Rural Rail Service Preservation Act of 1989

Rural Rail Service Preservation Act of 1989 - Amends Federal law to prohibit the Interstate Commerce Commission from exempting a person, class of persons, or a transaction or service from provisions authorizing rail carriers to abandon any part of their railroad lines or discontinue transportation over such lines.

Authorizes the Commission to issue a certificate of abandonment or discontinuance only if, at least one year (currently, four months) before the application was filed, the railroad line, (or portion) was identified in the rail carrier's diagram (or an amendment to the diagram) as one for which an application was anticipated.

Increases the period of time within which a person may file a protest to an application for abandonment or discontinuance by a rail carrier. Requires the Commission, upon the request of a shipper located in any community affected by a proposed abandonment or discontinuance, to provide in one or more of such communities an opportunity for a hearing on such proposed abandonment or discontinuance, unless the Commission for good cause finds that a hearing is impracticable or unnecessary.

Requires the Commission to base its determination in an abandonment or discontinuance proceeding upon financial data respecting the line or transportation proposed to be abandoned or discontinued rather than system-wide or industry-wide averages, to the extent such line-specific data are reasonably available.

Declares that the authority to abandon or discontinue under a certificate issued by the Commission shall expire: (1) two years after its issuance; or (2) 90 days after the completion of any judicial review with respect to such issuance, if later.

Requires a rail carrier to serve a request for proposal or request for offer for the transfer of a line of railroad to a transferee that is not a rail carrier upon a designated representative of the rail carrier's employees, concurrent with transmittal of such request to such transferee. Declares that such representative shall have the same opportunity to submit a proposal or offer as any other interested person. Prohibits a rail carrier from rejecting a proposal or offer solely because it is made by a labor organization. Declares that an employee performing service for a rail carrier in connection with a line of a carrier to be sold shall be entitled for selection to non-management positions on such line to the extent available. Prohibits the approval of proposed sales of certain railroad lines without prior notice to the public and a hearing. Conditions Commission approval of the sale of a railroad line on entitlement to a lump sum separation allowance of any employees who are unable to secure employment with the carrier through seniority rights and are unable to secure a position with the new owner or transferee.

Requires a transferee of a railroad line to establish initial pay rates, rules, and working conditions for the employees of the transferring rail carrier whom it intends to hire.

Authorizes the Commission to approve the acquisition of a railroad line by two carriers under common control only if it finds that the avoidance of existing collective bargaining agreements is not the principal purpose of the proposed transaction.