Metra to STB: Establish Use Conditions, Compensation for UP Terminal Facilities (UPDATED 3/16/26)

The STB in September 2025 granted Metra’s application for terminal trackage rights to continue service over three lines owned by host freight railroad UP. Metra and UP have been negotiating the transfer of commuter rail services on the three lines—the Union Pacific North, Northwest, and West—for several years. UP has historically provided service for Metra under a PSA (Purchase of Service Agreement), which has been extended several times while the railroads negotiate a new agreement.

Approximately 39% of Metra’s annual ridership (13.7 million out of a total 35 million passengers) is associated with the three lines owned, used and dispatched by UP (see map, below). Those lines were once operated by the Chicago & North Western Railway: the West Line to Elburn, the Northwest Line to Harvard and McHenry, and the North Line to Waukegan, with limited service to Kenosha, Wis. Metra has eight other lines; one of which, the historic Chicago, Burlington & Quincy line to Aurora, runs on right-of-way owned by BNSF, which still operates it under contract with Metra.

“As directed in the [STB’s] September 3 Decision, and reflected in the Parties’ Joint Status Report filed on November 13, 2025, Metra and UP have been negotiating the conditions and compensation for Metra’s use of UP’s terminal facilities,” Metra told the STB in its Dec. 1 filing (download below). “The parties have exchanged drafts of a comprehensive Trackage Rights Agreement to govern Metra’s use of the UP Lines and have exchanged multiple offers on compensation and other terms. The parties have made progress and reached common ground on some elements. For example, Metra anticipates that it will be able to reach agreement with UP on issues including the effective date; maintenance fee; train schedules and special trains and service change requests; dispatching protocol; a joint services committee for ongoing coordination of operational, maintenance, and capital project matters; dispute resolution; and audits. While the parties continue to confer, it is clear at this point that the parties will not reach agreement on all remaining disputed issues in a way that would remove the need for Board involvement.”

Because the STB’s September decision enables either party to request the Board’s establishment of compensation and/or conditions of use, Metra said it is doing so. Metra noted that it informed UP and “discussed the possibility of a joint request,” but UP declined.

“Compensation and the remaining disputed issues are too important and too material for Metra, the public it serves, and the taxpayers that provide critical funding for its transportation service to be left unresolved indefinitely,” the regional/commuter railroad reported. “Both UP and Metra have continued to operate cooperatively and safely on the UP Lines since the parties’ Purchase of Service Agreement (‘PSA’) expired on June 30, 2025. The Board has acted, as needed, when issues have arisen. … UP has asserted on review that ‘hosting passenger service on a freight-rail network is too important, complex, and potentially dangerous to undertake without clear terms governing dispatching, maintenance, liability, indemnity, and many other topics.’ … Metra agrees that Board involvement, as requested here, to establish the conditions and compensation for Metra’s ongoing use of the UP Lines, is necessary and appropriate.”

The key issues to be determined, Metra said, cover: the scope of the trackage rights; length of term; trackage rights fee “under the SSW Compensation formula,” how the fee is adjusted over time, and treatment of Metra’s capital contributions; performance standards; and liability, indemnification, and claims handling. While these issues are not the only ones unresolved, “they are the most consequential and bear on the other areas of disagreement,” according to Metra.

The regional/commuter railroad stressed that it “intends to remain engaged in negotiations with UP during this second phase of the proceeding and will continue to work with UP toward narrowing the issues for final resolution by the Board.”

Metra also proposed the following procedural schedule:

The STB in a Dec. 2 decision (download below) ordered that the indemnity, liability allocation, and claims administration provisions of the Metra-UP PSA as it existed on June 30, 2025, be “imposed as an interim condition in this proceeding until final terms are established or this proceeding is otherwise resolved.” While acknowledging Metra’s Dec. 1 request that the Board “establish conditions and compensation, and a proposed procedural schedule,” it reported that those would be addressed in a subsequent decision.

The STB in a March 12, 2026, decision (download below):

• “[D]enies as premature” a request by Metra to set conditions and compensation for the use of terminal facilities. It noted that the record “reflects that productive negotiations have been ongoing and does not substantiate Metra’s claim of an ‘impasse.’” Given the Board’s “strong preference for a negotiated resolution of disputes, the Board will deny Metra’s request to commence a compensation and conditions phase at this time and directs an additional period for the parties to continue their negotiations.” 
• “[T]emporarily stays discovery sought by Metra, and directs the parties to continue negotiations for 60 days (absent a joint request for additional time) [that will expire May 12, 2026] followed by the submission of a joint report to the Board.” The STB noted that it was setting a timetable for this negotiating period “because, as Metra correctly notes, negotiations should not indefinitely delay the commencement of the conditions and compensation phase where the parties cannot agree and at least one party seeks Board resolution.”

According to the STB, UP and Metra must thereafter submit a joint report within 10 days after the negotiating period (or any jointly-requested extension) expires. The joint report, it said, must: 

• “(a) Identify the issues on which the parties have reached agreement; and 
• “(b) Identify with specificity any remaining issues that must be resolved (including, without limitation, any disputes pertaining to specific facilities encompassed by the September 3 Decision and to valuation methodologies). This section of the report shall also include a brief description of the nature of the disagreement and the parties’ respective positions. 
• “(c) Each party must also state whether—and if so, why—it believes mediation would be useful to resolve any remaining disputes, and if it does not believe that mediation would be useful, the reason(s) for that belief.”

Further Reading:

• STB Grants Metra’s ‘Terminal Trackage Rights’ Application
• Reports: UP Takes Metra to Court
• STB Denies Metra’s Request for Temporary Injunction
• Metra to STB: Ensure Passenger Service on UP Lines ‘Continues Uninterrupted’
• UP, Metra Move Closer to Service Transfer
• STB Orders Mediation for UP, Metra
• Judge Pronounces Common Carrier Obligation for ‘Commuter Rail’ Dead
• Report: RTA Redirects Funds From Metra, Pace to Prevent CTA Service Reductions