Surface Transportation Board Clarifies Preemption Rules on Complete Takings and Shipper and Receiver Activities
On November 9, 2026, the Surface Transportation Board (STB) issued its highly anticipated Policy Statement on Jurisdiction and Preemption Under the ICC Termination Act (ICCTA). The act establishes exclusive federal jurisdiction carried out by the STB over transportation by rail carriers. 49 U.S.C. § 10501(b). The word exclusive appears straightforward, yet disputes over preemption abound, and decades of preemption jurisprudence have muddied the preemption landscape. The Policy Statement provides new clarity that will prove a useful tool both in litigation, and for carriers and other stakeholders seeking to educate state and local officials in an effort to avoid disputes.
While the Policy Statement largely and helpfully summarizes STB precedent on several hot-button preemption issues, it goes a step further with respect to complete takings and regulations directed at rail customers, refining its prior analysis and strengthening the protection that preemption affords the rail industry.
Takings
For complete takings, the STB comes down on the side of applying a categorical preemption analysis to "state and local claims seeking to take exclusive possession of any portion of validly held railroad right-of-way, or to take rail carrier property that the rail carrier uses—or plans to use—to support rail transportation." This framework would obviate the need for the rail carrier to establish that a proposed taking unreasonably interferes with rail transportation. The STB's principal reasoning is that only Board-certified abandonment removes former railroad land from its jurisdiction, and allowing state or local takings of land still subject to the Board's jurisdiction would fly in the face of this statutory scheme.
Definition of "Transportation by Rail Carrier"
The STB acknowledges inconsistencies in its decisions regarding when shipper and receiver activities are no longer considered "transportation by rail carrier." The STB "provides a modified analytical framework" consisting of a two-part test.
First, is the facility or project at issue developed or used to receive or tender common carrier rail service—a transload, off-loading, or similar facility whose function is the interchange of traffic with a rail carrier? Second, does the state or local action restrict, condition, or dictate common carrier service to that facility, such as the volume, frequency, timing, configuration, or commodity mix of common carrier service? Where the answer to both is yes, the action may regulate transportation by rail carrier in practical effect, and the categorical or as-applied framework, as appropriate, would apply depending on the nature of the regulation.
If either answer is no, "section 10501(b) is not implicated, unless the action discriminates against rail transportation." The modified framework thus refocuses the analysis primarily on the "effect" of a state action rather than the stated object of the action.
The STB's Policy Statement is meant to provide "concise explanations," "reduce confusion," and "proactively prevent disputes regarding the Board's jurisdiction and ICCTA preemption." Time will tell whether it achieves those goals, but for now, it provides a useful summary that should facilitate clearer communications between railroads, states, and municipalities.
