The Surface Transportation Board issued a policy statement Monday explaining the reach of its exclusive authority over rail transportation and when that authority preempts conflicting state, local and federal laws under the ICC Termination Act of 1995.
The board said in a news release that the statement answers a September 2025 request from six railroad and shipper groups. The coalition included the National Grain and Feed Association, Association of American Railroads, American Short Line and Regional Railroad Association, American Chemistry Council, Intermodal Association of North America and National Industrial Transportation League. The statement, docket EP 791, became final with its Federal Register publication Monday.
This is guidance, not a rule. "The Board is not making any binding determinations in this policy statement," the board said in the document. It pulls three decades of board and court precedent into one place, backed by a new preemption resource page.
The framework has two tracks. Categorical preemption applies to rules that by their nature manage rail operations, including permitting or preclearance requirements that could deny or unreasonably delay them, such as building permits, zoning and environmental permits. As-applied preemption calls for a fact-specific look at whether a rule unreasonably burdens or discriminates against rail. The board said courts have found local limits on locomotive idling categorically preempted and have regularly struck down state limits on blocked crossings.
The section most relevant to grain elevators and transload sites deals with rules aimed at rail customers rather than railroads. The board acknowledged its past decisions in this area "have not always been entirely consistent" and laid out a two-part threshold test. First, is the facility built or used to receive or tender common carrier rail service, such as a transload or off-loading site? Second, does the state or local action restrict, condition or dictate that service, including its volume, frequency, timing, configuration or commodity mix?
If both answers are yes, the rule may be preempted. One example the board gave: a regulation capping the rail traffic a facility may receive. If either answer is no, federal preemption generally does not apply unless the rule discriminates against rail. The board said it expects much regulation of customer facilities to stay outside its jurisdiction, and electrical, fire and plumbing codes would still apply.
The board also said there is no stand-alone "police power" exception to preemption, though generally applicable, nondiscriminatory rules with only incidental effects on rail can stand. It suggests that claims seeking exclusive possession of railroad property, such as eminent domain or adverse possession, be treated as categorically preempted, while road crossings and utility easements would still get an as-applied review.
The preemption question gained attention in recent years when the California Air Resources Board proposed locomotive emissions requirements, according to the USDA Agricultural Marketing Service Grain Transportation Report. The board said individual disputes will still be decided on their own facts, circumstances and arguments.
