shall be deemed available, in conformity with the conclusions annexed hereto.
With respect to the issues submitted to this Court for decision pursuant to §§ 211(h)(2) and 211(h)(3) of the Rail Act, the Court has reached the following conclusions:
1. In accordance with the provisions of § 211(h)(2), the agency agreement should embody the distinctions between rail and non-rail accounts as set forth in the Trustees' proposed Appendices "A" and "C." Said Appendices are therefore approved.
2. The terms proposed by Conrail for settlement of the compensation issues should be accepted, without prejudice to the right of any party to contend before the Special Court that this resolution of the issue produces further erosion or other claimed detriments, or other benefits.
3. The amount to be set aside for the Trustees' operating expenses should include (a) cash and temporary cash investments (ICC Accounts Nos. 701 and 702) (to be supplied directly by the Trustees, if not included in Appendix "A"), (b) the Canada Southern dividend when received, and (c) the sum of $20 million from receivables collected by Conrail pursuant to the agency agreement. The amount thus set aside shall be subject to periodic review and adjustment if necessary.
4. For purposes of § 211(h)(3), the term "cash and other current assets" includes only those items treated as "current assets" under the ICC system of accounts. Specifically, this includes ICC Accounts Nos. 701 through 713. It does not include capital accounts, and specifically does not include Account No. 716.
5. Compensation to employees during vacation periods after conveyance date are the responsibility of Conrail, not of the Debtor's estate. Funds in the segregated account should not be used to reimburse Conrail for any such payment. The parties are free to pursue before the Special Court their respective contentions as to whether or not this disposition of the matter results in "other benefits" for valuation purposes.
6. With respect to materials and other inventory on hand as of conveyance date but not yet paid for, the position of Conrail is correct.
7. The remaining issues presented by Trustees' proposed Appendix "F" are reserved for later decision pending further negotiations and possibly further proceedings.
8. The issues presented by proposed Appendix "B" and "D" are likewise reserved for decision pending further negotiations or further proceedings.
9. At least initially, this Court should retain jurisdiction to resolve disputes. Depending upon the nature and extent of disputes which may arise, some other mechanism for resolution may later be decided upon.
10. In making disbursements from the segregated account, Conrail should treat as trust funds those elements of the current interline accounts determined to constitute trust funds in the decision of the Court of Appeals for the Third Circuit in In re Penn Central Transportation Co., 486 F.2d 519 (3d Cir. 1973), cert. denied 415 U.S. 990, 94 S. Ct. 1588, 39 L. Ed. 2d 886 (1974). Current interline obligations between railroads in reorganization may be disregarded. After setting aside the appropriate amount for Trustees' expenses, funds in the segregated account may be disbursed for pre-conveyance payroll of both agreement and non-agreement personnel, and payroll taxes attributable to the pre-conveyance period. During the first 60 days of operation under the agency agreement, Conrail need not make disbursements from the segregated account for the satisfaction of obligations, the non-payment of which would not pose a threat to continued business relationships or otherwise interfere with continuation of rail service. At the end of the 60-day period, the situation will be reviewed by the Court, and further appropriate determinations made. If a more specific ruling is required in the interim, any party may apply for clarification or further instructions.