,

regulates general railroad safety. The FRSA does not permit states

to promulgate laws relating to railroad safety over subject matter

on which the Secretary has already promulgated a rule. 45 U.S.C. §

434.

The PUCO informed the Railroads that the regulations

enacted pursuant to the OHMTA would not become enforceable

against railroads until December 10, 1988. In response to this

information, the Railroads withdrew their request for a preliminary

injunction and filed for partial summary judgment on the

preemption issue on October 26, 1988. The Railroads sought to

enjoin the PUCO permanently from enforcing the regulations; they

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also sought a declaration that the statutes and regulations were

subject to the FRSA preemption provision. The Railroads claimed

that the FRSA expressed the intent of Congress to preempt state

tules such as the challenged provisions of Ohio law.

On November 10, 1988, the PUCO filed a cross motion for

partial summary judgment on the preemption issue raised by the

Railroads. It contended that the FRSA preemption provision

applies only to matters of general railroad safety, and not to the

regulation of intermodal hazardous materials transportation, even

when applied to railroads. The PUCO contended that the HMTA

created a dual system of federal and state regulation, under which

states could govern transportation of hazardous materials, by rail

or otherwise, through laws consistent with their federal

counterparts. 49 U.S.C.App. § 1811. The Ohio laws, it asserted,

were within this sphere of state authority. It requested an order

from the District Court finding Ohio Revised Code sections 4905.83

and 4907.64 valid and enforceable.

The court held a hearing on November 30, 1988, and

concluded that the Ohio statutes in question constituted laws

_relating to "railroad safety" within the definition of the FRSA

preemption provision. 45 U.S.C. § 434. On December 12, 1988,

the district court granted the Railroads’ motion for partial summary

judgment and granted a premanent injunction. In particular, the

court held that the FRSA preempted sections 4905.83 and 4907.64 of

the Ohio Revised Code, and sections 4901:2-7-01 through

4901:2-7-22 and 4901:3-1-10 of the Ohio Administrative Code. The

PUCO now appeals from this grant of summary judgment.

II.

In 1966, Congress created the Department of Transportation

(DOT). See 49 U.S.C. §§ 1651-1660, as amended. The DOT

received the authority under several laws previously vested in a

number of government agencies and departments to regulate,

among other things, the transportation of hazardous materials. P.L.

89-670, 49 U.S.C. 1651 (1966). The authority to regulate under one

of these laws, the Explosives and Other Dangerous Articles Act,

was transferred from the Interstate Commerce Commission. 49

U.S.C. § 1655(e)(4).

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This authority to regulate, among other things, the

transportation of hazardous materials transferred to the Secretary

was delegated by statute to modal administrations (in this case, the

Federal Railroad Administration and the Federal Highway

Administration). The Federal Railroad Administration (FRA) had

authority to promulgate hazardous material transportation

regulations for railroads through its administration of the

Explosives Act. 49 U.S.C. § 1655(f)(3)(A) (1966), amended by 49

U.S.C. § 1655(f)(3)(A) (1974). The Federal Highway Administration

(FHA) had similar authority for motor carriers. 49 U.S.C. §

1655(f)(3)(B) (1966), amended by 49 U.S.C. § 1655(f)(3)(B) (1974). In

both cases, the Secretary had no power either to retain the authority

or transfer it to a modal administration other than the FRA (for

railroads) or FHA (for motor carriers). 49 U.S.C. § 1655(f)(3)

(1966), amended by 49 U.S.C. § 1655(f)(3) (1974).

In 1970, Congress passed an omnibus bill which enacted,

among other provisions, the Hazardous Materials Transportation

Control Act of 1970 (HMTCA) and the FRSA. Pub.L. 91-458, 84

Stat. 971. The HMTCA was Congress's first attempt at establishing

intermodal regulation of hazardous materials. The HMTCA

directed the Secretary to establish facilities within the federal

government; evaluate hazards surrounding the shipment of

hazardous materials; establish a central reporting system for those

hazards; and review all aspects of hazardous material

transportation to increase the control and safety of such

transportation. 49 U.S.C. § 1761 (repealed 1974).

The FRSA was enacted to govern railroad safety. The

declaration of purpose of the FRSA states:

The Congress declares that the purpose of [the FRSA]

is to promote safety in all areas of railroad operations

. .. and to reduce deaths and injuries to persons and

to reduce damages to property caused by accidents

involving any carrier of hazardous materials.

45 U.S.C. § 421. The FRSA allows states to retain some

enforcement powers in the area of railroad safety. In relevant part,

the preemption provision reads:

A State may adopt or continue in force any law, rule,

regulation, order, or standard relating to railroad

safety until such time as the Secretary has adopted a

rule, regulation, order, or standard covering the subject

matter of such State requirement.

45 U.S.C. § 434 (emphasis added). Thus, any state regulation over

an area covered by the FRSA (whether consistent or not) is

preempted. This preemption provision was debated vigorously in

Congress prior to passage. The House Report accompanying the

FRSA stated that some of the covered "railroad safety" laws ". . . are

set forth in detail in appendix B of this report." H.R. Rep. No. 1194,

9ist Cong., 2d Sess., reprinted in 1970 U.S. CODE CONG. &

ADMIN. NEWS 4104, 4105. Appendix B lists, among other laws,

the Explosives Act. |

With the passage of another omnibus bill in 1974, true

intermodal regulation of the transportation of hazardous materials

came into being. Pub.L. No. 93-633, 88 Stat. 2156. This bill enacted

the HMTA and amended the DOT enabling act. It also created an

independent safety board to oversee the functions and performance

of each of the modal administrations within the Department of

Transportation. 49 U.S.C.App. §§ 1901-1902.

The HMTA amended the DOT enabling act to prohibit the

Secretary from delegating the functions, powers, and duties to

administer the Explosives Act to the FRA or the FHA. Pub.L.

93-633, § 113(e)(1), (2). The amended provision read in relevant

part for the FRA:

The Federal Railroad Administrator shall carry out the

functions, powers, and duties of the Secretary

pertaining to railroad safety as set forth in the statutes

transferred to the Secretary by subsection (e) of this

section (other than [the Explosives and Other

Dangerous Articles Act)).

49 U.S.C. § 1655(f)(3)(A). Thus, the regulation of the

transportation of hazardous materials moved from a modal to an

intermodal basis.

The preemption provision of the HMTA differs from that of

the FRSA. The HMTA provides that:

... any requirement of a State or political subdivision

thereof, which is inconsistent with any requirement set

forth in [the HMTA], or in a reguiation issued under

[the HMTA], is preempted.

49 U.S.C. § 1811(a). Thus, unlike the preemption provision of the

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FRSA, which forbids state regulation on subject matter on which

the Secretary has already adopted a regulation, the HMTA allows

state regulations which are consistent with federal regulations.

In 1980, Congress amended the FRSA. Pub.L. No. 96-423, 94

Stat. 1811 (amending 45 U.S.C. §§ 431-433). Congress amended

Section 425 of the FRSA to allow greater (but still limited) state

participation in investigative and surveillance activities relating to

railroad safety. 45 U.S.C. § 435(g). The HMTA was not listed as

one of these laws. In regard to this omission, the House Report

stated that, “[s]ince the [HMTA] is not directed specifically and

solely at railroad safety, that Act is not within the scope of the

amendment." H.R. Rep.“No. 1025, 96th Cong., 2d Sess. 13,

reprinted in 1980 U.S. CODE CONG. & ADMIN.NEWS 3830,

3837-38.

Il.

The question before us is simply this: should a train carrying

a load of hazardous waste be considered a railroad which happens

to be carrying hazardous waste (thus suggesting application of the

FRSA preemption provision) or hazardous waste which happens to

be carried by rail (thus suggesting application of the HMTA

preemption provision)? The Committee report to the 1974 Act

states:

The intent of the Committee in these provisions [the

HMTA] is to consolidate in the Department of

Transportation the [sic] certain basic functions with

respect to regulated hazardous materials, while the

enforcement of the regulations pertaining to the

shippers and carriers of hazardous materials remains

delegated to the particular Administration within

DOT having jurisdiction over the mode by which such

materials move.

H.R.Rep. No. 1083, 93d Cong., 2d Sess., 1974 U.S. CODE CONG. &

ADMIN.NEWS 7669, 7681. We find it clear from this language, and

the legislative history behind it, that the purpose of the HMTA was

to consolidate regulation of hazardous material transportation at

the Secretarial level, and not to remove such regulation of

hazardous material transportation by rail from the preemption

provision of the FRSA.

A-23

Although we credit the PUCO's compelling argument that the

creation of the HMTA in 1974 removed promulgation (though not

enforcement) of regulations under the Explosives Act from the

FRA, we do not believe that such removal changes the fact that

FRSA preemption relates to all rules and regulations regarding

railroad safety promulgated by the Secretary, whether or not such

regulations are promulgated by the FRA through power delegated

by the Secretary. See 45 U.S.C. § 434. Clearly, the HMTA is a law

relating to railroad safety, even if regulations pursuant to it are

promulgated by the Secretary directly, not by the FRA.

We further find the PUCO's argument concerning removal of

regulatory authority from the FRA by the HMTA unpertsuasive in

light of the plain and much-discussed preemption provision of the

FRSA. See, generally, Hearings Before the Subcommittee on

Transportation and Aeronautics of the Committee on Interstate and

Foreign Commerce, 91st Cong., 2d Sess. (1970). Repeal or

amendment of this preemption provision as it related to the

transportation of hazardous materials was not discussed during the

passage of the HMTA. In giving the Secretary authority to

promulgate regulations involving the intermodal transportation of

hazardous materials under HMTA, we do not believe that Congress

concurrently repealed the broad historic federal preemption of state

railroad regulation. See National Association of Regulatory

Commissioners v. Coleman, 542 F.2d 11 (3rd Cir.1976).

We find that the language of the FRSA, “any law .. . relating

to railroad safety," 45 U.S.C. § 434, applies to the HMTA as it

relates to the transportation of hazatdous material by rail. The

plain meaning of a statute must be given great weight. Watt v.

Alaska, 451 US. 259, 265-66, 101 S.Ct. 1673, 1677-78, 68 L.Ed.2d 80

(1981). We further note that Congress examined the problems of

hazardous material transportation by rail within the context of a

more general discussion of railroad safety. H.R.Rep. No. 1194, 91st

Cong., 2d Sess., reprinted in 1970 U.S. CODE CONG. &

ADMIN.NEWS 414, 4107.

To find that a later statute has repealed an earlier one, we

have required that “the later law designates the statute repealed in

such manner as to leave no doubt as to what statute is intended.“

Equitable Life Assur. Soc. of U.S. v. Grosvenor, 426 F.Supp. 67, 71

(W.D.Tenn.1976), aff'd, 582 F.2d 1279 (6th Cir.1978). The HMTA

does not fulfill this test. Repeal by implication is disfavored.

A-24

Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1013, 104 S.Ct. 2862, 2878,

81 L.Bd.2d 815 (1984).

The PUCO contends that courts reviewing questions of

federal supremacy must “start with the assumption that the historic

police power of the states is not to be superseded by federal

enactments ‘unless that was the cleat manifest purpose of

Congtess,’ “ citing Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230,

67 S.Ct. 1146, 1152, 91 L.Bd. 1447 (1947). We hold that the FRSA

revealed such a purpose and that the enactirient of the HMTA did

not demonstrate otherwise. In fact, Santa Fe Elevator also instructs

us that one test of preemption is whether “the matter on which the

State asserts the right to act is in any way regulated by the Federal

Act." Id. at 236, 67 S.Ct. at 1155. In this case, it is clear that matters

of railroad safety ate governed by the preemption provision of the

FRSA.

Further, the PUCO argues that ption is precluded where

a state acts within its sphere of authority under a dual system of

federal and state regulation established by Congress. Louisiana

Public Service Comm'n v. FCC, 476 U.S. 355, 370-78, 106 S.Ct. 1890,

1899-1903, 90 L.Bd.2d 369 (1986); Pacific Gas & Electric Co. v. State

Energy Resources Cons. & Dev. Comm'n, 461 U.S. 190, 212-17, 103

§.Ct. 1713, 1726-29, 75 L.Bd.2d 752 (1983). However, we find that

the system of regulation created by the FRSA and HMTA is of a

different character than that at issue in Louisiana Public Service

Comm'n. In that case, the reservations of authority to the state were

explicit. Louisiana Public Service Comm'n 476 U.S. at 370, 106 S.Ct. at

1899. Thus, the Court found that such a clear reservation prevented

federal preemption of those areas.

In this case, federal power to regulate transportation of

hazardous materials is absolute; state power is limited. Thus,

unlike Louisiana Public Service where the Court was concerned that

“... a federal agency may preempt state law only when and if acting

within the scope of its congressionally delegated authority," 476

US. at 374, 106 S.Ct. at 1901, we have no qualms about the scope of

the DOT's authority to promulgate hazardous material

transportation regulations. The only question is whether the PUCO

also may do so for railroads.

In Pacific Gas & Electric, the state had express power to

regulate the economics of nuclear production. 461 U.S. at 205-06,

103 S.Ct. at 1722-23. The federal law, the Atomic Energy Act, did

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not explicitly prohibit states from exercising economic regulation.

The question before the Pacific Gas & Electric Court was whether

federal regulatory authority over nuclear production preempted a

state regulation which arguably came within the express state

authority. Again, the question before us is different. The federal

government clearly has the power to regulate all aspects of railroad

safety; state power is limited. Thus, the HMTA does not present the

same type of dual regulatory authority presented in Louisiana

Public Service or Pacific Gas & Electric.

We agree with the PUCO that our preemption analysis "is also

to be tempered by the conviction that the proper approach is to

reconcile 'the operation of both statutory schemes with one another

rather than holding one completely ousted.'" Merrill Lynch v. Ware,

414 US. 117, 127, 94 S.Ct. 383, 390, 38 L.Ed.2d 348 (1973), quoting

Silver v. New York Stock Exchange, 373 U.S. 341, 357, 83 S.Ct. 1246,

1257, 10 L.Ed.2d 389 (1963) (citation omitted). However, we do not

agree with the PUCO's interpretation of this language in this case.

A failure to follow the preemption provision of the HMTA in no

respect ousts the HMTA. In this case, the decision of the district

court, applying the FRSA preemption provision to regulations

promulgated under the HMTA, retains the essential character and

purpose of both statutes. The national character of railroad

regulation and the need for regulation of hazardous material

transportation on an intermodal basis are both respected.! The

decision of the district court is AFFIRMED.

1 Finding that the regulations issued pursuant to the OHMTA are preempted by

the preemption provision found in the FRSA, we find it unnecessary to address the

questions of whether the Ohio regulations are also preempted by the preemption

provision found in the HMTA.

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