Agenda - Planning Commission - 01/07/2016

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Zoning Bulletin December 10, 2015 1 Volume 9 1 Issue 23 Citation: Grosso v. Surface Transportation Bd., 804 F.3d 110 (1st Cir. 2015) The First Circuit has jurisdiction over Maine, Massachusetts, New Hampshire, Puerto Rico, and Rhode Island. FIRST CIRCUIT (10/16/15)—This case addressed the issue of whether the activities at a transloading facility at the conclusion of a rail journey— which here included the vacuuming, screening, bagging, and palletizing of wood pellets—constituted rail "transportation" such that the activities were preempted by the Interstate Commerce Commission Termination Act and not subject to state and local regulation. The Background/Facts: Grafton & Upton Railroad Company ("G & U") was a licensed rail carrier. It owned a railroad line in Massachusetts. In 2008, G & U decided to expand its rail yard in the Town of Upton ("Upton") and develop it into a rail -to -truck transloading facility. More specifically, G & U constructed a wood pellet facility that would receive wood pellets in bullc from hopper railcars and transfer them, after some processing and bag- ging, onto trucks. G & U also entered into a Terminal Transloading Agree- ment with Grafton Upton Railcare LLC ("GU Railcare"), an entity neither owned nor operated by G & U, which was to operate the transloading ser- vices on behalf of G & U. The Upton Board of Selectmen determined that the activities at the facil- ity were preempted by the Interstate Commerce Commission Termination Act ("ICCTA"), 49 U.S.C.A. § 10501(b). The ICCTA vests exclusive juris- diction over "transportation by rail carrier" with the federal Surface Transportation Board (the "STB"). Generally, state and local laws govern- ing transportation by rail carrier are preempted by the ICCTA. Residents of Upton who lived near the facility (the "Petitioners") complained that the transloading activities caused them harms "such as exposure to excess glare, light intrusion, noise, and diminution of property values, and that such harms would be prevented by enforcement of Upton's zoning by-laws, which, for example, restrict a building's height and require special permits for manufacturing facilities, which permits could limit noise and above -ground storage." The Petitioners asked the STB to declare that the wood pellet activities were not part of "transportation by rail carrier," and therefore were not preempted by the ICCTA and could be regulated by Upton. The Petitioners argued that the facility here did not constitute "transportation by rail carrier" because: (1) the wood pellet transloading operations were not "transportation" under the ICCTA because they were manufacturing activities; and (2) GU Railcare was not a "rail carrier" under the statute. The STB disagreed with the Petitioners. It concluded that "the vacuum- ing, screening, bagging, and palletizing of the wood pellets were 'transporta- tion' and not `manufacturing' because, although those activities were 'not essential' to transporting wood pellets by rail, they `facilitate[d]' such transportation by making it 'more efficient' " in that the activities allowed G & U to transport the pellets by hopper cars rather than boxcars. The STB also deteunined that GU Railcare was acting on behalf of G & U in perforrn- © 2015 Thomson Reuters 3