May 2008
STB orders interchange disclosuresThe Surface Transportation Board announced Thursday that it has adopted new regulation requiring parties selling or leasing rail lines to disclose any agreements "affecting the ability or incentive of the purchasing or tenant railroad to interchange traffic with a railroad other than the selling or landlord railroad."
The action came in a decision in the proceeding entitled Disclosure of Rail Interchange Commitments, STB Ex Parte No. 575 (Sub-No. 1) and follows the board's Oct. 30, 2007 decision in Review of Rail Access and Competition Issues—Renewed Petition of the Western Coal Traffic League, STB Ex Parte No. 57.
STB said it adopted the new regulations "to facilitate the board's case-specific review of challenges to interchange commitments, as well as the board’s monitoring of interchange commitments."
STB said the regulations also provide a procedure "whereby a shipper or other affected party may obtain access to information regarding an existing interchange commitment in order to pursue its rights under the statute."
Agreements limiting the ability of short lines to interchange traffic are known as "paper barriers" and have become a contentious issue in an industry where capacity is strained.
Full St. Charles Streetcar Line to resume serviceNew Orleans' famed St. Charles Streetcar Line will resume service on its full length June 22, extending service from St. Charles Avenue and Carrollton to its traditional endpoint at Carrollton and Claiborne. The line, severely damaged by Hurricane Katrina in August 2005, has reopened in segments as overhead catenary was restored and hard-to-secure parts were ordered, or manufactured, by the New Orleans Regional Transit Authority to rehabilitate the historic Perley Thomas cars that ply the line.
NORTA plans a "grand celebration" marking the resumption of service on June 28, in conjunction with the Carrollton Area Network, a neighborhood group, and the Arts Council of New Orleans. All are welcome to attend.
Stanley H. Barriger, 74Well-known railroader, consultant, and passenger train advocate Stanley Huntington Barriger, the son of John W. Barriger III, died at his home at Claremont, N.H., on May 27. He was 74.
Barriger graduated from MIT in 1955 and from the Yale Graduate School of Transportation Economics in 1956. He worked for Missouri Pacific, New York Central, Amtrak, the United Fruit Co., and for the World Bank and Association of American Railroads as a consultant on jobs in 38 countries. "It has been documented that Stanley had logged the greatest number of rail miles traveled of almost any living person," said his brother, John W. Barriger IV, in a statement. “It was this passion for travel, especially by rail, that inspired him to open Ascutney Travel in Claremont in 1985. One of his proudest accomplishments was his success in convincing Amtrak to begin service to Claremont Junction in 1980s, the only New Hampshire passenger stop on its Montrealer line.”
In 1984, Barriger was a founding Trustee of the John W. Barriger III National Railroad Library, now at the University of Missouri-St. Louis, America’s largest and most complete repository of railroad data. Memorial contributions to the Barriger Library may be sent in care of Greg Ames, Curator, One University Boulevard, St. Louis, MO 63121-4499; phone (314) 516-7253.
In addition to his brother, Stanley Barriger is survived by his wife, Cynthia Cahill Barriger; his son, Mark S. Barriger; his daughter, Amy S. Barriger; his step-son, Michael J. Cahill; and his step-daughter, Erin K. Pacheco.
U.S. rail traffic down 1.2% in latest weekTotal volume for U.S. railroads in the week ended May 24 was estimated at 34.0 billion ton-miles by the Association of American Railroads, down 1.2% from the comparable week last year. Carload freight in the week totaled 330,208 cars, down 1.7% from last year. Intermodal volume, not included in the carload data, also slipped 0.9% from a year ago.
Among carload commodities with gains from a year ago were grain, up 12.7%, metallic ores, up 38.3%, and waste and scrap materials, up 11.6%. Declines included motor vehicles and equipment, down 23.2%, lumber and wood products, down 12.7%, and nonmetallic minerals, down 14.2%.
Canadian railroads during the week ended May 24 reported carload traffic declined 0.9% from last year, though intermodal volume rose 7.6%.
Carload freight on Kansas City Southern de Mexico (KCSM) during the week rose 1.3% over the comparable week last year, while intermodal traffic gained 4.0%.
NS, 10 short line partners team for "Empire Link"Norfolk Southern and 10 New York State-based short line railroads seek to capture freight traffic now dominated by short-haul truck movements through the "Empire Link." One goal is to give short line railroads the ability to market excess rail freight capacity on NS's Southern Tier main line between Binghamton and Silver Springs, N.Y., as well as on branch lines between Corning and Geneva, and between Waverly and Ludlowville.
The 10 short line and regional railroads participating in the Empire Link are: Bath and Hammondsport Railroad; Central New York Railroad Corp.; Finger Lakes Railway; Livonia, Avon and Lakeville Railroad; the New York, Susquehanna & Western Railway Corp.; Ontario Central Railroad; Owego & Harford Railway; Rochester and Southern Railroad; Wellsboro and Corning Railroad; and Western New York & Pennsylvania Railroad.
"With the high price of diesel fuel, the Empire Link is an attractive option for shippers currently trucking freight in New York, Pennsylvania, and New Jersey," said David Lawson, NS vice president, industrial products. "The Empire Link provides our New York short line partners with the tools and resources to design and offer rail transportation services that are truck-competitive in lanes
that are less than 500 miles."
"The recent collaboration of the American Short Line and Regional Railroad Association's Eastern Region Short line members and Norfolk Southern is one of the most creative business initiatives to come about in the last 15 years," said Rich Timmons, ASLRRA president. "We expect positive results for shippers, communities, and big and small railroads alike. If the Empire Link performs as we anticipate, it could serve as a model for future Class I and short line business arrangements."
The partnership is the second such effort NS has made this month to bolster its marketing reach in the Northeast. NS and Billerica, Mass.-based Pan Am Railways recently announced a joint venture, Pan Am Southern, to improve rail service opportunities in the "Patriot Corridor" in New England.
Toronto buys Axion composite tiesAxion International, Inc. announced Thursday that it has received its first order for composite railroad switch ties developed in conjunction with scientists at Rutgers University and utilizing virtually 100% recycled plastic. The Toronto Transit Commission placed the order after successfully testing the ties. Axion, which is based in Basking Ridge, N.J., said the order was procured by its Canadian partner, H. J. Skelton (Canada) Ltd., and "is expected to be the first of many."
In announcing the order, Axion said its structural products "have the distinct advantage of being environmentally friendly as well as providing superior products to customers." The company said its composite ties "last longer than conventional creosote treated wooden ties, perhaps longer than 50 years, offering significant cost savings in maintenance and product replacement, have freedom from biological attack (including termites) and moisture, and eliminate hazardous exposure to humans and the environment."
Tulsa official: Send Amtrak our wayProposals to extend Amtrak's Heartland Flyer service north of Oklahoma City have prompted objections from at least one Tulsa city representative, who asserts that Oklahoma taxpayer money should fund an extension into northeastern Oklahoma instead.
"I wish Oklahoma City no ill," City Councilor Rick Westcott said in a statement May 27. "But an extension of Amtrak which leaves 1.1 million northeastern Oklahomans without service is unacceptable."
The current proposal would link the current route, linking Fort Worth, Tex., with Oklahoma City, north to Newton, Kan., linking up with Amtrak's existing national system. Oklahoma City's City Council has endorsed the proposal, which also is being studied by the Kansas Department of Transportation.
But Westcott said Amtrak also has sought to add Tulsa to its network, and noted Oklahoma's Department of Transportation asked Amtrak last year to conduct a study on the Oklahoma City-to-Tulsa route. In addition, in 1998 when the Oklahoma Legislature appropriated funding for Amtrak service from Oklahoma City to Fort Worth, "Tulsa was promised that we would soon have Amtrak service as well. Ten years later, we still don't," Westcott charged.
CSX taps Parsons Brinckerhoff for "on-call" needsParsons-Brinckerhoff has been awarded a three-year general engineering consultant services (GEC) contract by CSX to provide services "on an on-call basis for transportation projects on CSX's entire railroad, with a focus in the railroad's northwest region, which encompasses Illinois, Indiana, Michigan, Ohio, Kentucky, and Tennessee."
Parsons-Brinckerhoff will aid in track, civil, structural, electrical, mechanical, environmental, and geotechnical engineering concerns. PB also will assist with architectural design and coordination with CSX signal engineering consultants, the company said.
NS honors 43 customers with safety awardNorfolk Southern Corporation has recognized the safety performance of 43 of its customers with the Thoroughbred Chemical Safety Award for 2007. The awards, given annually for the past 12 years, are presented to companies that ship more than 1,000 carloads of hazardous chemicals without incident.
"These valued customers have set the example for safe handling of chemicals transported by rail," said Norfolk Southern CEO Wick Moorman. "Their record of zero incidents demonstrates their commitment to safety in the workplace and in the community. Norfolk Southern is pleased to recognize their accomplishments."
Those honored include: Airgas Carbonic Inc.; Akzo Nobel Chemicals Inc.; American Ecology Corp.; The Andersons, Inc.; ArcelorMittal USA; Archer Daniels Midland Co. plant at Peoria, Ill.; Aventine Renewable Energy, Inc.; BP; Chemtrade Logistics Inc.; Dow Chemical Co.; E.I. DuPont de Nemours and Co. plant at Belle, W. Va.; Georgia Gulf Corp.; Global Ethanol, LLC; Hawkeye Renewables, LLC; Horsehead Corp.; Huntsman Corp.; Ineos Oligomers; International Commodities Export Corp.; INVISTA S.à.r.l.; Kemira Water Solutions, Inc.; Koch Mineral Services; Koppers Inc.; Linde, Inc.; Lucite International Inc.; Marathon Petroleum Co. LLC; NOVA Chemicals (Canada Ltd.); Nucor Corp.; NuStar Marketing LLC; Olin Corp. Chlor Alkali Division plants at Augusta, Ga., and Charleston, Tenn.; PCS Phosphate plant at Savannah, Ga.; PPG Industries, Inc.; Procter & Gamble Manufacturing Co.; Rhodia, Inc.; Rohm and Haas Co.; Sunbelt Chlor Alkali Partnership; Suncor Energy Inc.; Sunoco Chemicals Inc. plants at Frankford, Pa., Haverhill, Ohio, and Westville, N.J.; Terra Industries Inc.; Valero Marketing & Supply Co.; and WRB Refining LLC.
Rail employment down slightly in AprilU.S. Class I railroads employed 164,577 workers in mid-April, down 1.61% from April 2007, according to the Surface Transportation Board. The transportation numbers took the biggest hit. Employment was off 7.94% to 6,623 in transportation (other than train and engine), and down 2.77% to 68,554 in transportation (train and engine).
There were also declines in the number of executives, officials, and staff assistants (10,073, down 1.37%); professional and administrative (13,677, down 1.02%); and maintenance of equipment and stores (down 0.36% to 30,354). Maintenance of way and structures employment was up seasonally by 0.61%, to 35,296.
BNSF quadruple track main line waits out rain delayBNSF's four-track main line to Wyoming's Powder River Basin is in place, but the line's mining customers have suffered the wrath of Mother Nature, BNSF reported Wednesday. Inclement weather slowed coal train loadings, though moderating weather conditions would allow mines to resume normal loading shortly.
BNSF's 21 miles of four-track main line was placed into service May 14 at Logan Hill on the railroad's Orin Subdivision. BNSF believes the route is "the world's longest stretch of quadruple main line devoted exclusively to freight service." It expects the improvement to boost capacity from an average 132 trains per day--150 trains at peak periods--to nearly 200 trains per day.
BNSF shares a portion of the line with Union Pacific, and coordinated planning and construction with UP, which had personnel on site for the cutover. "We appreciate the efforts of everyone who planned and executed this project," said Steve Bobb, BNSF group vice president-Coal.
Brazil advances $9 billion high speed rail planThe government of Brazil has disclosed its plans for putting together an organization to build a $9 billion high speed rail line connecting the international airports of Rio de Janeiro and Sao Paulo and a cargo airport in Campinas in Sao Paulo state.
At an infrastructure meeting in Rio de Janeiro on Tuesday, Cabinet Chief Dilma Rousseff said the government intends to combine a foreign consortium and a local consortium into a single entity to handle the project (the cost of which has been scaled down from an original estimate of $11 billion for reasons not readily apparent). Separate proposals for the two groups will be sought in tenders next February. Rousseff recently visited Japan and South Korea to present the plant to interested builders.
Poll: Kansas City residents will accept light rail sales taxA poll of Kansas City (Mo.) area voters released Tuesday shows that more than half of voters in Jackson, Clay and Platte counties approve of a proposed half-cent sales tax to finance a regional light rail system.
Respondents favored a regional system over a Kansas City-only starter line by a ratio of 2-1. A majority also favored creation of a tri-county governing authority to oversee the plan's implementation.
The poll was requested by Kansas City Mayor Mark Funkhouser, who sent copies of the results and a regional transit plan to 60 area elected officials in preparation for a meeting Friday to discuss the plan, available on Kansas City's website, which includes the use of LRT, streetcars, commuter rail, and bus rapid transit.
The current plan, which differs from one voters approved in 2006, is estimated to cost $1.2 billion to construct. Annual operating cost is estimated at $53.3 million. Proponents want to put the sales tax question on the November ballot in Jackson, Clay, and Platte counties.
Funkhouser said the poll "should be characterized as a poll on the concept for a regional transit system on the Missouri side of the state line."
CSX warns of debt, layoffs, expansion freezeCSX management sent shareholders a new plea Tuesday to reject the "misleading statements" of the TCI Group in its efforts to seat a slate of dissident directors on the CSX board at the company’s annual meeting June 28. "CSX is fast on the way to becoming the best railroad in America under the leadership of your board of directors," said CSX Chairman, President, and CEO Michael J. Ward. "The TCI Group tells you that it wants CSX to become the best railroad in America, while arguing to sell the company, choke it with excessive debt, freeze its expansion, alienate its customers and regulators, and lay off its workers."
Ward said the CSX board has set "achievable goals" that surpass those of the TCI Group: "At first glance, the TCI Group throws around some big numbers for improvement. Examined closely, the $2.2 billion in productivity gains that the TCI Group is targeting include $1.8 billion from guesses at volume gains, not detailed productivity improvements."
Ward also said the TCI Group mischaracterizes the “experience” of its block of nominees vs. that of the CSX board: “The TCI group claims that its dissident slate has over 50 years of railroad experience. Applying the TCI group’s own criteria for measuring railroad experience, the CSX director slate has 155 years of railroad experience and the five directors targeted by the TCI Group have 65 years of railroad experience.”
Ward also questioned the TCI Group’s understanding of what it takes to operate a safe railroad. “CSX ranks near the top in safety,” he said, “because of real plans, real hard work throughout the organization, real capital commitment, and a real ‘tone at the top' reflecting a passion for safety. The TCI Group says a lot of things to you about its desire for safety, but in Wall Street speeches a TCI founding partner joked about the importance of making capital investments to support safety, saying ‘you don’t need cap-ex to put up handbrakes in railcars.’”
Railpower to build locomotives in CanadaRailpower Technologies announced that it will build a plant in Saint-Jean-Richelieu, Quebec, that “will significantly improve our manufacturing efficiencies and provide Railpower with the ability to rapidly expand production of the world’s leading high efficiency locomotive.”
Railpower said the Ontario Teachers' Pension Plan, which invested $35 million in the company earlier this year, “has agreed to invest, on a private placement basis, an additional $20 million in Railpower to finance the construction of the manufacturing facility and to allow the company to build additional demonstration locomotives.” Investment Quebec has granted Railpower a subsidy of up to $2.5 million to help finance the project, which is expected to create 125 new jobs.
GenSet locomotives for Detroit and CaliforniaNational Railway Equipment Company’s multi-engine N-ViroMotive™ GenSet switcher locomotives continue barnstorming the nation’s railroad yards. CSX is NREC’s latest customer, and another successful test has been conducted in California.
In Michigan, a public-private partnership involving CSX Transportation, the Michigan Department of Transportation (MDOT), and the Southeast Michigan Council of Governments (SEMCOG) has brought two of the ultra-low-emission locomotives to CSX’s Rougemere Yard in Dearborn, an EPA-designated non-attainment area. The units are the first low-emission locomotives to be deployed in Michigan, as well as on CSX’s 23-state rail network. The two GenSet locomotives were retrofitted using 80% Federal Fiscal Year 2007 Congestion Mitigation and Air Quality Improvement (CMAQ) funds and 20% CSX funds. MDOT was the project sponsor and worked closely with SEMCOG. Two additional GenSet locomotives have been agreed to through continued partnership and contracts are currently in development. Once the additional locomotives are delivered, all yard locomotives at Rougemere Yard will use GenSet technology.
CSX, a member of the EPA’s Climate Leaders program, in which the company has committed to reducing its emissions and leveraging other means for environmental benefits, has invested more than $1 billion to upgrade its fleet with technology that reduces fuel consumption and air pollutant emissions. Through efforts like these, CSX says it has improved its fuel efficiency by approximately 80% since 1980. CSX is also a charter member of the EPA SmartWay Transport Partnership, which is designed to promote voluntary reductions in fuel consumption and emissions.
In California, Central California Traction Company (CCT) of Stockton successfully performed an operational test earlier this spring at the Port of Stockton and on its main line of a two-engine, 1,400 hp 2GS-14B four-axle GenSet. CCT General Manager Dave Buccolo remarked that the locomotive’s adhesion “was impressive. It consistently pulled well, pulling the same tonnage as two of our SW1500 units up a 2% grade. And when CCT analyzed the fuel consumption, there was a 61% fuel saving per eight-hour shift compared to an SW1500.” CCT operates between Stockton and Lodi, Calif., and interchanges with BNSF, Union Pacific, and Stockton Terminal & Eastern Railroad.
The N-ViroMotive GenSet, says NREC, can achieve an 80%-plus reduction in nitrous oxide (NOx) and particulate matter (PM) emissions, in addition to offering up to 60% in fuel savings capability in switching and road switching service and a 50% to 65%-plus improvement in tractive effort adhesion efficiency, compared to conventional switchers. “These locomotives are significantly quieter than existing locomotives; they achieve the most stringent noise level requirements for off-road capital equipment,” the company says. “In contrast to existing locomotives, GenSets can be cranked up as quickly as a truck engine, avoiding the need to leave engines idling for long periods of time. They utilize an engine load sharing system that evens out the wear and tear between each engine to reduce maintenance requirements by 35% or more. Microprocessor-based electronic controls and modularized mechanical platforms significantly decrease maintenance requirements. They’re EPA certified as an ultra-low emitting locomotive and meet and exceed all current EPA Tier II railroad emission standards for locomotives.”
U.S. rails report slight gain in ton-milesTotal volume for U.S. railroads in the week ended May 17 was estimated at 34.1 billion ton-miles by the Association of American Railroads, 1.2% higher than in the comparable week last year. Gains in grain, coal, and chemical traffic helped push revenue ton-miles up. Carload freight as a whole was down 0.1% from last year, to 331,199 cars, and intermodal volume was off 1.1% to 233,824 trailers and containers. In Canada, carloads for the latest week were down 7.8% to 74,308,while intermodal traffic was up 6.2% to 48,638 units. Kansas City Southern de Mexico reported 10,993 carloads of traffic for the week ended May 77, off 6.7% from last year, with intermodal volume up 10.5% to 5,212 units.
CSX expanding Boyles Yard automationCSX will expand its Railcomm-supplied Domain Operations Controller (DOC®) system at Boyles Yard, Birmingham, Ala. RailComm will provide modifications to the existing DOC® Server to add graphical control for additional switch locations. A new DOC® workstation will be added to control seven additional switches. RailComm’s 2.4 GHz RADiANT™ data radios will provide a wireless communications network to link the office with the field locations.
“CSX is taking full advantage of the DOC® system’s built-in expansion capabilities, which allow the addition of workstations and/or field control nodes without interrupting operation of the current system,” RailComm said.
NS highlights a green light for going greenNorfolk Southern, whose predecessor railroad Southern Railway touted itself as “giving a green light to innovation,” has introduced a new section of its website to communicate about its environmental sustainability efforts.
Asking, “What footprints will we leave in the world?” the site outlines what NS is calling its “broad-based sustainability initiative, “which includes “developing public-private partnerships to improve the nation’s rail transportation network while supporting the economy; focusing on safety to benefit employees and communities; minimizing use of natural resources; and reducing, reusing, and finding alternatives for commonly-used railroad materials.”
Vice President Real Estate and Corporate Sustainability Officer F. Blair Wimbush said an important part of NS’s sustainability effort involves employee, customer, and supplier input. “We invite visitors to use the ‘Your Ideas’ area of the new website to submit their thoughts—whether individual or global in concern—about how we can become better environmental citizens.”
Another feature of the site is NS’s “Green Machine” carbon footprint analyzer, which illustrates “how shippers can reduce emissions as rail becomes a larger component of supply chains.” The calculator shows how many automobiles would have to be taken off highways, and how many trees would need to be planted, in order to achieve air quality improvements equivalent to those offered by greater use of rail.
To visit the website, go to www.nscorp.com/footprints and click the “Learn More About NS and the Environment” tag.
Shipper satisfaction at new high, forum is toldThe 2008 North American Customer Railroads Customer Forum took place in San Francisco this week as part of the annual meeting of the North American Rail Shippers Association (NARS). The keynote speaker was CSX Chief Executive Officer Michael J. Ward, who told the forum: “Freight traffic is expected to increase dramatically over the next decade. If we want to see more of that traffic on rail and less on our overcrowded highways, railroads and shippers need to be ready to meet the challenge.”
The Association of American Railroads, which sponsored the forum, hosted a panel discussion with top railroad executives and offered customers breakout sessions with individual railroads. AAR President and CEO Edward R. Hamberger noted that a recent Morgan Stanley survey of shippers showed that “customer satisfaction with the railroad industry is at an all-time high,” but he said “we need to make sure we continue to grow and provide our customers with good, reliable service.”
Rails maintain Wall Street momentumThe Dow Jones Transportation Average reached an all-time high earlier this week and is up 19% since March 19, gains that have far outpaced the 11% rise for the Standard & Poor’s 500 Index over the same period, Dow Jones Newswires reported in an article distributed Friday. “The spike that sent oil futures over $135 has done little to stunt that momentum,” said Dow Jones. “While the Transports Average has fallen about 2% since its peak, the Dow Jones Average lost 3.4% over the same period.”
Dow Jones said railroads “have ridden the boom in coal, ethanol, and other commodities to solid gains this year,” while big trucking companies “have benefited as higher costs squeeze out their smaller, weaker competitors.”
“Railroads have posted the biggest gains,” said Dow Jones, “with CSX Corp. up 35% in the past three months, Union Pacific Corp. up 25%, and BNSF Corp. up 22%. They’ve benefited from growing shipments of coal, ethanol, and grains; are more efficient than trucking; and have the ability to raise prices.”
Amtrak common stock subject of a lawsuitA federal district court in Cincinnati has become involved in a dispute that has ties to Chiquita bananas, the Cincinnati Reds baseball team, a huge insurance company, a billionaire Republican-Party fundraiser, the defunct Penn Central, and Amtrak.
To understand, you have to return to 1970, when Amtrak (formally, the National Railroad Passenger Corp.) was created by Congress through the Rail Passenger Service Act to relieve freight railroads of the financial burden of operating money-losing passenger trains. In creating Amtrak, Congress provided substantial tax credits to the freight railroads in exchange for their transferring passenger equipment to Amtrak. Four of the railroads were at the time unable to make use of the tax credits.
So Congress created 9.4 million shares of Amtrak common stock, with a $10 per share par value, calling it an equity interest in Amtrak, and distributing those shares to Burlington Northern (now BNSF Railway), Chicago, Milwaukee St. Paul & Pacific (now part of Canadian Pacific), Grand Trunk Western (now part of Canadian National), and the bankruptcy trustees of Penn Central (which became Conrail, and then was split in a sale to CSX and Norfolk Southern). Since Penn Central donated the most passenger equipment, it was given 53% of Amtrak’s common stock. Congress also created preferred shares in Amtrak, all of which were given to the U.S. Department of Transportation to ensure federal control of the passenger railroad.
Few really expected the Amtrak common stock ever to have value—except billionaire financier Carl Linder, who, at the time, was chairman of Chiquita Brands, part owner and CEO of the Cincinnati Reds, owner of 42% of insurance conglomerate American Financial Group (AFG), a major contributor to the Republican Party—and with a reputation of turning financial cats and dogs into show horses. When Penn Central was liquidated, Lindner, on behalf of AFG, purchased its 53% of Amtrak common stock, or 5.2 million shares, with a total par value of $52 million.
In its lawsuit, AFG accuses Amtrak of not becoming profitable, and thus eroding the value of the common stock. It is unlikely that AFG will have difficulty proving that. If the $52 million AFG paid for the Amtrak common stock revalued based on the consumer price index since 1971, the new value would be $277 million—or more than $550 million for all the outstanding common stock. That is about half of Amtrak's current annual federal subsidy.
It is what AFG demands, as a result, which makes this lawsuit interesting. AFG is demanding the return of its $52 million investment, plus interest, and unspecified damages. AFG’s lawsuit says Amtrak wrongfully subsidized passenger train travel rather than focusing on operating at a profit. AFG says “Amtrak officials permitted political pressures” to initiate, expand and retain unprofitable routes, which eroded the value of the common stock.” And when former Amtrak President David Gunn “attempted to negotiate new labor agreements that would give the company greater flexibility in reducing costs, Amtrak’s board forced him out of office,” says AFG.
Moreover, says AFG in its lawsuit, when Congress passed the Amtrak Reform and Accountability Act of 1997, it directed Amtrak to shift its focus and orientation “back toward profitability” and redeem all of its outstanding common stock for fair market value no later than Oct. 1, 2002.
Amtrak’s initial offer to AFG, of 3 cents per share, was rejected by AFG as “ridiculously low and arbitrary,” lacking “adequate analysis and supporting documentation.” In January 2008, says AFG, Amtrak “insisted” that the stock was “worthless,” and AFG broke off talks with Amtrak. The lawsuit was filed May 19.
AFG contrasts the activities of Amtrak with those of Conrail, which also was created as a nationalized railroad by Congress in 1973. “The goal of both Amtrak and Conrail was the same,” says AFG: “To modernize and rationalize rail operations, make them more efficient, and return them to profitability.” Unlike Amtrak, says AFG, Conrail turned a profit in 1987, and the government sold its ownership interest “through what was then the largest initial public stock offering in the nation’s history,” producing $1.9 billion for the U.S. Treasury. “Unlike Conrail, which was managed and operated as a business for profit and for the benefit of its shareholder owners,” says AFG, “Amtrak was, through a continuous process over the last 37 years, converted into a company not managed for profit, but instead operated to provide government-subsidized public transportation.”
BNSF, Canadian Pacific and Canadian National, which still hold their shares of Amtrak common stock, are not parties to the lawsuit.
By Frank N. Wilner. Wilner a contributor to Railway Age, is author of “The Amtrak Story,” “Railroad Mergers: History, Analysis, Insight,” and “The Railway Labor Act and the Dilemma of Railroad Labor Relations.” The latter two are available from Simmons-Boardman Books at www.transalert.com
Railroads increase ton-miles per gallonU.S. railroads moved a ton of freight an average of 436 miles per gallon of fuel consumed in 2007, a 3.1% improvement over 2006 and 85.5% better than in 1980, according to the Association of American Railroads. Noting that railroads are "three or four times more fuel efficient than trucks," AAR President and CEO Edward R. Hamberger points out that "if just 10% of the freight currently moving by truck went instead by rail, the nation could save one billion gallons of fuel per year."
Four Class I's earn double-digit ROIsFour Class I railroads posted double-digit returns on investment in the 12 months ended March 31, 2008. The seven Class I railroads as a group had an ROI of 9.76% in the latest 12-month period, based on total operating revenue of $56.05 billion and net railway operating income of $8.04 billion. For the 12 months ended March 31, 2007, the Class I's earned 10.15%, with revenues of $50.3 billion and operating income of $7.05 billion.
Soo Line led the latest list with a return of 15.28%. Norfolk Southern earned 13.16%; BNSF, 10.07%; CN/Grand Trunk, 10.04%; Union Pacific, 8.83%; Kansas City Southern, 7.81%; and CSX Transportation, 7.61%.
Rate of return is important to railroads not only as an indicator of earning power but also as a measure of revenue adequacy, which is based on the prevailing cost of capital. The Surface Transportation Board considers revenue adequacy in the handling of such issues as rate challenges by shippers and line abandonment requests.
In a decision announced Jan. 16, the STB implemented a methodological change, using the Capital Asset Pricing Model, for calculating the cost of equity, a key component of the cost of capital. Under the new formula, STB determined that the railroads’ cost of capital in 2006 was 9.94%.
Bombardier wins $349 million Swedish orderBombardier Transportation announced that it has won a $349 million contract from SJ AB, the Swedish state railway, for 20 four-car REGINA trains, expanding an existing fleet. The contract carries an option for 20 additional trains.
Seventy REGINA trains are currently operating or on order in Scandinavia. Bombardier says the trains are specially designed to withstand harsh climate conditions and are equipped with innovative propulsion and control systems featuring regenerative braking that reduces energy consumption by up 20%.
Kansas City gets federal grant for light rail analysisThe Kansas City Area Transportation Authority will receive $2.6 million from the U.S. Department of Transportation for a Light Rail Alternative Analysis, according to the office of Sen. Kit Bond, R-Mo., ranking member of the Senate Appropriations Subcommittee for Transportation, Housing and Urban Development.
Kansas City's Light Rail Alternative Analysis is a cooperative effort by KCATA, the city of Kansas City, and the Mid-America Regional Council.
Voters in November 2006 approved establishing light rail for the region despite a lack of support from elected officials. The voter-approved plan envisioned LRT running from the Kansas City Zoo north through downtown and approaching Kansas City International Airport. But the Kansas City (Mo.) city council rejected the voter-approved plan as unworkable late last year. A lawsuit challenging the city council's action was subsequently dismissed. City officials have sought an alternate plan since then.
"Light rail is continuing to be a topic of great public interest in Kansas City, and this earmark is essential in the efforts of KCATA and the city of Kansas City to bring a workable light-rail plan to voters in November," KCATA General Manager Mark Huffer said in a release.
Norfolk Southern puts first Uni-Levels on the roadNorfolk Southern announced Wednesday that it has received 55 fully-enclosed Uni-Level cars from TTX and has loaded the first 13 of them, launching a new service network to provide "economical rail transportation of large motorized vehicles, including Class5--8 trucks and recreational vehicles." Prototypes of the new cars have been successfully tested during the last three years. Service will initially be concentrated on local NS service lanes, with later expansion into Mexico, Canada, and the West Coast.
"Transporting these types of vehicles in a Uni-Level car helps ensure that the vehicles will arrive at their distributors in factory-quality condition and will not require re-work, as is often the case with over-the-road transportation," said Norfolk Southern. The cars were built by Kasgro with the superstructure fabricated and applied by National Steel Car.
Oklahoma City supports Amtrak extension planThe Oklahoma City Council has approved a proposal to to extend Amtrak's Heartland Flyer north of the city to Newton, Kan., where it would link with Amtrak's existing system and offer passenger rail access to Chicago.
The current Heartland Flyer, a state-supported train, runs between Oklahoma City and Fort Worth, Texas. The Northern Flyer Alliance, a grassroots organization which advocated the establishment of the train in 2005, is behind the current effort to extend it north.
The Kansas Department of Transportation is studying the proposal, and hopes to issue a report in 2009.
Extending the route is expected to cost $5 million, primarily for track upgrading. Of that, the cost for Oklahoma's portion of the route is estimated at $2.9 million. Texas and Oklahoma each contribute roughly $2 million a year for the train's current operation.
Bombardier to help design Russian locomotiveBerlin-based Bombardier Transportation and CJSC Transmashholding, Russia's largest manufacturer of rolling stock, have agreed to form a joint engineering venture to develop a new generation of locomotives using asynchronous propulsion technology for the Russian and export markets. The new company will be based in Russia.
This is Bombardier's third joint venture with Transmashholding. The two companies last year formed Bombardier Transportation Transmashholding AG to develop advanced propulsion technology for Russian railway equipment and to manufacture reaction converters and other components for electric locomotives.
"The establishment of a new company to develop a family of new-generation locomotives is a further example of our intention to expand long-term partnerships with Russian industry," said Bombardier Transportation President Andre Navari.
A joint announcement of the new venture on Wednesday said Russian Railways will need 11,675 locomotives between 2008 and 2015 and an additional 11,722 between 2016 and 2000.
New York MTA to reap $1 billion from new dealThe New York Metropolitan Transportation Authority's financial prospects brightened with the announcement that the agency has reached a tentative deal with a new developer that will bring the agency more than $1 billion for its capital program in return for air rights over its West Side Rail Yards in Manhattan.
The deal with Related Companies/Goldman Sachs to develop the air space came just 10 days after a tentative agreement with Tishman Speyer Properties carrying the same $1.054 billion price tag collapsed. The MTA board is to vote on the new agreement at a special meeting Thursday.
MTA Executive Director and CEO Elliott G. Sander said the revenues "are critical to funding the MTA's capital needs."
The real estate development, for which MTA put out RFPs in July 2007, will take place over MTA's John D. Caemmerer Yard, where the Long Island Rail Road stores trains. The current proposed deal includes both the Western Rail Yard and the Eastern Rail Yard.
New York City Mayor Michael Bloomberg, an enthusiastic supporter of the plan, noted that it involves "the only large parcel of undeveloped space left in Manhattan. The attractiveness of this area for developers seems in part because the city is funding an extension of the No. 7 [subway] line, making this vital new mixed community of residential, commercial, and office space a true transit oriented development."
CSX productivity target too low, says TCI The TCI Group, which is seeking to put five of its own nominees on CSX’s 12-member board, sent a letter Tuesday to CSX shareholders asserting that the railroad "has the opportunity to achieve $2.2 billion in incremental annual productivity benefits within five years"—five times the amount CSX itself has targeted.
"To accomplish the kind of improvements we see as possible, we'll need fresh thinking and greater railroad experience in the CSX boardroom," said the letter. "Our nominees, with over 50 years of railroad experience and the strength to be independent voices, will provide exactly that."
The TCI Group--comprising the Children's Investment Fund and 3G Capital Partners--and its five nominees own around $2 billion of CSX stock, or 8.7% of the total, and through swap contracts have an
additional $3 billion of economic exposure to CSX.
The Group said its proposals, though viewed as “ill-conceived” or "ill-inspired" by CSX, appear already to have prompted action by the company: "Since we began urging change in 2007, CSX has greatly expanded its share buyback program to $3 billion over two years (from $500 million over one year) and raised its financial performance guidance by over 20%--and recently committed, for the first time, to $400 million in 'targeted' productivity gains through 2010."
CSX's annual shareholders meeting will be held in New Orleans June 25.
NEC governors protest planned Amtrak four-day shutdownThe governors of six Northeast states have asked Amtrak to offer a service alternative during a planned four-day shutdown of the Northeast Corridor June 14-17. Amtrak is installing a new bridge over the Thames River in Connecticut during that time, and plans to run extremely limited service between New York and Boston via Springfield, Mass.
A letter to Amtrak President Alex Kummant, written by Connecticut Gov. Jodi Rell, calls Amtrak's current plan "unacceptable" and claims it will have impacts for travelers beyond the states where the line is closed. It says the disruptions "will represent a hardship for thousands of business and other travelers. As Governors, it is our responsibility to ensure that the public interest is well served. We are writing today to strongly urge you to work with our respective Departments of Transportation to find alternative service while the work is completed."
Amtrak has arranged no substitute bus service or "bus bridge" as it has done in the past, and will offer no New York-to-Boston service at all on June 14, a Saturday. Amtrak will offer one daily train June 15 through 17 between New York and Boston via its Inland Route.
Co-signing the letter written by Rell were by Govs. Jon Baldacci (D-Maine), John Lynch (D-N.H.), Jon Corzine (D-N.J.), David Paterson (D-N.Y.), and Jim Douglas (R-Vt.).
Senate bill would retain limits on truck sizesU.S. Senators Frank A. Lautenberg (D-N.J.) and Claire McCaskill (D-Mo.) announced that they have introduced a bill "to keep dangerously heavy and large trucks off the nation's highways" by maintaining the current limit of 80,000 pounds for tractor trailers on the national highway system and establishing a maximum length of 53 feet for trucks. The "Safe Truck and Operations and Preservation Act of 2008" (STOP) responds to the efforts of a coalition of shippers, truckers and others to persuade Congress to include a number of pilot projects for increasing truck weights and lengths in the new transportation act due in 2009.
The "Americans for Safe and Efficient Transportation" coalition, which includes such powerful members as the National Manufacturers Association and the National Industrial Transportation League, is pressing for consideration of an increase in allowable weights, on a nationwide basis, from 80,000 to 97,000 pounds, and for double 33-foot trailer combinations. Safety and environmental improvements as well as increased fuel efficiency for the trucking industry are major arguments.
In its May 16 newsletter, NITL told its members: "Recent U.S. Department of Transportation studies as well as a Transportation Research Board study indicate that reducing vehicle-miles-traveled of trucks that equip themselves with six axles could reduce accidents as well as engine emissions.”
The STOP bill is similar to a bill Senator Lautenberg introduced in 2003, when the truck-size issue was last in major contention. That was the year the Association of American Railroads and the American Trucking Associations agreed to a six-year truce on the issue. That truce expires next year.
Truckers are not universally in favor of longer, heavier trucks, and railroads are not universally against them. Legions of smaller truckers with a vested interest in their existing equipment are happy with the status quo. Meanwhile, big trucking companies have become major intermodal customers of the big railroads--BNSF, for example, recently noted that J. B. Hunt is its biggest single customer--and a division along strictly modal lines on the truck size and weight issue is no longer in the cards.
Rail stocks rise as analyst praises UP’s bullish outlookStocks of Class I railroads rose solidly Monday following an analyst’s upgrade of Union Pacific, which itself touted optimism last week about its future earnings.
"(Chief Executive) Jim Young's comprehensive 'blocking and tackling' approach seems to be gaining steady traction across the entire company and across all the functional railroad disciplines," said Stifel Nicolaus analyst John G. Larkin in a note to clients, in defining UP's growth objectives combined with its plan to compensate for a weak economy and rising fuel costs.
UP Chief Financial Officer Rob Knight last week unveiled "Project Operating Ratio" with a low-70s target for 2012, down from 79.3 in 2007 and 89.4 in 2004. Earnings per share should grow in the "mid-teens," UP said, with earnings returned to shareholders expected to increase significantly, fed in large part by anticipated freight revenue growth of 6%-to-8%.
In trading Monday afternoon, shares of Union Pacific jumped $5.45, or 3.6%, to $158.45, shy of its all-time high of $159.65. Other Class I railroads also gained, led by CSX, KCS, and CP (all up 3.7%). NS was up 2.8%, BNSF was up 2.3%, and CN was up 1.1% Monday afternoon.
No-cost data exchange file uploader from ExpressYardExpressYard, a service offering of rail industry software and hardware supplier SSG Innovations LLC, has released a free tool for uploading 500-byte freight car repair billing files to Railinc's Data Exchange. This was done in response to AAR Circular C-10646, which states that as of January 2008, a freight car repair invoice must be transmitted through the AAR Data Exchange to be valid. "We’re trying to make everyone's job a little easier," said Justin Gillam of ExpressYard. "Uploading to the Data Exchange has become required, and not everyone has the ability to upload their data files automatically using their billing system. Our new upload tool makes it easy for any contract shop or railroad to submit their data to the Data Exchange."
The tool can be accessed at www.expressyard.com/crbupload.
The ExpressYard repair billing and operations management system is currently used at over 150 repair facilities across North America, including contract shops and regional and short line railroads.
Utility wins $30 million in rate case against UPThe Surface Transportation Board announced a decision Monday that it said will require Union Pacific to grant an estimated $30 million in rate reductions and reparations in a maximum-rate case brought before the board by Kansas City Power & Light Co.
STB said that about half of that relief is attributable to its recent decision to adopt a new method of determining the railroad cost of capital.
The utility had challenged the rates charged by UP for the movement of Powder River Basin coal to KCPL’s generating station near Ladue, Mo.
“The parties to this case stipulated that the maximum lawful rate should be set at 180% of the variable cost of providing service,” said the board in announcing its decision. “The board found that UP’s rates for the challenged movements all exceed 180% of the variable cost of providing the transportation at issue. Accordingly, the board (1) ordered UP to establish and maintain ratees, not to exceed 180% of the variable cost of providing the service at issue, through the end of calendar-year 2015; and (2) ordered UP to pay reparations to KCPL, plus interest, for monies previously collected for rates charged above the 180% of variable-cost level.
“The board’s decision applied the agency’s Apri1 2008 railroad cost-of-capital determination in the case entitled Railroad Cost of Capital—2006, STB Ex Parte No. 558 (Sub-No. 10). The board used the 2006 cost of capital figure to estimate that UP’s reparations, with interest, to KCPL for 2006 will be approximately $2.9 million, an 8.3% reduction from the total transposition charge KCPL incurred that year. The board further estimated that the total relief KCPL will obtain from the agency’s decision—including both reparations and the lower rate prescribed by the agency through 2015—will approximate $30 million. Approximately half of that relief is attributable to the board’s decision to use a Capital Asset Pricing Model instead of a single-stage Discounted Cash Flow model . . . to determine the 2006 cost of capital.”
STB’s decision (Docket No. 42095) can be accessed on the STB website by clicking here.
BNSF puts 67 Genset switchers in serviceBNSF Monday said it has placed 67 National Railway Equipment Co. N-ViroMotive GenSet switcher locomotives in service for the Dallas/Fort Worth and Houston areas. The GenSets were acquired through the Texas Commission on Environmental Quality's (TCEQ) Emissions Reduction Incentive Grants (ERIG) Program, which provides grants to eligible projects in non-attainment areas and affected counties.
The low-horsepower switch locomotives carry three engines that operate only as needed, potentially reducing nitrogen oxide and particulate matter emissions by 80% to 90%, and improving fuel efficiency by 15% over standard switch engines.
"BNSF is pleased to have received this funding as part of the TCEQ's Texas Emissions Reduction Plan (TERP)," said Mark Stehly, assistant vice president, Environmental and Research and Development. "Rail transportation is the most environmentally friendly form of surface transportation, the most fuel-efficient mode, and the most effective way to reduce congestion on our nation’s highway. Not only can rail help to improve air quality in non-attainment areas such as Houston and Dallas/Fort Worth, it is the most efficient way to reduce greenhouse gas emissions and meet our future energy needs."
"Although major strides have been made, and continue to be made, with respect to reductions in industrial point source emissions, the overall air quality problems will only truly be addressed if there are additional reductions in areas such as mobile sources," said Donna Phillips, regional director, TCEQ Houston Region Office. "The positive effect of voluntary emission reductions through participation in programs such as TERP cannot be overstated."
Jim Wurtz, NREC's vice president marketing and sales, said, "These EPA Certified and CARB recognized N-ViroMotive GenSet units have emission levels unequaled worldwide for original equipment manufacturers of freight locomotives and are several years in advance of anticipated EPA emissions regulations for new switching and freight haul locomotives."
During the last decade, BNSF has acquired about 2,700 low-emissions, more fuel-efficient locomotives, replacing a significant portion of its 6,400-engine road and switch fleets. BNSF said one of the other locomotive types is the GE Evolution® Services locomotive.
"GE Transportation invested approximately $400 million to develop the Evolution® Series locomotive over an eight-year period. Entering the market in 2005, the Evolution® Series locomotive is now the most technologically advanced, fuel-efficient and eco-friendly diesel-electric locomotive in history. It delivers up to 5% higher fuel efficiency and a 40% reduction in emissions over its predecessor," said Barry K. Hall, TST Sales Leader, GE Transportation. "The Evolution® Series locomotive serves as one of GE's first products to be certified as part of its Ecomagination initiative. Ecomagination is a company wide commitment to developing technology designed to help customers satisfy environmental challenges, to maximize performance and reduce cost."
Wabtec to buy Italian component supplierWabtec Corp. announced Monday that it has agreed to pay $80 million in cash for POLI s.p.a., a manufacturer of rail braking equipment based in Italy. POLI has annual sales of about $45 million. The transaction is expected to be completed in the third quarter and to be accretive in the first year.
Since 1952, POLI has manufactured braking related components for passenger and freight railroads. Its products include discs for high speed application as well as tread brake units and pneumatic brake valves built to UIC (International Union of Railways) standards. POLI has around 500 employees at production facilities in Italy and Macedonia.
"The combination of Wabtec’s existing products and technological expertise with POLI’s European-approved components positions us for future growth in key international markets," said Wabtec President and CEO Albert J. Neupaver. Wabtec manufactures a range of products for locomotives, freight cars, and passenger vehicles, and also builds new switcher and commuter locomotives.
UP engineers big changes at the topUnion Pacific today announced that Bill Wimmer, a 51-year veteran of the railroad and Railway Age’s 2007 “Railroader of the Year,” has been promoted to vice president-Operations. Succeeding him as vice president-Engineering will be David Connell. The change is effective June 1, 2008.
In his new position, Wimmer will be responsible for developing UP’s corridor strategy, outlining its five-year capital plan, and other strategic initiatives for the Operating department. UP Executive Vice President-Operating Dennis Duffy said Wimmer’s “engineering knowledge and experience represent tremendous assets that will be invaluable as he transitions to this new position.”
Since joining UP’s Engineering group in 1957, Wimmer has held many positions, including division engineer, district engineer, Western Region engineer, General Superintendent Western Region, assistant vice president-Environmental Management and senior assistant vice president-Engineering Management.
Connell will be responsible for the day-to-day operation of the Engineering department, which includes overseeing track, bridge and signal maintenance and new construction. He has held a number of positions since being hired in 1983, including director of track maintenance, general director of engineering technology, chief engineer-Central Region, and assistant vice president Engineering-Construction.
Bill Van Trump, who previously served as assistant vice president Engineering-Maintenance, has been promoted to senior assistant vice president-Engineering, reporting to Connell. He will be responsible for signal operations including design and maintenance. He will also lead the Engineering department’s “Total Cost of Ownership” process. Since joining UP in 1967, Van Trump has served as carpenter, roadmaster, assistant division engineer, director of track maintenance, assistant chief engineer of track, and assistant vice president Engineering- Maintenance.
Todd Wimmer will assume Connell’s previous position as assistant vice president-Structures and Maintenance. He will be responsible for overseeing UP's bridge construction and track maintenance projects. He currently serves as general superintendent-transportation services of the Portland Service Unit. Since being hired in 1991, he has held numerous positions, including gang laborer, manager of construction projects, director of track maintenance, and superintendent of the Wichita Service Unit.
Pat Meriwether, who recently returned from active duty in Afghanistan, will assume Todd Wimmer’s responsibilities at the Portland Service Unit. Since joining UP in 1984, he has served as director of train management, superintendent of the North Little Rock Service Unit, superintendent of transportation services, general superintendent-Harriman Dispatching Center, and general superintendent-transportation services of the Northern Region.
Carload traffic climbs 5% on U.S. railroadsU.S. railroads originated 337,103 carloads of freight in the week ended May 10, up 5%, led by sharp increases in grain traffic, which was up 18.2% from the corresponding week of 2007; coal, up 11.9%; and metallic ores, up 27.8%. Intermodal volume in the latest week was off 1.1% from last year to 229,960 units; trailer volume rose 4.0% but container traffic declined 2.4%. The Association of American Railroads estimated total volume for the week at 34.9 billion ton-miles, up 6.4% from the 19th week of 2007.
In Canada, carload traffic during the week ended May 10 declined 4.5% to 76,870 cars, and intermodal volume was up 2.7% to 49,455 trailers and containers. The Kansas City Southern de Mexico reported a 7.8% decline in carload traffic, to 9,930 cars, with intermodal volume down 5.8% to 4,191 units.
Rail stock prices hit new highsThe stock prices of the nation's four largest railroads reached new 12-month highs in Friday trading on the New York Stock Exchange. Union Pacific achieved a new per-share high of $156.15 during the day, up from a previous record of $152.28; BNSF Railway climbed to $109.43 from $108.109; Norfolk Southern to $65.23 from $64.88; and CSX to $65.23 from $64.88.
The new highs came on a day when the stock market generally was down as crude oil prices climbed. The improved railroad performance followed the announcement Thursday that rail carload traffic in the U.S. increased 5% in the latest reporting week.
Another positive was the disclosure that Berkshire Hathaway’s Warren Buffett had increased his position in BNSF from 60.8 million shares to 63.8 million—reflecting, said one analyst, the belief that "as trucks get hit by higher costs, the transportation of goods will be transferred to railroads."
NS, Pan Am Railways join to serve "Patriot Corridor"Pan Am Railways and Norfolk Southern will implement expanded joint rail service between Albany, N.Y., and the greater Boston area via the "Patriot Corridor" in a 50-50 joint venture, dubbed Pan Am Southern.
North Billerica, Mass.-based Pan Am Railways will transfer to the joint venture its 155-mile main line track that runs between Mechanicville, N.Y. (north of Albany), and Ayer, Mass., along with 281 miles of secondary and branch lines, including trackage rights, in Connecticut, Massachusetts, New Hampshire, New York, and Vermont.
For its part, NS will transfer to the joint venture cash and other property valued at $140 million. Of that amount, $87.5 million will be invested within a three-year period in capital improvements on the Patriot Corridor, applied to terminal expansions and also track and signal upgrades. The companies also anticipate the construction of new intermodal and automotive terminals in the Albany area.
Pan American Railway's Springfield Terminal Railway subsidiary has agreed to provide all railroad services for the joint venture.
"We are excited to partner with Norfolk Southern on the Patriot Corridor. Since the Conrail transaction was implemented in 1999, both Pan Am Railways and Norfolk Southern have been working to bring additional high quality rail transportation options to our New England customer base. This joint venture is the culmination of those efforts," said David Fink, president of Pan Am Railways. "With energy prices continuing to rise, the Patriot Corridor will give our customers additional capacity and speed to get their products to market."
Said NS CEO Wick Moorman, "Norfolk Southern has been working with Pan Am Railways to improve rail service and increase transportation options between the Norfolk Southern system and the Boston area. The Patriot Corridor creates a new level of rail competition in upstate New York and New England by improving train speed, reliability, and capacity, as well as strengthening connections between the region’s short line and regional railroads and Norfolk Southern’s 22-state network."
The joint venture seeks approval from the Surface Transportation Board. Additional materials describing the transaction will be posted on Norfolk Southern's Web site, www.nscorp.com, and will be furnished to the Securities and Exchange Commission as part of a Current Report on Form 8-K.
Industry trio forms transport/logistics consortiumTranSystems, Watco Companies, Inc., and Harbour Contractors have agreed in principle to form Transportation and Logistics Consortium (TLC), in order to provide transport users "an outsourced
organization with the ability to provide a bundled services approach to the development, design, construction and operation of various types of transportation facilities."
TLC says it will serve clients in both the private and the public sectors, with its primary customer focus carriers, shippers, and public transportation organizations.
TranSystems, of Kansas City, Mo., is focused exclusively on providing professional services to transportation users and providers, including architecture, engineering and planning, management and supply chain consulting, real estate consulting, and infrastructure security analysis.
Pittsburg, Kan.-based Watco Companies Inc. operates 17 railroads in 15 states, providing transportation, mechanical, and intermodal–transload services. It also provides full service mechanical repairs at its mechanical shops and full service intermodal–transload services at numerous locations throughout the United States.
Harbour Contractors, Plainfield, Ill., offers construction management, design-build services, owners representation, program management, and general contracting services to transportation, shipper, academic, corporate, municipal, and industrial clients.
Belden Inc. consolidates affiliatesSt. Louis-based Belden Inc., manufacturer of signal transmission products, has merged four of its data transmission affiliates into a new entity. Belden EMEA, with headquarters in the Stuttgart, Germany, metropolitan area, will combine the asssets of Belden Europe (Venlo, The Netherlands), HEW-Kabel (Wipperfürth, Germany), Hirschmann Automation and Control (Neckartenzlingen, Germany), and Lumberg Automation (Schalksmühle, Germany). Dr. Wolfgang Babel, who already headed Hirschmann and Lumberg Automation, has been named president of Belden EMEA. The combined entity employs more than 2,200.
CSX blasts TCI Group's "bad math, half truths"CSX Corp. President and CEO Michael J. Ward sent shareholders a letter Thursday accusing the TCI Group of using "bad math, flawed assumptions, and half truths" in its efforts to replace five members of the CSX board with its own nominees. CSX shareholders will cast their votes on the hedge fund's challenge at their annual meeting in New Orleans June 25.
Asserting that the challengers have made "numerous suggestions to reduce CSX's investment-grade debt rating to 'junk status,'" Ward sought to set the record straight.
His first evidence was a chart showing that CSX ranked "best" among the six major North American railroads in shareholder value creation, expense control per revenue-ton-mile, margin expansion, earnings-per-share growth, and projected earnings-per-share growth through 2010. In employee safety, CSX ranked second to perennial winner Norfolk Southern.
Ward said the chart shows that "CSX is an industry leader across well recognized critical performance measures. What's more, the company is growing faster than its rail peers, has presented the most aggressive financial guidance in the industry, and has a proven plan to achieve that guidance."
As an example of flawed TCI reasoning, he said the group challenging CSX's current management "wants you to believe that there is a widening gap between expense per ton-mile at CSX and Canadian National. This is simply not true. When CN's expenses are properly adjusted for foreign currency translation, the gap has not increased to 28% as the TCI Group might have you believe--it has narrowed from 11% to 8%."
As another comparison that doesn't stand up to close scrutiny, he said “the TCI group has alleged that CSX prices its services at a discount to Norfolk Southern's pricing. What they fail to disclose is that after making the necessary adjustments for length of haul and CSX's equipment privatization strategy, CSX prices are at parity with Norfolk Southern. What's more, CSX has the strongest 2008 pricing guidance in the industry."
Ward also reminded shareholders that CSX's stock price returns "have ranked ahead of the top 93%, 95%, and 87% of all S&P companies over the past one, three, and five years, respectively."
MUNI to tap solar power for operationsSan Francisco's Public Utilities Commission has authorized a 5 megawatt solar power project that, among other items, will provide power to the city's MUNI light rail system.
The facility will be placed on the roofs of the newly retrofitted Sunset Reservoir, and on Pier 96, which houses a recycling center. The PUC expects the project to generate enough electricity for both buildings, and for other buildings including San Francisco General Hospital, as well as for MUNI.
San Francisco-based Recurrent Energy won the contract to finance and build the project through Power Purchase Agreements. Recurrent will own and operate the power plant and sell the power back to the city over a 25-year period. The project is expected to go on line in mid-2009.
Siemens wins $2 billion train order from BelgiumSiemens announced Thursday that its Mobility Division has received an order from Belgian National Railways (SNCB) for 305 multiple-unit trains valued at more than $2 billion. It's the largest rolling stock order Siemens has ever received.
Scheduled for use in Belgium's regional service, the trains will be manufactured at the Siemens plant in Krefeld-Uerdingen, Germany, starting in 2009. Deliveries will take place from 2012 to 2016.
The trains will be built to the Desiro ML design. Each will accommodate 280 passengers and will have a top speed of 100 mph. The first trains of this new line are scheduled to enter service for the German rail operator Mittelrheinbahn later this year. Previous generations of the Desiro line are in service in Bulgaria, Germany, Greece, Slovenia, the U.K., and the U.S.
TRAX orders 77 LRT cars from SiemensSiemens Transportation Systems has landed an order for 77 S-70 light rail cars, worth $277 million, from Salt Lake City's TRAX light rail system, with an option for 180 additional cars.
The 77-car order reportedly is the largest LRT vehicle purchase ever made by a U.S. locale from Siemens, surpassing the company's delivery of 55 cars to Denver's Regional Transportation District. Siemens will manufacture the cars at its plant in Sacramento, Calif.
Utah Transit Authority is overseeing the addition of four light rail lines, including a link to Salt Lake City International Airport, to its existing two-route system connecting Salt Lake City points and Sandy. TRAX currently operates with 69 light rail vehicles, also provided by Siemens, which UTA acquired as part of an option placed by the San Diego Metropolitan Transit System. TRAX began operations in December 1999.
Robert E. Tuzik joins Holland LPHolland LP has named Robert E. Tuzik Rangecam Business Manager, reporting to Robert Madderom, general manager of the Railway Measurement Systems and Services Division. In his new position, he will be managing the company's recent acquisition, Industrial Metrics.
Tuzik was editor of Railway Age's sister engineering publication, Railway Track & Structures, for six years. He began his railroading career with the Santa Fe Railway in Chicago in the operating department, and joined RT&S After earning a B.A. at the University of Illinois, Chicago, and an M.S. in journalism at Northwestern University Medill School of Journalism in 1989. Tuzik's tenure at RT&S was followed by seven years with OMNI Products, Inc., beginning with a sales and marketing position that led to promotion as President and COO. In 2003, Tuzik founded Talus Associates LLC, a marketing, sales, and project management firm serving the rail industry. This led to the development of "Interface, the Journal of Wheel/Rail Interaction," a quarterly Internet-based journal. He also spent three years working for Advanced Rail Management, providing sales, marketing, and management direction.
Tuzik has served on the REMSA board, Heavy Axle Load Research Committee, various APTA committees, and is a member of AREMA and TRB.
Train accidents down 23.3% in three yearsU.S. Secretary of Transportation Mary E. Peters says the number of train accidents has decreased 23.3% in the last three years, and she gives a big part of the credit to the National Rail Safety Action Plan that the Federal Railroad Administration launched in 2005.
That plan, the DOT noted in a statement Wednesday, "focused on reducing the most frequent and highest-risk cases of train accidents; accelerating research to strengthen rail tank cars carrying the most dangerous hazardous materials; addressing the effects of fatigue on train crews; enhancing highway-rail grade crossing safety; and using data in a new way to better direct federal inspection resources to where they're needed most."
FRA is now developing "a risk-reduction strategy to further drive down the number of train accidents," supplementing existing safety efforts, said FRA Administrator Joseph H. Boardman. He believes the risk-reduction approach will help railroads and FRA "identify, analyze and correct safety issues before they result in a train accident or employee injury."
An example of this strategy, said Boardman, is the FRA Confidential Close Call Reporting System demonstration project.
NS garners 19th straight Harriman safety awardAt a luncheon Wednesday in Washington, Norfolk Southern was awarded the E.H. Harriman Award (Group A) for the 19th year in a row, honoring its safety record among line-haul railroads whose employees worked 15 million employee-hours or more during 2007. Other Group A recipients included CSX Transportation (silver) and Union Pacific Railroad (bronze).
In accepting the award for NS, CEO Wick Moorman thanked the railroad's 30,000 employees for their continuous commitment to safety.
The E.H. Harriman Awards celebrate the safety achievements of railroads, honoring four categories within the industry. All data are documented by the Federal Railroad Administration.
In Group B (line-haul railroads whose employees worked 4 million to 15 million employee-hours in 2006), for the second year in a row, the gold award went to Kansas City Southern Railway. Silver going to Chicago's Metra, and bronze honors went to Canadian Pacific Railway (U.S. operations).
Group C includes railroads whose employees worked less than 4 million employee-hours during the award period. Awards were given to Iowa Interstate Railroad (gold), Elgin, Joliet and Eastern Railway (silver), and Florida East Coast Railway (bronze).
Awards in Group S&T, recognizing switching and terminal companies, went to the Terminal Railroad Association of St. Louis (gold), Union Railroad of Pittsburgh (silver), and Birmingham Southern Railroad (bronze).
Certificates of Commendation were awarded recognizing four railroads with continuous gains in employee safety improvements over a three-year period and showing the most improvement between 2005 and 2006. Certificates went to Amtrak for Group A, the Long Island Rail Road in Group B, Wisconsin & Southern Railroad in Group C, and Union Railroad for Group S&T.
Edward R. Hamberger, president and CEO of the Association of American Railroads, said in a statement, "Last year the train accident rate was the lowest in history. So was the grade crossing accident rate. The total number of fatalities from all rail-related incidents was also the lowest in history. And the employee injury rate was the second lowest in history, missing the record set in 2006 by less than one percent."
Hamberger noted 2008 has started off with a strong safety record, as well. "The employee injury rate, the train accident rate, and the grade crossing incident rate were all lower in the first two months of this year than they were a year ago," he said.
Also at the luncheon, the Harold F. Hammond Award for 2007, honoring an individual's contribution to railroad safety, was presented to James "J.T." Wilson, conductor in CSX Transportation's Florence, S.C., division. Wilson has been a full-time divisional safety coordinator since 2001, and in that role he developed a plan to provide new employees with advanced switching and safety training.
Since the "Switching For Success" program began in the Florence division in 2005, human-factor derailments were reduced in the division by 50%. That program is now being adopted by other CSX divisions.
Harsh winter cuts Global Railway earningsGlobal Railway Industries Ltd. reported Tuesday that it earned C$641,598 on revenue of C$15.5 million in this year's first quarter, compared with earnings of C$1,188,445 on revenue of $9.5 million in the first quarter of 2007.
"We are disappointed with the results," said Chairman, President, and CEO Terry McMananam. "The harsh winter made it difficult for North America’s railroads to perform track and signal maintenance, resulting in the deferral of work programs and related spending. Early indications are that railway spending on track and signal components will return to normal levels throughout the remainder of the year.
"On the positive side," McManaman added, "the inclusion of CAD Railway Industries is beginning to yield the anticipated benefits, contributing significantly to Global's revenue jump of 64% to C$15.5 million in the first quarter of 2008. I am also pleased to report that the CAD integration and the C$10.5 million VIA Rail contract startup are progressing on schedule."
Timken wins bearing service contract in BrazilThe Timken Co. announced Wednesday that it has signed a long-term agreement with Brazil's largest independent railroad operation, America Latina Logistics S.A. (ALL), to operate a rail bearing reconditioning plant at an ALL facility in Sorcaba, Brazil. Timken engineers will operate the onsite unit.
Timken said it will utilize its proprietary software "to analyze damaged bearings, measuring variables such as end-play and loads," to produce a reconditioned bearing "that performs like a new bearing but at considerable cost savings." ALL operates a 13,000-mile system with 1,000 locomotives, 29,500 freight cars, and 1,300 road vehicles.
LA Metro plans more "Rapid" bus linesLos Angeles Metro CEO Roger Snoble is far from happy with the proposed $3.57 billion budget for FY 2009 that the Metropolitan Transportation Authority announced on Tuesday. "This is a balanced budget," Snoble was quoted as saying, "but it sure doesn’t speak well for the future." Snoble is particularly worried about the continued deferment of improvements to Los Angeles County's transit infrastructure.
Rail partisans aren't likely to be overly enthusiastic about the budget, either. It proposes to add six more "Rapid" bus lines, bringing the total to 25, and sets aside less than 25% of total spending for rail.
The $785 million planned for rail includes $65.4 million in operating assistance for Metrolink trains, plus funds to complete the Metro Gold Line from Union Station to East Los Angeles and to advance the planned 8.5-mile Exposition Line. The budget still requires the approval of the Metro board.
For LIRR, train noise takes a new directionMTA Long Island Rail Road President Helena Williams says America's largest commuter railroad intends to reduce the use of train horns and their decibel levels at numerous locations and, on the technological front, will install noise mufflers on its M-7 electric trains designed to direct the sound of the horn forward rather than letting it disperse to the sides.
"This directional muffler developed by the very resourceful members of our Maintenance of Equipment Department is an important part of our strategy to lower the volume on this railroad and improve the quality of life for the thousands of people in Nassau, Suffolk and Queens who live and work close to our tracks," Williams said.
LIRR believes it can modify its policy on train horn noise in compliance with federal guidelines and without compromising safety. As one example, the LIRR plans to eliminate horn soundings previously required when trains passed stations without stopping during morning and evening rush hours. Instead, engineers will only be required to sound the horn when they see someone standing too close to the edge of the platform or for other safety reasons.
The railroad also seeks two waivers from the Federal Railroad Administration. The first involves FRA regulations requiring engineers to sound the traditional two long blasts, one short one, and one additional long blast at all public highway rail grade crossings. The railroad seeks permission to return to its former practice of one short blast of the horn when trains depart from stations located within 50 feet of these crossings. LIRR has identified 24 such locations, 18 in Nassau County, five in Suffolk County, and one in the borough of Queens.
A second waiver would permit the LIRR to lower the minimum 96-decibel level required by the FRA on the railroad's electric multiple-unit fleet.
"While we cannot eliminate horns, we can and have taken a careful look at our equipment and our operations, and have developed the steps I am announcing today which we believe can be taken to reduce train horn noise without compromising public safety or the essential transportation services we provide to 86 million people annually," Williams said.
Truckers reopen size-and-weight issueFive years ago, the American Trucking Associations and the Association of American railroads declared a "cease-fire" in their battle over truck size and weight limits on the nation's 46,000-mile Interstate Highway System. The truce won’t officially end until September 2009, but the ATA on May 8 launched a new "sustainable future" program that calls for, among other things, bigger and heavier trucks.
Specifically, ATA sees a road ahead with weight limits increased from 80,000 to 97,000 pounds, and double 33-foot trailer combinations. The AAR doesn’t see this as a violation of the cease-fire, pointing out that any action on the proposal won’t come until a new omnibus transportation bill is enacted, and that will be after the truce expires.
The AAR's position on truck size and weight limits is that they should be maintained as they now exist. Under current law, trucks operating on most of the national system are limited to a gross vehicle weight of no more than 80,000 pounds (though heavier weights are allowed in certain grandfathered situations). Longer combination vehicles (LCVs)--tractors with two or more trailers having gross vehicle weight of more than 80,000 pounds--are allowed in some states on certain highways under laws that existed prior to the freezing of truck size and weight limits by Congress in 1991.
Bombardier Skytrain order notches milestoneBombardier Transportation announced Tuesday that Vancouver's Skytrain has exercised an option for 14 new Advanced Rapid Transit MK II vehicles. The option is part of a 34-vehicle contract signed in November 2006.
The option moves the number of ART vehicles in operation or on order past the 600 mark, Bombardier said. Skytrain is operated by British Columbia Rapid Transit Co.
Raymond T. Betler, president of Bombardier Transportation's Total Transit Systems Division, said that more than 250 vehicles have been ordered in less than four years, indicating continued strong demand for the ART system and its linear-induction-motor technology.
BNSF sells rail line to Port of Seattle for $107 millionBNSF and the Port of Seattle have signed an agreement allowing the port to acquire a 42-mile rail route between Renton and Snohomish, Wash., for $107 million. King County is contributing $2 million toward the purchase, and has been granted the right for a future trail along the southern 32 miles of the right-of-way.
Rail freight service is envisioned for much of the route, as is potential commuter rail service. The Port of Seattle plans a public process to hear input on how King County residents would like to see the rail corridor used. While the route's future uses are yet to be determined, the port sought to acquire the entire the right-of-way to avoid future problems, according to Port Commission President John Creighton.
Said King County Executive Ron Sims, "In the end we've ensured that this irreplaceable 42-mile corridor stays in public ownership and is not broken up and sold piecemeal for private development."
RailAmerica will abandon Oregon short lineFollowing months of controversy and acrimony, Boca Raton, Fla.-based RailAmerica, Inc. said Monday it will seek to abandon its Coos Bay Line between Coquille and Eugene, Ore., operated by subsidiary Central Oregon & Pacific Railroad (CORP). In a May 12 letter to the Surface Transportation Board, RailAmerica said feedback from Oregon Gov. Ted Kulongoski, shippers, and Union Pacific made the decision necessary.
"Upon assessing these reactions to our efforts to build a coalition to address the long-term viability of the Coos Bay Line—and, in particular, after seeing both the state of Oregon and (Union Pacific) unequivocally reject our proposals—CORP made a decision following (April 24-25) hearings to seek to abandon the Coos Bay Line," RailAmerica said.
"While CORP remains willing to work with interested stakeholders to discuss solutions that would permit continued operation of the Coos Bay Line, we simply cannot justify investing many millions of dollars to rehabilitate a line that shows little if any prospect for returning to profitability," the company said.
RailAmerica has said it was losing $1 million annually on the line. In a May 8 letter filed with STB, legal counsel for CORP wrote, "The proposed abandonment or discontinuance of service would begin at Milepost 669.0 up to and including Milepost 785.6, and [a spur from] CORP Milepost 738.8 and LPN Milepost 2.0," totaling roughly 122 miles.
STB on April 10 directed RailAmerica and Central Oregon & Pacific Railroad by May 12 "to show cause why the Board should not consider CORP's ongoing failure to provide service on the Coos Bay Line (the Line) in Oregon to be an unlawful abandonment and why CORP should not be required either to promptly repair the tunnels on the Line and resume rail service or to seek abandonment authority."
Rail Runner Express taps video and data systemNew Mexico's Rail Runner Express will employ a combined video and event recorder monitoring system from Railhead Vision Systems® (a division of the Railhead Corp.) and Wi-Tronix®, LLC. The jointly developed system synchronizes video with data from any installed event recorder regardless of manufacturer or model.
The system generates a single downloadable file containing both video and data extracted from an applied event recorder, and enables real-time, wireless access to download video and event recorder information.
The system is comprised of two components: Wireless Processing Units (Wi-PU) from Wi-Tronix, and Railhead Digital Video Recorders from Railhead Vision Systems. The two companies have integrated the two technologies to generate a single synchronized video file that also contains event recorder data.
"This system will help us in our day-to-day operations," says Lawrence Rael, Executive Director for the Mid-Region Council of Governments, which operates Rail Runner. "We will be able to
look at potential problem areas on the train that might need to be addressed. Just having real-time information as it relates to the operations of the Rail Runner will provide added safety in the corridor."
Schumer: PA should oversee New York-Penn Station workU.S. Sen. Charles Schumer, D-N.Y., Monday called for the Port Authority of New York & New Jersey (PA) to take over the reevelopment of Pennsylvania Station, saying it would spur economic development on Manhattan's West Side. Schumer said current economic woes should not interfere with the project.
"The natural inclination in these conditions can be to retract. Pull back. Put all big projects on hold. Yet that is exactly the wrong approach and will leave us in worse condition than we are in today when the next upswing occurs," Schumer said in written remarks.
Penn Station, served by New Jersey Transit, the Long Island Rail Road, and Amtrak, is Amtrak's largest station on the Northeast Corridor and the only major Hudson River crossing (road or rail) linking New Jersey and Manhattan not controlled by the PA. (Amtrak owns the Northeast Corridor; it and the LIRR share operational control of Penn Station.)
Current plans, tabbed at $14 billion, call for moving the transportation hub across Eighth Avenue into the James A. Farley post office, a landmark building. The station would be named after the late U.S. Sen. Daniel Patrick Moynihan, who spearheaded the idea. But the current plan has been dogged by some community resistance and political maneuvering among Manhattan real estate interests.
Notwithstanding such difficulties, Mayor Michael Bloomberg reiterated the city's intent to proceed with the current plan, questioning Schumer's timing. "If he gets us the money for Moynihan, we'll be able to do that at the same time" as rebuilding the World Trade Center site, which the PA does oversee, Bloomberg said.
CN tailors new intermodal service for highway usersCN announced Monday that it is introducing intermodal service connecting the Eastern Quebec region with Toronto, and western Canada. CN said the new service will appeal to forest products producers and other shippers of heavy products "who can load 66,000 pounds in a 40-foot container, which has the equivalent of a 53-foot truck trailer."
Stan Jablonski, the railroad’s senior vice president, sales, said: "The service will educe wear and tear on long-distance truck fleets and extend the environmental benefits of rail to a new group of shippers."
CN will offer Quebec City shippers daily service to Toronto, Winnipeg, Edmonton, Calgary, and Vancouver. "We believe there is a strong interest in this intermodal option in the Quebec City area and beyond, including Johnquiere, Chicoutini, Montmagny, La Pocatiere, and Riveire-du-Loup," said Jablonski.
Luxembourg carbuilder acquires three Serbian facilitiesEuropean freight car manufacturer International Railway Systems S.A. (IRS) announced Monday that it has acquired a controlling interest in three factories in Nis, Serbia: MIN Verona a.d., MIN Locomotiva a.d., and Specijalna Vozila a.d. The acquisition expands the Luxembourg-based carbuilder's rolling stock franchise and represents its entry into locomotives manufacturing.
IRS noted that he factories are located on the Pan-European Transport Corridor X linking Turkey and Greece with Austria, Bulgaria, Macedonia, Serbia, Croatia, and Slovenia.
Financing fixed for Shuttlewagon purchaseThe Unitranche Fund LLC, co-managed by affiliates of GE Commercial Finance and Allied Capital, announced Monday the closing of a $103 million debt package to support the acquisition of Central Power Products (Shuttlewagon), by Nordco, Inc., and for the recapitalization of Nordco, a portfolio company of the Riverside Co.
The announcement said Shuttlewagon, a manufacturer of railcar movers, is the third add-on to Nordco, a supplier of new and rebuilt m/w equipment, repair parts, and services. Shuttlewagon is based in Grandview, Mo.
Prover gets a boost from Synopsys Synopsys, Inc., Mountain View, Calif., a supplier of EDA (exploratory data analysis) and IP (internet protocol) software for semiconductor design and manufacturing with locations throughout North America, Europe, Japan, and Asia, has invested in Prover Technology AB, which provides signaling design automation services for engineering safety-critical systems that control trains, switches, and signals. Prover says the Synopsys investment will enable it to accelerate its research and development efforts and expand its operations in Europe, North America, and Asia.
Prover, a privately held company founded in 1989, is headquartered in Stockholm, Sweden, with wholly owned subsidiaries in France and San Francisco and offices in Shanghai, China. The company’s customer base includes Airbus, Ansaldo, Bombardier, MTA New York City Transit, RATP (Paris Metro), Swedish National Rail, Thales, and others.
West Side Yards plan stalls, New York MTA saysIn a brief statement, New York's Metropolitan Transportation Authority has announced negotiations between it and real estate company Tishman Speyer to develop property over existing rail yards on Manhattan's West Side had "reached an impasse." The announcement could jeopardize MTA's plan to create a mixed-use development on 26 acres above the existing rail yards, used by the Long Island Rail Road.
MTA said Tishman Speyer sought to alter a key item in the proposed deal which "changed the economics of the proposed deals and the certainty of payments to the MTA. The MTA remains committed to developing these unique and very valuable parcels of land."
MTA last March chose Tishman Speyer's $1 billion proposal, from among four bids, to build up to 10 million square feet of office space, 550,000 square feet of retail, 3,000 residential units, and 13 acres of open space. The project was to rise on a $2 billion platform above the rail yards, which would remain functional.
Tishman Speyer, in a statement, said, "This is a highly complicated deal and we have been negotiating in good faith with the MTA for several weeks." The company said it still seeks "to complete this deal and reach an agreement that satisfies the needs of everyone."
CSX: We'll proceed with Winter Haven workCSX will proceed with construction of an intermodal center in Winter Haven, Fla., regardless of the outcome over commuter rail service in central Florida.
In a letter to Florida Gov. Charlie Crist, CEO Michael Ward said, "Permitting and public review of the new intermodal and automotive terminal in Winter Haven are proceeding." Ward added, "This state-of-the-art facility will provide an important economic stimulus to Polk County, and reduce long haul truck traffic in the State as developers locate warehouse and distribution centers adjacent to the rail terminal." CSX expects to begin construction of the project's first phase in October.
Ward said CSX is still agreeable to working with local, state and federal officials to pursue commuter rail service, which state legislators rejected last week due to concerns over liability. Critics of the proposed CSX/Florida agreement demanded a revision of a clause mandating that any state-run commuter operation to pay for the cost of accidents involving commuter trains and passengers, even if CSX were at fault.
"Our contract with the Florida Department of Transportation allows until June 30, 2009 for passage of legislation to provide for the purchase of insurance and allocation of liability prior to closing on the sale of our right-of-way," Ward said. "We will honor that commitment."
Mica continues pursuit of “true” U.S. high speed railOffering public support for House Resolution H.R. 6003 at a press conference in Washington May 8, Rep. John L. Mica, ranking member of the House Transportation & Infrastructure Committee, also is advancing H.R. 6004, "a bill to provide for competitive development and operation of high-speed rail corridor projects." Mica believes that that Amtrak is ill-equipped to provide adequate high speed rail options in the U.S.
The Florida Republican, often critical of Amtrak's fiscal and operating performance, notes that Amtrak’s Northeast Corridor (NEC) Acela service averages just 83 mph, and sets the "true high speed rail" average at 120 mph. Mica notes France's new AGV service averages 200 mph, while the "slowest Japanese Bullet train has an average speed of 125 mph."
The congressman is sponsoring H.R. 6004, based in large measure on an earlier proposal introduced last March by Mica (H.R. 5644), which would authorize the Secretary of Transportation to solicit proposals for massive upgrading and/or overhaul of the NEC, with a goal of two-hour service between New York and Washington, D.C. (Portions of this proposal have been incorporated into H.R. 6003.)
Under H.R. 6004, any NEC overhaul, in turn, would serve as a pilot project for other potential high speed rail routes elsewhere in the U.S. The bill outlines several expected benefits, including not just reduced travel times but also economic development, reduced air pollution, and reduced pressure on regional airspace in the Northeast.
"Amtrak, the state, and private entities would be able to participate in any of these proposals or even submit its own proposals," a statement from Mica’s office said. "We are hoping to attract some level of private investment to this initiative."
House committee seeks five-year Amtrak reauthorizationHouse Resolution H.R. 6003, the Passenger Rail Investment and Improvement Act of 2008, was unveiled May 8 by members of the House Transportation & Infrastructure Committee, with a press conference demonstrating bipartisan support of Amtrak intercity passenger rail service.
The $14 billion, five-year reauthorization includes about $1.34 billion per year for Amtrak's capital needs, along with $606 million per year for operations. Amtrak's fiscal year 2008 capital budget was $565 million.
The resolution also includes several provisions for advancing high speed rail development (or what some observers categorized as "higher speed" incremental rail approaches). Two such provisions include: the soliciting of proposals by the U.S. Department of Transportation to significantly upgrade and overhaul Amtrak's existing Northeast Corridor (NEC); and proposals for two-hour express service between New York and Washington through less-dramatic improvements to existing NEC infrastructure, such as catenary, signaling, and/or additional high speed turnouts.
In addition, about $345 million per year would be provided to states and/or Amtrak to finance facilities and infrastructure improvements, as well as passenger equipment, for projects improving speeds to 110 mph. States would have to provide at least 20% of a project's cost.
The bill also would establish a pilot program permitting freight railroads to partner with potential new passenger rail providers, and provide more than $400 million per year in matching funds that states could apply for to advance passenger rail improvements.
Notably absent is any mention of penalizing freight railroads for Amtrak's on-time performance problems. U.S. Sen. Frank R. Lautenberg, D-N.J., recently said the cost borne by Amtrak for such problems was as high as $111.4 million, citing a study conducted by USDOT's inspector general per Lautenberg’s request. The senator last October sponsored a bill empowering the Surface Transportation Board to investigate Amtrak delays and fine freight railroads held responsible.
Carload freight healthy in April, but intermodal strugglesU.S. railroads' full-month April results saw sustained strength in carload freight and a continuing slump in intermodal traffic, according to the Association of American Railroads.
The AAR reported 1,668,255 freight carloads originated in April, up 0.9% from April 2007. Intermodal originated traffic for the month of 1,117,511 units slipped 2.1% from the year-ago period.
Seven of the 19 major commodity categories tracked saw U.S. carload increases in April 2008 compared to April 2007, AAR said. Commodities showing carload gains in April 2008 included coal (up 5.3%), grain (up 20.6%), and chemicals (up 2.9%). Among decliners were motor vehicles and equipment (down 19.5%), coke (down 1 35.7%), and crushed stone, sand, and gravel (down 6.0%).
"The Bureau of Economic Analysis recently reported preliminary first quarter 2008 GDP growth was 0.6%. That's pretty low, of course, but it actually exceeded what some economists were predicting," said AAR Senior Vice President John Gray. "The fact that rail carload traffic was up in April is another indication that our economic situation, while still difficult, might not be as dire as some had thought."
Canadian traffic patterns were somewhat the opposite. Canadian rail carload traffic in April was down 6.2% versus April 2007; commodities showing carload declines included motor vehicles and equipment (down 21.7%) and lumber and wood products (down 30.9%). But Canadian intermodal traffic was up 3.5% in April compared with the year-ago month.
Carloads carried on Kansas City Southern dé Mexico were down 1.5% in April, while intermodal units increased 20.4%.
For just the week ended May 3, the AAR noted U.S freight carloading originations increased 2.1% over the corresponding week in 2007. Intermodal volume declined 3.7% during the week ended Mary 3 versus the comparable week a year ago. Total volume of 34.8 billion ton-miles was up 3.6% over the comparable week a year ago.
For Canadian railroads during the week ended May 3, carload freight declined 11.9% compared to a year ago, while intermodal rose 3.5%.
Kansas City Southern dé Mexico's performance during the week ended May 3 included a decline of 9.4% in carload freight, but an increases of 6.3% in intermodal traffic originated.
New York's MTA joins The Climate RegistryNew York's Metropolitan Transportation Authority (MTA) Thursday announced it had become one of the founding members of The Climate Registry, a non-profit organization which will measure and report greenhouse gas emissions generated by various industry sectors. The Climate Registry was incorporated in March 2007.
"Moving 8.5 million people per day without automobiles saves an enormous amount of carbon from entering the atmosphere," said MTA Executive Director Elliot G. Sander. "But it does result in some carbon emissions. We hope that by voluntarily reporting our emissions to The Climate Registry, we will better understand our environmental impact and therefore work more effectively at reducing it. We also hope that this initiative will contribute to the public's understanding of the role that mass transit plays in reducing carbon emissions."
New York State's Commission on Sustainability and the MTA last month issued a series of interim recommendations on ways the MTA could reduce its carbon emissions; MTA says its membership in The Climate Registry results from those recommendations.
MTA has agreed to measure, independently verify, and publicly report its greenhouse gas emissions on an annual basis using the Climate Registry General Reporting Protocol, which it says is based on the internationally recognized greenhouse gas measurement standards of the World Resources Institute and World Business Council on Sustainability.
Salt Lake City advances LRT airport linkSalt Lake City's city council has approved $35 million for expanding TRAX light rail to Salt Lake City International Airport, but with a caveat requiring Utah Transit Authority to expand its free zone eastward on the University Line to take in the Library Station. The UTA board of directors must approve the motion.
Council members said the library's exclusion from the free zone, while courthouses and the state's capitol building were included, made little sense. "It seems ridiculous that it's not [free]," one city counselman said.
UTA says enforcement of an expanded free zone could be problematic and costly, since it would encompass part of the University TRAX line after it branches away from the north-south line to Sandy. But UTA also acknowledges that the introduction of electronic payment cards later this year could address some of the problems arising.
Seattle ponders streetcar networkSeattle's Department of Transportation is considering the addition of at least four streetcar routes, emanating from the current 1.3-mile South Lake Union Streetcar line which began operation last December.
Chosen as possible routes are: a 3.5-mile line to the University District from Westlake Center, extending the South Lake Union line northeast via Eastlake Avenue East, the University Bridge, Northeast Campus Parkway and up University Way to Northeast 50th Street; a 4-mile line through downtown on First Avenue, connecting the King Street Station area and extending north to Seattle Center; a 4.4-mile line from Westlake Center to Fremont and Ballard, extending along the west side of Lake Union, across the Fremont Bridge and up Leary Way Northwest to 22nd Avenue Northwest and Northwest Market Street; and a 2.8-mile line from Pioneer Square to First Hill and Capitol Hill, extending up South Jackson Street from Fifth Avenue east to Boren Avenue and Broadway, as far north as East Aloha Street.
Construction of any or all of the proposed lines would require some form of public/private partnership, Seattle city officials have said, following the approach used to construct the South Lake Union line.
ARINC wins NEC centralized electrification and traffic control contract
ARINC Incorporated won a contract to design and deliver a Centralized Electrification and Traffic Control System for the National Railroad Passenger Corporation (Amtrak) Northeast Corridor Operations. The project is part of a major Amtrak infrastructure improvement program for the Northeast Corridor. The new system will provide Amtrak with a capability to improve the efficiency of their train operations and energy management on the Corridor.
The new CETC system will be based on ARINC's Advanced Information Management AIM® software platform, with a fully redundant architecture supporting multiple control centers and their associated emergency back-up centers. It will have the capability to operate the entire Northeast Corridor from any of several centers located throughout the Northeast, and will support train dispatching from Washington D.C. to Boston.
In addition to Amtrak trains, the system will be used to dispatch freight traffic from Norfolk Southern and CSX Transportation and commuter trains from Southeastern Pennsylvania Transportation Authority (SEPTA), Maryland Area Regional Commuter (MARC), New Jersey Transit and Virginia Railway Express (VRE).
ARINC has designed and built rail operations centers and SCADA systems on the corridor for MBTA, Long Island Rail Road, Metro North Railroad, New York City Transit, New Jersey Transit, Conrail, SEPTA, Maryland MTA and WMATA.
Viterra to acquire NREC low-emission locomotive for Vancouver terminal
Viterra Inc. will reduce emissions and traffic delays at its Pacific grain terminal in Vancouver with the acquisition of an N-ViroMotive™ GenSet locomotive from National Railway Equipment Co. The acquisition is being partially funded through the Government of Canada’s Freight Technology Incentives Program, which is designed to reduce Greenhouse Gas and air pollutant emissions in the freight sector.
In a recent two-week operational test, the two-engine, 1,400-hp GenSet 4-axle unit demonstrated superior tractive effort, fuel and emissions savings compared to Pacific’s existing 1,200-hp switch engine.
“Though we knew this engine was a big fuel saver with extremely low emissions, we were astonished at its tractive effort,” says Bill Mooney, Viterra’s Director of Terminals. “While using only one of the NREC locomotive’s two GenSets (700 hp), we could pull 28 loaded grain cars at a time from the staging tracks over a railroad grade crossing to our elevators, versus only 12 cars when using our 1,200-hp unit. This means we can cut the number of times we block that very busy crossing by one-half to one-third."
Mooney added that during unloading operations, Pacific was able to handle 18 cars compared to six with its existing switcher, thereby further reducing traffic interruptions at another road crossing. Mooney noted that reducing the frequency of grade crossings is important to the entire Port of Vancouver since there is very heavy container truck and other traffic. While reducing the time required to unload a train, the N-ViroMotive locomotive also significantly reduced noise in the local area.
Faiveley Transport enters discussions to purchase Ellcon-National
Faiveley Transport, a company controlled by Faiveley SA and Sagard, has entered into exclusive discussions to purchase 100 percent of Ellcon-National and its affiliates. The company points out that this acquisition will be a key step for Faiveley Transport to penetrate the North American market and the freight brakes’ business.
Ellcon-National, founded in 1910 and based in based in Greenville, S. C., produces a wide range of products for freight cars such as brakes and loading devices, together with equipment for passenger rail cars including stainless steel doors and windows, for intercity and light transit vehicles.
Faiveley Transport, based in Paris, France, notes that, if it completes this transaction, it will be in a strong position to continue developing worldwide sales from this product range. It will also enable Faiveley Transport to ensure ongoing competitive production thanks to Ellcon’s solid industrial experience and extensive presence in the U.S. domestic market.
The Faiveley Group is a global supplier of railway systems and services, with technical expertise in air conditioning, electro-mechanics, on-board electronics, braking systems and couplers, platform doors and gates and customer services.
Stella-Jones reports strong first quarter
Stella-Jones Inc. first quarter sales reached $66.2 million, an increase of $4.2 million, or 6.8 percent over last year's first quarter sales of $61.9 million. The contribution from the Arlington, Wash., facility for the full period in 2008, versus only one month in 2007, accounted for essentially all of this gain. The appreciation of the Canadian dollar, Stella-Jones' reporting currency, reduced the value of U.S. dollar denominated sales by approximately $5.0 million when compared with the same period last year.
Railway tie sales posted a strong 31.4-percent increase to $32.3 million, reflecting continued solid industry demand and increased supply capability, following the expansion of the Bangor, Wis., facility with the addition, in May 2007, of a treating cylinder that increased plant capacity by over 50 percent.
Gross profit in the first three months of 2008 reached $13.7 million, or 20.6 percent of sales, compared with $15.9 million, or 25.7 percent of sales in the same period in 2007. Net earnings were $5.3 million, or $0.42 per share, fully diluted, in the first quarter ended March 31, 2008 compared with $6.1 million, or $0.48 per share, fully diluted, in the corresponding period in 2007.
Subsequent to the end of the first quarter, on April 1, 2008, the company completed the acquisition of The Burke-Parsons-Bowlby Corporation, a producer of treated-wood products primarily for the railroad industry. BPB, which began operations in 1955, had sales of approximately US$100.0 million for the 12-month period ended December 31, 2007. This acquisition includes five treating plants located in DuBois, Pa.; Goshen, Va.; Spencer, W.Va.; and Stanton and Fulton, Ken. BPB further strengthens Stella-Jones' position in the North American railway tie market, establishing it as the second largest player, with an estimated market share of 25 percent.
RailAmerica appoints Preslar chief financial officer
RailAmerica, an operator of North American regional and short line railroads, named Clyde Preslar chief financial officer. Preslar assumes his current position with more than 25 years of experience in corporate finance, including 12 years experience as a CFO of publicly traded companies. Prior to joining RA, Preslar was the executive vice president and chief financial officer for Cott Corporation in Tampa, Fla. He also served as vice president and chief financial officer for Lance, Inc. in Charlotte, N.C. Preslar is an Elon College graduate and holds an MBA from Wake Forest University. He will be based in Jacksonville, Fla.
Massachusetts studying expanded railroad service
The Patrick Administration is launching a study to look at ways to expand rail freight transportation in Massachusetts, the local newspapers report. The study will include the first state rail plan in nearly two decades based on a review of all rail infrastructure and the relationship between freight and passenger rail on common lines.
Lt. Gov. Timothy Murray says the study is key to expanding commuter rail service while ensuring the efficient delivery of goods. He said the $1-million study will also put the state in a better position to obtain federal railroad funds. The study by the Executive Office of Transportation is expected to take 15 months to complete.
Work begins to replace CTA Loop train control system on elevated lineCrews will begin work this week to replace the signal and train control systems and replace deteriorated rail ties and track in an effort to prevent slow zones along the Loop elevated tracks. The new train control system will enhance CTA’s ability to operate trains through two junctions where Brown, Orange, Green, Purple and Pink Line trains enter and exit the Loop.
The new system will replace the current system that has been in operation for more than three decades. In addition, approximately 10,000 feet of track will be renewed along with the replacement of rail ties that will eliminate nearly 600 feet of existing slow zones and help to prevent future slow zones. The track work will require trains to be rerouted periodically from the Lake and Wabash stretches of elevated track to the Wells and Van Buren elevated tracks. Customers can expect these types of reroutes through Thanksgiving 2008. As weather permits in early 2009, crews will begin work on the Wells and Van Buren elevated tracks, requiring trains to be rerouted to the completed Lake and Wabash tracks. The project is scheduled to be completed in 2009.
A new signal and train control system will be installed at the Loop junctions of Van Buren/Wabash and Lake/Wells. These are two of the busiest junctions on CTA’s rail system. Approximately 115,000 customers travel through the junction at Lake/Wells on a typical weekday and 79,000 through the junction at Van Buren/Wabash. The new systems will help to improve the reliability of service by regulating train movement, speed and intervals at those junctions.
As part of the Loop project, the current signal system will be replaced with a modern automatic train control signal system. A portion of the bridge control system that operates the Lake and Wells Street bridges also will be upgraded.
ecoFREIGHT delivers ecoFRIENDLY locomotives to CPRCanadian Pacific Railway will test two environmentally friendly locomotives in southern Ontario thanks to Transport Canada's ecoFREIGHT Program, said Executive Vice-President and Chief Operating Officer Kathryn McQuade.
"We commend Minister Cannon and his colleagues for helping us improve the environment in the communities we serve," said McQuade. "The Government of Canada's ecoFREIGHT program helps us test and prove innovative products sooner."
Canadian Pacific has ordered two high efficiency National Railway Equipment Company GenSet locomotives. Instead of one 2,100-horsepower diesel locomotive engine, they use three independent diesel engine GenSets to achieve the same amount of total horsepower. Overall, the technology aims to achieve significant fuel savings, ultra-low emissions and longer engine life.
Canadian Pacific's emissions per Revenue Ton Mile have decreased almost one quarter (24.1 percent) since 1990 while RTMs have increased 37.4 percent over the same period. Additionally, CP has equipped three-quarters of its existing locomotive fleet with automatic engine start/stop technology, which reduces emissions from idling locomotives.
BNSF grade crossing safety results continue to improveFor the past 12 months, BNSF has continued to improve its grade crossing safety results. In fact, BNSF continues to have one of the lowest highway-railroad grade crossing collision rates in the rail industry. For the first quarter of 2008, collisions per million train miles are down to 1.50 collisions per million train miles as compared to 1.76 in March 2007.
BNSF is committed to helping local and state law enforcement work with drivers to change unsafe behavior at grade crossings. Some of these programs include:
- Operation Lifesaver - safety educational courses targeted for "high-risk" populations, including industrial truck drivers, school bus drivers and new drivers
- Officer on a Train - law enforcement professionals observe motorists’ and pedestrians’ behavior at railroad crossings, either watching from a locomotive cab or from the ground at the crossing
- Roll Call - a law enforcement program that reinforces prior training and the importance of enforcing grade crossing safety laws
Across its 32,000-route-mile network, BNSF has more than 26,000 highway-railroad at-grade crossings.
"One way to address grade crossing safety is to reduce the number of at-grade crossings," says Lyn Hartley, director of public projects, Engineering. "So far this year, BNSF has worked closely with communities and private land owners to close more than 154 grade crossings. We’re ahead of plan, with a goal of 450 closures by the end of this year."
"The most important reason focus on grade crossing safety is to save lives," said Rick Flink, regional manager, Field Safety Support. "Although pedestrian and trespasser casualties were reduced to 29 so far this year from 32 in 2007, we will continue to focus on keeping people off of the right of way. Education and enforcement programs have led to the decrease we’ve seen so far, but we need to get these down to the lowest levels possible."
Union Pacific wins award for developing, operating Genset LocomotivesUnion Pacific received the 2008 CALSTART Blue Sky Merit Award™ for using second-generation cleaner and more efficient switching locomotives. The annual award recognizes outstanding marketplace contributions to clean air, energy efficiency and to the clean transportation industry overall by companies, organizations and individuals.
"Union Pacific Railroad stepped up with a smart next step to battle urban pollution: its commitment to developing and then operating cleaner, energy-efficient 'Genset' switching engines deserves recognition," said John Boesel, President and CEO of CALSTART.
Union Pacific Railroad’s Genset serves as successor to the first-generation diesel-battery hybrid switching locomotives, and can be a platform for future generations of hybrid switching locomotives incorporating energy storage technologies. Genset is expected to reduce emission of oxides of nitrogen and particulate matter by up to 80 percent and achieve a similar 16 percent reduction in fuel consumption. The company successfully deployed 160 engines in 2007.
"Union Pacific is committed to moving freight safely and more efficiently to reduce the environmental impact on the communities in which we operate," said Jim Young, chairman and CEO, Union Pacific. "We are honored to receive The Blue Sky Merit Award™ for work on the Genset locomotive and other environmental efforts which reflect our employees' vision and creativity in generating solutions that have a long-term positive impact on the transportation industry."
Wabash National sells RoadRailer® set to Japan's Shiga Transport Co. Ltd.Wabash National Corporation announced that Japan's Shiga Transport Co. Ltd. purchased a demonstration set of RoadRailer® intermodal equipment. Shiga Transport, representing the Japan trucking industry, purchased the RoadRailer equipment to investigate the possibility of using RoadRailer intermodal products in Japan. RoadRailer is a unique technology with the flexibility of an over-the-road trailer that is specially equipped for railroad intermodal service.
Japan is pursuing a program called Dual Mode Transport II in which, by utilizing the RoadRailer technology, the country would improve its freight structure and reduce pollution and green house gases. A national demonstration of the RoadRailer technology will take place in Japan this June.
"Wabash National is pleased to be working with Japan's Shiga Transport," said President and CEO of Wabash National Dick Giromini. "This is a great opportunity for Wabash National to globally expand the benefits of RoadRailer technology, and enable Shiga Transport to provide Japan with this innovative technology as the country focuses on better utilizing its railroad infrastructure."
ASLRRA sets attendance record at San Antonio meetingThe American Short Line and Regional Railroad Association annual meeting now taking place in San Antonio, Texas, had 1,500 people registered, a new attendance record for ASLRRA conferences. Montana Rail Link, Pioneer Valley Railroad Co. Inc. and R.J. Corman Railroad Co./Central Kentucky Lines won the association’s marketing awards for efforts ASLRRA says "embody ingenuity and commitment, both to success and a cleaner environment."
The winners of the Railway Age Short Line Railroad of the Year Award, Twin Cities & Western Railroad, and the Railway Age Regional Railroad of the Year, South Kansas & Oklahoma Railroad, were also honored at the meeting.
GE said to be seeking buyer for its rail services unitGeneral Electric Co. is seeking a buyer for its rail services unit in a deal that could be worth about $4 billion, according to people familiar with the company, the Financial Times reported on its Web site. The move to sell the unit is part of GE's attempts to reduce its exposure to low-margin businesses after reporting disappointing first-quarter results last month, according to the newspaper.
The unit leases 165,000 railroad cars and 120,000 trailers and containers. GE declined to comment on the report, the FT said.
GE's effort comes as CIT Group Inc., the commercial and consumer finance company, is also quietly seeking a buyer of its CIT Rail business, according to people familiar with the sale process, the newspaper said. CIT Rail owns and leases a fleet of more than 100,000 rail cars and 500 locomotives across North America.
CSX highlights market-leading track record in investor presentationCSX Corporation filed an investor presentation with the Securities and Exchange Commission in connection with the company's 2008 annual meeting of shareholders, which is scheduled for Wednesday, June 25, 2008.
"CSX's Board of Directors has driven extraordinary shareholder returns, financial and operational performance, and excellence in corporate governance and offers a compelling future outlook," said Michael J. Ward, CSX chairman, president and chief executive officer. "We look forward to meeting with CSX investors to discuss our track-record of success and concrete plans to continue to create value for all shareholders. We believe that the block of TCI group nominees, if elected, may seek to implement an agenda that would damage CSX's future success and returns to shareholders."
The CSX Board of Directors recommends that shareholders re-elect its experienced and highly qualified directors and support the Board's efforts to create additional value by promptly voting the WHITE proxy card by telephone, Internet or mail. CSX also strongly urges shareholders to disregard any blue proxy card sent by The Children's Investment Fund ("TCI") or other members of TCI's group, including 3G Capital Partners.
The investor presentation is available in the "Investor Presentation" section of the company's annual meeting website at 2008annualmeeting.csx.com or at the SEC's website at www.sec.gov.
Canada regulator dismisses grain rail complaintCanada's transport regulator said it has dismissed a request from a group of grain shippers to order Canadian National Railway to stop using a new system to distribute rail cars, local media report.
The railway's new program has created problems for the Canadian Wheat Board and five small grain companies, the Canadian Transportation Agency said in an April 30 letter. But the agency said there was not enough evidence to show the shippers or farmers suffered irreparable harm from the program, which allows shippers to order cars to specific elevators up to 16 weeks in advance.
The shippers have been involved in a formal service complaint against CN. The Canadian Transportation Agency ruled in January that CN failed to provide adequate service to grain shippers last year, but said it is still evaluating the railway's service for the current year.
Barge finally freed from Mississippi River railroad bridge in IowaA barge that hit a railroad bridge over the Mississippi River in southeastern Iowa has been freed, and rail traffic is moving again.
The jumbo hopper barge was freed about 63 hours after it became wedged against the BNSF Bridge at Burlington, Iowa. Line boats and towboats were used to free the barge and help push it upriver. There appeared to be damage to the barge's fiber lift covers and a hole at its base.
Damage to the bridge was minimal, and the track itself was not affected, said BNSF spokesman Steve Forsberg. Rail traffic had to be shut down for 35 hours after the barge strike, backing up more than 100 trains.
Amtrak rerouted a leg of its California Zephyr, which runs from Chicago to San Francisco. Freight trains were held until the bridge reopened.
The accident remains under investigation, the Coast Guard said.
Railroads fill new niche as for Colorado’s growing wind-power industryColorado's $3-billion railroad freight sector is rolling strong and destined to get stronger, with the wind at its back, local newspapers report. The state's effort to build a new industry centered on wind power is likely to bring a surge of new business to rail carriers. Already major haulers of coal, the freight lines are well positioned to embrace the new energy economy by transporting materials and products for wind energy.
Proximity to rail lines was a key factor in the decision of Danish firm Vestas Wind to locate an $80-million blade manufacturing plant that opened earlier this year in Windsor. And rail access also was a primary criterion in Dragon Wind's choice of Lamar as the site of its $15-million wind-turbine tower factory scheduled to open later this year.
Even without the promise of new business from the wind-energy industry, Colorado is a hub for the nation's two major rail haulers, Union Pacific and BNSF. They carry a combined workforce of 2,800 employees in Colorado, with a total payroll of more than $200 million. Their 2,300 miles of main line Colorado track handle 2.9 million carloads of freight a year. Central Denver is anchored by a main rail line and a series of railyards with dozens of spur tracks where incoming and outgoing trains sort their cars according to their ultimate destination.
"Rail is taking on surprising new turns," said Tom Clark, executive vice president of the Metro Denver Economic Development Corp. "Obviously, it has been a major player with coal and other products, but the advent of the wind industry has added a whole new element."
Clark said rail infrastructure in Colorado has become a key part of economic developers' recruitment efforts that target wind-energy manufacturers and other businesses.
Record high energy prices — especially for diesel that fuels locomotives — have hit railroads as hard as any other transportation sector. But rail's ability to handle trains with hundreds of cars gives it an efficiency advantage compared with tractor-trailer freight. Locomotive fuel efficiency has increased 80 percent since 1980, according to BNSF spokesman Steve Forsberg. On average, a train can carry a ton of freight for 423 miles on a gallon of fuel. The efficiency comes from running steel wheels on steel track — producing only one-tenth has much resistance as a rubber tire on pavement.
In addition to rail giants UP and BNSF that dominate Colorado's rail freight network, smaller short-haul lines such as investor Pat Broe's Great Western Railway help funnel business to the main lines. Vestas Wind's turbine blades — up to 144 feet long — are being carried via Great Western from the Windsor plant to main lines operated by BNSF and UP for eventual distribution to wind farms. On the other end of the distribution chain, Dragon Wind will use rail to receive shipments of steel plates that will be shaped into wind-turbine towers.
Alstom to equip ICE3 trains with ATLAS control systemAlstsom announced May 2 it has signed a contract with Deutsche Bahn to install the onboard ATLAS control system on 10 very high speed ICE3 trains built by Siemens. The contract is worth 14 million euros ($21.6 million), and includes an option for equipping an additional seven trains.
The ETCS ATLAS was designed at the Alstom sites at Charleroi in Belgium and Villeurbanne in France. Deutsche Bahn and Alstom staff will carry out the onboard installation and integration of the control systems at the operator’s workshops
ICE3 trains run on cross-border rail lines linking Frankfurt to Amsterdam, Brussels and Paris. They currently are equipped with nine different control systems. ATLAS technology initially will be installed alongside existing systems, which subsequently will be phased out.
"Alstom offers a simple and proven solution allowing ICE3 to circulate in four countries with a unique train control system. With this new ETCS order, Alstom confirms its position as leader in the field of train interoperability on the European network," said Roland Kientz, North Europe senior vice president for Alstom Transport.
Are rails revenue-adequate? They say "no"Railroads want the Surface Transportation Board to change the way it determines whether railroads are earning revenues that are adequate to meet their capital improvement needs. The Association of American Railroads said it filed a petition Thursday asking the agency to start a rulemaking proceeding to adopt the use of replacement costs--not return on investment--to determine whether the carriers are collecting adequate revenues.
The STB recently determined that the railroad cost of capital in 2006 was 9.4%, down from 12.5% in 2005. This means that several railroads appeared to have returns on investment exceeding the cost of capital, and were therefore "revenue adequate."
The AAR says the proposed new method of determining revenue adequacy would be more in tune with modern financial practice.
"Until now," the association pointed out, "the agency has used the depreciated book value of a railroad's assets to determine its capital investment base. As a result, railroads' revenue needs have been understated. Using replacement costs--instead of book value--to determine revenue adequacy should result in a more accurate estimate of the revenues railroads need to maintain the industry's capital-intensive network and expand rail infrastructure."
The AAR noted that a recent study by Cambridge Systematics found the industry needs to invest $148 billion in new infrastructure during the next three decades in order to meet the anticipated transportation needs of the national economy.
Portec earnings edge upPortec Rail Products, Inc. announced unaudited net income of $1.34 million, or $0.14 per share, for the first quarter ended March 31, compared with unaudited net income of $1.2 million, or $0.13 per share, in the prior-year quarter. Net sales for the quarter were $24.8 million, down from $27.5 million for the first quarter 2007.
Richard J. Jarosinski, president and Chief Executive Officer, said, "We are pleased with our financial results for this period, despite our sales level being affected by a slower roll-out of new orders by our Canadian and United States Class I railroad customers. Challenging weather conditions in the current quarter also delayed the start-up of many of our customers' capital expenditure and track maintenance programs. Our earnings growth in the current quarter reflects lower administrative expenses, a better product mix, and lower interest expense."
At noon Friday, shares of Portec traded at $12.00, down 1%.
California green groups target locomotive emissionsSouthern California "environmental justice" groups have petitioned the state's Air Resources Board to mandate locomotive emissions reduction, claiming the current voluntary agreement with freight railroads has failed to address the situation adequately. The petition appears to ask the board to sidestep or attempt to supersede federal authority.
The Center for Community Action and Environmental Justice, a coalition of groups, made its request April 24; the board has 30 days to respond to the petition. A board spokeswoman said ARB is reviewing the petition, but stressed "there is no question that ARB cannot set emissions standards for locomotives."
At the board's most recent meeting April 24, Mike Barr, attorney for the Association of American Railroads, disputed the petition's assertions. "The MOU has produced reductions very quickly and effectively, far more than regulations could have done," he said.
Under a 2005 memorandum of understanding, freight railroads agreed to cut particulate matter emissions at railyards in California. The MOU required idling reduction devices on California-based locomotives within three years, a phase-out of non-essential locomotive idling, identifying and repairing locomotives that emitted excessive smoke, and increasing the use of ultra low-sulfur diesel fuel.
The environmental groups say the Air Resources Board's own 2007 and 2008 health risk assessments, conducted at railyards, show that the policy hasn't been effective, citing increased cancer risks at those locations.
Carload freight edges higher, but intermodal declinesContinuing strong grain and coal traffic nudged railroad carload freight to 335,865 cars in the week ended April 26, up 0.3% from the corresponding week last year. Grain loadings were up 20.1% while coal loadings gained 7.6% from the comparable week of a year ago.
Intermodal freight declined 4.4% from a year ago, to 224,365 trailers and containers. The Association of American Railroads estimated total volume at 34.7 billion ton-miles, up 1.8% from 2007.
In Canada, carload traffic in the latest week totaled 76,896 cars, down 6.2% from a year ago, and intermodal volume totaled 48,556 units, up 2.2%. Kansas City Southern de Mexico carload traffic fell 12.9% to 10,629 cars, but intermodal volume was up 23.9% to 5,345 units.
TrinityRail car backlog shrinksTrinity Industries announced that TrinityRail's order backlog on March 31 totaled 27,960 railcars valued at $2.4 billion, compared with a backlog of 37,790 cars worth $3.1 billion on March 31, 2007.
Trinity said the current backlog reflects the removal of 1,970 cars "due to uncertainty surrounding the bankruptcy of the customer that ordered them." These cars had been scheduled for delivery in 2009. In this year’s first quarter, TrinityRail shipped 6,010 cars and received firm orders for 4,080 cars.
A surge in business for its other groups--Energy Equipment, Inland Barge, and Constriction Products--permitted Trinity to report corporate earnings of $65.6 million for the first quarter, up $59.1 million in the corresponding 2007 period. The price of Trinity shares increased 12% in midafternoon trading Thursday.
FreightCar America earnings dropFreightCar America reported Thursday that it earned $1.1 million or $0.10 per share on sales of $95.1 million in first-quarter 2008, compared with net income of $23.0 million or $1.80 per share on sales totaling $325.5 million in the first quarter of 2007.
President and CEO Chris Ragot said first-quarter results were significantly impacted by "decreasing volume levels and pricing pressure in our industry." He said the rising cost of manufacturing materials led the company to "selectively forward purchase materials to defray the price increases," affecting cash flows for the quarter.
"The current operating environment further validates our decision to optimize our manufacturing footprint and flexible process engineering techniques, as well as to increase our cost reduction efforts across all levels of our organization," said Ragot. "We remain confident that our strategy will prove successful over the long term as we continue to navigate through this difficult phase of our industry cycle."
He said FreightCar America received orders for 2,396 new cars in the first quarter of 2008, compared with 2,074 in the fourth quarter of 2007 and 768 in the first quarter of 2007. The backlog of unfilled orders was 6,785 units on March 31, 2008, compared with 5,399 on Dec. 31, 2007, and 5,007 on March 31, 2007.
Crossing fatalities down sharply this yearRailroads reported 38 fatalities at highway-rail grade crossings in this year's first two months, down 32.1% from the 56 crossing deaths recorded in January-February 2007. Trespasser fatalities were up 10.9% to 61. Total rail-related fatalities declined 9.5% to 105.
Train accidents were down 10.1% to 388 in January-February this year, according to preliminary statistics posted April 30 on the Federal Railroad Administration’s website. The number of collisions increased 29.6% to 35, derailments declined 14.0% to 382, and yard accidents were down 8.5% to 204.
Track causes were blamed for 136 train accidents, down 15.5% from last year; human factors, 134, down 5.0%; equipment causes, 53, down 17.2%; signal causes, three, down 57.1%; and miscellaneous causes, 62, up 5.1%.
Parsons Transportation Group gets next Houston LRT contractThe Metropolitan Transit Authority of Harris County, Tex., has chosen Parsons Transportation Group for the next phase of the authority's light rail project in Houston. Metro awarded a $12 million contract to the company, running through December, to coordinate Phase II construction of the East End rail line.
Parsons was one of three contractors bidding on the light rail line's second phase of development. Metro in May 2007 awarded a $77.3 million contract to Washington Group International for Phase I development work of the East End project.
CSX/Florida deal's fate still uncertainThe proposed 61.5-mile central Florida commuter rail project, negotiated by the state and CSX, is being held hostage to legislative maneuvering as some question portions of the negotiated agreement, including absolving CSX from any liability issues.
State Senate Transportation Chairman Carey Baker April 30 moved to strip the issue from the state Senate's transportation bill due to concerns about liability and various amendments being attached to the measure. Later the same day, however, backers of the project said language might be restored when the bill goes to the state House; if the House approved the measure, the Senate would revisit the issue on a straight yes-or-no vote.
The political maneuvering affects not just the $641 million agreement with CSX but the state's overall transportation program, including a proposed rental-car surtax to pay for commuter rail in both central and south Florida, and a 25% increase in Florida's Turnpike tolls.
In a letter last week, Florida Chief Financial Officer Alex Sink encouraged legislators to review the state's agreement with CSX, recommending a revision of the clause mandating that any state-run commuter operation to pay for the cost of accidents involving commuter trains and passengers, even if CSX were at fault. The agreement in part calls for CSX to pay the state $10 million per year to use the commuter rail line up to 12 hours per day for its freight trains.
Birmingham, Ala., seeks bids for streetcar systemThe Birmingham-Jefferson County Transit Authority in Alabams says it seeks proposals for the design and construction of its planned $33 million, 2.5-mile streetcar system. Birmingham hopes to start construction on the line by November.
Interested parties must attend a May 19 pre-proposal meeting to qualify as bidders. Proposals will be accepted by the transit authority until June 30. Contractors can obtain more information through the authority's website, www.bjcta.org/index.php?id=166.
The proposed route would begin at the intermodal facility on Morris Avenue and wind through the city, passing cultural hotspots, such as the Birmingham Museum of Art and the Birmingham-Jefferson Convention Complex.
City and transit authority officials may travel to Milan, Italy, to view Peter Witt-style heritage streetcars in operation there; Birmingham is mulling use of such cars for its project.