The Surface Transportation Board issued a declaratory order per request by the California High-Speed Rail Authority (CHSRA) to limit injunctions against California's intrastate high speed rail project through use of the California Environmental Quality Act (CEQA), among other items reiterating its belief that STB itself has clear title of oversight to the project.
STB issued its decision, Docket No. FD 35861, late Friday, Dec. 12, 2014, one day after CHSRA announced it had preliminarily selected a team of contractors, led by Dragados USA, for a second 65 miles of the route through the Central Valley. Dragados USA submitted a bid of $1.23 billion for the work, lower than the state’s expectation of $1.5 billion to $2 billion. The CHSRA Board of Directors is expected to give formal approval to the selection in January.
Summing up its decision, STB said, “The Board concludes that 49 U.S.C. § 10501(b) preempts application of the California Environmental Quality Act, to the extent discussed below, to the construction of a high-speed passenger rail line between Fresno and Bakersfield, Cal[if].”
"On Oct. 9, 2014, the California High-Speed Rail Authority (Authority) filed a petition requesting that the Board issue a declaratory order regarding the availability of injunctive remedies under the California Environmental Quality Act (CEQA) to prevent or delay construction of an approximately 114-mile high-speed passenger rail line between Fresno and Bakersfield, Cal. (the Line)," STB said. "The request for a declaratory order will be granted."
STB noted that it earlier had determined it "has jurisdiction" over the proposed new HSR system, adding, "The Board has granted petitions for exemption, subject to environmental and other conditions, permitting construction of the first segment" of the proposed system between Merced and Fresno, in California's Central Valley. "The Authority states that it has commenced work on the Merced to Fresno segment and is currently in the process of implementing and/or procuring construction contracts for a majority of the Line."
CHSRA's petition to STB noted "that seven lawsuits have been filed challenging its compliance with CEQA with respect to the Line and that the petitioners seek injunctive remedies under CEQA that would prevent or delay the Authority's ability to proceed with construction of the Line. The Authority argues that 49 U.S.C. § 10501(b) preempts such CEQA remedies because, if successful, injunctive relief would enjoin construction of a Board-authorized project," STB clarified.
STB said, "Opponents claim . . . that the market participant doctrine exception to preemption applies here. Opponents also argue that § 10501(b) preemption would intrude upon the state of California's sovereignty by interfering with the internal controls and limitations the state has placed on the Authority, its own agency.
Furthermore, Opponents argue that expedited consideration of the petition is unnecessary and that the preemption issue the Authority asks the Board to address is not ripe. According to Opponents, the Authority has no immediate plans to begin construction of the Line."
STB's decision stressed that "several CEQA lawsuits have been filed and, regardless of Opponents' suggestions to the contrary, permanent injunctive relief has already been requested and a preliminary injunction could be requested at any time in those pending lawsuits. Moreover, the Authority states that, contrary to the claims of some of the Opponents, it is in the process of implementing and/or procuring construction contracts for a majority of the Line and uncertainty regarding the preemption issue could impact its ability to proceed. Lastly, this decision will inform interested parties and the California Supreme Court of our views on federal preemption of CEQA and the market participant doctrine as they relate to this matter involving railroad transportation within the Board's jurisdiction under § 10501(b)."