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Authorizing the Kansas City Southern Railway Company To Construct, Connect, Operate, and Maintain Railway Bridge Facilities at the International Boundary Between the United States and Mexico

This July 29, 2020 Presidential permit authorizes Kansas City Southern Railway Company to build and operate new railway bridge facilities at the U.S.-Mexico border crossing at Laredo, Texas/Nuevo Laredo, Mexico, adjacent to an existing international rail bridge. The permit imposes extensive conditions including compliance with all applicable laws, free access for government inspectors, provision of CBP inspection facilities at no cost, indemnification of the United States, and automatic expiration if construction has not begun within 15 years.

Federal Register Open PDF 85 FR 47009

Impact dates

  1. Permit expires if construction of Border facilities has not commenced

Key directives

  • Grant permission to construct, connect, operate, and maintain railway border facilities at Laredo/Nuevo Laredo
  • Border facilities subject to all applicable laws and regulations including CFIUS and IBWC oversight
  • Permittee must provide free CBP inspection facilities meeting agency design standards at no cost to U.S.
  • Permittee must indemnify U.S. from liability including environmental contamination
  • Permittee must maintain facilities in good repair and compliance with law
  • Permittee must report construction start, completion, interruption, or discontinuation
  • Permit expires if construction not commenced within 15 years of issuance
  • President retains sole discretion to terminate, revoke, or amend permit
  • President may take possession of facilities for national security with just compensation

Timeline

Immediate

  • Permit issuance effective July 29, 2020
  • KCS authorized to begin acquiring rights-of-way and permits
  • Obligation to provide CBP inspection facilities triggered

Near term (90d)

  • KCS must begin construction or permit expires July 29, 2035 (15-year deadline)

Long term

  • Construction completion and ongoing operation subject to presidential oversight
  • Potential national security takings under Article 4
  • Long-term CBP inspection facility maintenance obligations

Risks & tensions

  • National security takings provision (Article 4) creates tension between infrastructure investment certainty and presidential emergency powers
  • Indemnification clause including environmental liability may affect project financing and insurance costs
  • CBP facility provision at no cost to U.S. creates open-ended financial obligation for permittee with evolving agency standards
  • Permittee bears all regulatory compliance risk despite presidential authorization; 'does not affect applicability' clause limits permit shield
  • Vague 'appropriate agencies' and 'his designee' references create implementation uncertainty
Other: Authorizing the Kansas City Southern Railway Company To Construct, Connect, Operate, and Maintain Railway Bridge Facilities at the International Boundary Between the United States and Mexico · Executive Orders