On March 14, the U.S. Surface Transportation Board ruled that Norfolk Southern’s proposed acquisition of Norfolk & Portsmouth Belt Line Railroad Company — a Class III terminal railroad jointly owned with CSX Transportation — would be considered a “significant” transaction. The designation means the deal will receive extra scrutiny from the federal regulator.

NPBL is a terminal railroad that operates approximately 36 miles of track from Portsmouth to Norfolk, Va., and approximately 27 miles of trackage rights over NS from the City of Chesapeake to the City of Norfolk, Va. The trackage rights facilitate NPBL’s access to the Norfolk International Terminal, one of two primary container terminals at the Port of Virginia.  The short line is jointly owned by NS (57.14 percent) and CSX (42.86 percent), a split that dates back to the 1980s. The short line was created in 1896 by eight different railroads. Through various mergers and acquisitions, NS eventually became the majority owner. 

In 2018, CSX sued NS and the short line, alleging they had a monopoly on traffic in and out of the Norfolk International Terminal by basically boxing the competitor out of the facility. Later, the STB determined that while NS was the majority shareholder in the 1980s, federal regulators never formally permitted the railroad to control it. In hopes of resolving the issue once and for all, NS filed paperwork earlier this year to acquire formal control of NPBL. While NS suggested it was a minor transaction, the STB disagreed. The STB stated that NS’ application for a minor transaction would be considered its “prefiling notification” and that the railroad could file its formal application this summer. —Railfan & Railroad Staff