Transportation
January 2003
ICCTA Preemption Limited By Recent STB Ruling
The Surface Transportation Board (“STB”) recently
issued a decision that establishes certain limitations
on federal preemption under the ICC Termination
Act of 1995 (“ICCTA”). The STB has exclusive
jurisdiction over freight rail carrier transportation
and that jurisdiction preempts other federal and state
laws under the ICCTA preemption statute, 49 U.S.C.
§ 10501. The expansive scope of ICCTA preemption
has been widely recognized. In several recent cases,
ICCTA preemption has been extended to rail
intermodal facilities even in instances where the STB
lacked specific licensing jurisdiction over such
facilities. However, in Hi Tech Trans, LLC –
Petition for Declaratory Order –Hudson County, NJ,
Finance Docket No. 34192 (STB served November
20, 2002), the STB determined that it did not have
jurisdiction over the movement of trucks carrying
construction and demolition (“C&D”) debris to a
truck-to-rail transload facility and therefore ICCTA
did not preempt the application of state and local
laws barring the delivery of such debris to that
facility.
Hi Tech Trans, LLC (“Hi Tech”) is a non-carrier that
operates a truck-to-rail transload facility on property
owned by Canadian Pacific Railway Company
(“CP”) in Hudson County, New Jersey. Hi Tech
contracts with shippers of C&D debris and with
truckers licensed by the State of New Jersey to
transport the debris from construction sites to the
transload facility, where the debris is transferred in
bulk from trucks to rail cars and then shipped in
interstate commerce on CP’s rail lines. Hi Tech is a
licensee of CP and performs marketing and
transloading for CP’s movement of this type of
freight.
Pursuant to New Jersey solid waste management
laws, the Hudson County Improvement Authority
(“HCIA”) designated a single, truck-to-truck facility
to receive all C&D debris originating in Hudson
County. HCIA has the authority to impose fines and
penalties on transporters delivering Hudson County
C&D debris to the Hi Tech facility and other
facilities not designated to receive such waste. HCIA
has taken steps to prevent such C&D debris from
being delivered to the Hi Tech facility.
On May 3, 2002, Hi Tech filed an amended petition
with the STB seeking a declaratory order that Hi
Tech’s activities and those of its customers (the
producers of C&D debris) were subject to exclusive
STB jurisdiction and therefore immune from HCIA’s
attempts to prevent C&D debris originating in
Hudson County from being delivered to the Hi Tech
facility. HCIA and the New Jersey Department of
Environmental Protection (“NJDEP”) opposed Hi
Tech’s petition, arguing that the HCIA single facility
designation was aimed at solid waste collection and
disposal activities and not rail transportation in
interstate commerce.
By decision served on November 20, 2002, the STB
determined that it did not have jurisdiction over
activities (such as the movement of trucks carrying
C&D debris on public roads) that extend beyond the
rail-related activities at the transload facility. The
STB noted that to come within the scope of ICCTA
preemption, activities must be “integrally related to
the railroad’s ability to provide rail transportation
services.” The STB concluded that the only Hi Tech
activity that might be considered integral to rail
transportation would be the transfer of C&D debris
from trucks to rail cars at the transload facility itself.
Kirkpatrick & Lockhart LLP
It rejected Hi Tech’s attempt to characterize its
activities as one continuous intermodal movement
subject to exclusive STB jurisdiction. Otherwise, the
STB noted, all state and local regulation of activities
that occur before a product is delivered to a rail
carrier for transportation would be preempted.
The Hi Tech decision is significant because it is one
of only a handful of STB and court decisions that
establish limits on ICCTA preemption. The Hi Tech
decision indicates that the STB’s exclusive
jurisdiction does not extend to non-rail activities that
occur outside the boundaries of an intermodal
facility. Although the STB recognized that Hi Tech’s
truck-to-rail transloading operations might be
covered by ICCTA preemption because they are
integral to rail transportation provided by CP, it
rejected Hi Tech’s attempt to characterize its solid
waste collection and truck transport activities as part
of those transloading operations. The decision
appears to stand for the proposition that other
federal, state and local government agencies may
regulate activities that occur prior to the receipt of
freight at a rail or intermodal facility. However, it is
unclear whether the STB would have reached the
same result if CP or another rail carrier were
conducting such activities.
EDWARD J. FISHMAN
202.778.9456
efishman@kl.com
FOR FURTHER INFORMATION, please consult one of the lawyers
listed below:
Boston
Harrisburg
Pittsburgh
Jeffrey S. King
Carleton O. Strouss
Theodore A. McConnell
Stephen M. Olson
San Francisco Robert J. Sherry
Washington Edward J. Fishman
Kevin M. Sheys
617.261.3179
717.231.4503
412.355.6566
412.355.6496
415.249.1032
202.778.9456
202.778.9290
jking@kl.com
cstrouss@kl.com
tmcconnell@kl.com
solson@kl.com
rsherry@kl.com
efishman@kl.com
ksheys@kl.com
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This publication/newsletter is for informational purposes and does not contain or convey legal advice. The information herein
should not be used or relied upon in regard to any particular facts or circumstances without first consulting a lawyer.
© 2002 KIRKPATRICK & LOCKHART LLP.
ALL RIGHTS RESERVED.