WALKER.docx

March 9, 1995
VIA FACSIMILE
Jeff Walker, Special Assistant
Office of the Governor
Statehouse
Boise, ID 83720-0034
RE:Abandonment of the Idaho Northern and Pacific Council  Branch Line
Dear Jeff:
Following up on our conversation of yesterday, I wanted to provide you with a little more information.  The abandonment of railroad lines is governed by federal law and supervised by the Interstate Commerce Commission (ICC).  There are two kinds of abandonment proceedings before the ICC.  The normal process is for the railroad to file an Application seeking abandonment.  An abandonment Application normally contains specific information outlining the reasons a railroad desires to abandon a branch or main rail line.  More specifically, an abandonment Application details operational expenses and revenues; condition of the track and other structures; operating practices and schedules; salvage value of the track and structures; a 12-month forecast of future traffic and revenues; a list of current shippers; and estimated payments if someone desires to subsidize continued rail operations.  A normal abandonment proceeding is usually completed in approximately 200 days.
The other type of abandonment proceeding (like in this case) is a Petition to be exempt from the normal abandonment requirements.  The Petition for an exemption contains only minimal information such as a map, name of representative, whether the right-of-way is suitable for other public uses, and an environmental report.  Exemptions are usually used where there has been no traffic on the line for two years or where there is a significant change in operations, e.g., a bridge or trestle fails and the expense of rebuilding exceeds the revenue of the line.  Exemption requests, unless opposed, are approved within 30 days after publication in the Federal Register.  In this particular case, the ICC could grant the exemption as soon as May 1, 1995, unless protested or opposed.
The PUC’s role in rail abandonment proceedings is to determine whether the abandonment would be adverse to Idaho’s interests and to coordinate the submission of agency comments to the railroad and the ICC.  Idaho Code § 62-424 requires that the PUC convene a public hearing on the proposed abandonment.  If the PUC finds that the abandonment of the branch line would be adverse to Idaho’s interests and that the line has a potential for profitability, then it represents the State before the ICC.
Executive Order No. 94-1 provides that State agencies coordinate any submissions to the railroad or the ICC with the PUC prior to transmittal.  This Executive Order was issued to ensure that the State speaks with one voice.  If agencies have divergent views regarding abandonment, then these differences are brought to the Governor for decision.  
From prior experience in litigating these cases, we have found that efforts by the Commission in proceedings before the ICC are not, in themselves, always sufficient to carry the day.  Participation by current and potential shippers, those most affected by a proposed abandonment, is important.  Once the State has decided to challenge an abandonment, we usually solicit the assistance of the Governor and our congressional delegation.  Although the Commission cannot represent the specific interests of individual shippers, we can provide advice and assistance, and we may coordinate our efforts with those of local shippers.
The Commission has tentatively scheduled a public hearing in this matter for March 23, 1995 in Weiser.  The Commission invites comments from local officials, shippers, the public and the Railroad.  Based upon information received at the public hearing, or lack thereof, the Commission then decides whether the abandonment is adverse to Idaho’s interests.  Until evidence has been presented, the Commission does not have a record upon which to make its determination.  Consequently, the Commission has not ruled on the merits of this case.
I hope you find this information helpful, I have also included a copy of a generic letter used by Governor Andrus when replying to rail abandonment inquiries.  If you have further questions, please contact me at 334-0312.
Sincerely yours,
Donald L. Howell, II
Deputy Attorney General
JR\L-WALKER.DH
Attachment
cc:Commissioners
Bill VonTagen
Jack McMahon