Property Rights Foundation of America®

from Proceedings of the Third Annual New York Conference on Private Property Rights (PRFA, 1998)

The Rails-to-Trails Movement
Richard Welsh
Executive Director, National Association of Reversionary Property Owners

The last time I was an Albany, New York, was in January 1957. I was on a Coast Guard icebreaker, using the tugboat to break ice up in the river. I don't even know if they do that anymore but they did it for many years. Before I got into the aviation branch of the Coast Guard, I was on the tugboat and had many enjoyable times here in Poughkeepsie and a few other places along the river.

I've come back many years later, fourteen years now, to tell you about an issue dear to my heart, this Rails-to-Trails movement. Some of you may have heard the term but don't understand what it is. Maybe the name of our association, the National Association of Reversionary Property Owners, might leave you a little breathless and you might not understand the issues, so I'll cover what that is.

Reversionary rights are a property right that has developed at the state level, sometimes through statutory law, but most of the time in most states through case law in the last 200 years or however long your state has been part of the Union. "Reversionary rights" are really not the correct term but it's the term that's been developed over the years. Back in usually the 1800's, when most railroads were formed, the property owner normally gave an easement to the railroad. Sometimes it's a one or two paragraph document that described the land in very general terms, sometimes a quarter or half section or a mile (a full section) to the railroad. "I hereby grant [stated width] right-of the-way across my land," and they would describe the land, and that would be the instrument of conveyance.

It didn't say, "I want the reversionary rights back," or "If it's not going to be used as a railroad, I get the land back." It simply said that, "I give an easement for a right-of-way."

Those railroads started forming in this part of the world in the 1830's, I think 1832 was the first one. Most major railroads were completed, I think, before 1900. In fact, only one major railroad was ever built after 1900. It wasn't until 1906, 1907 when railroads started to abandon lines for whatever reason. At that time the courts came face-to-face with, "What are we going to do with these rights-of-way now that the railroads have quit running the railroad?"

Well, in every instance, the courts have said that the landowner owns the land. All he gave was an easement for one purpose and that was for railroad purpose and when the railroad purpose is extinguished, in the legal terminology, or abandoned, then it reverts back to the property owner without the burden of the easement on top of it. So that's what developed into reversionary rights. The short of it is, the property owner or his successor in title already own the land when the tracks were on it and the railroad only had the right to run the railroad over it, nothing more.

Well, that was fine, but the problem is that in the "do-good" era of the sixties and seventies, that didn't suit the realm of the green movement, or the people who were trying to take property without paying for it, for trails or whatever purpose. So in 1976 they tried to get Congress to pass a law that said that all railroad rights-of-way that go to trails are theirs. Well, the courts immediately flipped and said that's a taking of property, you have to pay for it.

And so, after that early court decision in 1977, the trails movement, green movement, whatever you want to call it, prodded Congress to do something different that would pass muster with the court. Finally in 1983 they got Congress to pass a law that said, we won't let the government actually abandon the lines, they can discontinue service, pull up their rails and ties, but we're not going to let the government say it's fully abandoned. In the interim while we're waiting for something else to happen on this railroad right-of-way, we're going to build trails on it for the good of everybody else.

Congress gave in to that and passed the Rails-to-Trails Law in 1983. It was a very short, one paragraph amendment to the Rails-to-Trails Act. It was buried among 216 other sections. It never really had a hearing on the issue and never had a fair hearing before Congress. The great President Reagan signed it. I can't hold him hostage on that one; I don't think anybody really knew what was in that bill. Most of the bill had to do with individual trails throughout the country, for which the federal government was actually building the trail, was going to buy or fund it, and they have this thing stuck in Section 208, near the end. I don't think anybody really paid any attention to it except the cognoscenti in the trails movement or the environmental movement.

The Interstate Commerce Commission, which at that time was supposed to implement the law, was permeated with conservative Republicans. They didn't feel the law was constitutional. So nothing was really done until the trails proponents actually forced the Interstate Commerce Commission through procedural regulatory methods to have a rule-making of how they were going to implement it. About the same time, two of the members were up on the Interstate Commerce Commission. They resigned and they put members on there that weren't of the same philosophy of the previous ones that were there. So in 1985 they passed some regulations that we live with today that are totally onerous and a taking of, so far, about 64,000 property owners' property, namely their rights to the railroad right-of-way lands. And lots of these people have trails, some as close as 16 feet from their back yards or homes, trails with lots of people, or a few people, snow machines or whatever on them, very intrusive, and some have proved to be disastrous, actually loss of life, and things upsetting to property owners.

Railroads were against these rails-to-trails. Railroads are still living in the Dark Ages... They still think they're in the 1800's where they had close to a monopoly to get whatever they wanted. They couldn't quite see what the end of the rainbow for them was. The golden pot at the end of the rainbow was this rails-to-trails. It wasn't until 1991 when our astute Congress passed the ISTEA regulations (for those of you that are not attuned to ISTEA, Intermodal Surface Transportation Efficiency Act, the "efficiency" it's kind of a misnomer, an oxymoron, actually), but basically it's a federal gas tax, $30 billion, divvied up amongst the states, separate political subdivisions much different than it was divvied up in 1991.

One of the things in there was this enhancement program. It's actually about 10 percent of about 60 percent of the total package. It turns out to be about half a billion dollars per year. Half a billion dollars of the federal gas money goes to enhancements. Enhancements were ten little things that this money can go to, and it mainly boiled down to rails-to-trails. They twisted it all around so that rails-to-trails gets about 88 percent of that money every year. It has for the last six years.

It was supposed to be for wetlands, historic preservation, rail grade crossings, bicycle paths and rails-to-trails, but the rails-to-trails crowd and their bureaucratic friends have basically twisted it around and 88 percent is going to rails-to-trails.

Now here's how it hurt. This may make a few of your blood boil when you see how this has been twisted around. The railroads don't theoretically have an interest in probably more than 5 percent of these right-of-ways. They probably own fee title to no more than 5 to 6 percent of these right-of-ways in America. So they don't own anything. But the government's given them this right to this right-of-way, and they're saying, okay, you can abandon and if you agree to this trail use you can negotiate with this government agency and you can hold this government agency up for anything you want. It says, OK, you can say to the Hudson Valley, Columbia County, if you want to build a trail on this right-of-way, you got to give us $6 million. Well, you don't have $6 million. Well, you go to the ISTEA, we'll wait six months. We'll wait eight months, ten months, two years to get part of that enhancement money. You get that money, you pay it to us, and we'll give you a little quitclaim deed that says that you've got the right to run that trail on here. And that's the thing that's been going on — one-half a billion dollars a year for the last six years.

Counties, cities, states, water districts, conservation districts, any government entity has access to that money, and they've been using it. Not fixing roads, not fixing potholes, not fixing old bridges, or anything else. It's going to the off-road trails, basically. It has nothing to do with roads. It didn't take the railroads much to figure this one out. So that's been going on now about five years. It's getting worse.

But here's the key, one of the major things. We challenged this, federal law, this rails-to-trails, in the courts. We used the railroad from Burlington, Vermont. Mr. Presault and we got all the way to the Supreme Court. The Supreme Court said, Nope, that's a constitutional law. Your real claim is going to the U.S. claims court. They took your land. We agree with that, probably. But you go to the U.S. claims court and get your just compensation. That was February 1990.

Here we are eight years later. Mr. Presault still isn't in U.S. claims court. We've already been to the U.S. Court of Appeals three times since then on different things, either winning one or losing one, or a little point of the case building here, back and forth. But we're getting close. But even so, the claims court is not the answer.

Let's just say, the government, local government, pays the railroad X amount of money for something they don't own. The property owners that are involved, they go to the claims court and they get the U.S. government to pay them eventually. But here's the real kicker, you'll love this, the railroads are saying, I'm gonna sell that to you for $6 million but I want you to give me a Form 100 or Form 2200, which is an IRS donation acknowledgment form that says $140 million. And we're gonna write off the $32 million, or $38 million, or whatever it is, different on our corporate income tax and get 39.6 percent back. And that's what they're doing.

We have documentation on that, and we've shown it to Congress. And phtt, oh well ... it's kind of like your state legislature, you don't have enough people there that really have an interest in property rights, and all this insider stuff that's going on, and this program creep, or what-do-you-call-it.

But that's what the railroads have finally discovered. And along with that, they get rid of their linear toxic waste dumps to these poor little counties, cities and townships because that's part of the deal: I give you a quitclaim deed, you take care of these environmental problems, we've built up over 120 years. And, mind you, they've been dumping Agent Orange there and 2-4-D until they banned it, oils and whatever else that railroads hauled over the years. Almost every railroad bridge in America has about three times as much to remove than it's worth in salvage value, so they give that all way.

This insider information is what controlled this. When ISTEA was written, the Rails-to-Trails Conservancy out of Washington, D.C., wrote part of that issue, because before President Bush signed that bill in October 1991, the Rails-to-Trails Conservancy had 600 forums set up around the United States to say how to get this money, and I went to two of them. Before anybody else even knew what it was. So we know they are doing part of the writing on the inside.

That's where our movement, the property rights movement, in general, is lacking. We have no concerted voice in Washington, D.C., that can go in. We don't have a "Ma and Pa" issue. Property rights as we know it today is not a "Ma and Pa" issue. But the green movement is. It sounds good. "Rails-to-trails" sounds great. Gosh, they're going to put these trails around. They're all on an easy grade, the handicapped can use them, the Boy Scouts can go up and down. They're good for rollerbladers and kids and everybody else. Sounds great. Nobody ever thinks, as Mr. Burling was saying today at lunch. It's one of those little things where we look the other way. Oh, that doesn't sound too bad. Don't forget, there's no free lunch in this country when you deal with our type of a democracy. Somebody is always going to get hurt. It's not a zero sum game as some people like to say the U.S. stock market is.

So my time is limited here. But I do want to say a few things here. We have a web site, very simple, non-graphical web site and that's one of the best things the property rights movement can do. They cost almost nothing. You do have to have access to the Internet, which is throughout most of the country now. It's non long-distance. I encourage all of you to get into the technological age. It's not that hard. The web sites the property rights movement and others have are a tremendous resource for anybody throughout the country to network to see what the other people are doing.

Right now 47 of the 50 state legislatures are on line. You can see every bill. Every night I call up the Washington State home page, the California State home page and I'll look and see what new bills are filed in the state legislature along with a short synopsis of what they are.

So I know immediately that night if there's something of interest to property rights, the environmental movement or whatever and I can call people to tell them to, Hey, get on that subject. Or I'm planning on going to Sacramento, or to Washington, and testify when these bills come up.

I asked the few people here if they've ever gone to the Legislature and testified. Most state legislatures have open arms for you at these hearings but you have to travel to the capital to do that. It's very important, very powerful for our movement to get in and let these legislators, these neutral ones, sometimes, know where you're at.

You can be an insider, and that's what it takes to win this movement.

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