The 7th Circuit Court of Appeals made a recent ruling that could end up eliminating one of the biggest rights-of-way issues that slow down fiber construction projects. In the case of CSX Transportation v. Zayo Group, LLC, the court ruled that the easement that CSX owns for its railroad tracks only applies to the surface of the Earth and that the railroad right-of-way does not extend either above or below the tracks.
The court said specifically that the installation of underground fiber lines or overhead fiber lines that are tall enough not to interfere with trains does not constitute “continuous trespass”. This ruling means that Zayo is free to place the fiber without the railroad company’s permission and that Zayo doesn’t have to pay any one-time or ongoing fees for the rights-of-way.
The court said that the right-of-way still belongs to the actual landowner. That’s an important distinction, because most railroad lines were granted an easement to build the railroad lines, and were not given outright ownership of the land. The land under the tracks is still owned by a local government or a private landowner. Since most fiber crossings for railroads happen where the railroad tracks cross a public road, then the state, county, or city that maintains that road still owns the actual rights-of-way and can grant it to a fiber overbuilder just like they grant rights-of-way along all public roads.
CSX had argued that the property rights related to railroad tracks do not fall under the jurisdiction of the State of Indiana, but the court disagreed. The lawsuit was originally filed when CSX alleged that Zayo had illegally trespassed in ten different situations where the company had crossed railroad tracks with fiber without paying the railroad. The court ruled that CSX didn’t have legal standing to make assertions of criminal trespass. The court further said that CSX failed to demonstrate that its railroad easements were exclusive to only railroad use, and that even if it could be construed that the railroad had that right on the surface, it couldn’t make that same claim for the ground below the easement or the air above the easement. The court said that the Zayo fibers did not disturb the railroad’s business in any way.
It’s likely that this ruling will be appealed. But if this ruling stands, it will be a big deal for companies that build networks. We’ve heard a lot of talk over the last year about the FCC wanting to override local jurisdiction for providing rights-of-way along public roads. While there are some horror stories of local government rights-of-way along roads taking too long, most permits are handled pretty routinely and are not the giant mess being claimed by the FCC. The real rights-of-way problems come when trying to build networks to cross railroad tracks, bridges, interstate highway underpasses, or parklands. Each of these situations can add both time and cost to a fiber construction project.
Railroad crossings can be a particular problem, because a large fiber project in a rural county might need to pass railroad tracks at multiple locations. It’s often not easy to determine who owns a given stretch of track, and in many cases the tracks are owned by companies that bought the easements from a defunct railroad or abandoned line. There can be big fees to cross at a single location, and I’ve seen fees as high as $20,000 to cross a single set of tracks. The even bigger problem is the delays. It’s not unusual for the paperwork for a rail crossing to stretch to well over a year.
A few years ago, the Virginia legislature tried to solve this problem by putting a shot clock on the approval for a railroad crossing and by limiting the fees. Unfortunately, that law was eventually knocked down by a court. Perhaps this ruling, made at the Appeals Court level, will have some staying power.