Amicus Curiae Brief — City of Auburn v. United States

Supreme Coort, U.%

es Ge ay

APR 21 1999

No. 98-1511 he

IN THE

Supreme Court of the United States

OcTOBER TERM, 1998

CITY OF AUBURN, a municipal

corporation of the State of Washington,

Petitio. .er,

Vv.

THE UNITED STATES GOVERNMENT and THE SURFACE

TRANSPORTATION BOARD, an agency of the United States

Government; KING COUNTY, a Washington municipal

corporation; BURLINGTON NORTHERN SANTA FE

CORPORATION, a Delaware corporation; BURLINGTON

NORTHERN RAILROAD COMPANY, a Delaware corporation;

BURLINGTON NORTHERN SANTA FE ACQUISITION, INC.

and THE BURLINGTON NORTHERN AND SANTA FE

RAILWAY COMPANY,

Respondents.

On Petition for Writ of Certiorari to the

United States Court of Appeals for the Ninth Circuit

BRIEF OF AMICI CURIAE

THE NEW JERSEY STATE LEAGUE OF MUNICIPALITIES

AND THE INTERNATIONAL MUNICIPAL LAWYERS

ASSOCIATION IN SUPPORT OF PETITIONER

WILLIAM JOHN KEARNS, JR. THOMAS W. DUNN

General Counsel, The New Jersey Counsel of Record

State League of Municipalities BEATTIE PADOVANO, LLC

50 Chestnut Ridge Road

HENRY UNDERHILL

General Counsel, International

Municipal Lawyers Association

P.O. Box 244

Montvale, NJ 07645

(201) 573-1810

Attorneys for Amici Curiae

i

TABLE OF CONTENTS

summary of Areimient 52500. 2

PMN 6 oS ES ies ees g FE FOE 3

I. The ICCTA Is Not Clear And Unambiguous As

To The Intent Of Congress To Preempt All State

Police Powers With Respect To Railroads. .. 3

Il. The Legislative History Of The ICCTA

Mandates A Finding That Congress Did Not

Intend To Sweep Away Local Police Powers As

They Apply To Railroads. ............... 12

Ill. Important Questions Of Federalism Are

Presented By This Case. The Court Ought To

Grant Certiorari To Return Balance To The

Relationship Between Railroads And The States

Caused By The Ninth Circuit Misreading Of

Congpennionel intent... ke 18

IE Fhe yar Cotas FE ak ed oie 20

TABLE OF CITED AUTHORITIES

Page

Cases:

Borough of Riverdale v. New York Susquehanna and

Western Railway Corp., New Jersey, Law Division,

Morris County, not officially reported, Docket No.

MRS-L-2297-96 (decided August 7, 1996) ..... 6

Burlington Northern Santa Fe Corp. v. Anderson, 959

¥. SOD. TAGS CPN, SURE? os ea cn cuce serene bay ie

CSX Transp., Inc. v. City of Plymouth, Mich., 86 F.3d

O26 (60m Cis. BSB) iii vsn cone cise eneuneins 13

CSX Transp., Inc. v. Georgia Pacific Public Service

Comm 'n., 944 F. Supp. 1573 (N.D. Ga. 1996) ... 14,15

Illinois Commerce Commission vy. I.C.C., 879 F.2d 917

(22... CRs TRB ov a cae a ae a Re ee Gk 13

I.N.S. v. National Center for immigrants’ Rights, 502

U.S. 183, 112 S. Ct. 551, 116 L. Ed. 2d 546 (1991)

Pe os i ee ade Ry ent CeCe 12

Medtronic v. Lohr, 518 U.S. 470, 1168S. Ct. 2240, 135

he, BG. 20 Fe ERD on oes eevee oe ee ek ae

San Diego Building Trades Council v. Garmon, 359

U.S. 236, 79 S. Ct. 773, 3 L. Ed. 2d 775 (1959) . 19

Village of Belle Terre v. Boraas, 416 U.S. 1, 94S. Ct.

RD Sy PO bev Rc FET LOOTED ec hha aoa bea 19

Wain Sena ere

ill

Cited Authorities

Page

Village of Euclid v. Ambler, 272 U.S. 365, 47 S. Ct.

a FR Bey BU BO SOS TDIAG) o.oo kg occ he vase 19

Village of Ridgefield Park v. New York Susquehanna

and Western Railway, 318 N.J. Super 385, 72 A.2d

MANS) CN eI A ee alee eg 6

Statutes:

I at eS 12

oe 8 ROSIE: (RI SEAR at ea 12

TE Eo OS” Ge se eee te ee 3, he

I I ge Pe ods 12

NIE ME PERI heh re che a ee be

cg Be SSSI ey ee eerie Mee ean 16, 17

Me Sn UNION Sg eas ea bk Da ecu cy. 10, 13, 17

Weer ED AOOUNO) oo... ek sccee be. 8, 10, 14, 15, 16, 17

ee Ries REO sp a cn ly 14

EGE eg fa re 10

49 U.S.C.

iv

Cited Authorities

Page

VF UBAS GAIOE bs ccs ata ee Ce 1]

OP UaSo B ELABE i is:ics cad nee eee 1]

BD ALA. § AIOE sae os hea Se a Pe 9

TF Minn BE LRTOREOD oa ope Wic ed | he bees ook ca 9

OF UB As: EAS ii ok IS 6 RL 9

GR Si ie, BONN TUE ies oss VEE So Ree 10

RF A tes L ETE S fae ees ss hu 10

iif RS OE & 4 by: Capra Pinas Aone eae oe emt ies 10

OP Sih SG FROOO 6 in wc ose ak tava eck 10

SP UD S LEO ch swe Siew rciueke ene 10

TPAD. CURE Rete cack 12, 13

We Si aihes OE SURO STR OUEE 6 86-0 Goh heen 9

OF Wakes BE BLP R EE 5 Ns bh bok cee ee 9

BD LS Aci BO MUTATE: A + oid 654 eee. 9

OF Si cohe ee AO ok ee Be had oe 9

y

Cited Authorities

Page

SPU .C; O65 0801 UGE cis cess ee 9

OF S.C. OG 1S IISB i he ie os 9

OF) Als OF Naa ee si oe bce es: vas SS aya]

ait ROR A CS: + RN Semana eins ae 9,10

SP OR OO LETRA IOP oy ok so) bi 9

WP toe, GE LIDOT-B 1908 oi TS i a 9

Fibs FoR a Oe Os BOO Be. Os 14

Fie OLA OL RMT 5 oe, oa ees 14

Other Authorities:

H.R. Rep. No. 104-311 (1995), reprinted in 1995

aA RaS, BOT 8S CNG Pe See 16

H.R. Conf. Rep. No. 104-422 (1995), reprinted in 1995

Pe OE Nee): epee ie oe Se eee oa 17

Peas Greet WM CFE CT ee ie etx 10

GARR IES Gavidg opus vaca, oe ee 10

a ie ee ee >Re

+ 9 oll Poca? WS eS

EE Os SO SEP UR Ae

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l

INTEREST OF AMICI CURIAE

The New Jersey State League of Municipalities (the

“League”) is a voluntary association which provides advocacy,

education and support for municipalities in the State of New

Jersey.' More than 560 municipalities are members of the

League. It tracks legislation affecting municipalities and

comments on local impacts. It intervenes, on behalf of its

members, in selected cases pending in federal and state courts.

Because of its vigilance on behalf of its New Jersey

members, the League is particularly well situated to comment

on the effect of legislation and court rulings that affect the historic

“police powers” of municipalities. The ability of municipalities

to regulate in the interest of public health, safety and welfare is

basic to the proper functioning of local government in New

Jersey and throughout the United States.

ie International Municipal Lawyers Association (“IMLA”)

is anonprofit professional organization that has provided services

and programs to local government lawyers since 1935. With a

membership of more than 1500, IMLA is the oldest and largest

association of attorneys that represent local government.

Since its establishment, IMLA has served its membership

by being an advocate for the interests, positions and views of

local governments involved in cases pending in the United States

Supreme Court, in federal circuit courts and in state appellate

1. Counsel for a party did not author this brief in whole or in

part. No person or entity other than the amicus curiae, its member,

or counsel have made a monetary contribution to the preparation or

submission of the brief. Pursuant to Rule 37 of the Rules of Court,

the parties have consented to the filing of this brief. Their letters of

consent have been filed with the Clerk of the Court.

2

and supreme courts, that present legal issues that may have a

significant impact on a substantial number of governments across

the United States.

IMLA is also uniquely situated to comment on a case that

has a possibility of sweeping away important police power

regulations of states and municipalities as they apply to railroads.

The League and IMLA submit this brief in support of the

Petition for a Writ of Certiorari by the City of Auburn because

the interpretation by the Ninth Circuit of the Interstate Commerce

Commission Termination Act (“ICCTA”) absolutely preempts

the applicability of local building, environmental and other police

powers to railroads.

SUMMARY OF ARGUMENT

The language of the ICCTA is not clear and unambiguous

as to preemption by Congress of all State police powers with

respect to railroads. The language of the preemption sections of

the ICCTA, when read in pari materia with other provisions of

the ICCTA, reveal a Congressional intent to preempt only local

regulations related to the primary economic regulatory function

of the Surface Transportation Board (“STB”).

The full title of the act and the statutory history of the ICCTA

evidence a Congressional intent not to preempt the exercise by

the states of their police powers except as those police powers

relate to traditional economic regulation of railroads. The

jurisdiction of the STB over railroads is exclusive only as the

economic matters covered by the ICCTA. When a matter is not

the subject of review by the STB, State regulation is not

preempted.

SERA ihe pt) tht Ses Cabes HF

PaO der inane AES Be Woe nnn wee

3

The Ninth Circuit’s interpretation of the ICCTA has the

effect of rendering a whole host of traditional police powers —

such as building, fire safety and sanitary regulations —

inapplicable to railroads. There is nothing in the language of the

ICCTA, the legislative history of the ICCTA or the history of

other railroad regulation or deregulation that suggests that

Congress intended to exempt railroads from these types of local

regulations. The Court should grant certiorari to dispel the

notions contained in the Ninth Circuit opinion below that the

ICCTA preemption of state police powers is absolute.

ARGUMENT

I.

THE ICCTA IS NOT CLEAR AND UNAMBIGUOUS AS

TO THE INTENT OF CONGRESS TO PREEMPT ALL

STATE POLICE POWERS WITH

RESPECT TO RAILROADS.

This case began with proceedings before the STB in which

the Burlington Northern Santa Fe Corporation, and related

companies (“Railroad”) sought approval from the STB pursuant

to 49 U.S.C. §§ 11323-25 for approval of a transaction (the

Merger”) in which the Railroad would reacquire a line, known

as the Stampede Pass Line, (which it or its predecessors formerly

owned), and convert the rail line from one carrying local traffic

to one providing through main line service between eastern and

western Washington.

In connection with the Merger, the STB, acting pursuant to

the National Environmental Policy Act (“NEPA”), 42 U.S.C.

§ 4321 et seq., conducted an environmental assessment as to

operational matters, focusing primarily on the effects of the

4

increase in train traffic on the entire Stampede Line. (Appendix

D at page 71a).

As part of the upgrade of the rail line affected by the Merger,

the Railroad intended to engage in certain construction activities.

These included the replacement of track sidings, replacement

of maintenance of way buildings and snow sheds, improvement

of the Stampede Pass tunnels and installation of communications

towers. (Appendix B at 24a). No environmental assessment of

these activities was conducted because the STB found that these

activities did not require STB approval under the ICCTA.

(Appendix D at 71a).

The Railroad originally made application to the local

jurisdictions for permits for the construction activities but

withdrew them after the Secretary of the STB had given an

informal opinion, in response to a request by King County, that

the ICCTA had preempted the ability of the municipalities to

apply their police power regulations to the construction activities.

King County, and later Auburn, applied for a formal ruling by

the STB. The STB ruling on the Auburn petition was appealed

to the Ninth Circuit.

The STB ruling recognized that preemption does not

withdraw from the states “the power to regulate where the

activity regulated [is] merely a peripheral concern” of federal

law. (Appendix C at 49a). It also recognized that where state or

local law can be applied without interfering with the federal

law, the courts have done so. (Appendix C at 50a). However,

without examining the ordinances at issue, the STB found that

“it appears that requiring a permit for BNRR’s operations or

maintenance and upgrading plans for the Stampede Pass line

would go too far.” (Appendix C at 50a).

5

On Auburn’s appeal to the Ninth Circuit, the Court took a

much broader view than did the STB of the preemption

provisions of the ICCTA and held:

We believe the congressional intent to preempt this

kind of state and local regulation of rail lines is

explicit in the plain language of ICCTA and the

statutory framework surrounding it. (Appendix A

at 17a).

The League and IMLA would not be filing this brief had

the Ninth Circuit properly applied the principles of this Court’s

decision in Medtronic v. Lohr, 518 U.S. 470, 486, 116 S. Ct.

2240, 135 L. Ed. 2d 700 (1996). This case would not have had

the significance that it does to these amici if the construction

details had been properly before the STB and the Court had

found that specific local building and environmental regulations

had been preempted. However, the construction details of the

upgrade were never before the STB under the ICCTA. The

environmental review conducted by the STB was limited to the

considerations necessary to approve the Merger and did not deal

with the consequences of construction. No attempt was made to

harmonize the ordinances of Auburn and King County with the

environmental assessment conducted by the STB pursuant to

the Railroad’s request for approval of the Merger.

The effect of the rulings of the STB and the Ninth Circuit,

therefore, is that local regulations are preempted even when there

is no need for STB approval of a railroad activity under the

ICCTA. This effect is much wider than Congress intended and

is needlessly detrimental to legitimate and proper police power

regulations by states and municipalities.

6

Because of the holding in this case, a railroad in New Jersey

has been arguing that it is no longer obligated to allow inspection

of its sanitary, electrical and other facilities in offices located in

boxcars that are permanently affixed to a railroad track and used

in connection with a new locomotive refueling facility. Those

facilities did not require a certificate of authority from the STB

under any of its statutorily specified ICCTA remedies. Yet the

New Jersey Superior Court Appellate Division has held that the

ICCTA vests primary jurisdiction for implementation of such

fundamental public health and safety police power remedies in

the STB. Village of Ridgefield Park v. New York Susquehanna

and Western Railway, 318 N.J. Super 385, 72 A.2d 267 (App.

Div. 1999). A petition for certification to the New Jersey

Supreme Court has been filed and remains pending in that Court.

On the other hand, prior to the Ninth Circuit decision in

this case, a New Jersey Superior Court, Law Division judge had

quite properly held that a railroad facility for off-loading liquid

food product from railroad tanker cars could be reviewed by

local land use agencies on an application for site plan approval

under the New Jersey Municipal Land Use Law. The Court there

held that it would be an unreasonable restraint on interstate

commerce and, therefore unlawful under the ICCTA preemption,

for the local land use agencies to deny a site plan approval and

thereby prevent the construction of the facility. However, the

Court found no reason why, under the ICCTA, a railroad could

not be required to submit an application and to attempt to

accommodate its facility to the local, legitimate police power

concerns of the municipality. Borough of Riverdale v. New York

Susquehanna and Western Railway Corp., New Jersey, Law

Division, Morris County, not officially reported, Docket No.

MRS-L-2297-96 (decided August 7, 1996).

eS ae a ee

:

7

The opinion of Justice Stevens in the Medtronic supra case

sets forth some elemental principles applied by this Court in

judging preemption cases. That opinion says:

... Although our analysis of the scope of the

preemption statute must begin with its text, [citation

omitted] our interpretation of that language does not

occur in a contextual vacuum. Rather, that

interpretation is informed by two presumptions about

the nature of preemption. [citation omitted]

First, because the States are independent

sovereigns in our federal system, we have long

presumed that Congress does not cavalierly preempt

state-law causes of action. In all preemption cases,

and particularly in those in which Congress has

“legislated ... in a field which the States have

traditionally occupied,” [citation omitted] we “start

with the assumption that the historic police powers

of the States were not to be superseded by the Federal

Act unless that was the clear and manifest purpose

of Congress.”

* * *

. .. [S]econd, our analysis of the scope of the statute’s

preemption is guided by our oft-repeated comment,

initially made in Retail Clerks v. Schermerhorn, 375

U.S. 96, 103, 84 S.Ct. 219, 222, 11 L.Ed.2d 179

(1963), that “[t]he purpose of Congress is the ultimate

touchstone” in every preemption case. [citation

omitted] As a result, any understanding of the scope

of a preemption statute must rest primarily on “a fair

understanding of congressional purpose.” [citations

omitted] Congress’ intent, of course, primarily is

8

discerned from the language of the preemption statute

and the “statutory framework” surrounding it.

{[ Medtronic, supra 518 U.S. at 484-486, 116 S. Ct. at

2250-2251 emphasis in the Original]

Justice Breyer concurring in part and concurring in the

judgment of the Court, joined in the foregoing language and

found the preemption statute in the Medtronic case to be

ambiguous. 581 U.S. at 503-508, 116 S. Ct. at 2259-2262.

Applying those principles to this case, amici respectfully

submit that the words of preemption sections of the ICCTA are

ambiguous and cannot be construed as sweeping away all State

police powers, particularly when those matters are not the subject

of an STB application.

Section 10501(b) says:

10501(b) The jurisdiction of the Board over —

(1) transportation by rail carriers, and the remedies

provided in this part with respect to rates,

classifications, rules (including car service,

interchange and other operating rules), practices,

routes, services, and facilities of such carriers; and

Sete sireaarenliiD mR AAR arse

(2) the construction, acquisition, operation,

abandonment, or discontinuance of spur, industrial,

team, switching, or side tracks, or facilities, even if .

the tracks are located entirely in one State, is

exclusive. Except as otherwise provided in this part,

the remedies provided under this part with respect

to the regulation of rail transportation are exclusive

and preempt the remedies provided under Federal or

State law. [49 U.S.C. § 10501(b), emphasis supplied].

ie

ie

j

9

To properly understand Congressional intention, it is

necessary to examine what is meant by the phrase “remedies

provided under this part with respect to the regulation of rail

transportation.” To do that, it is necessary to look to the context

of the statute.

When it used the word “part” in Section 10501, Congress

was referring to Part A entitled “Rail” of Subtitle IV entitled

“Interstate Transportation” of Title 49 entitled “Transportation”

of the United States Code. Part A — the “part” referred to in

Section 10501 — consists of nine chapters entitled “General

Provisions” (49 U.S.C. §§ 10101-10102); “Jurisdiction”

(49 U.S.C. §§ 10501-10502 ); “Rates” (49 U.S.C. §§ 10701-

10747); “Licensing” (49 U.S.C. §§ 10901-10907); “Operations”

(49 U.S.C. §§ 11101-11164); “Finance” (49 U.S.C. §§ 11301-

11328); “Federal-State Relations” (49 U.S.C. §§ 11501-11502);

“Enforcement, Investigations, Rights and Remedies” (49 U.S.C.

§§ 11701-11707); and “Civil and Criminal Penalties” (49 U.S.C.

§§ 11901-11908 ).

The “remedies” found in this part deal exclusively with the

economic regulation of railroads. For example, the chapter on

rate-making says that railroad routes and rates must be

reasonable. The procedure for determination of whether a

railroad is complying with the law in this regard is set forth in

49 U.S.C. § 11701 which says that “if the Board finds that a rail

carrier is violating this part, the Board shall take appropriate

action to compel compliance ...” A person, including a

governmental authority may file a complaint “about a violation

of this part” under 49 U.S.C. § 11701(b). The Board has the

authority to bring a civil action to compel very specific actions

on the part of railroads. 49 U.S.C. § 11702. The Attorney General

has the authority to bring court proceedings or civil actions to

prosecute persons “violating this part” or to compel “compliance

10

with this part” 49 U.S.C. § 11703. The rights and remedies of

persons injured by rail carriers are governed by 49 U.S.C.

§ 11704. Statutes of limitations dealing with actions to recover

overcharges are specified in 49 U.S.C. § 11705. 49 U.S.C.

§ 11706 deals with the liability of rail carriers under receipts

and bills of lading. Section 11707 deals with the liability when

property is delivered in violation of routing instructions,

49 U.S.C. § 11707.

The Chapter on Federal-State relations deals only with the

proper method of taxation of railroad properties by the States. .

49 U.S.C. §§ 11501-11502. if

In connection with the construction of railroad lines, the

Board has the authority to issue certificates of authority with

respect to an extension of existing railroad lines or to the

construction of new lines. 49 U.S.C. § 10901. It has the authority

to regulate the construction, acquisition, operation, abandonment

or discontinuance of spur, industrial, team, switching, or side

tracks, or facilities, even if located in only one State. 49 U.S.C.

§ 10501.

However, nowhere in “this part” are there regulations similar

to those found in broadly applicable, noneconomic police power

regulations enacted by most States. For example, New Jersey

has a Uniform Construction Code, N.J.A.C. 5:23-1.1 et seg.

which governs the construction standards for all buildings,

including those owned by railroads. The Code provides for

periodic inspections of footings and foundations, sanitary

systems, electrical systems and the like. N.J.A.C. 5:23-1.18.

These are not “remedies provided under this part” which are

preempted by Section 10501(b). It would be absurd to think

that Congress intended the STB to promulgate regulations similar

to the Uniform Construction Code for railroad facilities. Would

11

the STB staff perform building inspection functions? It would

be equally unthinkable that Congress would have otherwise left

these very important protections of public health and safety

unregulated simply because a railroad was involved. Congress

must have intended that the preemption decreed by the ICCTA

would be applicable only to the types of regulation that were

expressly covered in “this part” of the ICCTA.

Likewise, a more narrow construction of 49 U.S.C.

§§ 11323-11325 is mandated when the context of those sections

is considered. Chapter 113 deals with “Finance” of railroads.

Subchapter I (49 U.S.C. § 11301) deals with perfecting security

interests in railroad cars and other equipment. Subchapter II deals

with “Combinations” and, generally gives the STB the power

to review and approve or exempt various transactions (such as

mergers or other combinations) involving railroads. Section

11321, relied upon by the Ninth Circuit has a sentence which,

quoted in its entirety, says:

A rail carrier, corporation, or person participating in

that approved or exempted transaction is exempt

from the antitrust laws and from all other law,

including State and municipal law, as necessary to

let that rail carrier, corporation or person carry out

the transaction, hold, maintain and operate property,

and exercise control or franchises acquired through

the transaction. (49 U.S.C. § 11321).

Again, this section is ambiguous at best. Does it mean that

simply because there has been an approved or exempted merger,

a railroad is exempted from obtaining a certificate of occupancy

for its facilities if one is required by local law? Or that a railroad

involved in a merger is no longer required to clear snow from

its sidewalks if required by municipal ordinance? The section

12

was meant to apply only to those laws that are necessary to allow

the combination to proceed; not to all police power regulations.

The final ambiguity is found in the last clause of the

preemption sentence which preempts “the remedies provided

under Federal or State law.” If the Ninth Circuit rationale is to

be logically applied, Federal as well as State law is to be

preempted. As Auburn suggests, railroads would therefore not

be subject to the Clean Water Act (33 U.S.C. § 1251), the

Endangered Species Act (16 U.S.C. § 1531), the National

Environmental Policy Act (42 U.S.C. § 4321) or the Clean Air

Act (42 U.S.C. § 7401). In fact, read literally, the Federal

Railroad Safety Act (49 U.S.C. § 20101) which consciously

transferred safety regulations from the ICC to the Department

of Transportation would be preempted by the ICCTA. Such an

anomalous result could not have been within the contemplation

of Congress.

Far from being “explicit” as to the preemption, therefore,

as the Ninth Circuit held, the Court and the STB had an obligation

to look beyond to the legislative history to find the intent of

Congress. Medtronic, supra.

Il.

THE LEGISLATIVE HISTORY OF THE ICCTA

MANDATES A FINDING THAT CONGRESS DID NOT

INTEND TO SWEEP AWAY LOCAL POLICE

POWERS AS THEY APPLY TO RAILROADS.

When a statute is ambiguous the Court may look to various

aids to help in the interpretation. One is the title of the Act.

L.N.S. v. National Center for Immigrants’ Rights, 502 U.S. 183,

112 S. Ct. 551, 116 L. Ed. 2d 546 (1991). Another is the

legislative history.

13

The full title of the ICCTA when it was enacted by Congress

was

An Act to abolish the Interstate Commerce

Commission, to amend Subtitle IV of Title 49, United

States Code, to reform economic regulation of

transportation, and for other purposes. (Emphasis

supplied).

This clear statement of the intent of Congress in enacting

the legislation belies the holding of the Ninth Circuit that the

ICCTA was intended to reform anything other than economic

regulation.

Until the adoption of the ICCTA, the States had certain

economic regulatory powers with respect to railroads. See for

example, Burlington Northern Santa Fe Corp. v. Anderson, 959

F. Supp. 1288, 1294-95 (D.Mt. 1997) which described the system

of economic regulation of railroads that had been in place in

Montana since 1870. See also Illinois Commerce Commission

v. LC.C., 879 F.2d 917 (D.C. Cir. 1989) holding that under the

Staggers Rail Act of 1980, the State regulatory authorities

continued their jurisdiction over the abandonment of intrastate

rail spurs.

Even after the adoption of ICCTA, the States retain certain

regulatory powers with respect to the safety of railroad

operations. See CSX Transp., Inc. y. City of Plymouth, Mich.,

86 F.3d 626 (6th Cir. 1996) recognizing that under the Federal

Railway Safety Act (49 U.S.C. § 20101 ) there was the possibility

of State regulation of railroad speed limits and other safety

matters but striking down particular municipal regulations.

As part of a prior deregulation measure adopted in 1978,

Congress enacted a predecessor to the present Section 10501.

14

That statute defined the powers of the ICC in Paragraph (a);

defined the limitations of the ICC in Paragraph (b); and said in

Paragraph (c):

This subtitle does not affect the power of a State, in

exercising its police power, to require reasonable

intrastate transportation by carriers providing

transportation subject to the jurisdiction of the

Commission under this subchapter unless the State

requirement is inconsistent with an order of the

Commission issued under this subtitle or is prohibited

under this subtitle. [P.L. 95-473. 92 Stat. 1359.]

That Act also contained, as its Section 10907 the following

language:

(b) The Commission does not have authority under

sections 10901, 10906 of this title over,

(1) the construction, acquisition, operation,

abandonment, or discontinuance of spur, industrial,

team, switching, or side tracks if the tracks are

located, or intended to be located, entirely in one

State.[ P.L. 95-473. 92 Stat. 1407.]

When Congress enacted the ICCTA, the limitations on the

power of the STB with respect to intrastate railroads in the former

paragraphs (b) and (c) of Section 10501 were eliminated. And

the ICCTA version of 10501(b) imported the language of Section

10907 to make it clear that spur tracks and the like were now

part of the jurisdiction of the STB even if located in only one

State. Powers that the States formerly had to regulate the

economic aspects of railroads were clearly eliminated by the

ICCTA. See CSX Transp., Inc. v. Georgia Pacific Public Service

15

Comm 'n., 944 F. Supp. 1573 (N.D. Ga. 1996) (state regulation

of railroad agency closings are preempted by the ICCTA). See

also Burlington Northern Santa Fe Corp. v. Anderson, 959

F. Supp. 1288, 1294-95 (D.Mt. 1997) (state regulation of railroad

agencies are preempted).

However, those cases involved only economic regulation

and do not hold that all police power regulations have been

preempted. It was not the intention of Congress to supplant police

power regulations except when they affected the specific

economic concerns of railroads embodied in Part A of the

ICCTA. The text of various Congressional reports so

demonstrate.

The first committee report came from the House Committee

on Transportation and Infrastructure. Commenting on what was

then Section 10103 [and what later became the preemption

sentence of Section 10501(b)], the Committee said:

To reflect the replacement of the Staggers Act system

of optional certification of State regulatory agencies

to administer economic regulation of railroads using

Federal standards, this provision is conformed to the

bill’s direct and general preemption of State

jurisdiction over economic regulation of railroads.

As used in this section, “State or Federal law” is

intended to encompass all statutory, common law,

and administrative remedies addressing the rail-

related subject matter jurisdiction of the

Transportation Adjudication Panel. The bill is

intended to standardize all economic regulation (and

deregulation) of rail transportation under Federal law,

without the optional delegation of administrative

authority to State agencies to enforce Federal

16

standards, as provided in the relevant provisions of i

the Staggers Rail Act. [H.R. Rep. No. 104-311 3

(1995), reprinted in 1995 U.S.C.C.A.N. 807.

Emphasis supplied. ]

The same House Committee Report contained the following

comment on what was then Section 10301 (and later became

the exclusive jurisdiction part of Section 10501(b):

This provision replaces the railroad portion of former

Section 10501. Conforming changes are made to

reflect the direct and complete preemption of State

economic regulation of railroads. The changes

include extending exclusive Federal jurisdiction to

matters relating to spur, industrial, team, switching

or side tracks formerly reserved for State jurisdiction

under former section 10907. The former disclaimer

regarding residual State police powers is eliminated

as unnecessary, in view of the Federal policy of

occupying the entire field of economic regulation of

the interstate rail transportation system. Although

States retain the police powers reserved by the |

Constitution, the Federal scheme of economic

regulation and deregulation is intended address and

encompass ail such regulation and to be completely

exclusive. Any other construction would undermine

the uniformity of Federal standards and risk the /

balkanization and subversion of the Federal scheme |

of minimal regulation for this intrinsically interstate

form of trar.sportation. [H.R. Rep. No. 104-311

(1995), reprinted in 1995 U.S.C.C.A.N. 807-808.

Emphasis supplied. }

17

When the bill was adopted by the Conference Committee,

Section 10301 — the exclusive jurisdiction language — was

renumbered as Section 10501. In addition, Section 10103 of the

House Bill — the preemption sentence — was amended by the

insertion of the words “with respect to the regulation of rail

transportation.” What was formerly Section 10103 was inserted

into Section 10501(b).

The Conference Report explained the change this way:

Former section 10103 dealt with remedies in all

modes of transportation regulated by the ICC, but

since 1980, former section 10501(d) and 11501(b),

with respect to rail transportation, had already

replaced the former standard of cumulative remedies

with an exclusive Federal standard, in order to assure

uniform administration of the regulatory standards

of the Staggers Act. The Conference provision

retains this general rule, while clarifying that

exclusivity is limited to remedies with respect to rail

regulation — not Staie and Federal law generally.

For example, criminal statutes governing antitrust

maters not preempted by this Act, and laws defining

criminal offenses as bribery and extortion, remain

fully applicable unless specifically displaced,

because they do not generally collide with the scheme

of economic regulation (and deregulation) of rail

transportation. [H.R.Conf. Rep. No. 104-422 (1995)

reprinted in 1995 U.S.C.C.A.N. 793. Emphasis

supplied].

The clear understanding of Congress based upon this

Legislative history was that the jurisdiction of the STB would

be exclusive with respect to economic regulation. There remains

room for regulation by the States on matters that have only a

18

peripheral effect on interstate commerce. Many vital police

power regulations including construction codes, sanitary codes,

fire regulations and even some zoning, land use and

environmental requirements do not prohibit the construction of

railroad facilities but impose reasonable conditions. The absolute

rule of the Ninth Circuit in this case prevents the application of

such historic, reasonable state and municipal regulation and flies

in the face of Congressional intent.

Il.

IMPORTANT QUESTIONS OF FEDERALISM ARE

PRESENTED BY THIS CASE. THE COURT OUGHT TO

GRANT CERTIORARI TO RETURN BALANCE TO THE

RELATIONSHIP BETWEEN RAILROADS AND THE

STATES CAUSED BY THE NINTH CIRCUIT

MISREADING OF CONGRESSIONAL INTENT.

Local governments are vital cogs in maintaining the quality

of life for Americans. Local regulations provide safeguards and

protections that are often taken for granted. Because of local

regulations, the foundation of a building is designed so that-it

does not settle and cause unsafe conditions. Walls and other

structural elements are designed so that they will not collapse

or cause other danger. Elevators are inspected so that the lives

of riders are not put in peril. Sufficient sanitary facilities are

required to accommodate people in public buildings, including

railroad terminals and other facilities, and to prevent disease.

Electrical codes prevent fire. Building codes provide adequate

access for fire fighters and emergency workers. Earthquake codes

not only protect the property of the railroad but the surrounding

residents and property owners in the event ofa catastrophe. Local

governments regulate litter and solid waste disposal for aesthetic

and health reasons. It has long been recognized by this Court

19

that zoning serves the general health, safety and welfare of

residents, Village of Euclid v. Ambler, 272 U.S. 365, 47 S. Ct.

114, 71 L. Ed. 2d 303 (1926), and helps to provide a safe and

desirable environment, Village of Belle Terre v. Boraas, 416

U.S. 1, 9, 94S. Ct. 1536, 1541, 39 L. Ed. 797 (1974).

So long as the application of any police power ordinance

has only an incidental or peripheral effect on interstate commerce

or a Federal scheme of regulation of railroads the power of the

State or municipality should not be preempted. cf. San Diego

Building Trades Council vy. Garmon, 359 U.S. 236, 243, 79

S. Ct. 773, 778, 3 L. Ed. 2d 775 (1959). A blanket preemption

such as that found by the Ninth Circuit destroys the delicate

balance between the federal interest in safe, economical and

efficient means of transportation and the State interest in safe

and desirable communities.

Under the ruling of the Ninth Circuit, a railroad would be

permitted to build Grand Central Station or Union Station

without bathrooms, a commuter station without parking spaces,

or an intermodal facility without adequate means for ingress

and egress. None of those facilities are exclusively subject to

the remedies of the ICCTA any more than the snow sheds and

communication towers of the Railroad were here.

By granting the Petition for Certiorari in this case, the Court

can confirm that the preemption imposed by the ICCTA is not

absolute and that the States, as well as the United States, continue

to have power to regulate railroad activities so long as there is

no undue interference with interstate commerce.

Here, the STB erred by not examining the specific

ordinances in question to determine whether the permit

regulations here imposed more than a peripheral burden on

20

interstate commerce. The Board simply drew the conclusion that

because Auburn and King County sought to compel the railroad

to get permits, the regulations had “gone too far.” The Ninth

Circuit erred by misconstruing the ambiguous words of the

ICCTA. Certiorari is necessary to correct these errors and to

guide States and municipalities about the extent of their

remaining powers to regulate railroad construction.

CONCLUSION

The League and IMLA urge the Court to grant the petition

of the City of Auburn for a Wnit of Certiorari.

Respectfully submitted,

THOMAS W. DUNN

Counsel of Record

BEATTIE PADOVANO, LLC

50 Chestnut Ridge Road

P.O. Box 244

Montvale, NJ 07645

(201) 573-1810

WILLIAM JOHN KEARNS, JR.

General Counsel, The New Jersey

State League of Municipalities

HENRY UNDERHILL

General Counsel, International

Municipal Lawyers Association

Attorneys for Amici Curiae