PRIA, Government Policy, Made Personal

Summary

The Secretary of Transportation must immediately guarantee trustee certificates for the Milwaukee Railroad under the Emergency Rail Services Act of 1970. This guarantee is to let the railroad keep up and run its whole system starting November 1, 1979, and to pay for operations during the 60-day period that begins either when a certain event happens under section 920(b) or on April 1, 1980, whichever comes first. The guaranteed amount equals the railroad’s maintenance and operating expenses (for those purposes) minus its revenues. These guaranteed certificates are junior to any creditor claims that existed on November 4, 1979. The Commission must at once provide $10,000,000 from directed service funds to the Secretary, who must give it to the railroad’s trustee for operations starting November 1, 1979. Any obligations to the United States under this help are canceled when the railroad is reorganized as an operating carrier or when “substantially all” of it is bought — meaning more than 50 percent of the rail system and more than 50 percent of the employees (both measured as of October 14, 1980) meet those conditions.

Title 45, §906

Railroads, Source: USLM XML via OLRC

(a)to (c) Omitted

(d)Authorization

The Secretary of Transportation shall, under the authority of the Emergency Rail Services Act of 1970 [45 U.S.C. 661 et seq.], immediately guarantee trustee certificates of the Milwaukee Railroad, on the basis of an estimate of the amount required to be provided under subsection (e) of this section, for purposes of allowing the Milwaukee Railroad, commencing November 1, 1979, to maintain its entire railroad system in accordance with section 920 of this title, and as required to finance operations which the Milwaukee Railroad continues for the 60-day period beginning on the date of the occurrence of an event described in section 920(b) of this title or on April 1, 1980, whichever first occurs. Such guarantee shall be made without regard to the findings set forth in section 3(a) of the Emergency Rail Services Act of 1970 [45 U.S.C. 662(a)], and the provisions of section 3(b)(3) [45 U.S.C. 662(b)(3)] and the last two sentences of section 3(d) of such Act [45 U.S.C. 662(d)] shall not apply to such guarantee.

(e)Amount of guarantee

The Secretary shall guarantee trustee certificates of the Milwaukee Railroad pursuant to this section in an amount equal to the difference between (1) the total expenses incurred by such railroad attributable to the maintenance and the continuation of service in accordance with subsection (d) of this section, and (2) the revenues of such railroad.

(f)Subordination of claims

Notwithstanding the provisions of section 3(c) of the Emergency Rail Services Act of 1970 [45 U.S.C. 662(c)], certificates guaranteed under this chapter shall be subordinated to the claims of any creditors of the Milwaukee Railroad as of November 4, 1979.

(g)Availability of funds

The Commission shall immediately make available to the Secretary of Transportation the sum of $10,000,000, out of funds available for directed service under title 49. The Secretary of Transportation shall immediately make such funds available to the trustee of the Milwaukee Railroad for purposes of financing the operations of the Milwaukee Railroad, beginning November 1, 1979, in accordance with section 920 of this title.

(h)Cancellation of United States obligations

(1)All obligations to the United States or any agency or instrumentality of the United States incurred pursuant to this section by the Milwaukee Railroad or the trustee of the property of the Milwaukee Railroad shall be waived and canceled when—

(A)the Milwaukee Railroad is reorganized as an operating rail carrier; or

(B)substantially all of the Milwaukee Railroad is purchased.

(2)For purposes of this subsection, substantially all of the Milwaukee Railroad shall be considered as having been purchased when (A) more than 50 percent of the rail system operated by the Milwaukee Railroad on October 14, 1980, has been purchased, and (B) more than 50 percent of the employees employed by the Milwaukee Railroad on October 14, 1980, have obtained employment with other rail carriers.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The Emergency Rail Services Act of 1970, referred to in subsec. (d), is Pub. L. 91–663, Jan. 8, 1971, 84 Stat. 1975, which is classified generally to chapter 15 (§ 661 et seq.) of this title. For complete classification of this Act to the Code, see

Short Title

note set out under section 661 of this title and Tables. Directed service under title 49, referred to in subsec. (g), probably refers to directed service under section 11125 of Title 49, Transportation, prior to the general amendment of subtitle IV of Title 49, by Pub. L. 104–88, § 102(a). Codification Subsecs. (a) to (c) of this section amended section 662 of this title.

Amendments

1980—Subsec. (h). Pub. L. 96–448 added subsec. (h).

Statutory Notes and Related Subsidiaries

Effective Date

of 1980 AmendmentAmendment by Pub. L. 96–448 effective Oct. 14, 1980, see section 710(d) of Pub. L. 96–448, set out as a note under section 1170 of Title 11, Bankruptcy. Abolition of Interstate Commerce Commission and

Transfer of Functions

Interstate Commerce Commission abolished and functions of Commission transferred, except as otherwise provided in Pub. L. 104–88, to Surface Transportation Board effective Jan. 1, 1996, by section 1302 of Title 49, Transportation, and section 101 of Pub. L. 104–88, set out as a note under section 1301 of Title 49. References to Interstate Commerce Commission deemed to refer to Surface Transportation Board, a member or employee of the Board, or Secretary of Transportation, as appropriate, see section 205 of Pub. L. 104–88, set out as a note under section 1301 of Title 49.

§906 Guarantee of Trustee Certificates