In the latest round of a battle that began during the late 1980s, the City of St. Helena has won an appellate court ruling stating the Napa Valley Wine Train is not a public utility to be regulated by the Public Utilities Commission. The decision appears to mean that the city has sole jurisdiction over the design and operation of the Wine Train’s long-proposed station in downtown St. Helena.

From 1996 through 2003, the Public Utilities Commission (PUC) issued no fewer than seven formal rulings on the status of the Wine Train. The Commission swung back and forth on the question of whether the Wine Train provided transportation and, therefore, was a public utility. But a unanimous three-judge panel of the First District Court of Appeal annulled all PUC decisions “to the extent they deem the Wine Train a common carrier providing transportation subject to regulation as a public utility.”

The Wine Train, which began operating in 1990, carries tourists on a slow ride from Napa to St. Helena and back. The 36-mile round trip makes no stops and takes about 3 hours. Gourmet meals and fine wines are served. The train does run special tours that stop at a few wineries near Yountville (about halfway between Napa and St. Helena). The Wine Train has long argued that it is a railroad subject to the PUC. The Legislature passed a bill in 1990 that appeared to place the Wine Train under the sole jurisdiction of the PUC.

St. Helena and many Napa Valley winemakers and grape growers have fought the Wine Train continuously, saying it does not provide meaningful alternative transportation, blocks roads and driveways, and gives the valley a carnival atmosphere. St. Helena officials have contended that a Wine Train stop in their town would flood the city’s quaint but congested streets with hundreds of tourists, many of them in search of a public restroom.

After losing the most recent rounds at the PUC, St. Helena asked the court to intervene. Although it cited the procedural history in detail, the court needed only seven paragraphs of its published opinion to decide the merits of the case.

The state Supreme Court’s decision in Golden Gate Scenic Steamship Lines, Inc. v. Public Utilities Com., (1962) 57 Cal.2d 373, has long helped define “transportation” as “the taking of persons or property at some point and putting them down at another.” The PUC and the Wine Train argued that the Golden Gate Scenic Steamship definition of transportation was not applicable, but the court disagreed.

“We see no reason to depart from the ordinary meaning and find the Wine Train does not provide ‘transportation,’” Justice Timothy Reardon wrote for the court. “Presently, the Wine Train does not pick up passengers at one location and put them down at another location. Rather, the Wine Train provides a round-trip excursion from Napa. Throughout the proceedings, the PUC has made much of the fact that the approved project envisioned up-valley stops and connections with shuttles that would transport passengers to wineries and other points of interest. The PUC alleges the proposed project has not been realized because the Wine Train has not been permitted by the city to have an up-valley station. We are not persuaded by this bootstrap argument. In essence the PUC is arguing that before the Wine Train can function as a common carrier, it must be granted the powers of a public utility to pre-empt local jurisdiction.

“The fact that they Wine Train could provide transportation in the future does not entitle it to public utility status now,” Reardon wrote.

The court cited two of the PUC’s own decisions that said sightseeing is not a function of a public utility. (Re California Western Railroad, Inc., (1998) 78 Cal.P.U.C.2d 292;Western Travel Plaza, Inc., (1981) 7 Cal.P.U.C.2d 128.) The Wine Train, the First District ruled, is a sightseeing service. And even if the Wine Train had a station in St. Helena, “it could be argued that any transportation provided would be incidental,” the court held.

In the unpublished portion of its opinion, the court rejected arguments that St. Helena’s claims regarding PUC decisions from 1996 were barred by the statute of limitations. The PUC’s most recent decisions implicated the earlier ones, and the city filed on time to challenge the recent decisions, the court determined. The court also ruled that the city was not barred from arguing that the Wine Train was not a public utility simply because the city had asked the PUC in 1988 to regulate the Wine Train as a public utility. At that time, the Wine Train contended that only federal transportation authorities could regulate it, and locals feared there would not be adequate environmental review unless the state PUC intervened.

The Case:
City of St. Helena v. Public Utilities Commission, No. A104466, 2004 DJDAR 7459. Filed June 21, 2004.
The Lawyers:
For the city: Patrick Power, (510) 446-7742.
For the PUC: Randolph Wu, PUC general counsel, (415) 703-2015.
For the Wine Train: James Squeri, Goodin, MacBride, Squeri, Ritchie & Day, (415) 392-7900.