In the matter of arbitration between
 r
 United Transportation Union and
 Brotherhood of Locomotive Engineers
 -and.
 CSX Transportation, Inc. r
CSX Transportation, Inc. (hereinafter referred to as CSXT or the Carrier) is a Class I railroad that has evolvsd from the merger and acquisition of some eleven (11) railroads and their subsidiaries pursuant to the authorisation of the Interstate donm<erea Commission (hereinafter referred to as the ICC). Since 1961, the Baltimore 4 Ohio Railroad (hereinafter referred to as the B&0) and the Chesapeake i Ohio Railroad (hereinafter referred to as the C&O) haw been commonly controlled and managed. These railroads and some subsidiaries comprised the Chessie System, Inc. The Chessia System, Inc. also controlled the Western Maryland Railway Company (hereinafter referred to as the WM) -
 In 1980, the Chassis System, Inc. and the Seaboard Family Lines, Inc. were merged to form CSZ Transportation. Inc. The ICC approved this merger in Finance Docket go. 38905. In this same Finance Docket, the ICC also authorised the CSX Corporation to control the Richmond, Fredericksburg 4 Potomac Railroad (hereinafter referred to as the RIM through stock ownership.
 In 1983, through a Notice of Exemption, the ICU authorized the 880 to operate the railroad properties of WM as part of the 8 W system. (Finance Docket No. 30160). In 1987, the ICU issued another Notice of Exemption in Finance Docket No. 31033 merging the B&O into the C&O. As a result of this merger, the 840 ceased to exist as a separate corporate entity. In 1987, the ICU also authorized the merger of the C&O into CSx in Finance Docket No. 31106. In 1988, the ICU authorized the merger of the WM into CSXT (Finance Docket No. 31296). In 1992, the ICU authorized CSXT to operate the properties of the RF&D in the name and for the account of CSXT (Finance Docket No. 32020).
 It should be noted that with the exception of the seminal 1980 merger betwen the Chassis System, Inc. and the Seaboard Mast Line Industries, Inc., all these other mergers were exempt from prior ICU approval. In all of these Finance Dockets, the ICU imposed the-labor protective conditions set forth in New York apsk Railway-Control-HreekZyrn Eastern District Terminal, 360 ICU 60, (1979) (hereinafter referred to as the New York Dock Conditions).
 This arbitration under Article I, Section 4, of the New York
 Dock Conditions emanates from a January 10, 1994 notice that the
 Carrier served on four (41 United Transportation union (tTTC)
 General Committees of Adjustment and three (3) Brotherhood of
 Locomotive Zagineers (aLt) General Committees of Adjustment. The
 Carrier claims that this notice was served in accordance with
 Article I, Section 4, of the Now_;o%o. ^^'-'k Conditions. The
 Carrier contends that this New York Dock notice was served pursuant to ICC Finance Dockets 28905, 30160, 31033, 31106, 31296, 31954 and 32020.
 The January 10, 1994, notice advised the affected VTLJ and 8LE General Committees of Adjustment that CSXT intended to fully transfer, consolidate and merge the train operations and associated work fares on the former WM, RF&P and a portion of the former C80 in the area between Philadelphia. PA., Richmond, VA., Charlottesville, VA,., Lurgan, PR., Connellsville, P11., Huntington, w. V11. and Bergoo, W. V11. This proposed consolidation would include all terminals, mainlines, intersecting branches and subdivisions located in this territory between southern Pennsylvania and southern Virginia. This territory would be known an the Eastern 240 Consolidated District. It would encompass seven (7) existing seniority districts for train service employees and five (5l existing seniority districts for engine service employees.
 The January 10, 1994, notice also advised the D79 and 8LE General Committees of Adjustment that the aforementioned operations on the C&O, WK and RT&P would be merged into operations on the former Baltimore and Ohio Railroad and the affected train and engine service employees would be governed by the existing collective bargaining agreements on the former HW applicable to train and engine service employees. Additionally, CSXT proposed that the working lists of the separate districts protecting service in this territory would be merged, including
 establishment of common extra boards to protect service out of the respective supply points that would be maintained.
 The notice outlined six (6) initial operational changes that the Carrier intended to make in order to facilitate the proposed transfer, consolidation and merger. However, CSXT subsequently withdrew its proposal requiring the Keystone Subdivision to protect certain service west of Cumberland. The Carrier suggested that a meeting be held on January 10, 1994, to commence negotiations for an implementing agreement pursuant to Article I, Section 4, of the Now York Deck Condition.
 CSXT estimates that forty-five (45) train and engine positions would be abolished and forty-three (43) now positions would be created as a result of this consolidation. Some positions will be established at now locations. The Carrier asserts that no train or engine service employees will be furloughed as a result of the coordination. Howwr, the Carrier's proposal will result in the closing of a number of supply points on the former CAO, 840 and 11M. Reporting points would also change for some train and engine service Gmployeesone seniority district would be created for the proposed Eastern S&0 Consolidated District.
 on February 10, 1994, the parties met to discuss the Carrier's January 10, 1994, notice. The DTO and the aLR took the position that the notice was improper for a myriad of reasons. They claimed that the proposal was improper because it would cause changes in the rates of pay. rules and working conditions
 in existing collective bargaining agreements without compliance with the Railway Labor Act. They further asserted that the proposal did not involve a "transaction" under the Now York nock Cpndis,i,ons. Moreover, the UTU and BLS complained that the notice failed to specifically relate any of the proposed changes to the individual Finance Dockets cited by the Carrier. They also claimed that the proposal was not permitted by the Interstate Commerce Act and had no relation to the merger dating back to 1940 between the Chessie System, Inc. and the Seaboard Coast Line Industries, Inc. because no properties of the former Seaboard Coast Line were involved in the proposed changes. The Unions asked the Carrier to withdraw its January 10. 1994, notice but it refused to do so.
 on February 25, 1994, CSXT submitted a proposed implementing agreement to the BLS and UTO involving the properties of the former e&0, C&O, RF4?, and tIM it wished to mmrge. The Unions reiterated their objections to the notice and declined to meet to discuss the carrier's proposed implementing agreement. On March 75, 1995, CSXT insisted that its notice was proper and legal and suggested that the parties proceed to arbitration pursuant to Article I. Section 4, of the Now York Dock Conditions.
 The aLi and UT9 General Committees of Adjustment agreed to participate in the arbitration requested by CSXT while reserving their rights to challenge the January 10, 1994, notice as improper and procedurally infirm: and that there was no legal basis or authority for the changes proposed in the notice. The
 Unions maintained that these arguments, among others, would be presented to the Maw York pack arbitrator.
 On September 23, 1994, the National Mediation Hoard designated the- yndersigned as Arbitrator of this dispute. The parties submitted extensive Submissions and a plethora of evidence in support of their respective positions. A hearing was held on March 31, 1995, in Washington, D.C. Based on the extensive evidence and arguments advanced by the Unions and CSXT, this Arbitrator hereby addresses the issues submitted to him.

 The ultimate question. before this Arbitrator is whether the Carrier, s proposed implementing agreements with the United Transportation Union and the Brotherhood of Locomotive Engineers comport with Article I, Section 4, of the Now York pock labor protective conditions. However, before reaching that paramount question, the Unions have presented several threshold issues that must be. addressed. As noted heretofore, when the Unions agreed to CS7cT'a invocation of arbitration, they specifically reserved their right to submit these issues to the Arbitrator appointed pursuant to Article I, Section 4, of the Nor York Dock Conditiene.

 It is a universally accepted principle that Arbitrators appointed pursuant to Article I, Section 4, of the Now York Dock conditions serve as an extension of the ICC. Since these Arbitrators derive their authority from the ICC, they are duty
 bound to follow decisions and rulings promulgated by the ICC. The ICC has suggested that Now York Dock Arbitrators should initially decide all issues submitted to them, including issues that might not otherwise be arbitrable, subject, of course, to ICC review. Consistent with that mission, the undersigned Arbitrator hereinafter addresses the issues advanced by the UTU and BLE.

A "transaction* is defined as any action taken pursuant to a Commission authorization upon which Nay York Dock conditions have been imposed. The Unions stress that CSXT is the moving party in this arbitration. Therefore, according to the Unions, C57CT must prove that there is a causal nexus between an ICC approved transaction and the operational changes it wished to make on the C&O, B&O, WM and RF&P railroads.
 Rather than demonstrate this requisite causal relationship, the Unions contend that the Carrier merely listed seven Finance Dockets in its purported January 10, 1994, notice and explained eight (now sewn) changes it wished to implement without identifying whether any of the particular Finance Dockets bear any relationship to any of the proposed changes. For these reasons, among others, the Union submits that CS7cT has not submitted a proper and valid Now York Dock notice for this Arbitrator's consideration.
 In CAI Core, Control Chassis System Inc and Seaboard Cn~ast Line Indus., Inc., 1 I.C.C. 3d 715 (1993). the ICC set 7
 forth guidelines to determine when a proposed coordination constitutes a "transaction" under Now York Deck. In that proceeding, CSXT proposed to abolish four dispatcher positions at Corbin, Kentucky and transfer this work to management positions in Jacksonville, Florida. CSXT served this notice under the authority o! Finance Docket No. 3!905 which the ICC had approved in 1900, eight (s) years prior to the proposed transfer of these dispatcher positions. The American Train Dispatchers Association (ATDA) refused to agree to an implementing agreement and one was imposed by a New York Dock Arbitrator. The ATDA appealed the Arbitrator's Award to the ICC arguing that the change proposed in 1981 occurred too long after imposition of Nw York Dock conditions in 1980 to qualify as a "transaction.'
 The ICC rejected the ATDA's argument and found that the eight (·1 year lapse between its imposition of New York Dock labor protective conditions in Finance Docket No. 3·905 and the proposed transfer of dispatching functions in 1988 did not, by itself, render the proposal improper. The ICC explained that the relevant inquiry is not the passage of time but whether the coordination reasonably flowed' from the control transaction that had been approved in 1910. The ICC declared that approval of a principal transaction extends to and encompasses subsequent transactions that are directly related to and fulfill the purposes of the principal transaction. The ICC did caution, however, that there must be a direct causal connection between the earlier merger transaction and the subsequent operational
 changes sought to be implemented by a carrier.
 It is instructive to note that in 1980, the ICC authorized the CSX Corporation to control the RF&P in Finance Docket No. 28905. In 1987, the ICC approved the merger of the 840 into the C&O in Finance Docket No. 31033. and the merger of the Cho into CSX (Finance Docket No. 31106). In 1988, the ICC sanctioned the merger of the WM into CSXT which lad been formed in 1987 (Finance Docket No. 31396). And in 1992, the ICC authorized CSXT to operate the properties of the RP&P (Finance Docket No. 320201. All these Finance Dockets were cited by the Carrier in its January 10, 1994, notice to the OTU and iLi.
 In this Arbitrator's opinion, the operational changes proposed by the Carrier in its January 10, 1994 notice directly filated to and flowed from the aforementioned transactions that were authorized by the ICC. Were it not for the ICC permission in those Finance Dockets, CSXT would haw no authority to merge the e&O, C&O, WN and RFLP territories into a single, discrete rail freight operation. To this Arbitrator, there is a direct causal relation between the mergers and coordinations sanctioned by the :CC in the Finance Dockets cited in the Carrier's January 10; 1994, notice and the operational changes it sought to implement on the former ShO, Cho, WK and RF&P properties. Accordingly, that proposal constituted a ·transaction· as defined in Article I, Section 1(a), of the New York Dock Conditions.
 II. Does the Arbitrator lack authority to grant CSZ'!~s reams...
 for modificataen or relief fros e=istin collective
 baretinina aareestmAts because Article 1. Section 2. et w~
 Nest York Docle ceadi tieas s`datea the preservative of rates
 of eav. rules. wary, na ceadit oas id rights nrivileaes a=d
 beaelits ,.wder asastiaa aareeaeRtst
 Article I, Section 2, of New York pock provides as follows:

In Railway Labor Executives' Association v. U~ted States of America and the Interstate -Commerce commission. 9t= l.2d $04 (1993), the United States Court o! Appeals for the District of Columbia Circuit ruled that Section 11317 of the interstate Commerce Act (49 U.S.C. 11347) mandates that rights, privileges and benefits afforded employees under existing collective bargaining agreements must be preserved. The Court remanded the case to the ICC to define 'rights, privileges and benefits.· The ICC has not yet rendered a ruling in that remanded proceeding.
 The Unions.argur that until the ICC defines what is meant by the *rights, privileges and bensfits· language of Section 4oS of the Rail Passenger Service Act, which has been incorporated into Section 11347 of the Interstate Commerce Act, this Arbitrator lacks authority to grant CSXT the right to modify or eliminate any existing collective bargaining agreements.
 Although the ICC has suggested that New York Dock arbitrators address all issues submitted to them, subject to its review, clearly it would be inappropriate for this Arbitrator to determine what was intended by the statutory language "rights, privileges and benefits· in Section 405 of the Rail Passenger Service Act. In Zxeeutives, the Court of Appeals for the D.C. Circuit specifically remanded this determination to the ICC. Therefore, it would be totally inappropriate for this Arbitrator to offer an opinion on the scope of this statutory language and I expressly decline to do so.
 Addressing the facts extant in this particular proceeding, it appears that there would be several significant changes in the working conditions of train and engine service employees affected 5y the Carriers proposal. For instance, their current seniority districts will be expanded to include all of the C&O, S&O, WM and RFALP territory to be coordinated. Also, the crew reporting points will be expanded to include all reporting points in this combined seniority district. Many present supply points will be eliminated for these employees. And those employees now working under the C40, WM and RF&P schedule agreements will be placed under H40 schedule agreements: Additionally, some employees will have their representation changed from the DTC to the sLB.
 while these are indeed not insignificant changes for many train and engine service employees in the territory to be coordinated, nevertheless similar changes are not uncommon in many New York Dock implementing agreements. Several New York Dock
 Arbitrators have imposed implementing agreements placing employees under a different collective bargaining agreement. Moreover, numerous CSXT employees have been transferred to other railroads with different agreements pursuant to ICC implementing agreements. It should be noted that representation changed for many employees when the B&0 Central District was created. Moreover, crew reporting points and seniority districts have been changed and expanded as a result of ICC authorized mergers and consolidations. CSXT'a current proposed coordination is not markedly.different from other mergers and coordinations approved by the ICC or by Arbitrators acting under the authority of the ICC.

 IZI. Does section 1134L (al e! the Interstate Cas_sree 7~et
 " ;=lv to grecesdines e:~ted lreaarier review and
 d~roval by the ICC?
 Section 11341(a) of the Interstate Commerce Act (49 C.S.C.
 11341(a]) exempts a carrier from the antitrust law and all other
 law, including State and municipal law, as necessary to let it
 carry out a transaction approved by the ICC under Chapter 113 of
 the Interstate Commerce Act (49 0.8.C. section 11301 et seg.) In
 Norfolk &1W estern ~ilway Ca. at al. v. American Train
 Disoatehers et al., 499 ?.S. 117 (1991). the United States
 Supreme Court ruled that the Section 113411a) exemption ·from all
 other law· includes a carrier's legal obligation under a
 collective bargaining agreement when necessary to Carry out an
 ICC-approved transaction. The Supreme Court concluded that
 obligations imposed by laws, such as the Railway Labor Act, will
 12
 not prevent the efficiencies of rail consolidations from being achieved.
 The Unions contend that this exemption applies only when it is necessary to carry out a transaction anoreved by the ICC. They maintain that the exemption does not apply when the ICC exempts a railroad from review and approval pursuant to Section 10505 of the Interstate Commerce Act (49 Q.S.C. 10505). All of the transactions cited by CSXT in its January 10, 1991, notice, with the exception of the 1980 seminal transaction in Finance Docket No. 28905, involved exemptions under Section 10505 rather than approvals under Chapter 113. Therefore, the unions assert that the Section 11341 (al exemption from ·all other law* is inapplicable to these transactions.
 In the light of the Supreme Court's unambiguous decision in Train Dispacchers, it cannot be gainsaid that the ICC may exempt transactions approved under Section 11341(a) from the RLA, and collective bargaining agreements entered into thereunder, when this is necessary to carry out a transaction approved by the ICC. The ICC has ruled that this authority extends to Arbitrators when they are working under the delegated authority of the ICC (See CSX Coreeratien - Ceatrel - Chassis Syltas. 'Inc. and Seaboard Cease Line Indnstriee, 1 I.C.C.3d 715 (19911). Moreover, several arbitrators under Article I. Section 4, of Nev York Deck have concluded that they haw the authority to override existing collective bargaining agreements if they are an impediment to carrying out an approved transaction.
 At issue here is whether the Section 11341(a) exemption :rom the RLA and collective bargaining agreements subject to the RA also applies to transactions exempt from ICC review and approval under Section 10505 of the Interstate Commerce Act. A literal reading of Section 11341(a) would seem to support the unions argument that the exemption from other laws does not apply to transactions exempt from ICC approval. However, the ICC has concluded that it has the authority under both Section 11341(a) and Section 11347 of the Interstate Commerce Act to modify collective bargaining agreements under the RLA when they are an impediment to a merger. (See C$X Corporation -- Control -Chassis System, Inc. and Seaboard Coast Line Industries, Inc., 6 ICC 3d 715 (19901). This is the so-called ICC *Carman II· dicision. The Court of Appeal for the D.C. Circuit deferred to the ICUs judgment in Executives.
 As noted at the outset of this proceeding, Arbitrators acting under the authority of the ICC must adhere to ICC rulings and decisioru. In the aforementioned Carman II decision, the ICC expressly stated that Arbitrators appointed under the Now York p= conditions haw the authority to modify collective bargaining agreeseats when necessary to permit mergers. Thus. this Arbitrator has the authority under both Section 11341(a) and 11347 to modify existing collective bargaining agreements if this is necessary to carry out the coordination proposed by CSXT in its January 10, 1994, notice.
 7V. ase the aroviaiens of Section 11341(&V inamalicahl,_ to
When the CSXT served its January 10, 1994, notice on the UTU and HLE, it cited seven (7) Finance Dockets that the ICC had either approved or exempted from prior approval and regulation. The Unions contend that there is no statutory or other legal basis or precedent for combinations of multiple approved or exempt transactions. This Arbitrator must respectfully disagree with the Unions' contention, however.
 It is true that Section 11341(a) of the Interstate Commerce Act refers to 'the transaction' in the singular. Nevertheless, the Carrier's reference to multiple Finance Dockets does not appear to be barred by the Interstate Commerce Act, ICC decisions, or the Now York Dock Conditions. It is noteworthy that all of the cited Finance Dockets apply to CSIT's control of the four (4) properties it now wishes to consolidate. Moreover, the ICC imposed the same labor protective conditions in each of those transactions. Also, for many years, CSXT and its predecessor railroads have served notices under New York Dock and other ICC labor protective conditions listing multiple Finance Dockets. Evidently, neither the affected rail labor organizations nor the ICC took any exception to this practice.
 For all the foregoing reasons, this Arbitrator finds that it was not improper for CSXT to reference a combination of seven (7) Finance Dockets in its January 10, 1994, notices to the UTQ and HLE.
 v. Carr
In Dispatchers, the Supreme Court declared that the Section 11341(a) exemption is applicable only when it is necessary to carry out an approved transaction. The Court ruled that the exemption can be no broader than the barrier which would otherwise stand in the way of implementation. The ICC advocated a similar limitation in Carmen ZZ. The ICC assumed that any change in collective bargaining agreements will be limited to those necessary to permit the approved consolidation and will not undermine labor's rights to rely primarily on the RLA for those subjects traditionally covered by that statute.
 The Unions argue that the changes now proposed by CSZT are not necessary to carry out the Finance Dockets cited in the Carrier's January 10, 1994 notices in view of the actual transactions involved in those Finance Dockets; the lack of any relationship between the proposed changes; and the years that have passed since those ICC decisions.
 CSXT has convinced this Arbitrator that it is necessary to
 change the seniority districts of the train and engine service
 employees affected birita proposal if the territory of the
 erstwhile CAO. 260, M and R1ip to be coordinated is to be run as
 a distinct and unified rail freight operation. Were the Carrier
 required to continue operating this territory as four separate
 railroads each with its own work force and seniority district the
 operating efficiencies contemplated by the coordination would be
 illusory. According to the carrier, the proposed consolidation of
 16
 the present four seniority districts into a single seniority district will eliminate some train delays and will promote more efficient manpower utilisation. To achieve this enhanced efficiency it is necessary to eliminate the current seniority districts on the affected territory and create a single seniority district.
 CSXT also contends that to achieve the enhanced operating efficiency intended by its proposed consolidation some crew supply points will have to be closed, such as Hanover, PA. Charlottesville, vX and Kaggerstown. 1D for freight train operations. These changes, in conjunction with the establishment of Richmond as a common supply point for train service crows, will improve manpower utilisation, according to the Carrier, $Inca excess RF&P train and engine service employees at Richmond will be able to supplement the B&0, nee and C&0 Crows who now operate tiers. Again, it appears that it will be necessary to close some former crew supply points in order to achieve the efficiencies contemplated by the proposed consolidation.
 It must be stressed that employees working in the consolidated territory will continue to receive the same wage rates and benefits that they currently receive. Except for the elimination of their current seniority districts and the closing of some supply points for crows, the present collective bargaining agreements on the B&0, C40, o1X and RFi,D will be continued unchanged. This transaction therefore will not result in a mere *transfer of wealth· from these employees to CSXT which
 the D. C. Court of Appeals found impermissible in Executives. Rather, the savings will be achieved from better utilization of equipment, facilities and manpower. A1so,.CSXT will not be obligated to hire additional train and engine service employees due to its more efficient use of employees on the combined territory. Moreover, CSXT estimates that train delays will be greatly reduced. Thus, in this Arbitrator's opinion, the transaction itself will yield enhanced efficiency independent of any modifications in the present collective bargaining agreements on the 340, Coo, WK and RF&P.

issllsentine aareal~T -- In 1983, the OTU and the iLi executed implementing agreements after the B&O received permission to operate the properties of the western Maryland in Finance Docket No. 30160. In 1991, the UTO and the BLS executed implementing agreements after the CSXT acquired the rail assets and operations of the RF&P in Finance Docket go. 3195·. Those implementing agreements provided that *they shall remain in full force and effect until revised or modified in accordance with the Railway Labor Act.0
 According to the Unions, those implementing agreements are still in effect since they were never revised or modified pursuant to the RLA. The Unions maintain that the Carrier has no right to re-coordinate the properties that were involved in those implementing agreements.
 The Unions cite a 1991 award rendered by Neutral Robert 0. Harris in a case between the UTU and CSXT involving Carrier ,s notice to coordinate work performed on the C60 and the Louisville and Nashville Railroad Company in support of its contention. Arbitrator Harris found that because of an earlier implementing agreement involving the same properties, CSXT was precluded from asking for de nova arbitration to coordinate property subject to an implementing agreement which, by its express terms, may only be changed pursuant to the RLA. The Carrier has appealed the Harris Award to the ICC.
 It appears that Arbitrator Harris concluded that an implementing agreement may not be changed in a second coordination of the same nrooertiAs except in accordance with the terms of the implementing agreement. Howver, CSXT and or its predecessors agreed to implementing agreements involving the WM and the RF&P. Evidently, there were no implementing agreements involving the 860 and C40. Since over ·0f of the territory the Carrier now proposes to coordinate involves former 360 and C6o property the Carrier is not now seeking coordination of "the same properties" which were subject to earlier implementing agreements, in this Arbitrator's judgment.
 This would sees to distinguish the Harris Award. In any event, this Arbitrator finds nothing in the interstate Commerce Act, ICC decisions or the New York Dock conditions which preclude coordination of property previously coordinated and subject to an implementing agreement which may only be revised or modified
 pursuant to the RA. Any tension between this Award and the Harris Award must be resolved by the ICC.
 In this Arbitrator's view, when the drafters agreed that an implementing agreement could only be changed in accordance with the RLA they intended this prohibition to apply to matters subject to bargaining under the RLd1. They could not haw intended it to affect the jurisdiction of the IM Nor did they have the right to preclude the ICC from reviewing mergers and eoordinatioas subject to its jurisdiction. A new transaction would be governed by the interstate Coerce Act, not the Railway Labor Act.
 It is also noteworthy that C!=? and its predecessors haw negotiated several implementing agreements containing language similar to that involved in the Harris Award. Many of those properties were subsequently coordinated without resort to the RIJ1. Rather, they were coordinated in accordance with ICC procedures. The ICC has made it clear that labor disputes arising from transactions which it bas approved are resolved through labor protective conditions it has imposed. such as Raw York
      not through the Railway Labor Act.

For all tha foregoing reasons, this Arbitrator finds that it was permissible for CUT to propose a subsequent coordination of property that had bees coordinated previously which was subject to an implementing agreement which could only be modified or revised pursuant to the Railway Labor Act.

 20
 vI=. =s there a public transportation benefit llevina lres< the
 carrierls nroeosall
 In Executives the Court of Appeals for the D.C. Circuit held that to override a collective bargaining agreement, the ICC must find that the underlying transaction yields a transportation benefit to the public, not merely a transfer of wealth from employees to their employer. Although the Court of Appeals remanded that proceeding to the ICC to clarify whether there were, in fact, transportation benefits to be had from the lease transaction involved there, it suggested that ·traarportation benafits· could include the promotion of safe, adequate and efficient transportation; the encouragement of sound economic conditions among carriers; and enhanced service levels.
 The Carrier anticipates that its proposed changes will promote more economical and efficient transportation in the territory now served by the 860, C60, 11M and Rl6P which it wished to coordinate. According to the D. C. Court of Appeals, there would thus be some transportation benefit flowing to the public from the underlying transaction proposed by CUT in its January 10, 1991, notices to the DM and BLS.

 Cww w
As observed heretofore, the ICC must decide whether changes in the B&O, MO, W and RP&P collective bargaining agreements that are necessary to implement the transaction proposed by the Carrier involve 'rights, privileges and benefits" of train and
 engine employees affected by the transaction which must be preserved. If the ICC determines that their "rights, privileges and benefits· have been preserved, an issue on which this Arbitrator nukes no finding, then the implementing agreements proposed by.CSXT on February 25, 1994, meet the requirements of Article I, Section 4, of the New York Dock Conditions. Any employees adversely affected by this transaction will be entitled to New York Dock labor protective benefits.
 The Carrier's January 10, 1994, notice to the GTQ and B1.$ comported with the requirements of the New York Dock Conditions. The notices were in writing: were posted and served on the DR'Q and BLi ninety (90) days in advance: contained a full and adequate statement of the proposed changes; and included an tfatimate of the number of employees in each craft who would be affected by the proposed changes. The notices were therefore proper Now York Deck notices.

 Respectfully submitted,

 1244if #. a'AV-·&--
 RObert M. O'Brien, Arbitrator

 April 24, 1995

 22
 S:zFAC= =?A_vSFCR-ATICN BOARD-

    Finance ~oCket Yo. 299OS (Sub-No. 26)


CSX CORPORATICN--CCNTROL--CHESSIE SYSTEM, INC.

AND SEABOARD COAST '-:NE INDUSTRIES. INC.

(ARBITRATION REVIEW)


Decided: April 15, 1996

 1ERVicE 07'APO 2 9 f996(

 GSX Transportation. Inc. (GSXT), filed as appeal with the former Interstate Commerce Commission (ICC) to review an arbitration award interpreting and applying a labor protective agreement. The Surface Transportation Board has now bean given 7uriadietiort over this matter. We reverse the findings o! facts and conclusions of law in the award of Arbitrator Robert 0. Harris concerning the implementing agreement proposed by CSXT to efteet·etuc earrmvs coordination of operations in a new operating district. We will vacate the arbitral decision and award, and remand the proceeding to the parties to continue the implementing process in accordance with Article I. Section 4 of the New York Dock conditions through lurches negotiations or arbitration to reach a new implementing agreement.

 PROCEDURAL MATTERS

 On January 75, 1995, the Railway Labor Executives' Association (RLEAI and its affiliated labor organizations' filed a notice under 19 U.S.C. 10375 to intervene. RL6A contends that all the affiliated labor organizations maintain collective bargaining agreements lC8Ae1 with CSXT, and will be significantly affected by the resolution o! the issues raised is this proceeding.

 CSXT opposes RLEA's intervention on the grounds that RLEA is not a party to the proceeding. CSXT argues that section 10378 applies to intervention by designated representatives of employees sad is, therefore, not available to RLEA, which is

 ' The ICC Termination Act of 1995, Pub. L. No. 101-88. 109 Stet. 803 (CM Act). which vas enacted on December 79. 1995, and cook effect on January 1. 1996, abolished the Interstate Commerce Commission (ICC or Commission! and transferred certain functions and proceedings to the Surface Transportation Board (Board!. Section 701Ib1(1) of the Act provides, in general, chat proceedings pending before the ICC on the effective date of that legislation shall G decided under the far in effect prior to January 1. 1998. insofar as they involve functions retained by the Act. This decision relates to a proceeding that was pending with the ICC prior to January 1. 1996, and to functions that are subject to Board jurisdiction pursuant to 19 U.S.G. 11376. Therefore. this decision applies the far in effect prior to the Act, and citations are to the former sections o! the statute, unless otherwise indicated.

 ' The affiliated labor organizations ors: American Train Dispatchers Department, Brotherhood o! Locomotive Engineers; Brotherhood o! Maintenance of Way Employees; Brotherhood o! Railroad Signalmen; Brotherhood of Locomotive Engineers: Hoes! Employees rs Restaurant Employees International Union; International Brotherhood of Boilermakers 4 Blacksmiths; International Brotherhood of Electrical Workers: International Brotherhood of Firemen 4 Oilers: and Sheet Metal Workers International Aaaoeiacion.
 -=CRS= ::o. 299·:5;_=.`o. 161

 =cmpr:sed of chief execu:1ves of several unions. Acccrding to petitioner, the CSXT employees who may be affected by :his proceeding are represented by the United Transpor:at:cn _.-.:on lU.'U), which already is a car:y. :n response, RLEA argues chat is is be:.^.g -utilized as a convenient, shorthand reference for each of the nine railway labor organizations listed in the
 N I the unincoroorated associations to which their
 otice, as well as chief executives belong." Consequently, RLEA believes section 10328 is applicable to its intervention.

 We agree with RLEA that the issues cc be decided here are pert:nent-eo collective bargaining agreements between its affiliates and CSXT as well as between labor and the railroad industry in general. RLEA and its affiliates have a legitimate interest in the outcome of this proceeding. Thus, we will grant RLEA's request to intervene, and will accept into the record its statement filed on January 25, 1995. We will refer to the UTU and the RLEA collectively herein as the Unions or as labor.

 By pleading filed February 15, 1995, CSXT petitions for leave to file a reply to UTU's reply and a 2-day extension to file a reply to RLFJ1's statement. In the interest of developing a full and complete record, we will grant CSXT's request in its entirety. CSXT's reply to UTU and to RL&A, filed February 15, 1995, is accepted into the record.

 BACKGROUND

 CSXT in its present form was created by a series of transactions approved by the ICU. In the 1980 decision in Core.--Conerel.-Chessie i S.C.L. Induseriu. Ins., 363 I.C.C. 521 (19801 (CSXT Control), the Commission allowed CSX Corporation, a noncarrier holding company, to control as subsidiary corporations the Chassis System, Inc. (Chessle) and Seaboard Coast Line Industries, Inc. (SCLI). The railroads controlled by Chassis included the Chesapeake t Ohio Railway Company lC&O), the Baltimore i Ohio Railroad Company (340), and the Western Maryland Railway Company (WM). The railroads controlled by SCLI included the Seaboard Coast Line Railroad (Seaboard), the Louisville and Nashville Railroad Company (L&NI, the Clinchfield Railroad Company (Clinchfield), and several smaller carrier. In a subsequent series of decisions. the ICU approved the consolidation of the railroad corporate entities controlled by CSX Corporation into its subsidiary CSXT.'

 Each of these transactions creating present-day CSri' vas approved subject to the ICU's standard labor protection conditions. These conditions were adopted in New ~erk ~eek ~v.-Control--Brooklyn Eastern Dist., 360 I.C.C. 60 (19791 (New York Doek), to implement the Congressional mandate to provide such protection under 49 U.S.C. 11347.

 ' In CSrt Control, the Commission authorized the CSZ Corporation (USX) to acquire control of the 6 subsidiary rail carriers of Chassis and the 10 subsidiary rail carriers (the socalled Family Lines) of SCLI, through the merger of Chassis and SCLI into USX. Two years later. in Seaboard GeaALLine RJe_- Meraer Exemption--Louisville 4 N. R.I., Finance Docket No. 30053 (ICU served Nov. 6, 19821, the Seaboard and the LAM (both of which were subsidiaries of SCLI in 1980) merged to form the Seaboard System, Inc. Subsequently, in Baltimore c O. R.R. and Chesapeake 4 O. Rv.--Mercer Exemption, Finance Docket No. 31033 (ICU served May 22, 1987), the 840 merged into the C&O. Later that year, C&O merged into the recently created CSXT. Che aoeake 4 O R R and C~X Transn.. Inc.--Mercer Exemption,
 Finance Docket No. 31106 (ICU served Sept. 16, 19671.
                  --.'.3.^.C9 .~=6eC :i0. 033 E a-.,·9C.

                                        i5,


;rider ·:.w v,..< ^cc:<, :acor changes necessary for consummat:cn of agency- apprcved transactions are established by implementing agreements negotiated before the charges occur. If the parties cannot reach an :rplement:ng agreement, the issues are resolved by arbitration. Arbitration awards may be appealed to the Board under the *ace Curtain standard of review.'

 Pursuant to the ICUs 1380 decision in CSXT Control, on March 4, 1981, CSXT and the UTU entered into an implementing agreement (the 1981 Agreement) for the coordination of certain territories of the C40, L6,N, and Clinchfield Railroad Company (Clinchfield). In that agreement, the affiliate carriers and relevant labor organizations agreed that train operations between Hazard-Fleming and Martin, KY, on the C40 and L&N lines, and between Shelby, KY. and Erwin, TN, on the C40 and Clinchfield lines would be combined into "the Coordinated Territory.- The Agreement concluded with the following statement in Article XVIII: "This Agreement shall remain in full force and effect until revised or modified in accordance with the Railway Labor Act, as amended.·

 On February 11. 1993, CSXT served a notice pursuant to Article I, Section 4 of New York Dock upon the UTU Committees of C&O, L&N, and Clinchfield to expand the Coordinated Territory.' The 1993 proposed coordination involved operations from Ravenna, KY, through Perrit, Hazard. Deane, and Martin. KY, to Beaver Jet., and then to either Russell or Shelby, KY. UTU opposed the notice on the grounds that Article XVIII required that the 1911 Agreement could only be revised or modified by the Railway Labor Act (RLA). Arbitration followed.

 On October 17, 1991, an Arbitration Committee` found that the carrier's New York pack notice of February 11, 1993, was improper because the 1981 Agreement specified RIJ1 procedures as the only method of modification of the 1961 Agreement. In support of its ruling, the Committee stated:

    If the ICC found, as it has, that parties can make enforceable arrangements, jointly agreed to, which are different from those required by New York Dock, it


' Under 49 CFR 1115.8, the standard for review is provided
 in Chicago 4 North Western Tntn. Co.--Abandon-mint, 3 I.C.C.2d 729
 (1987) (Lace Curtain). Under the La.ee QuXtain standard, the
 agency does not review 'issues of causation, the calculation of
 benefits, or the resolution of other factual questions- in the
 absence of 'egregious error.- j, at 735-36. In Delaware and
 Hud.nn Railway Company--.ease and Traekaae Rights Fxemarrion-
 ^~2r~naf~eld Il Company, Finance Docket 140. 30965
 (Sub-NO. 1) In "~ (ICC served Oct. 4. 1990) at 16-17, remanded
 on other grounds in Railway Labor Executives' Ass'n v. United
 JL&LU, 967 F.2d 606 (D.C. Cir. 1993), the ICC said:

    Once having accepted a case for review, w may only overturn an arbitral award when it is shown that the award is irrational or fails to draw its essence from the imposed labor conditions or it exceeds the authority reposed in arbitrators by those conditions. (Citations omitted.]


' A second notice, dated March 17, 1993, referred to the February 11, 1993 notice, and explained is detail the proposed coordination between: (1) Ravenna and Martin: l21 Hazard and Shelby; and, (3) Russell and Dent.

 ' Robert O. Harris, chairman and neutral member, H. S. Emerick, for the carrier, and Robert W. Earley, for the union.
 ,'_narxe -ccxet No. 233Ci s;b·No. 26i

    would appear ;!:at an arbi:racicn comm:::ee acting under authority granted by the :,.C would be s:lilarly bound follow such arrangements. If that :s the case, the carrier, by its 1981 agreement, has precluded itself from asking for dl nova arbitration of a coordination which encompasses a coordination which it previously agreed may only be modified in an agreed upon-manner.


On December 9, 1994, CSXT petitioned far review of the Arbitration Committee's decision and award. CSXT requested the ICC to vacate the decision, find chat the 19·1 Agreement is not an impediment to implementing the transaction proposed by the 1993 notice, and direct the Arbitration Committee to fashion a new implementing agreement as required by Article I, Section 4 of New York Dock. UTU replied. RLEA filed a statement in support of UTU's position, and CSXT filed a rebuttal. For the reasons discussed below we will review the arbitrator's decision, vacate the decision, and remand the proceeding to the parties to continue the implementing process in accordance with Section 4 of New York Dock.

 ARGUMENTS OF THE PARTIES
The parties raise three main issues: (1) whether CSXT was bound by the provisions of Article XVIII of the 1981 Implementing Agreement: (2) whether the changes would improperly reopen the prior 1981 Agreement by re-coordinating the territory already coordinated there: and (3) whether the changes are the type that may justify our overriding Article XVIII as an impediment to the proposed transaction.

 r.sea Curtain Review. CSXT contends that its appeal meets the Lace curtain standard of review. The carrier avers that its appeal raises recurring and otherwise significant issues of general importance regarding the proper interpretation of y= York Dock and, thus, satisfies the Laee c&Xtain criteria. In addition, CSXT argues that the Arbitrator's conclusion that the parties, through a prior implementing agreement, could replace ther agency's New York Dock procedures with RLA procedures for implementing future transactions. is egregious error, and thus, merits our review and reversal. The Unions do not challenge our authority to review the Arbitrator's decision, but they argue that there is no reason to overturn the award.

 Article xVIII Lanouaoe. UTU contends that CSXT knowingly and voluntarily agreed to the Article XVIII language that provides that the RLA procedures are the only way to modify the 1981 Agreement, and that CSXT is, therefore. bound by the bargaining clause.

 CSXT counters that Article XVIII's reference to the RLA was merely 'boilerplate phraseology' found in many collective bargaining agreements, and chat it applied only to modifications of those provisions relating to employees' rates of pay and work rules after implementation of the 1981 transaction. CSXT maintains that the agency's New York Dock procedures would be followed for any future transactions that also involved the Coordinated Territory.

 UTU, however, takes issue with the railroad's categorization of Article XVIII as merely boalarplate language pertaining to employee rates or work rules. It argues that it was not necessary to include the disputed language to assure the use of the RLA for negotiating those provisions, because such matters are subject to RLA procedures anyway.
CSXT complains that the labor organizations' interpretation of Article XVIII focuses only on the reference to RIJ1 procedures
 -na-Ce :-_C~et ;I0. ~j::i _-D-YO

 and :snores the A3ree!ren:·s r ccgnit:on Of a.w -~rk procedures :n Article X::.a) of the Agreement. Because the agreement specifically referenced Yew Xcrk ^
 . CSXT contends that it was free =o =arty cut .new coordinations under those procedures, pursuant to the authority granted in CSXT ^_=nerol.

 CSXT asserts that it and its predecessors have previously coordinated territories under New York Dock in subsequent ICC-authorized transactions, despite the inclusion of similar RLA language in-the implementing agreement, and without any objection from UTU. -For example, the WM and 860 entered into an implementing agreement with IT:U on November 28, 1979. Section XI of the agreement contained the same reference to the RLA as does Article XVIII. B40 and WK served notice in 1983 under Article I. Section 4 of New York pack to expand the Coordinated Territory by adding track from Curtis Say Railroad. After UTU refused to agree to a new implementing agreement, one was imposed by an arbitration committee under New York Dock.
In 1959, the former Atlantic Coast Line Railroad Company and L&N entered into an implementing agreement with a predecessor union of the VIV coordinating their operations in Montgomery, Alabama. Section 5 of that agreement contained the same Article XVIII*reference to the RLA at issue here. Nevertheless, this territory was expanded to include track of the former Atlanta 4 west Point Railroad and the Western Railway of Alabama, pursuant to a 1983 New York Dock implementing agreement. The former 840. C60 and L&N expanded their coordinated train operations in Cincinnati. Ohio under a 1984 New York Dock implementing agreement. e" Appendix I. even though this same territory had been the subject of an earlier coordination accomplished under an implementing agreement with the UTU containing the RLA reference. In 1992 CSXT expanded coordinated territories of the former C&0 and Seaboard System in Richmond. Virginia to include track of the former Richmond. Fredericksburg and Potomac Railroad. The previous November 29. 1989 implementing agreement again contained the REA reference.

 The union responds that its failure to invoke its right to follow RLA procedures in the past is not a waiver of that right here. The union contends that in the instance involving 310 and WM, it did not invoke its RLA bargaining right because there was an intervening ICC decision under which the second coordination agreement proceeded. In addition, the consolidation involved only 0.15 miles of rail and five employees, who were not subject to significant changes.

 CSXT also argues that the arbitrator's decision failed to explain what -quid pro quo- it would receive for relinquishing its statutory right to accomplish coordinations through New York procedures. CSXT implies that the 1981 Agreement was not a typical -contract- embodying some bargain between CSXT and UTU in which the railroad could waive its statutory right. Rather. CSXT characterizes the 1981 Agreement as a regulatory requirement of the ICC.

 UTV states that the language is clear, simple, and unambiguous, and that the Arbitrator had no need to "psychologize· the carrier's motivation. UrU speculates that CSXT readily and knowingly agreed to Article XVIII because it had no meaningful expectation in 1981 that it would re-coordinate the same territory 12 years later.
CSXT maintains that the Committee's construction of Article XVIII is contrary to the statute, to New York Dock, and to the ~~XT Control decision. Citing Norfolk i Western Railway ~omoanv.. the-- Ra " w-v Comtanv ^d·^^·r·ra~e Railroad (·omoanv--
              ro ooerate and Trackage iahts (Arbitration

F=^ance =ocket Yo. 289:5 ;Sub-No. 26)
R·v_ew` Finance Docket No. 30582 (Sub-No. 2) (:CC served May 7,
 :392 and July 7, 1392) f~or_·~-- s .teete-~,), the railroad argues
 that :he exclusive nechod rer·_.;llred by :_C precedent for
 accomplishing a transaction such as is croposed here is chat
 provided in New Yark Doek. According to CSXT, the parties may
 .not, by agreement, vary the requiremancs set by the statute and
 ICC order, especially when the alternative procedure is contained
 in an agreement that has never been reviewed by the agency.

 7TJ maintains, however, that nothing in the statute or in Vow York Dock prohibits the carrier and the labor organization from voluntarily agreeing in a New York Dock implementing agreement to a different method of resolving matters concerning future coordinations of the involved lines.

 Relation to 1981 Agreement. CSxT argues that its 1993 proposed transaction was not intended to be a modification of the 1981 Agreement, but was a new coordination, requiring a completely new notice and a new implementing agreement under Article I, Section 4 of New York Dock, CSXT maintains: (1) that the transaction covered by the 1981 Agreement had already been consummated: (2) that, by its terms and by operation of Now York p=,-it was limited to coordinating the train operations described therein, and did not address future transactions: (3) chat the 1961 Agreement would not be modified or revised by the proposed transaction, but would be superseded and replaced by a new Now York Deck Implementing Agreement governing tile expanded, Coordinated Territory; and, c11 that employees' interests would still be protected, because they would continue to receive the protections and benefits under New York Dock, as guaranteed in CSXT Control.

 In response, tTRI cites language from CSYT's 1993 notices that appears to contradict the railroad's argument that the 1993 proposal was not intended to modify the 1901 Agreement. The February 11, 1993 notice stated that it was 'necessary to reopen discussions of the consolidated area.' The stated intention of this !larch 11, 1993 notice was "to reopen the agreements coordinating the operations between Hazard and Shelby, Kentucky
 . to revise the present agreements to operate as indicated below: ····.· According to the union, the matters 'indicated below ware three proposals to expand the 1961 Hazard-DeansMartin coordination.'

 DISCUSSION AND CONCLUSIONS

 Lace Curtain Review. In ~~e Certain, the ICC asserted its authority to review arbitral awards arising from the labor protective Conditions that the agency imposes upon its approval of mergers and other transactions embraced within 19 U.S.C. 11343(a). The ICC stated there chat it would review such awards if they involve 'significant issues of general importance regarding the proper interpretation of our labor protective conditions.'' It also said chat where chore is egregious error or where the award fails to draw its essence from the labor conditions, it would reverse an arbitral award.'

 The issue of whether the railroad has bound itself to follow RLA procedures in undertaking the changes at issue is a significant issue of general importance which merits our review.

 ' Sja Exhibits A and S, UTU's verified statement.

 Lace Curtain, 3 I.C.C.2d at 736.

 ' ;A~ at 735.
 _nanre -=cket :70. 7a975;ub-·to. 76;

 -_.-.er %:n:en 3:spuces :_r au_hor::y to review the Arbitrator's
 =_a:on. Acecrd:-gly. -a ri:= ::ear the appeal.

 Article x · - 'a^-~'c . Arbitrator Harris concluded chat the carrier notice under Section 4 of New York Dock was improper tecsuse the implementing Agreement provides chat following the procedures of the RLA offers the 'only method for modifying or expanding the coordination of forces originally agreed to covering the territory between Hazard and Martin. ICY." But
 arris did-not support his finding chat the reference to the RLA had that meaning. Before the arbitrator, CSXT argued, as it does `ere, chat the reference to RLA procedures in Article XVIII means that changes in pay and working conditions must be negotiated pursuant to the RLA. But the railroad claims that the language does not mesn that any further modification of the implementing agreement to carry out an :CC-authorized transaction is subject to RLA rather than ICA procedures.

 Rather than restating the procedure under the law, labor believes chat including the subject language would express the :-cent to adopt a new procedure, the RLA, rather than the customary procedure under the ICA for implementing changes arising out of an ICC-approved transaction. The Unions argue that such an interpretation makes the most sense because section 6 notice under the RLA must be served by the carrier if it proposes any changes in rates of pay or work rules, whether such a provision is inserted in the implementing agreement or not. Thus, reasons UTU, a more reasonable interpretation of the language is that it was included to make clear in this agreement that a wider scope was envisioned for the RLA than is usually the case. Labor concludes that the language is clear, simple, and unambiguous.
We do not agree with the Unions that the reference to the RLA is free from ambiguity. It is neither uncommon nor unreasonable for the parties to an agreement to recite the applicable law in the contract. Thus the interpretation argued by CSXT may not be rejected out of hand. Moreover, assuming without deciding that carriers and unions may by agreement replace the ICA process with that of the RLA, the fact that Congress enacted sections 11347 and 11341(a) to govern in these instances suggests that any ambiguity in an agreement be resolved in favor of the ICA process. I" Norfolk 4 w. IV. Co. v. tTeriean Train Disnatehers Assn, 499 U.S. 117, (1991). Any agreement by the parties to depart from section 11347 and York Dock procedures to resolve matters that would normally be covered by those procedures should therefore be clearly and unambiguously expressed. That is not the case here.
In looking at the evidence submitted by the parties, we note that the railroad has pointed to certain circumstances to support its position. CSXT notes chat similar language had been included in four other implementing agreements. The railroad points to this as a practice continuing over 30 years which has never been interpreted by the railroads, the unions or anyone else to until now mean that the RLA displaces New York Dock as the procedure for modifying implementing agreements to make changes arising out of transactions approved by the ICC. The unions have challenged the relevance of one of those precedents, but have not produced any precedents where a provision such as the one in Article XVIrI has been employed or interpreted to provide for modifications for an implementing agreement pursuant to RLA provisions.

 In another arbitration case, Cer re ration--Centre(-~hry·,(ie. !.or; and Seaboard Coaat Line Induetriu. Ine. (Arbitration Review), Finance Docket No. 17905 (Sub-lfo. 77). (ICC served Dec. 7, 1995).(rSX.-Control--Chassia/B~), Arbitrator Robert M . O'Brien addressed a similar provision in an
 :-plement:-g agreement. ..".-.e '.-. a^d the Brotnernocd of :ocomot:ve Engineers .3LE' arg%ed t:ere, as -': and the RLEA nave argued here, that any change to t-a :-pie-.ent_ng agreement had to be undertaken pursuant to Rla. procedures. In support of their arguments to Arbitrator O'Brien, the unions cited the decision of Arbitrator Harris in this proceeding. O'Brien distinguished Harris' award by construing the letter's holding as limited to a "second coordination of the same properties.- O'Brien then found that in the proceeding before him the properties to be coordinated were different. Arbitrator O'Brien then went on to say, 0'Brien Award at 20, that:

    In this Arbitrator's view, when the drafters agreed that an implementing agreement could only be changed in accordance with the RLA they intended this prohibition to apply to matters subject to bargaining under the RLA. They could not have intended it to affect the jurisdiction of the ICC. Nor did they have the right to preclude the ICC from reviewing mergers and coordinations subject to its jurisdiction. A new transaction would be governed by the Interstate Commerce Act, not the Railway Labor Act.


In support of his conclusion, Arbitrator O'Brien cited the fact that CSXT had negotiated several implementing agreements containing the RLA language and noted that many of these properties were subsequently coordinated without resort to the RLA. ·Rather·, he noted, "they were coordinated in accordance with ICC procedures. O'Brien Award at 11. The ICC upheld Arbitrator O'Brien's award.

 Because w conclude that Article MIX merely recites existing law, which provides that RLA procedures apply to modifications of rates of pay and rules (i.e., matters which are outside the scope of modification to CDA's which can be made by an implementing agreement), we need not address CSXT1s assertion that this transaction warrants a now implementing agreement rather than modification of the 1981 Agreement. Nor need we resolve the issue of whether the parties to an implementing agreement. by mutual consent, may supplant Now York pock procedures with RIA procedures to govern matters that otherwise would be covered by the New York Dock procedures. Finally, we need not consider whether we may or should override the provisions of such an agreement pursuant to the provisions of section 49 U.S.C. 11721(a) or 49 U.S.C. 11747.`°

 We find that the arbitrator committed egregious error in finding that CSXT was bound to effect the coordination at issue by resorting to the RLA as a result of the provisions of Article XVIII. Accordingly, we vacate the arbitrator's award and remand the proceeding to the parties to continue the implementing process in accordance with Article I. Section 4 of the Nay York conditions through further negotiations or arbitration to reach a now implementing agreement.

 The court in Brotherhood of Locomotive KAaineers y. I.C.C_, 885 F.2d 446 (8th Cir, 19891, held that parties to an implementing ageeement under New York Dock could agree to follow RLA procedures for any modifications to an implementing agreement and that the ICC lacked authority to override such an agreement. The court, however, based its conclusions on Brotherhood of Rv. Carmen v. ICC, 880 F.2d 562 (D.C. Cir. 1989) (holding that the ICC lacked authority to modify CBA's), which was subsequently overturned by the Supreme Court. Norfolk &W. Ry Co. v. AmTrain nianatchers Assn, 499 U.S. 117 (1991).
                  -.-a.^.ce _oc:tet ::o. 23915 Sub-No. :5


'.his decis_cn wi:i .not s:gn_·.:_art:y affect either the .rua:_ty of the h.i:ran erv:r-^.^e.^.t ar .energy c0rservation.

    '· is ordered:


1. The decision and award of Arbitrator Robert 0. Harris is vacated. The proceeding is remanded to the parties for further proceedings in accordance with our findings.

 2. A c-opy of this decision will be served on Arbitrator Robert 0. ~iarris.

    3. This decision is effective on the service date.


By the Board, Chairman Morgan, Vice Chairman Simmons, and Commissioner Owen.

Vernon A. William@

Secretary

SERVICE DATE - JULY 15, 1997

SURFACE TRANSPORTATION BOARD'


DECISION

 Finance Docket No. 28905 (Sub-No. 27)

CSX CORPORATION-CONTROL-CFIESSIE SYSTEM, INC.

AND

SEABOARD COAST LINE INDUSTRIES, INC., ETAL

(Arbitration Review)


Decided: July 1, 1997

 We deny the petition of the United Transportation Union (UTU) and the Brotherhood of Locomotive Engineers (BLE) (jointly, the Unions) for a supplemental order wn«ming the ICUs decision served December 7, 1995.

 BACKGROUND

 CSXT Transportation, Inc. (CSXT) was created through various tramaaiona that were approved by the ICC subject to the standard New York Dock labor protection condition:.' Under New York Drrat, labor changes related to approved transactions arts effected through implementing agreements negowed before the ehanga occur. If the patties nmnt agree, the issues an resolved by atbicstion, with possible appeal to the Board under its deferential lace Curia* standard of review.' The Board (or arbiaames acrong under Aw York Dock) may, with

 " The ICC Termination Act of 1995, Pub. L. No. 104-88, 109 Stat. 803 (ICCTA), which wait enacted on December 29, 1995, and took effect on January 1, 1996, abolished the Interstate Commerce Commission (ICC of Commission) and traoderted certain functions and proceedings to the Surface Transportation Board (Board). Section 204(bxl) of the ICCTA provides, in general, that proceedings paling before the ICC on the effective date of slut iegialatioo shall be decided under the law in effort prior to January 1, 1996, insofar as they involve functions retained by the ICCTA. This demon relaw to a proceeding that was pending with the ICC prior to January 1, 1996, and to fimcsimts that an subject to Board jurisdiction pursuant to 49 U.S.C. 11326 and 11327. Therefore, this decision applies the law in effect prior to the ICCTA, and citations arc to the forota section of the statute, uNess otherwise indicated.

 ' The ICC adopted these eorditiatt in New York Dock Py.-ConoW-Brooklyn &auern Disc, 360 LC.C. 60 (1979) (New York Dock), to implement its mandate to provide such protxtian under forma 49 U.S.C. 11347, which has ban reeodified as 49 US.C. 11326.

    ' Under 49 CFR 1115.8, the standard for review is provided in Chicago & North Western

Tpoc CA A!F~III OIallflf, 3 I.C.C.2d 729 (1987), popularly known a the 'lae Cartoon' case.
 Uitda the Lace Caremw standard, the Board don tan review "issues of causation, the calculation
 of benefits, or the resolution of other fitenta! questions" in the absence of "egregious error,' which
 is to say, error that may have far reaching consequences for a substantial munba of employees
 subject to the conditions or that may interfere with our ability ro oversee implementation of the
 conditions. Id. at 735·36. In Defawme and Hudson Rathwy Company-Leers and Trackage
 Rights Ezempnom-Sprirtield Terminal Rwlray Company, Fuunce Docket No. 30965 (Sub-No.
 1) et aL (ICC saved Oct. 4; 1990) at 16-17, remanded err ocher groundr in Raihvay Labor
 Execunwa' A.u'n v. United States, 987 F.2d 806 (D.C. Cit. 1993), the ICC elaborated on the
 Lace Carraan standard as follows:

    Once having accepted a case for review, we may only overturn an arbitral award when it is shown that the award a irrational or fails to draw its essence from the

                                      (continued... )

limited. exceptions not relevant here. override provisions of collective bargaining agreements (CBAs) that prevent realization -of the public benefits of approved transactions.' Affected employees receive comprehensive displacement and dismissal benefits for up to 6 years.

 This proceeding arose because of CSXTs effofo to make operational changes related to a series of ICC-approved transactions that helped ro create the carrier as it is today. Briefly. CSXT proposed to coordinate tam operations arid make related labor changes over a portion of its system by creating a new operating district. the "Eastern B&O Consolidated District" (Eastern District). and merging seniority rosters in that new district. All engineers and trainmen working in the new Eastern Distinct were to be placed under CSXTs CBAs with UTU and BLE covering the former Baltimore & Ohio Railroad Company lines. Them was to be a net loss of five positions. On January 10, 1994, CSXT served a notice on UTU and BLE of its intention to implement the labor changes under New York Dock
The Unions refused to participate in the negotiation of an implementing agreement. The Unions argued. inter alia, that the labor changes may not be compelled under New York Dock because they would violate existing CBAs.' Unable ro negotiate. CSXT invoked arbitration under New York Dock The parties selected Robert M. O'Brien as the arbitrator. Arbitrator O'Brien issued his award on April 24. 1995.

 The arbitrator ruled that he had jurisdiction to arbi_ane an implementing award under New York Dock The arbitrator held that CSXT could implement the labor changes. unless the ICC were to find that they would tmlawfally override "rights privileges, or benefits" of CBAs that must be preserved under Article 1. section 2 of New York Dock The arbitrator reserved that issue for the ICC itself to decide in fight of the District of Columbia Circuit Court of Appeals' remand of this issue in RLEA. supra n.4. Both sides appealed the arbiauor's award.

 In in December 7, 1995 decision. the ICC ache arbitrators authority to implement labor changes related to the consolidation. The ICC rejected the Unions' argument that the . changes could not be implemented under New York Dock beam they involved CBA "rights. privileges, or benefits" that must be preserved under that decision. The ICC reaffirmed its authority to modify CBA terms when such changes am necessary to permit the carrier to realize the public benefits of an approved transaction. The ICC upheld the arbiauor's finding that public benefits would arise out of the positive effect of the workforce consolidation on

 Finance Docket No _9905 tSub-\, ;'
    (...continued) imposed labor conditions or it exceeds the authority reposed in arbitrators by those conditions. [Citations omitted.]


The ICC reviewed imth of law and policy, including issues involving interpretation of the stance or its labor conditions, under the more expansive standard of review appropriate for a regulatory agency charged with administration of a regulatory statute and its conditions thereunder. See Wal(aa r. CAB, 755 F.2d 861, 864-65 (11th Cir. 1985); Part American World Airways Ine, v. CAB, 683 F.2d 554, 562 (D.C. Cit. 1982).

 ' Where modification is necessary, we may act under either former sections 11347 or 11341(a), where these former provisions apply. or under the successors to these provisions. Railway Labor Erecutrves' Assn v. United States. 987 F.2d 806 (D.C. Cit. 1993) (RLEA): Norfolk & Western v. American Train Dispatclten. 499 U.S. 1 17 (1991): and American Train Dispatchers Association v. LC.C., 26 F.3d 1157 (D.C. Cir. 1994) (ATDA).
' The Unions also argued that (1) CSXT improperly based the changes on a succession of Commission decisions rather titan on a specified individual decision end (2) the changes cannot be based on any of the transactions approved in the succession of decisions because those decisions tie too old. These issues tie not involved in this decision.
                          Finance Docket No. 2890iiSub-`, :',


opersuonai efficiency. Subsequently, the ICUs decision was affirmed in Unwed Transportation union v. STB, 108 F.3d 1425 (V-C. Cir. 1997). - .

 By Petition $led9ctober 17, 1996, the UrVons;request that we enter a "supplemental order" under current 49 U.S.C. 11327 requiring CSXT to submit quarterly reports as to: (I) the public cransportation.benefits "assertedly realized" by the transaction: and (2) the manner in which those benefiti have been used.' On November 6. 19%. CSXT replied in opposition to the Unions' petition for a supplemental order.

 On December 31. 19%. the Unions filed a motion to file a reply to CSXT's reply and tendered a separately filed reply. CSXT filed a reply in opposition to the Unions' motion on January 8, 1997.'

 DISCUSSION AND CONCLUSIONS

 The Unions' petition for a supplemental order a more properly construed as a petition to reopen this adminisartively final manor. We may reopen and revise such decisions based on material error, changed circunnstaoea or new evidence. The Unions urge us to begin a separate proceeding to reexamine the issue of whether the public benefits of the transaction arc actually being realized: they argue that the benefits found by the arbitrator were "presumed" and based on unsupported assumptions. In essence, they are arguing that the ICC committed material error by adopting the arbitrators finding that there would be public benefits ftvm the proposed conaofdation of seniority districts.

 We disagree. As noted by the ICC in its De embar 7. 1995 decision a 12-13, and affirmed by the court (slip op. at 11-12). the efficiency benefits of the consolidation were supported and quantified in the record before the arbitrator. Thin. the efficiency benefits were neither presumed tar based on unsupported assumptions. The Unions have failed to justify reopening of this administratively final and judicially affirmed matter.

 The Unions also argue that we must reconsider the issue of whether the efficiency benefits of the transaction (assuaning asgurado that they exist) will likely be passed through to the pubiio. But the ICUs final decision thoroughly explained why the efficiency guns would benefit the general public as well as the railroad (slip op. at 13):

    Improvements in efficiency reduce a cartiet's costs of service. This is a public transportation benefit because it results in reduced rates for shippers and ultimately consumers The savings realized by CSXT an be expected to be passed on to the public beeauae of the presence of competition. Where the mansportation market for particular commodities a not competitive. regulation is available to am= that cost decreases an reflected in rate decreases. Moreover. increased efficiency anil lower costs would enable CSXT to increase traffic and mveatta by enabling that carrier to lower in rats for the service it provides or to peovids better aervia for the same rates. While the railroad thereby benefits from these lower costa. so does the public.


.' On April 12. 19%, the Unions filed an artier petition for a "supplemental order" asking us to remedy alleged defects in CSXTs implementation of the labor changes in the new Eastern District On October 23, 19%. the Unions filed a notice of withdrawal of that petition.

 ' We will not consider the Unions' reply to CSXT's reply. Under 49 CFR 1104.13(c). replies to replies are prohibited. This prohibition may be waived upon a showing of good cause. but the Unions have not shown good cause hero because they have not explained why the additional argument could not have been submitted in their original petition. Moreover, the Unions' reply merely offers further argument in support of its petition that we impose a reporting requtrement on CSXT.
 Finance Docket Nn. 28905 (Sub-No ='

 The Unions have not attempted. however. to explain why they believe the ICUs decision was erroneous at regards efficiency gains. Once again the question of efficiency gains was expressly addressed by the court reviewing the ICUs decision and the ICUs conclusions were affirmed. Thus, their petition must be denied.

 This decision will not significantly affect either the quality of the human environment or the conservation of energy resources.

 It is ordtrtd:

 1. The Unions' petition for a supplemental order is denied.

 2. This decision is effective on its date of service.
By the Board. Chairman Morgan and Vice Chairman Owes

 Vernon A. Willismts
 Secretary
 UNITED TRANSP. UNION v. SURFACE TRANSP. BD. 1,121

        CIUftlog r.J/ Iay (D.C. C14. IN7)


UNITED TRANSPORTATION UNION

and Brotherhood of Locomotive

Engineers, Petitioners,


SURFACE TRANSPORTATION BOARD

and United Sow of America.

Respondents.


Railway Labor Executives' Association,

et si.. Intervenors.


No. 96-162L

United States Court of Appeal,

District of Columbia Circuit


Argued Feb. 1, 1987.

 Decided March 21. 1997.

Railroad unions petitioned for review of order of the Surface Transportation Board allowing abrogation of seniority terms of existing coVactive bargaining agreements as part of consolidation of former railroads into consolidated nil distinct The Court of Appeal, Finny T. Edwards. Chief Judge, held tbac (1) established seniority provisions are within category of interests that are subject to abrogation to efhednte m railroad transaction approved by the Interstate Commeroa Commission (ICU). and (2) evidence supported finding that changes proposed by rsiiroad wen Deeasary to effecauta consolidation of raiway, operations approved by the ICU.


    Petition denied.


1. Commerce 40110

When a proposed consolidation iDVolvas rail Cerium statute requires InterStab Commerce Commission (ICU) to impose Is-

1426

 108 FEDERAL REPORTER, 3d SERIES

bor-protective conditions on the transaction to insure a fair arrangement that will safeguard interest of adversely affected employees. 49 U.S.C.(1994 Ed.) $ 11347.


2 Commerce erK7

Seniority provisions of collective bargaining agreement (CBA) are not within the compare of "tights, privileges, and benefits" protected absolutely by statute from power of Interstate Commerce Commission (ICC) to abrogate certain terms of collective bargaining agreement (CBA) as necessary to effectuate an ICC-approved railroad consolidation. 49 U.S.C.(1994 Ed.) ¢ 11347.


See publication Word" and Phrases for other judicial constructions and def initions.

 3. Commerce e-208

Evidence supported arbitrator's factual finding that railroad's abrogation of term of existing collective bargaining agreements (CBAs), in order to merge separate seniority rosters of former railroads into single seniority list for engineers and trainmen for entire consolidated rail district, was necessary to effectuate consolidation approved by the Interstate Commerce Commission (ICC).


On Petition for Review of an Order of the Surface Transportation Board.


William G. Mahoney, Washington. DC. argued the cause for petitioners, with whom John 0'B. Clarks. Jr. and Richard S. Edelman were on the brieL.


Lotto Mackall. V, Attorney. Surface Transportation Board, Washington. DC. argued the cause for respondents. with whom Henri F. Rush. General Counsel, was on the brief. John J. Powers, III and Robert J. Wiggers, Attorneys. U.S. Department of Justice, entered appearances.


Ronald M. Johnson argued the cause and filed the brief for intervenor CSX Transportation. Inc.


Jeffrey S. Berlin, Mark E. Martin. Robert W. Blanchette. Washington. DC, and Kenneth P. Kolson. Vienna. VA, were on the brief for artnicus curiae Association of American Railroads.


Before: EDWARDS, Chief Judge, HENDERSON and ROGERS, Circuit Judges.

Opinion for the Court filed by Chief Jude EDWARDS.


HARRY T. EDWARDS, Chief Judge:

This case arises out of an effort by CSx Transportation. Inc. ("CSXT") to implement an approved merger of operations of portions of four former railroads into a new, como8. dated rail district In so doing, CSx1' sought to abrogate terms of existing copse. tive bargaining agreements ("CBAa") in or. der to merge separate seniority rosters trio, the former railways into single seniority live for engineers and trainmen for the entire district and to place the employees of taw consolidated district under one CBA CSXT served notice on the United TranapoKatioa Union ("UTU") and the Brotherhood of Le. comotive Engineers ("BLE") (jointly. "us, ions") of its intent to consolidate the various seniority districts. After negotiations be. tween CSXT and the unions failed to produce an agreement implementing the proposed changes, the dispute was refereed to arbiur lion. The arbitrator ruled in favor of CS\T. holding that the proposed changes tie necessary to effectuate a transaction approved by the Interstate Commerce COmmL45101 ("ICC"); however. in light of this courss decision in Railway Labor Esetuttues* Ana's u. United States, 987 F2d 808. 814 (D.C.Cir. 1993) (8zeetstivea), the arbitrator reserved for the Commission the question whether CSXTs proposed changes undermine "nghu. privileges, and benefits" protected by 49 U.S.C. 4 11347 and the so-called 'Vnr Yom Dock rules." See Veto Yon(; Dock R9.-C°"' trot-Brookiyn E. Disc Terminal 360 LC.C. 60. ard sub nova .New York Dock Ry. r Litited States, 609 F2d 83 (2d Cir.1") (New York Dock).


Section 11347 incorporates the proce<uo' of the Rail Passenger Service Act. a5 f~'C' § 568. which provides that, in tnnseou°°" (such as railway cottsolidationsl approved by the Commission.


protective arrangements shall include ... such provisions as may be necesssr` for

UNITED TRANSP. UNION v. SURFACE TRANSP. BD. 14'27
 Clterl01 Fie 1413ID.C.Ctr. IM7)

 the preservation of tights, privileges,

 and benefits ... under existing collective
 bargaining agreements ....
 However. the Supreme-Court and this court
 have made it clear that the ICC may abro
 gate certain terms of a CBA as necessary to
 effectuate an ICC-approved Transaction. See
 Vorfolk Qe W. Ry. Co. v. American Train
 Dlspatchsn Assn. 499 U.S. 117, 127-?8. 111
 S.CL 1158, 116243. 113 L.Ed2d 95 (1991)
 'Dispatchers); American Twin Diapatehere
 A13 'n a ICC, 26 F.3d 1157, 1163-84 (D.C.Cir.
 1994) (ATDAJ: Ereeutnres, 987 F2d at 814.
 The questions at issue here are (1) whether
 established Seniority provisions tie within
 the category of interests that are subject to
 abrogation, and, if so. (2) whether the
 changes proposed by CSXT an necessary to
 effectuate the consolidation of railway opera
 tions that had been approved by the ICC.
 The Commission answered affirmatively to
 each of these questions, and we can find no
 error in the agency's judgment

The principal dispute in this tea a over the meaning of "rights, privileges, and benefits." for the parties agree that any employment arrangement meeting this definition u fully protected, save for modifications achieved through collective bargaining. The Commission held that "the term 'rights, privdege3. and benefits' means the 'so·called incidents of empioyment or fringe benefits' . . . and does not include scope or seniority provi. sions." CSX Carp-Control--Cheasit Sya" Inc. and Seaboard Coast Lire Indttt, Ire. Finance Docket No. 28908 (Sub-No. 27) (Nov. 22. 1995) (Commissions decision), re. Printed in Joint Appendix ("JA") 23& In light of the applicable statutory provisions and the judicial decisions construing them. we can )and no basis to overturn the CommisStori s holding on this point


Furthermore, the Commission did not err in upholding the arbitrator's finding that CSXT's proposed changes an necessary to


I. The ICC is the predecessor to the Surface Transportation Board ("STS"). Effective lanu· arv I. 1996. the Interstate Commerce Act ICA ") was amended by the ICC Termination act. thereby transferring ail of the ICC's remain ing functions to the STB. See fub.L No. 104 33. 109 Stat. 303 (1995). A savlnp clause in the Termination Act. 4 204. provides that marten


effectuate an ICC-approved consolidation. The ICC found that "merging the separate seniority roster inns one will produce real efficiency benefits," see id at 13, raprinud in JA 238, thus making clear the nexus between the proposed changes and the effectuation of an approved transaction found W be in the public interest.


On the record at hand, the petition for review moat be denied.


1. BACKGROUND

CSXT, a major rail tamer, is the product of various railroad merges, all approved by the ICC.' CSRT had its genesis in the ICUs 1980 decision authoriang CSX Corporation w control two railroad holding companies. See CSX Corp-Control--Chessie Sys., Ira and Seaboard Coast Liras Indus., Ire, 363 LC.C. 521 (1980) (CSX Control). Over time, the operations of the railroad subsidiaries of Cheaeie System, Inc. ("Cher sin.") and Seaboard Coast Line Industries. Inc. ("SCLI") were merged together and. ultimately. became CSXT. CSRT has combined various operations, facilities, and warkforees throughout portions of the former railroads that today constitute CSXT.


This case arises out of an attempt by CSXT to consolidate trait) operations, workforcea. and facilities an portions of four former railroads-the Baltimore and Ohio Ratlroad("B&0"), Western Maryland Railway ("oVM"). Chesapeake and Ohio Raitway ("C&O"1, and Richmond. Fredericksburg and Potomac Railway ("RFAcP'7. In 1990, CSX1' derided to combine train operations, workforcea, and facilities on the eastern portion. of the former B&0 with contiguous portions of the former RF&P. WK and C&0 w create the Eastern B&0 Consolidated District CSXT proposed to place all of the train crew employees working in lice new, consolidated distinct on merged seniority rasters, with one


arising before January 1. 1996 will continue to be `averred by the ICA as it existed pee-arnend· merit. We, therefore. will refer in the pre amendment ICA. We note that 55 I 1341(a) std 11747 of the ICA were continued by the ICC Termination Act. bin were renumbered. eespx. uvelv. as 55 1132 1(a1 and 11326.

1428

 108 FEDERAL REPORTER, 3d SERIES

list for engineers and a separate list for tTSuUnen.


At the time when the disputed proposals were advanced, CSXT had CBAs with the UTU and BLE covering each of the former railroads constituting the new district The seniority roles in the CBA for each railroad generally required that work in that geographic region be performed by employees with seniority rights under that agreements Under CSXT's proposed implementation plan for its consolidation of operations in the Eastern B&0 District, CSXT could rue any engineer or trainman to staff a train throughout the consolidated district, regardless of whether the territory was within the boundaries of the employee's railroad prior to consolidation.


On January 10, 1994. pursuant to Commission-mandated procedures under section 4 of the New York Dock rules, see New Ymit Dock. 360 I.C.C. at 77, CSXT served notice on the unions of its intent to consolidate various seniority districts of its affiliate carri. en. The unions refused to negotiate an implementing agreement concerning these changes. Because the unions and CSXT could not reach an agreement, the matter was referred to arbitration as required by section 4 of the New York Dock rules, see New York Dock 360 I.C.C. at 78.


A neutral arbitrator found (1) that the coordination proposed by CSXT was linked to an ICC-approved transaction: (2) that New York Dock arbitration was not barred by the terms of prior implementing agreements that made reference to Railway Labor Act ("RLA") bargaining; (3) that CSXT had shown that modification of existing CBAs was necessary; and (4) that the proposed changes to the costing CBAs could be made, provided. se required by section 2 of New York Dock ruin implementing 49 U.S.C. 4 11347, they slid not undermine protected "rights. privileges, and benefits." See IITU u CSX Transpt. Ins, (Ape. 21, 1996) (O'Brien. Arb.). reprinted in Supplemental Appendix ("S.A.") 413. The arbitrator, in light of this court's decision in Executives, 987 F2d at 814 (leaving for the Commission to determine in the first instance the scope of protected "rights. privileges, and benefits"),


reserved for the Commission the questioe whether CSXT's proposed changes to fly CBAs undermine protected "rights, p

leges, and benefits." See UTU u. CSX Tramp. Iris, (Ape. 21. 1996) (O'Brien. Arb,X reprinted in SA 413.


The unions petitioned the Commission to review and reverse the arbitrators decisroy see Petition of UTU and BLE. CSX Cory _ Control-Chessie System. Inc. and Seaboard Coast Line Indus. Ins, Finance Docket No. 29906 (Sub-No. 27) (June 9, 1996), reprinted in JA 33, while CSXT requested the Com. mission to uphold the arbitrator's findings and, further, to find that CSXT's proposed changes to the CBAs did not undermine pro ceded 'tights, privileges, and benefits," see Petition of CSXT, CSXT-Bled of Locomoties Eng'rs and United Tramp. Union. Fl. nance Docket No. 28906 (Sub-No. 2T) (June 9, 1996), reprinted in JA 7.


The Commission ruled in favor of CSXT. See Commission decision. mprmtsd in JA 224-dl. First, the ICC sustained the arbitrator's finding that CSXT's proposed coordination of train operations in the new, consolidated B&O Eastern District was linked to ICC-approved merger and control ttmsactions. See id at 8, reprinted in JA 231. Second, the Commission upheld the arbitrator's finding that prior implementing agreements of CSXT do not require that CSXT accomplish the coordination at issue here through Railway Labor Act ("RLA") bargaining procedure4 an Mrs proposed changes involve a different (Lc. greater) territory than titan to which the prior agreements applied. See id at 10-12, reprinted in JA 233-3d. The Commission also found that applying New York Dock rules in the instant cane comports with the parties' prior implementing agreements. On several Occasions, CSXT has consolidated operation within the territory of the former railrrwis and. without objection from the unions, aP plied New York Dock rules. See uiL Third. the Commission found that CSXT's proposed changes to seniority rights as established b' CBAs were necessary to effectuate the ICC' approved transaction. The ICC also found that CSXTs proposed changes are not a device to transfer wealth from the employees

GNITED TRANSP. UNION v. SURFACE TRANSP. BD. 1429
 Clue r lab rid 1117 (D.C. Cir. 1917)
to the railroad, and that the merging of the
 separate seniority districts will produce real
 egicieney benefits. Sea id at 13, reprinted
 in JA 238. Finally, the ICC determined
 tlut CSXT's proposed changes do not in
 voive "rights, pritvileygs, and benefits" that
 are protected by 49 U.S.C. ¢ 11347 and sec.
 lion 2 of the New York Dock rules. The
 Commission noted that "rights. privileges,
 and benefits" include only "the incidents of
 employment, ancillary emoluments or fringe
 benefits." See id a 14, reprinted in JA
 237. The Commission concluded that the
 CBA provisions a issue in this case do not
 fall within the protected "rights. Privileges.
 or benefits," as they involve scope and se
 niority changes of the type that consistently

 have been modified in the past in connection
 with consolidation& See id a 15, reprinted
 in JA 238.

 On January 4, 1996. the STB denied the
 unions' petition for an administrative stay.
 The unions then filed a petition for review in
 this court

 IL Axu.rsm

 The Supreme Court has made dear that,
 w effectuate an ICC-approved transaction,
 99 U.S.C. 3 11341(x) (1994) avows for the
 abrogation of terms in a CBA. See Du
 putchcrs. 999 U.S. a 12i-28, 111 S-CC u
 1162-G3.s In this court's Executives deci
 sion, however. we pointedout that "4 11347
 (involving 'employee protective arrangements
 in transactions involving rail carriers'] on its
 face provides more, Dot lose. generous labor
 protection than does 4 11341(x)." 987 F2d
 at 819. Thus, the court foam! that. with
 respect to transactions covered by section
 11347, "the Commission may not modify a
 CBA wily-Dilly." Id ' Notelese. the Exec
 utives decision a dear in recognizing that

L Section 11311(x) provides, in relevant part. that a carrier in an approved consolidation -is esempe (tons the antitrust lawn and from all other law. including Sure and municipal law, as necessary to let (it) carry wt the transaction." 19 U.S.C.¢ 113411a1(19941.


1. in their briefs, the unions afro contend thatunder previous implementing agreements. CS7Cf was required to make any modifications m CSAa for the former railroads comprising the new con-


the Commission may modify CBAs ae necessary to effectuate covered transactions:


The statute clearly mandates that "tights, privileges, and benefits" afforded employ. ees under eldeting CBAa be preserved Unless, however, every word o! every CBA were thought w establish a right privilege, or benefit for labor--an obviously absurd proposition-¢ 566 (and hence ¢ 11347) does seem to contemplate that the ICC may modify a CBA.


Id a 814 (footnotes omitted). Subsequently, in ATDA the court construed Executives as holding that "certain rnntraedlal provisions." i.c. chose treading upon any rights, privileges, or benefits in s CHA, "ate immutable." 28 F.3d a 1188.


In this case, we lace two main iawu--(1) whether CSXTa proposed seniority changes involve terms of a CBA that are shielded absolutely from the ICUs abrogation authority and, if not, (2) whether the proposed changes are "necessary" to effectuate an ICGapprmrod transactions


A. "RlgIYb. Priottya, end BeneAb"

The unions argue that the Commission erred in finding that CSRTs proposed merger of the seniority tarsus in the rnnselidated district would not undermine protected rights. We disagree.


(ll When a proposed consolidation involves rail carriers, 49 U.S.C. 4 11347 requires the Commission W impose lobar. protective conditional on the trailawlion to ensure a "fair arrangement" that will safeguard the interest of adversely affected employees. See Eaweutiwa, 987 F2d at 813. In interpreting the safeguards required by 4 11347, the Commission held in Near York Dock that "[tlhe rates of pay, rules, working conditions old all collective


solidated district through RLA procedures. On the record at hart! we fad rafting in that clean that gives to pause a that would dour us from deferring to the Commission's judgment.


We also note flat in a related use involving the same contract language a issue here (but a different consolidated district). a panel of thin

court is currently considering, and will address.

whether the languages requires application of


RLA procedures. Set (?U v. STH. Ho. 9t?`1701.
 1.130
108 FEDERAL REPORTER, 3d SERIES

bargaining and other nghta prunlegea and benefits ... under applicable laws and/or wasting collective bargaining agreements

shall be preserved unless changed by future collective bargaining agreements." 360 I.C.C. at 84 (emphasis added). In other words, CBA terms that establish "rights, privileges, and benefits" may not be abrogated outside of collective bargaining.` Up until now, this bread conceptual framework has been clear, but the scope of the rights at issue has defied comprehension. Obviously confused, the court in Executives remanded that case to the Commission to allow the agency to explain the meaning of the phrase "rights, privileges, and benefits." See 987 F2d at 814.


(2) In this case, the Commission offers a definition: "rights, privileges, and benefits" refers to "the incidents of employment, ancil. lary emoluments or fringe benefits-as op. posed to the more central aspects of the work itself-pay, rules and working conditions." See Commission decision at 14, re printed in JA 237. And "the incidents of employment, ancillary emoluments or fringe benefits" refers to employees' vested and accrued benefits, such a life insurance, hospitalization and medical care, sick leave, and similar benefits. See id at 15. reprinted in .J.A '1.338. According to the Commission, seniority provisions are not within the compass of "rights, privileges, and benefits" protected absolutely from the Commission's abrogation authority. See id On this point, the Com. mission notes that seniority provisions "have consistently been modified in the past in connection within (sic( consolidations. This may be due to the fad that almost all consolidations require scope and seniority changes in order to effectuate the purpose of the transaction. Railway Labor Act bargaining over these aspects of a consolidation would frustrate the transactions." Id


The Commission's interpretation a reason. able. See American main Dispatchers Ass'n a ICC, 54 F.3d 842, 847-8 (D.C.Cir. 19951 (holding that the ICUs interpretation of Neu; York Dock rules is entitled to sub-


4. No one has suggested that aenionrv provuioru fall within the compass of "rates of pay. mica. working conditions" under New York Dock so


stantial deference by a reviewing cotntn1 Under the Commission's interpretapas. "rights, privileges and benefits" are protect. ed absolutely, while other employee interests that are not inviolate are protected by a test of "necessity," pursuant to which there mug be a showing of a nexus between the change sought and the effectuation of an ICC-ap. proved transaction. Under this scheme, the public interest in effectuating approved con. sobdations is ensured without any undue sac. riflce of employee interests. In our view, this is exactly what was intended by Coogress.


In this case, the only contested changes to the CBAs are seniority provisions coveting the previously separate regions of rail sa. vice. When pressed at oral argument, the unions' counsel was forced to acknowledge that employees will lose no so-called "fringe benefits" by virtue of CSXT's proposed changes to the CBAs. Thus, the Commission committed no error in holding that CSXTs proposed changes do not undermine protected "rights, privileges, and benefits."


s. Necessity

I3I We next turn to the question whether CSX73 proposed changes to the seniority rosters were necessary to effectuate an ICC. appreved transaction. The unions contend that the Commission erred in finding a nexus. We disagree.


1. Nexus Between Changes Sought and
 ICC-Approved Transaction

It is undisputed that the Commission has, through a series of decisions. approved CSXTs proposed consolidation of the Chessin and Seaboard subsidiaries as being in the public interest See CSX Control, 363 I.C.C. at 521. Petitioners, however, contend that the Commission erred by finding that there is a nexus between CSh'Ts proposed changes to the seniority rosters and the ICC-ap· proved transaction. They argue simply that the passage of time between the ICC approval in CSX Control and the proposal for changes to the seniority rosters has rendered


the scope of this term is not an iaue in this cafe. It is onlv the meaning of "other rights. privileges and benefits" that a at issue.

the two events unrelated. This argument is mentles.


The record clearly supports the Commission's afrmance of the arbitrator's factual finding that the proposed changes are linked to an approved transaction. As the Commission noted, CSXT has consolidated its operations gradually, often waiting until corporate entities were merged. The Chessie and Seaboard Coast subsidiaries were not fully merged until 1992. On this record. we are sausfted that the passage of time does not diminish a causal connection. See CSX Corp.-Control-Chessie Sys., Inc and Sea. board Coast Line Indus, 8 I.C.C2d 715, 724 n. 14 (1992), affd sub nom ATDA 26 F.3d at 1157.


2 Transportation Benefit

In Executives we held that, in addition to finding a nexus between the proposed changes and an ICC-approved transaction, "to satisfy the 'necessity' predicate far over. riding a CBA, the ICC must find that the underlying transaction yields a transportation benefit to the public. 'not merely (a) transfer (off wealth from employees to their employer.' 987 F.2d at 815. In other words, the benefit cannot arise from the CBA modi. ficatiort itself: considered independently of the CBA. the transaction must yield enhanced efficiency, greater safety, or some other gain:' ATDA 26 F.3d at 1164 (quoting Ezesrdives).


CSXT argued, and the ICC accepted, that a consolidation of seniority rosters was necessary to effectuate the merger of the rail lines. This is both obvious on its face and was demonstrated by CSXT. First, there is little point in consolidating railroads on paper if a consolidation of operations cannot be achieved. It a obvious that separate and distinct parts. operating separately and distinctly, will not generate the value of consoddation. Second. CSXT demonstrated that changing crews at previous territorial boundaries of the former railroads. as would be required with separate seniority rosters, would increase costs and slow down transit times. Improvements in efficiency generated by a consolidated seniority roster will reduce CSXT's cost of service. resulting in


                  1431


reduced rates to shippers and ultimately to consumers. The unions offered no evidence to the arbitrator or Commission to challenge CSXT's contentions of improved efficiency. Indeed, at oral argument, the unions' counsel conceded that these efficiencies are not open to dispute. In short, the record supports the Commission's finding that CSXT'e proposed changes to the CBAs are necessary to effectuate the ICC-approved transaction.


        I1f. Coetezustorr


For the foregoing reasons, the petition for review is denied