February 3, 2023

Written by

Marybeth Luczak, Editor-in-Chief

3i-backed Regional Rail intends to acquire all stock of Effingham, Illinois-based EFRR, South Point, Ohio-based SPOR and ILW and assume direct control of those rail carriers, according to the Surface Transportation Board. (SPOR photo)

Regional Rail, a shortline holding company based in Kennett Square, Pa., has filed a verified 49 CFR 1180.2(d)(2) exemption to control Class III airlines Effingham Railroad Company (EFRR) and South Point & Ohio Railroad, Inc. (SPOR) and the Illinois Western Railroad Company (ILW) after becoming a Class III railroad company.

3i-backed Regional Rail intends to acquire all stock of Effingham, Illinois-based EFRR, South Point, Ohio-based SPOR and ILW and to assume direct control of these rail companies, according to a statement from the Surface Transportation Board ( STB). in the December 2 issue of the federal register (scroll down to download). All three minor roads are part of Agracel Rail Holdings, which is headquartered in Effingham, Illinois. ILW simultaneously filed a verified exemption notice intending to operate approximately 1,300 feet of track owned by the City of Greenville, Illinois, extending from a connection with CSX into the Alan E. Gaffner Industrial Park (scroll down to download).

The moves follow Regional Rail’s acquisition of the 123-mile Great Sandhills Railway in southwest Saskatchewan last month and G3 Canada Limited’s interests in three other rail freight facilities in western Canada.

Regional Rail also owns the East Penn Railroad, which operates 110 miles of track in southeastern Pennsylvania and northern Delaware; Middletown & New Jersey Railroad, which operates 55 miles of track in southeast New York; Tyburn Railroad, which operates a 35-acre rail-to-truck transhipment facility, trucking company and terminal switching operation in Morrisville, Pennsylvania; Florida Central Railroad, which operates a 68-mile route in the Orlando area; Florida Midland Railroad, which operates 28 miles of track in central Florida; Florida Northern Railroad, which operates 104 miles of track on two branch lines covering the region north of Tampa; Port Manatee Railroad LLC, which operates seven miles of track serving Port Manatee, Florida; and Carolina Coastal Railway, which operates 179 miles of track in eastern North Carolina, including a connection to the Port of Morehead City, NC.

(EFRR photo)

“3i RR and Regional Rail state that the share purchase agreements contain no provision that would restrict future traffic exchanges with a third connection carrier,” the STB reported. “3i RR and Regional Rail represent that: (1) the rail lines of EFRR, ILW and SPOR do not connect to the rail lines of other rail companies controlled by 3i RR and Regional Rail; (2) the transaction is not part of a series of anticipated transactions that would result in such a connection; and (3) there is no Class I railway company involved in the transaction. The Proposed Transaction is therefore exempt from the prior approval requirements of 49 USC 11323 pursuant to 49 CFR 1180.2(d)(2). This transaction may be consummated on or after December 18, 2022, the effective date of the exemption (30 days after filing of the verified notice).”

The STB noted that “[b]Since this transaction affects only Class III rail companies, the law does not allow the Board to impose health and safety conditions. …” Additionally, “[a]Under 3i RR and Regional Rail, this action is categorically exempt from the environmental review required by 49 CFR 1105.6(c) and from the historical reporting requirements of 49 CFR 1105.8(b).”

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