Grafton News: First Circuit Court rules in railroad’s favor on LPG transloading facility

A unanimous three-judge panel of the First Circuit Court of Appeals Friday slammed the door on the Town of Grafton’s efforts to stop the Grafton & Upton Railroad from building and operating its liquid propane transloading facility at its North Grafton rail yard, 42 Westboro Road.  The decision comes a little more than a year after the Town of Grafton appealed the federal Surface Transportation Board’s decision in favor of the railroad.

In doing so, the court found that the STB was correct in its finding “…that state and local permitting and preclearance requirements, including zoning requirements, are preempted with regard to the construction and operation of the facility…”

“I’m extremely happy with this decision, which affirms what the railroad has been saying all along, that the Town would have been better off working with us than spending three years and hundreds of thousands of tax dollars fighting this matter legally,” said Grafton & Upton owner Jon Delli Priscoli.  “We will now work to bring this much needed domestic energy to market to satisfy the growing demand.”

In a decision dated October 16, the court found no merit in any of the town’s arguments, either discounting their arguments as insufficient, or ruling that the town tried to introduce arguments that it had not raised at the STB in the first instance.

The court rejected the Town’s contention that the facility does “not constitute transportation by a rail carrier.”  The court rejected as “meritless” the Town’s contention that the Interstate Commerce Commission Termination Act does not pre-empt the railroad from local permitting.  The court also agreed with the STB and the railroad that well established precedent blocked the Town’s attempt to raise arguments on appeal that it had not raised before the STB.  These revolved around Grafton’s local health and safety jurisdiction and an effort to invoke the National Environmental Policy Act, a federal environmental review process.  In short, the Court rejected every argument the town raised in its appeal, and also ordered, “Costs to respondents (STB) and intervenor (Grafton & Upton Railroad).”

The decision brings the First Circuit, which covers MA, ME, NH, RI, and Puerto Rico, into line with other federal courts around the country on the subject of federal law preempting state and local permitting and preclearance  regulations governing rail transportation, according to John A. Mavricos, Christopher, Hays, Wojcik & Mavricos, LLP, who argued the case for the railroad.  Mavricos noted that the resounding totality of the decision and the uniformity of opinion among the several federal court jurisdictions make any further  review of the case unlikely as well.

In another case brought by a group of citizens from Upton challenging certain aspects of G&U’s operations at its yard in Upton, the Court confirmed that transloading cargo from railcars to trucks is rail transportation and that the transloading is being provided by a rail carrier, thereby exempting the transloading from state and local regulation.  The Court determined, however, that the STB had not properly analyzed activities relating to the transloading of wood pellets from railcars to trucks and remanded the matter to the STB.  The STB will now consider more specifically whether the transfer of wood pellets into bags for final delivery by truck constitute activities that facilitate the physical movement of the pellets.

The G&U continues to believe that the pellet transloading activities do in fact constitute transportation by rail that is exempt from state and local permitting and preclearance regulation.  The G&U will continue to take all required steps to give the STB the necessary information that is required in clarifying this issue to the Court’s satisfaction.

press release from the G&U

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