Rails-To-Trails Conversions: a Review of Legal Issues

RailsTrailsComment 9/22/06 10:28 PM Page 3

Commentary Rails-to-Trails Conversions: A Review of Legal Issues

Andrea C. Ferster

INTRODUCTION several generations,” was at risk of Rail-trails are subject to a unique, The construction and development of becoming irreparably fragmented.1 and occasionally complex, mix of fed- our nation’s system of rail lines was Like the difficulty of putting Humpty eral and state law. Many rail-trail con- nothing short of a marvel. At the peak Dumpty together again, it would be versions are “railbanked” under of the rail era in 1916, more than virtually impossible to recreate our Section 8(d) of the National Trails 270,000 miles of track crisscrossed the national rail corridor system after it was Systems Act, often called “the United States, carrying freight and pas- broken into hundreds of parcels of Railbanking Act” or the “Rails-to-Trails sengers and fueling the economy and land, due to the difficulties and costs of Act.” This important federal law, growth of a nation. At the turn of the assembling land in a more populous, enacted by Congress in 1983 to pre- century, the country’s labyrinth of rail increasingly urbanized 21st century serve established railroad corridors for lines hauled food to market, moved the America. interim trail and future rail use, pre- coal that heated cities, and took settlers The possibility of creating trails for empts state or local laws that are incon- into the Western frontier. The strength recreation and nonmotorized transporta- sistent with these goals. Some rail-trail of our national rail system has also tion on these unused railroad corridors conversions take place after the corri- been critical to our national defense. became both the opportunity and the dors have been legally “abandoned” Indeed, the trains that moved iron ore solution. With their gentle grades, often and, therefore, are subject to the from the Mesabi Range to the steel following rivers and traversing scenic vagaries of state law in resolving own- mills of the Great Lakes helped win landscapes, rail corridors make ideal ership disputes. And railroad corridors World War II. trails, turning vacant, sometimes derelict that were originally assembled through Just as the miles of rail line peaked, properties into linear parks, and filling federal land grants or federal grants-in- however, other methods of increasingly an increasing public need for outdoor aid of construction are subject to their popular transport—most notably, the recreation areas. According to the data- own unique set of federal laws govern- trucking industry—began eclipsing the base maintained by the Rails-to-Trails ing post-railroad use and disposition. rail industry’s dominance, and a long Conservancy, as of March 16, 2006, there This commentary provides a sum- period of decline began. Some rail were 1,393 open rail-trails, totaling mary of the legal issues that arise in the lines became underused and unprof- 13,365 miles in all 50 states and the context of rails-to-trails conversion, as itable. Starting in the 1970s, several District of Columbia, including such well as an overview of how some of major railroads went bankrupt, and car- national gems as the Minuteman those issues have been resolved. While riers began abandoning rail lines at an Bikeway, the most used bike trail in citations to pertinent case law are pro- alarming rate. Our nation’s rail corridor Massachusetts, and Missouri’s 225-mile vided, this article does not provide an system, “painstakingly created over Katy Trail State Park. exhaustive review of relevant legal authority. Andrea C. Ferster, a lawyer in private practice in Washington, 1. Reed v. Meserve, 487 F.2d 646, D.C., has served as general counsel of the Rails-to-Trails 649 (First Cir.1973). Conservancy since 1992. RTC is a national, nonprofit conser- vation organization founded in 1986 for the purpose of identi- fying, preserving, and converting rail corridors that are not currently needed for rail transportation into public trails, nonmotorized transportation corridors, and other public uses. RailsTrailsComment 9/22/06 10:28 PM Page 4

American Planning Association Planning & Environmental Law September 2006 Vol. 58, No. 9 | p.4 State law rarely had a clear answer to the question of who owns a railroad corridor and the effect of conversion into a trail.

ABOUT RAILS-TO-TRAILS CONSERVANCY authorized the ICC to impose a Public Use Condition as part of the abandon- Rails-to-Trails Conservancy has been the nation’s No. 1 advocate for the conversion of ment authorization, which deferred the unused railroad corridors into multiuse trails since its inception in 1986. With nearly disposition of railroad rights-of-way for 1,400 open rail-trails throughout the United States, and more than 1,200 trails in the 180 days to allow for possible transfers projects stage, RTC serves as the clearinghouse for rail-trail information. for public use, including rails-to-trails As part of RTC’s role as rail-trail expert and advocate, the nonprofit organization is conversions. a familiar presence on Capitol Hill. RTC has defended rail-trails and rail-trail funding However, interested communities within the national transportation legislation in the form of transportation enhance- and potential trail managers who ments, and has fought tirelessly against lawmakers that would see the critical railbank- wanted to purchase unused railroad ing law abolished. RTC is protecting both current and future rail-trails so that genera- corridors for conversion into trails faced tions of active individuals can enjoy these priceless public pathways. major obstacles under the set of rules Additionally, RTC provides its technical rail-trail expertise to local and regional trail organizations in need of guidance and support. From acquisition and funding, to design in effect at that time. The biggest chal- and maintenance, RTC has helped countless rail-trails come to fruition. lenge came from nearby landowners, With its more than 100,000 members and supporters, Rails-to-Trails Conservancy is many of whom believed—rightly or moving toward a goal where 90 percent of Americans live within three miles of a trail wrongly—that they were entitled to system—connecting healthier people to healthier places. For more information on repossess the land upon abandonment Rails-to-Trails Conservancy, visit www.railstrails.org. of rail service. Once the STB lost jurisdiction over the corridor, state law principles that FEDERAL REGULATION OF RAILROADS shed duplicative or unprofitable lines.6 might otherwise find the railroad had AND STATE LAW OBSTACLES TO Railroads that had been out of service “abandoned” its property interest were CORRIDOR PRESERVATION for two or more years were permitted to no longer preempted. As Congress rec- Railroads have been subject to federal abandon their lines through a much ognized, “The concept of attempting regulation since 1887, first by the more abbreviated “notice” process.7 As to establish trails only after the formal Interstate Commerce Commission a result, the rate of rail abandonments abandonment of a railroad right of way (ICC) and, since 1991, by the Surface by major carriers accelerated to is self-defeating; once a right-of-way is Transportation Board (STB), an agency between 4,000 to 8,000 miles a year.8 abandoned for railroad purposes there presently located within the U.S. By 1990, the 270,000-mile system of may be nothing left for trail use.”9 Department of Transportation.2 A rail- active rail lines had contracted to State law rarely had a clear answer to road subject to STB’s jurisdiction (basi- 141,000 miles. the question of who owns a railroad cor- cally, railroads operating freight service As thousands of miles of rail lines ridor and the effect of conversion into a in interstate commerce) may neither each year were given abandonment trail. The possibility of costly and time- discontinue rail service nor abandon its authorization, the railroads removed consuming “quiet title” litigation disput- real property interest in the corridor tracks and ties and either sold off the ing a trail manager’s ownership of a corri- until the STB issues a certificate of underlying property or allowed it to be dor was a significant disincentive to public convenience and necessity claimed by adjacent landowners. making the significant investment in a authorizing “abandonment.”3 The STB Without a program for preserving these rails-to-trails conversion. has the exclusive authority to deter- corridors, our Nation’s rail system was at In 1983, Congress hit on an innova- mine whether a railroad has abandoned risk of becoming irreparably fragmented. tive solution to the difficulties of pre- its line.4 Any state or local law that serving railroad corridors as trails. interferes with the STB’s authority to THE EMERGENCE OF RAILBANKING AND Section 8(d) of the National Trails regulate railroads is preempted and ITS ANTECEDENTS System Act established “the national therefore cannot be enforced.5 In 1976, Congress attempted to address policy to preserve established railroad In 1980, Congress significantly loos- the alarming loss of our national rail rights-of-way for future reactivation of ened the restrictions on railroad aban- corridor infrastructure as part of the rail service, to protect rail transporta- donments in order to allow the finan- Railroad Revitalization and Regulatory tion corridors, and to encourage cially beleaguered railroad industry to Reform Act of 1976 (4-R Act). This law energy efficient transportation use.”10

2. ICC Termination Act, 109 Stat. 5. City of Auburn v. United States, 9. H.R. Rep. No. 98-28, at 8-9 803 (1995). 154 F.3d 1025 (Ninth Cir.1998) (1983), U.S. Code Cong. & Admin. 3. Chicago & N.W. Transp. Co. v. (state and local environmental and News 1983, p. 119, 120. land use regulation preempted). Kalo Brick & Tile, 450 U.S. 311, 10. 16 U.S.C. § 1247(d). 321 (1981). 6. The Staggers Rail Act, Pub. L. 4. Grantwood Village v. Missouria No. 96-448, 94 Stat.1895 (1980). Pac. RR Co., 95 F.3d 654 (Eighth 7. 49 C.F.R. § 1152.50. Cir. 1996), cert. denied, 519 U.S. 8. Association of American 1149 (1997). Railroads. Railroad Facts (1992). RailsTrailsComment 9/22/06 10:28 PM Page 5

American Planning Association Planning & Environmental Law September 2006 Vol. 58, No. 9 | p.5 The STB views its authority under the Railbanking Act as both limited and ministerial.

This law allowed a railroad to free and legal responsibility must accom- stating, “Congress apparently believed itself of responsibility for an unprof- pany the request. Since the railroad that every line is a potentially valuable itable rail line by transferring it to a company must agree to negotiate a national asset that merits preservation qualified private or public agency for railbanking agreement, a copy of the even if no future rail use for it is cur- interim use as a trail until such time request for railbanking must be rently foreseeable.”13 as the line is needed again for rail served on the railroad at the same The STB has adopted a policy that service. This process is called “rail- time it is sent to the STB. it will issue railbanking orders so long banking.” as it possesses jurisdiction to do so.14 • If the railroad agrees to enter into Subsequent litigation has clarified the negotiations with the trail manager, HOW RAILBANKING WORKS authority of the STB to extend rail- the STB issues a Notice or Railbanking allows a rail carrier to banking orders and the manner in Certificate of Interim Trail Use, in 15 transfer an unprofitable or unwanted which that authority is exercised. If lieu of an order authorizing the rail- line—by sale, donation, or lease—to a the railroad consummates its abandon- road to fully abandon the line. This public or private entity (called an ment authority prior to the issuance of railbanking order gives the railroad “interim trail manager”) that is willing the Notice of Interim Trail Use, then and a qualified agency or group 180 to assume financial responsibility for the STB loses its jurisdiction over the days (which may be extended) to 16 the management of the right-of-way. corridor. Likewise, the STB will not negotiate a voluntary agreement for The process is administered by the issue a railbanking order if the rail- the transfer (by sale, lease, or dona- STB, which has promulgated regula- road has sold sections of a corridor for tion) of the corridor for interim trail 17 tions governing the program.11 The nontransportation uses. use. During that period, the railroad process works as follows: The STB views its authority under may remove tracks, ties, and other the Railbanking Act as both limited • An interested trail manager can property from the corridor. and ministerial: The STB will not issue request a railbanking order within • Once the parties notify the STB that a railbanking order where the railroad is 30 days after the railroad files an an agreement is reached for transfer not willing to negotiate.18 By the same application for an abandonment of the corridor to the trail manager, token, the STB will not refuse to issue with the STB (or, in the case of the corridor is added to the national a railbanking order based on third-party “exempt abandonments,” within 10 “railbank” for so long as the trail use objections about the desirability or days of publication of a Notice of continues or until the corridor is appropriateness of trail use.19 The STB Exemption in the Federal needed for future restoration of rail has authority to revoke a trail condition Register). service. only if it is shown that the statutory • The STB will consider “late-filed” requirements are not being met (i.e. railbanking requests so long as it has SCOPE OF THE STB’S RAILBANKING the trail user is not meeting its financial AUTHORITY obligations for the property and its use jurisdiction to do so. The STB’s 20 authority to railbank the corridor is The railbanking law has engendered a as a trail). terminated only after abandonment body of judge-made law, resolving The courts have rejected efforts by authorization is issued, and the rail- issues ranging from the constitutional- trail opponents to add burdensome pro- road notifies the STB that it has ity of the law to challenges to regula- cedural requirements, such as personal tions implementing the program.12 One notification to adjacent landowners, to taken steps to consummate the 21 abandonment. of the most important cases is Preseault the railbanking process. The STB’s v. ICC, in which the U.S. Supreme responsibilities under the federal envi- • Either a public agency or a qualified Court, in 1990, unanimously upheld ronmental and historic preservation organization can submit a railbank- the railbanking law as a valid exercise laws, such as the National Environ- ing request to the STB. A statement of Congress’s power under the Com- mental Policy Act (NEPA), 42 U.S.C. of willingness to assume financial merce Clause of the U.S. Constitution, § 4321, et seq., and Section 106 of the

11. 49 C.F.R. § 1152.29, for regular Procedures, 4 ICC2d 152, 157-58 Public Use Condition); Becker v. STB to consider in deciding 21. National Assn of Reversionary abandonments, 49 C.F.R. §1152.50, (1987); Illinois Commerce Comm’n STB, 132 F.3d 60 (D.C. Cir. 1997) whether the railroad abandoned the Property Owners v. ICC, C.A. No. for “exempt” abandonments. v. ICC, 848 F.2d 1246, 1261 (D.C. (STB lacks jurisdiction to railbank line prior to the issuance of the rail- 94-1581 (D.C. Cir., Nov. 3, 1995) Cir. 1988), cert. denied, 488 U.S. once abandonment has been banking order). (STB need not provide notice to 12. See, e.g., National Wildlife 1004 (1989). “consummated”). persons who may have a property Federation v. ICC, 850 F.2d 695 18. National Wildlife Federation v. interest in the rail corridor prior to (D.C. Cir. 1988) (upholding the 15. Birt v. STB, 90 F.3d 580 (D.C. 17. RLTD Railway Corp. v. STB, ICC, 850 F.2d 694, 699-702 (D.C. issuing a railbanking order). ICC’s interpretation of the Trails Act Cir. 1996). 166 F.3d 808 (Sixth Cir. 1999) Cir. 1988). as authorizing only voluntary trans- (upholding STB decision that it 16. Fritsch v. ICC, 59 F.3d 248 19. Citizens Against Rails-to-Trails actions between railroads and lacks jurisdiction to railbank corri- (D.C. Cir. 1995), cert. denied, sub. v. STB, 267 F.3d 1144 (D.C. Cir. trails groups). dor that was severed from the nom CSX Transportation v. Fritsch, 2001). interstate rail system); Jost v. STB, 13. Preseault v. ICC, 494 U.S. 1 116 S.Ct. 1262 (1996) (holding 194 F.3d 79, 87 (D.C. Cir. 1999) 20. Jost v. STB, 194 F.3d at 88-89 (1990). that ICC lacked jurisdiction to (full-width sales of sections of the (upholding STB’s issuance of NITU issue railbanking order notwith- 14. See Rail Abandonments: corridor is material evidence for the based on rebuttable presumption standing timely issuance of a Supplemental Trails Act that a trail manager is qualified). RailsTrailsComment 9/22/06 10:28 PM Page 6

American Planning Association Planning & Environmental Law September 2006 Vol. 58, No. 9 | p.6 The fundamental premise of the railbanking program was that once a rail corridor is placed in railbanking status, the railroad is entitled to reinstitute rail service on the line.

National Historic Preservation Act initial rail-trail conversion, the possibil- U.S. Court of Federal Claims—to (NHPA), 16 U.S.C. § 470f, has also ity of rail service reactivation is, by def- resolve “takings” claims against the been clarified through litigation.22 inition, remote, since the corridor United States. 28 U.S.C.§ 1491(a)(1). A key feature of the federal rail- would not have been proposed for rail- In addition, under the “Little Tucker banking law is its express preemption banking if there had been a foresee- Act,” claimants seeking compensation of conflicting state law. When a trail is able future need for rail service on the from the federal government under railbanked, the statute expressly pro- line. Nonetheless, prudent trail man- $10,000 can be heard by the federal vides that interim trail use of rail- agers must anticipate that contingency district court. 28 U.S.C. § 1346(a)(2). banked corridors “shall not be treated, in order to protect their substantial The initial difficulties in resolving for purposes of any law or rule of law, investment in the acquisition and whether the railbanking law “takes” as an abandonment of the use of such development of the trail and associated private property were exemplified by rights-of-ways for railroad purposes.” facilities in the event of rail service the Preseault case, which challenged the 16 U.S.C. § 1247(d). reactivation. Of particular importance is federal railbanking law on its face as a Relying on the principle of federal the need to establish terms and condi- “taking” of their ownership interest in preemption, the courts have uniformly tions such a compensation and future a Vermont railroad corridor. The efforts rejected efforts by trail opponents to rights to railbank, since the STB of the Preseaults to secure compensa- attack railbanking orders indirectly regards its role in the event of a peti- tion have resulted in no less than eight through challenges to an interim trail tion to vacate a railbanking order as reported court decisions in the state manager’s ownership or use of a rail- being ministerial in nature.28 and federal courts. The U.S. Court of banked corridor.23 Nor will the courts The STB has made clear that this Appeals for the Second Circuit, as well enforce state or local laws that might right to reactivate service, without the as the Claims Court and a three-judge operate to interfere with the trail man- necessity of a full-blown application to panel of the U.S. Court of Appeals for ager’s ownership or right to use the construct a new railroad, resides with the Federal Circuit, all initially ruled corridor.24 Actions brought by adjacent the abandoning carrier, which nonethe- that the Railbanking Law did not landowners seeking to “quiet title” to less retains a residential common car- effect a taking of any property inter- a railbanked corridor can be transferred rier obligation with respect to the corri- est.31 These decisions, however, were to federal court, and then dismissed for dor.29 While the STB has jurisdiction subsequently reversed by the full lack of jurisdiction.25 only over freight rail service, railbank- Federal Circuit, sitting en banc, and a The protective features of the fed- ing ensures that railroad corridors new decision was issued by a plurality eral railbanking law apply even where remain intact for light rail and passen- of the court, along with a concurring no order has been issued by the STB, ger rail service as well. and a dissenting opinion.32 so long as the relevant instruments of The plurality decision in the transfer make clear that the railroad RAILBANKING AND “TAKINGS” Preseault case held that the application retains the right to reactivate rail serv- While legal challenges to the owner- of the Railbanking Law under the ice on the corridor.26 Lawsuits seeking ship or use of railbanked trails are pre- facts of that case resulted in a physical to prevent trail use (as distinct from empted by the railbanking law, occupation of the underlying property, compensation claims) based on allega- aggrieved landowners are not left with- which is a category of government tions that railbanking works a “taking” out a remedy: They may still file a action that constitutes a per se taking. are also barred.27 “takings” claim under the federal As a result, the only issue in the case Tucker Act against the United States was whether, under Vermont state REACTIVATION OF RAIL SERVICE under the Fifth Amendment to the property law, the railroad held an The fundamental premise of the rail- U.S. Constitution, which requires the easement interest that had been aban- banking program was that once a rail government to pay “just compensa- doned—a question answered in the corridor is placed in railbanking status, tion” if it “takes” private property for a affirmative by the court. The deci- the railroad is entitled to reinstitute rail public use.30 The Tucker Act desig- sion, however, made clear that the service on the line. At the time of the nates a specialized federal court—the federal government, and not the trail

22. Goos v. ICC, 911 F.2d 1283 23. See, e.g., Dave v. Rails to U.S. 1149 (1997); Victor Oolitic 28. Georgia Great Southern Division, Const. Exemption—Council Bluffs, (Eighth Cir., 1990) (STB need not Trails Conservancy, 863 F. Supp. Stone Co. v. CSX Transp., Inc., 852 South Carolina Central Railroad Iowa, 8 I.C.C.2d 858 (1990). undertake any environmental 1285 (E.D. Wash. 1994), aff’d, 79 F. Supp. 721 (S. D. Ind. 1994); Co.—Abandonment Exemption— 30. See Preseault v. ICC, 494 U.S. review prior to issuing railbanking F.3d 940 (Ninth Cir. 1996). Schneider v. Union Pacific R. Co., between Albany and Dawson in at 11-12. orders; NEPA compliance occurs 864 F. Supp. 12 (D. Neb. 1994). Terrell, Lee, and Dougherty counties, 24. Friends of the East Lake in connection with STB consider- Georgia, Ab 389 (Sub-no. l 1X), 31. Preseault v. ICC, 853 F.2d 145, Sammamish Trail v. City of 26. Buffalo Township v. Jones, 813 ation of the application for aban- served May 16, 2003. 151 (Second Cir. 1988), aff’d on other Sammamish, 361 F. Supp.2d 1260 A.2d 659 (Pa. 2002), cert. denied, donment authorization); Friends grounds, 494 U.S. 1 (1990); Preseault (W.D. Wash. 2005) (City law requiring 124 S. Ct. 134 (2003). 29. Norfolk and Western Railway of Atglen-Susquehanna Trail, Inc. v. U.S., 27 Fed. Cl. 69 (1992), aff’d, consideration of alternatives to trail Co., Abandonment between St. v. STB, 252 F.3d 246 (Third Cir. 27. See, e.g., Louisiana Pacific 66 F.3d 1190 (Fed. Cir. 1995), held preempted by railbanking law). Marys and Minster in Auglaize 2001) (STB has ongoing respon- Corp. v. Texas Dep’t of Transp., 43 vacated, 100 F.3d 1525 ( 1996). County, Ohio, Dkt. No. AB-290 sibility to comply with NHPA in 25. Grantwood Village v. Missouri F. Supp.2d 708 (E.D. Tex. 1999); (Sub-No. 68), 9 I.C.C.2d 1015 32. Preseault v. U.S, 100 F.3d connection with abandonment Pacific Railroad Co., 95 F.3d 654 Good v. Skagit County, 17 P.3d (1993); See Iowa Power, Inc.— 1525 (Fed. Cir.1996). decision). (Eighth Cir. 1996), cert. denied, 519 1216 (Wash. App. Div. 1, 2001). RailsTrailsComment 9/22/06 10:28 PM Page 7

American Planning Association Planning & Environmental Law September 2006 Vol. 58, No. 9 | p.7 As the Supreme Court explained in the 1990 Preseault case, “under any view of takings law, only some rail-to-trail conversions will amount to taking...”

manager, was solely responsible for Maryland, the Federal Circuit certified viewed against the applicable common the payment of any compensation the predicate state law questions to the and statutory law, including the laws in owed. Moreover, the sole remedy Maryland Court of Appeals (Maryland’s place at the time of the original acquisi- available to the claimant is payment highest court). In a lengthy opinion tion as well as current law. Each state of just compensation; trail use cannot joined by six of the Court’s seven applies its own rules of construction.40 be halted or disrupted. judges, the Maryland Court of Appeals Resolution of questions over the As a plurality rather than a majority held that the scope of the applicable ownership of a rail-trail typically decision, the Federal Circuit’s decision railroad easement was sufficiently involves the following determinations.41 in Preseault has no precedential value, broad to include trail as well as railroad • What is the nature of the interest and is in conflict with the analysis of uses, and that the railroad’s participa- acquired by the railroad? The typi- the Second Circuit. Moreover, the tion in the federal railbanking program cal railroad generally acquired its analysis of the plurality decision has was inconsistent with an intent to aban- property interests in its corridor come under substantial scholarly criti- don its interest in the corridor.36 The through one of four methods: a pri- cism.33 Nonetheless, the analysis of the Federal Circuit relied on this decision vate grant from individuals result- Federal Circuit’s plurality decision in in holding that no taking had ing from negotiations with willing Preseault has, for the time being, estab- occurred.37 landowners; condemnation pro- lished the applicable jurisprudence for The Federal Circuit has upheld ceedings when they were not; and judicial review of takings cases involv- lower court decisions finding that the federal grants for portions traversing the Railbanking Law. claimants had a possessory interest in ing federal land or by prescription As the Supreme Court explained in the underlying rail corridor under appli- (adverse possession) where no deed the 1990 Preseault case, “under any cable law38 and also clarified that the or other ownership document view of takings law, only some rail-to- statute of limitations for filing takings exists. trail conversions will amount to takings claims begins to run when the first rail- . . . Others are held as easements that banking order is issued by the • The railroad might acquire one of at do not, even as a matter of state law, STB/ICC.39 least six common property interests: revert upon interim use as nature While a number of bills have been fee simple absolute, fee simple trails.”34 Subsequent “takings” cases introduced in Congress over the years determinable, fee simple subject to therefore focus on whether claimants to amend the railbanking law, many to condition subsequent, a general can establish, under the applicable deal with compensation issues, none of easement, a limited easement, or a state law, a property interest in the rail- these porposed amendments, to date, license. road corridor that would have become have passed. • In the case of conditional fees possessory but for the application of (called defeasible fees) that may be the Railbanking Law. DISPUTES OVER OWNERSHIP OF subject to divestment or reversion There are now a number of rail- RAIL-TRAILS upon the occurrence of a specified banking “takings” cases pending in Unlike railbanked corridors, managers event, such as cessation of rail serv- courts around the country and in the of rail-trails that have not been rail- ice, state law may extinguish any U.S. Court of Federal Claims. Many of banked remain vulnerable to being dis- possibilities of reverters or other the cases have been certified as class possessed by “quiet title” lawsuits. conditions on a base fee that are not actions on behalf of all persons claim- Quiet title litigation refers to an action formally recorded through “mar- ing a compensable interest in the rail- brought under state law to secure a ketable title” laws. banked corridor. One case has been judicial declaration that permanently certified as a statewide class action.35 resolves adverse claims of ownership • In many cases, railroad deeds do not The U.S. Court of Appeals for the interest and rights in property. clearly denominate the interest as Federal Circuit has been called on to Determining the nature of the own- either a “fee simple” or an “ease- resolve appeals in several of these ership interest acquired by a railroad ment” interest, but instead refer cases. often requires a parcel-by-parcel simply to a grant of land, with or In one case involving a railbanked inquiry, under which the language of without a reference to a “right-of- corridor in Montgomery County, the railroad deeds are examined and way.” There is considerable conflict

33. Richard A. Allen. “Does the 34. Preseault v. ICC, 40 U.S. at United States, 158 F.3d 574 (Fed. As of this writing, there is a bill 40. State v. Hess, 684 N.W.2d Rails-to-Trails Act Effect a Taking 924. Cir. 1998), cert. denied, 531 U.S. pending in Congress (H.R. 4581, 414 (Minn. 2004). of Property?” Vol. 31 Transpor- 35. Schneider v. United States, No 957 (2000). the Easement Owners Fair 41. D. Wright and J. Hester. tation Law Journal 35 (2005); 8:99CV315 et al. (D. Neb. August 38. Toews v. U.S.A., 376 F.3d Compensation Claims Act of “Pipes, Wires, and Bicycles,” 27 Danaya C. Wright, “Eminent 29, 2003). 1371 (Fed. Cir. 2004). 2006), which would reverse the Ecology L.Q. 351 (2000). Domain, Exactions, and Rail- Caldwell and Barclay decisions by banking: Can Recreational Trails 36. Chevy Chase Land Co. v. 39. Caldwell v. U.S.A., 391 F.3d providing takings claim cannot Survive the Court’s Fifth Amend- United States, 733 A.2d 1055 1226 (Fed. Cir. 2004) cert. “accrue” until the railroad has ment Takings Jurisprudence?” (Md. 1999). denied,126 S.Ct. 366 (2005); transferred, by written aggree- 26 Colum. J. Envt’l L. 399 (2001) 37. Chevy Chase Land Co. v. Barclay v. United States, 443 F.3d ment, control of the corridor to 1368 (Fed. Cir. April 11, 2006). the interim trail manager. RailsTrailsComment 9/22/06 10:28 PM Page 8

American Planning Association Planning & Environmental Law September 2006 Vol. 58, No. 9 | p.8 Many of the railroad corridors in the United States, particularly corridors in the West and Midwest, were assembled with land grants made by the United States government in the 19th century for the purpose of opening up the Western frontier.

in the case law as to the construction • Abandonment of a railroad easement adopted the Railroad Right of Way Act of such deeds as conveying a fee or may be inferred where the corridor is of 1875, codified at 43 U.S.C. §§ 934- easement.42 Some courts have held put to uses that are outside the scope 39 (“1875 Act”), granting a right-of-way that “right-of-way” could be either a of the easement. Alternatively, in through public lands.50 fee or an easement, and resort to some states, trail use is considered to There has been much litigation over rules of construction or extrinsic evi- be within the scope of a railroad ease- the nature of the interest conveyed by dence to aid in discerning the par- ment. This is sometimes known as the federal government to the railroads ties’ intent. the “shifting public use policy,” and particularly, the disposition of fed- under which the railroad easement is erally granted rights of way (FGROW) • Where the railroad has acquired an deemed broad enough to encompass upon cessation of railroad use. In 1922, easement over the land, a determina- other types of transportation or public Congress passed 43 U.S.C. § 912 to dis- tion must be made whether the ease- highway uses.45 Other states have pose of the federal government’s ment has been abandoned. In most rejected such a policy.46 retained interests in all FGROW in states, non-use of an easement, alone, case of abandonment. Under this is not sufficient, but must be coupled FEDERALLY GRANTED RIGHTS-OF-WAY statute, any federally granted parcel in with other affirmative actions, includ- Many of the railroad corridors in the a railroad corridor continues to exist as ing removing of tracks and ties or United States, particularly corridors in a railroad right-of-way, usable only for piecemeal sales of a railroad corridor.43 the West and Midwest, were assem- railroad or other public highway pur- • The word “abandoned” has a federal bled with land grants made by the poses, until Congress adopts a statute and state law meaning in the context United States government in the 19th transferring the title51 or until there is a of railroad law. A railroad has been century for the purpose of opening up judicial declaration of abandonment, “abandoned” for purposes of the fed- the Western frontier.47 The early fed- whichever first occurs.52 If there is a eral law when STB has granted the eral grants for railroad construction judicial declaration of abandonment, railroad permission to terminate its relied upon individual grants to rail- § 912 provides on its face that the title common carrier obligation to provide roads (or federal grants to a state in vests in the person or entity owning rail service on the line and liquidate trust to employ for the rail line for the legal subdivision traversed by the its property interest in the rail corri- which the grant was made). In 1852, FGROW in question, unless (a) the dor. Abandonment, for purposes of Congress adopted a general right-of- FGROW is in a municipality, in which state law, means that the railroad way statute, granting a right-of-way case it goes to the municipality, or (b) a intends to permanently relinquish its across public lands 100 feet in width to state or local government establishes a property interest in the corridor, gen- “all rail and plank road, or Macadam- public highway on the FGROW parcel erally evidenced by nonuse of the cor- ized turnpike companies. . . . ”48 Under within one year of the judicial declara- ridor coupled with actions giving the 1852 Act, the roads were to be tion of abandonment, in which case the effect to that intent, including begun within 10 years, and finished government’s interest is transferred to removal of track and ties and transfer within 15 years thereafter. Moreover, if the state or local government. The of the line for nonrailroad use. STB the road was abandoned, the 1852 Act courts have determined that 43 U.S.C. abandonment authorization is permis- provided that “said lands hereby § 912 controls disposition of all sive only; a railroad must still take granted . . . revert back to the general FGROW, including the Civil War era- steps to effectuate that permission.44 government.”49 In 1875, Congress grants,53 the 1875 Act grants,54 and the

42. See Annotation: Deed to 1158, 1160 (Seventh Cir. 1992). 738 (Wisc.1979); Lawson v. State 50. The 1875 Act was repealed as Railroad Company as Conveying of Washington, 730 P.2d 1308 a basis for granting new railroad 45. See State ex Rel. Washington Fee or Easement, 6 A.L.R.3d (Wash. 1986). rights of way effective October 21, Wildlife Preservation, Inc. v. State, 973, 977 (1966), and Later Case 1976, by P.L. 94-579, Title VII, § 329 N.W.2d 543, 545, 547 (Minn. 47. See Paul Gates. History of Service 706(a), 90 Stat. 2793. 1983), cert. denied, 463 U.S. 1209 Public Land Law Development 43. See Annotation: What (1983) (“Use of the railroad right- (1968); Thomas E. Root. Railroad 51. E.g., Brown v. Washington, Constitutes Abandonment of a of-way as a recreation trail is con- Land Grants From Canals to 130 Wash. 2d 430, 924 P.2d 908, Railroad Right of Way, 95 sistent with the purpose for which Transcontinentals: 1808-1941, 916 & 924 (1996) (Congress A.L.R.2d 468-499 (1966), and the easement was originally Natural Resources Law Section, adopts statute authorizing transfer Later Case Service acquired, public travel, and it Monograph Series, No. 4: of title to State of Washington for imposes no additional burden on American Bar Assn., 1987. state trail). 44. See, e.g., Gulf M. & O. R.R., the servient estate”); Hatch v. 128 F. Supp. 311 (N.D. Ala. 48. Act of Aug. 4, 1852, 10 Stat. 52. As a necessary precondition to Cincinnati & I.R.R., 18 Ohio St. 92 1954), aff’d, 225 F2d 816 (Fifth 28, § 1. In the event of deep cuts, seeking a judicial declaration of (1868) (converting a canal into a Cir. 1955), cert denied, 350 U.S. the grant was to be of “greater abandonment for purposes of 43 railroad does not extinguish the 932 (1956). The exception is in width . . . if necessary, not U.S.C. § 912, the ICC, now the original easement); Rieger v. Penn Indiana, where a state statute exceeding in the whole two hun- STB, must determine that the line Central Corp., No. 85-CA-11 (Ct. expressly provides that railroad dred feet.” is no longer required in interstate App. Greene County, Ohio, May easements terminate upon commerce, a process known as 21, 1985). 49. Id. § 3. There were various issuance of an ICC certificate of “authorizing an abandonment.” extensions of the time deadlines in abandonment, regardless of the 46. Schnabel v. County of Phillips v. Denver & R.G.W.R., 97 the 1852 statute until it was even- terms of the conveyance. See DuPage, 429 N.E.2d 671 (Ill. App. F.3d 1375, 1377 (10th Cir. 1996), tually supplanted by the 1875 Penn Central Corp v. United 1981); Pollnow v. State Dep’t of cert. denied, 521 U.S. 1104 Right of Way Act. States R Vest Corp, 955 F2d Natural Resources, 276 N.W.2d (1997). RailsTrailsComment 9/22/06 10:28 PM Page 9

American Planning Association Planning & Environmental Law September 2006 Vol. 58, No. 9 | p.9 The law on rails-to-trails conversions is still evolving, particularly in the “takings” litigation.

pre-Civil War state-mediated grants.55 In 1988, Congress modified the dispo- sitional scheme of 43 U.S.C. § 912 as part of the National Trails System Act Amendments of 1988, 16 U.S.C. § 1248(c)-(g). The Trails Act Amend- ments of 1988 provides that unless a public highway is established on FGROW per 43 U.S.C. §§ 913 or 912 within one year of a judicial declaration of abandonment, the federal interest in FGROW “shall remain in the United States.”16 U.S.C. § 1248(c). Recent litigation in the “takings” context has challenged some of the underlying assumptions about the ownership interest retained by the federal government in FGROW, creating a conflict among the courts. In one recent decision, the Federal Circuit determined that adjacent landowners, whose land was patented from the federal government under the Homestead Act, also acquired the federal government’s rights to railroad corridors that had been acquired through federal land grants.56

CONCLUSION The law on rails-to-trails conversions is still evolving, particularly in the “takings” litigation. Rails-to-Trails Conservancy has materials and resources on its website and provides other services to assist governmental and nongovernmental organizations sort through the various legal, politi- cal, and communications issues that may arise during the course of a rails- to-trails conversion.

53. E.g., Vieux v. East Bay Regional 55. See, e.g., Mauler v. Bayfield Park District, 906 F.2d 1330 (Ninth County, 204 F. Supp.2d 1168 Cir. 1990), cert. denied, 498 U.S. 967 (W.D. Wis. 2001), aff’d, 309 F.3d (1990); King County v. Burlington 997 (Seventh Cir. 2002) (applying Northern, 885 F. Supp. 1419 (W.D. §§ 912-13 to state-mediated, pre- Wash. 1994). Civil War federal railroad grants in 54. See, e.g., State of Idaho v. Wisconsin); City of Maroa v. Illinois Oregon Shortline R. Co., 617 F. Supp. Central R.R., 229 Ill.App.2d 503, 207 (D. Idaho 1985); Marshall v. 592 N.E.2d 660 (App. Fourth Chicago & North Western Transp. Dist.), appeal denied, 146 Ill.2d Co., 826 F. Supp.1310 (D. Wyo. 631, 602 N.E.2d 456 (1992) 1992), aff’d, 31 F.3d 1028 (10th Cir. (applying § 912 to 1850 state- 1994); Barney v. Burlington Northern mediated Illinois Central grant); R. Co., 490 N.W. 2d 726 (D. So. Marlow v. Malone, 315 Ill. App.3d Dak.1992), cert. denied, 507 U.S. 897, 734 N.E.2d 195 (App. Fourth 914 (1993). But see City of Aberdeen Dist. 2000) (same). v. Chicago & North Western Transp. 56. Hash v. U.S.A., 403 F.3d 1308 Co., 602 F. Supp. 589 (D. So. (Fed. Cir. Four, 2005) Dak.1984) (holding that 43 U.S.C. § 912 was not applicable to 1875 Act rights of way).