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Village of Barrington v. Surface Transportation Board

United States Court of Appeals, Seventh Circuit

June 11, 2018

Village of Barrington, Illinois, Petitioner,
Surface Transportation Board, et al., Respondents, and Canadian National Railway Company, et al., Intervening Respondents.

          Argued May 22, 2018

          On Petition for Review of an Order of the Surface Transportation Board. STB Finance Docket No. 35087.

          Before Flaum and Ripple, Circuit Judges, and Gettleman, District Judge. [*]


         In 2007, Canadian National Railway Company ("CN") sought approval from the Surface Transportation Board (the "Board") of its acquisition of control of the Elgin, Joliet, and Eastern Railway Company ("EJ & E") rail line near Chicago. As part of its review, the Board considered the impact of the acquisition on 112 railroad crossings throughout the Chicagoland area, including the intersection at U.S. Highway 14 ("U.S. 14") in the Village of Barrington (the "Village"). Crossings projected to be "substantially affected" by the acquisition were eligible for mitigation measures imposed by the Board as a condition to its approval, up to and including grade separation between the roadway and rail line. The Board approved CN's acquisition in 2008, but determined that U.S. 14 would neither be substantially affected nor warrant a grade separation. The Village unsuccessfully petitioned the Board to reopen its decision in 2011 and 2014. It failed for a third time in 2017, and now appeals the Board's most recent denial. Because the Village does not present new evidence or substantially changed circumstances that mandate a different result, we deny the petition for review.

         I. Background

         A. Factual Background

         CN is one of Canada's two major railroads, extending from Halifax, Nova Scotia on the Atlantic coast to Vancouver and Prince Rupert, British Columbia on the Pacific. Through its Grand Trunk Corporation subsidiary, the company also controls numerous rail carriers in the United States. Its American railway system extends north/south from Chicago to the Gulf Coast, and east/west from Pennsylvania to Minnesota.

         EJ & E West Company ("EJ & EW") is a wholly owned, noncarrier subsidiary of EJ & E. The EJ & E rail line, located in northeastern Illinois and northwestern Indiana, encompasses a 120-mile arc of mainline track around Chicago.

         Beginning in the 1990s, the EJ & E line became a means for freight moving through Chicago to avoid railway congestion in the center of the city. Notably, Chicago is the only city in the United States where all seven Class I railroads (railroads with annual operating revenues of $250 million or more) operate. According to the Board, "one third of all rail freight in the United States moves to, from, or through Chicago, " including more than 600 freight trains each day. "Converging in the Chicago Terminal District-a 2, 800 mile rail network containing 70 train yards and terminals-these freight trains compete for track and yard space with each other and with over 750 commuter trains and 78 Amtrak trains per day, which together serve over 84 million passengers a year." Vill. of Barrington v. STB, 636 F.3d 650, 652 (D.C. Cir. 2011) [hereinafter Barrington I]. "The resulting congestion slows freight traffic to a crawl." Id.

         In 2007, CN sought acquisition of control of EJ & EW in order to move a majority of its Chicago rail traffic to the EJ & E line. At the time, CN's rail network "converge[d] on the city like the spokes of a wheel … meet[ing] in the heart of the Chicago Terminal District." Id. As a result, trains passing through the city were forced to "contend with the city's congestion, " which often turned the thirty-mile journey into a twenty-four hour endeavor. Id. The EJ & E line, however, cut across CN's existing rail lines, thus allowing trains the opportunity to bypass the city center.

         Under federal law, the Board "has authority to regulate the construction, operation, and abandonment of most railroad lines in the United States, " Caldwell v. United States, 391 F.3d 1226, 1228 (Fed. Cir. 2004), including the "[a]cquisition of control of a rail carrier by any number of rail carriers." 49 U.S.C. § 11323(a)(3).[1] The Board must approve and authorize any transaction "consistent with the public interest, " but may nonetheless "impose conditions governing the transaction." Id. § 11324(c). CN applied for Board approval on October 30, 2007.

         Many roadways that intersect the EJ & E line are important to regional mobility. At the time of the proposed acquisition, "nearly 340, 000 people live[d] in close proximity to the EJ & E line, " and "73% of road crossings lack[ed] bridges over the tracks." Barrington I, 636 F.3d at 653. Consequently, the Board conducted an environmental review in accordance with the National Environmental Policy Act ("NEPA"), [2] 42 U.S.C. §§ 4321-4370m-12. The Board's Office of Environmental Analysis ("OEA")[3] prepared an Environmental Impact Statement ("EIS") examining 112 crossings along the EJ & E rail line, including the intersection at U.S. 14 in Barrington. It "studied how increased freight traffic would worsen traffic congestion, increase the risk of collisions, slow emergency responders, and increase the likelihood of hazardous material spills in communities along the rail line." Barrington I, 636 F.3d at 668. In the course of preparing the EIS, OEA "publish[ed] notices in the Federal Register and ads in local newspapers, [held] twenty-two public meetings attended by over 7200 people, consult[ed] with local, state, and federal agencies and officials, publish[ed] for comment a 3500 page draft environmental impact statement, [and held] a sixty day comment period on that draft, " during which it received over 13, 500 comments. Id. at 653.

         Substantially affected crossings were eligible for the imposition of mitigation measures as a condition to the Board's approval. Possible mitigation measures included: traffic advisory signs that notified drivers to stay clear of intersections; roadway modifications (such as widening); and, most relevant here, grade separation between the roadway and rail line. Critically, however, a substantially affected crossing did not automatically warrant mitigation. Rather, in determining what (if any) measures would be appropriate, OEA considered "the individual characteristics of each highway/rail atgrade crossing site." These factors included, inter alia, "the importance of the highway at the crossing to regional traffic flows, existing congestion, existing structures (such as mature trees and local roadways) near the highway/rail at-grade intersection, and the cost of a grade separation."

         To determine whether a crossing would be substantially affected by the acquisition, OEA studied impacts on traffic congestion by examining rail and vehicle projections for 2015.[4] Specifically, OEA examined three data "thresholds."[5]The first was the crossing level of service ("LOS"), a measure of how freely traffic moves at a crossing. The LOS at a particular crossing was characterized by a letter from A through F, with "LOS A" indicating relatively free-flowing traffic and "LOS F" indicating extreme congestion. A crossing was declared substantially affected if it would be classified as LOS E or F as a result of the acquisition. Second, OEA examined effects on vehicle queue length, or how far traffic backs up when a train passes. Crossings were deemed substantially affected where acquisition-related queues were projected to block a major thoroughfare that would not otherwise be obstructed. Finally, OEA analyzed the total length of delay for all vehicles stopped at a crossing. Crossings expected to experience more than forty hours of acquisition-related vehicle delay in a twenty-four hour period were considered substantially affected.

         OEA's draft EIS projected that if the acquisition were approved, 20.3 CN trains would travel across the Barrington segment of the EJ & E line each day by 2015, with an average length of 6, 829 feet and speed of 40 miles per hour. OEA further concluded that U.S. 14 did not exceed any of the three thresholds for substantially affected crossings. In particular, it determined that, as a result of the acquisition, the intersection would: (1) remain at LOS A; (2) not experience queues that blocked a major thoroughfare (although average queue lengths were expected to increase from 558 to 1, 048 feet); and (3) encounter only 31.78 hours of daily acquisition-related vehicle delay (compared to 2.49 hours if no CN trains were added).

         In response to the draft EIS, the Village conducted its own independent "VISSIM"[6] study using a different methodology than the EIS. The Village claimed that its VISSIM model calculated 135-249 hours of daily acquisition-related vehicle delay at U.S. 14, an amount substantially higher than the draft EIS forecast and above the forty-hour threshold established for substantially affected crossings.

         To address the Village's study, the Board performed an additional VISSIM traffic analysis specifically focused on the Barrington area, referred to as the Village of Barrington Traffic Operational Analysis (the "VOBTOA Study"). The VOBTOA Study concluded that during morning and evening peak periods, overall vehicle delay in the Barrington region would increase by 4% and 5%, respectively. It also found, however, that "the major source of congestion" was not the proposed acquisition, but rather "excess vehicle demand at existing major thoroughfare intersections, " which "backs up traffic into significant queues." As a result, it determined that "construction of a grade separation … at … [U.S. 14] … [was] not a feasible way to address regional congestion, " and "would only be beneficial if capacity improvements [were] incorporated at the upstream and downstream signalized intersections."

         In the final EIS published on December 5, 2008, OEA presented the VOBTOA Study and recommended final mitigation conditions for the proposed acquisition. The final EIS found that thirteen crossings would be substantially affected. Of these, OEA recommended mitigation for eight crossings (including two grade separations); it determined that mitigation was not needed for the remaining five. Once again, however, it concluded that the U.S. 14 intersection did not meet the criteria for a substantially affected crossing, much less a grade separation.

         More importantly, the final EIS determined that even if a grade separation at U.S. 14 were constructed, it "would have minimal benefit to traffic flow" because "existing traffic signals in proximity to one another, as well as the [existence of a separate commuter rail line that intersects with the EJ & E line in Barrington], would result in substantial queuing along … U.S. 14." OEA stated that as a result, "it [was] not the responsibility of [CN] to mitigate for [this] existing traffic congestion in the community by grade separating U.S. 14."

         B. Procedural Background

         1. The Board's 2008 Decision

         The Board approved the acquisition on December 24, 2008, subject to CN implementing the environmental mitigation conditions discussed in the final EIS.[7] See Canadian Nat'l Ry. Co.-Control-EJ & E W. Co., STB Finance Docket No. 35087, 2008 WL 8139694 (Dec. 24, 2008). Although the Board recognized that "numerous commenters requested grade separations, " it ultimately agreed with OEA's analysis "explaining why a grade separation … would not be practical or warranted at those crossings." Still, it imposed a "monitoring and oversight" period, during which CN was required to submit regular operational and environmental reports and the Board retained the authority to impose additional mitigation measures.[8] CN completed its acquisition of the EJ & E line on January 21, 2009, at a cost of $303 million.

         Following the Board's decision, approximately a dozen governmental entities, including the Village, filed petitions for review in the D.C. Circuit Court of Appeals. See Barrington I, 636 F.3d at 654. The Village argued that the Board "failed to take the requisite 'hard look' at traffic congestion and emergency responder delays in Barrington" and "failed to adequately examine strategies for mitigating those impacts." Id. at 672. The D.C. Circuit denied the Village's petition on March 15, 2011. Id. at 672-73.

         2. The 2011 Petition to Reopen[9]

         On October 14, 2011, the Village petitioned the Board to reopen its 2008 decision and require CN to bear at least 84% of the cost of a grade separation at U.S. 14. In relevant part, the Village highlighted that the Illinois Department of Transportation ("IDOT") had designated U.S. 14 a Strategic Regional Arterial ("SRA").[10] It also submitted an updated version of its 2008 VISSIM study. The revised analysis projected 2015 traffic conditions by examining actual post-acquisition CN operations in mid-2011 rather than the pre-acquisition estimates created in 2008. This time, the Village's study predicted 98-100 hours of acquisition-related vehicle delay at U.S. 14. As in 2008, the Village argued that this projection satisfied one of the criteria used by the Board in determining substantially affected crossings. However, the Village's study also indicated that, even if CN trains were not added to the EJ & E line, vehicle delay in 2015 would increase by 260 hours compared to 2007 levels.

         In addition, the Village introduced evidence that in 2010, it received a $2.8 million federal grant under the Transportation Investment Generating Economic Recovery ("TIGER II") program to undertake preliminary engineering studies for a grade separation at U.S. 14. It argued that its receipt of the TIGER II grant showed that the Board erred in not ordering a grade separation in 2008. Finally, it cited a growing "industry trend" of increased train lengths and slower train speeds, which it argued the Board did not consider when developing its 2008 mitigation framework.

         The Board denied the Village's petition on November 8, 2012. See Canadian Nat'l Ry. Co.-Control-EJ & E W. Co., STB Finance Docket No. 35087, 2012 WL 5458828 (Nov. 8, 2012). It concluded that "SRA designation alone … did not warrant a grade separation at a given intersection, particularly in areas with preexisting roadway capacity constraints." It further found that because the Village's 2011 study projected less impact on vehicle delay than its 2008 analysis, the Village had not presented new evidence or changed circumstances that would have materially altered its 2008 decision. It also noted that the Village's study confirmed that "even if CN's additional trains were to add 98-100 hours of increased vehicle delay at U.S. 14 … existing capacity constraints on U.S. 14 will contribute much more significantly to the vehicle delays at that crossing than will additional CN trains on the EJ & E line."

         Additionally, the Board reiterated that "exceeding the 40hour traffic delay threshold did not automatically warrant … a grade separation." As evidence, it pointed to the five crossings deemed substantially affected in 2008 that ultimately did not receive any mitigation measures. Citing the VOBTOA Study and final EIS, the Board emphasized that while the acquisition would increase delay at U.S. 14 "to some degree, " it "would not substantially modify the basic nature of the traffic congestion that motorists were already experiencing and would continue to experience in Barrington due to preexisting roadway capacity constraints."

         Regarding the TIGER II grant, the Board stated that the Village did not cite "any statements relating to the awarding of the grant that refute[d] the Board's decision in the [2008] Final Decision not to impose a grade separation." Last, it found that the Village failed to show that its supposed "industry trends" involving train length and speed "appl[ied] to or reflect[ed] CN's operations on the EJ & E rail line."

         Once again, the Village filed a petition for review, which the D.C. Circuit denied on July 18, 2014. Vill. of Barrington v. STB, 758 F.3d 326 (D.C. Cir. 2014) [hereinafter Barrington II].

         3. The 2014 Petition to Reopen

         The Village filed another petition with the Board on November 26, 2014, this time asking that CN be forced to contribute 79% of the cost of a grade separation (equal to $47 million). The Village referenced unexpected "energy-related market developments on CN's rail network." Specifically, it claimed that the acquisition, combined with an unexpected rise in global energy prices, had "facilitated … increased movement of energy commodity traffic (namely, crude oil, ethanol, and frac sand shipments) and that these unforeseen traffic volumes were not factored in the projections relied upon by the Board in its 2008 Final Decision." It asserted that "it necessarily follow[ed] that CN's projections could not have allowed the Board to weigh the profound long-term impact … on Barrington." It also maintained that this energy-related traffic resulted in "unanticipated movement of flammable hazardous materials through Barrington [that] pose[d] a threat to public safety not previously considered by the Board."

         Additionally, the Village contended that the average length of CN trains had significantly increased (from 5, 800 feet in 2011 to 8, 568 feet in 2014). It stated that this created greater vehicles delays and threatened emergency medical response. It also raised the prospect of "double-tracking, " i.e., the addition of a second parallel track along the EJ & E line. It claimed that, based upon the increase in energy-related freight traffic, as well as emails sent by CN personnel in 2013, "it [was] only a ...

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