June 2008
Nevada loses bid to delay nuclear-waste rail lineThe Surface Transportation Board has turned down a motion by Nevada to reject as incomplete an application by the of U. S. Department of Energy for authority to build a 300-mile line in the state to transport spent nuclear fuel and high-level radioactive waste to a repository at Yucca Mountain. DOE says the line, which would connect with Union Pacific at Caliente, is also intended to provide common carrier service to on-line communities.
In a decision handed down June 27, STB found DOE's request to be "sufficiently complete" at this stage of the proceeding. The decision permitted the state to amend its filing, refused to extend the procedural schedule to include an oral hearing on Nevada's objections.
STB noted that a main argument of the state is that "DOE has stated that it will not make a final decision on whether the line will be a common carrier line until it has completed further environmental review, and that it has failed to submit an operating plan with its application."
STB ruled: "While DOE may not have made a final decision as to whether to have common carrier service on the proposed Caliente Line, such uncertainty does not deprive this agency of jurisdiction over the project. In essence, Nevada would have us require a noncarrier applicant to be certain that it will construct and operate a common carrier line, thus transforming our grant of authority into a mandatory order to the applicant. It is well settled, however, that our grant of authority is permissive, not mandatory. The permissive nature of our grant thus recognizes that the decision to go forward with such a project is in the hands of the applicant and not this agency. We only determine whether such a common carrier project is inconsistent with the public convenience and necessity. And, at this point, only if DOE would definitely decide that it does not wish to have a common carrier service over the Caliente Line would we lack jurisdiction over the proposed line construction."
Ansaldo STS lands China high speed rail contractAnsaldo STS, in partnership with Beijing HollySys Co. Ltd., has won a $97.2 million contract to design, build, and begin operating signaling equipment for China's Zhengzhou-Xi'an high speed rail line, one of three high speed lines in the nation being equipped with European Railway Traffic Management System (ERTMS) technology. Ansaldo STS will receive $75.6 million for its work in the joint venture. Ansaldo STS's previous work in China included upgrades on the Qin-Shen and Shi-Tai rail lines, as well as work on the Shanghai Line 2 in China's largest city.
Alstom lands contracts in Dublin, New YorkAlstom June 30 said it has secured two contracts, one on each side of the Atlantic Ocean.
Ireland's Railway Procurement Agency has chosen the company to maintain 18 new Citadis tramcars for Dublin’s light rail system, LUAS, for a five-year period, with an option for six more years. The contract is worth $23.6 million. The new cars are being built at Alstom’s La Rochelle, France, plant and begin to arrive in Dublin early next year for deployment on the Green Line.
In the U.S., Alstom Signaling, Inc., said it received a $32 million order from L.K. Comstock & Co. for New York City Transit’s Signal System Modernization Project at NYCT's East 180th Street Yard White Plains Road Line.
Kenna is new Panama Canal Railway chiefThomas H. Kenna has been appointed president and director general of the Panama Canal Railway Co. (PCRC), a joint venture owned equally by Mi-Jack Products, Inc. and Kansas City Southern. Formerly director of marketing for PCRC, Kenna will take over the top post on July 1, replacing David L. Starling, who is assuming the position of president and chief operating officer of KCS.
Before joining PCRC in 2000, Kenna worked for Hapag-Llloyd, CMA CGM, and other major shipping lines in management and marketing positions. Mi-Jack President Michael Lanigan noted that Kenna's "marketing and sales efforts have been prime factors in PCRC's annual freight volumes moving from approximately 16,000 containers in 2001, the first year of operations, to nearly 222,000 in 2007." Lanigan said PCRC expects to move around 363,000 containers this year.
Midwest floods still disrupting freight traffic volumeThough flood waters are receding in many parts of the Midwest, their impact on U.S. rail freight traffic volume remains potent, according to the Association of American Railroads. AAP noted U.S. carload freight for the week ended June 21 was down 5.7% from the comparable week of 2007; volume dropped 6.1% on Western railroads and 5.3% on Eastern counterparts.
Intermodal traffic also continued to suffer, down 5.6% from year-ago levels. Total volume for the week was 32.8 billion ton-miles, down 4.4% from the comparable week in 2007.
Commodities registering gains included chemicals, up 4.9%, and grain mill products, up 0.8%. Offsetting those were declines in umber and wood products, off 21.8%, motor vehicles and equipment, down 19.3%, l
and petroleum products, down 11.6%.
Canadian railroad carload freight fell 6.9% for the week versus year-earlier levels, and intermodal traffic also declined 1.4%.
In Mexico, carloads on Kansas City Southern de Mexico declined 3.9% over the year-ago week, while intermodal volume rose 5.8%.
UTU merger opponents win another roundU. S. District Judge John Adams issued a preliminary injunction in Akron, Ohio, on June 26 restraining the United Transportation Union from completing a merger with the Sheet Metal Workers International Association pending settlement of a case challenging some of the events leading up to a vote last summer in which the merger was approved. Of an estimated 68,000 UTU members eligible to vote on the ratification, 12,097 cast votes, and 8,625 voted to approve the merger.
As Judge Adams noted, "There was immediately unrest within the UTU" that culminated in the legal challenge brought by four rank-and-file members. A temporary restraining order in December prevented the scheduled consummation Jan. 1, 2008, of the merger, which would have created the International Association of Sheet Metal, Air, Rail and Transportation (SMART) Workers. That has now been followed by the preliminary injunction, which means that the merger may not be consummated until the legal challenge to its validity and any subsequent appeals are settled.
In issuing his latest order, Judge Adams commented that the plaintiffs "have demonstrated a substantial likelihood of success on their claim that they were deprived of a meaningful vote." A major claim was that sufficient information was not provided prior to the vote on the new constitution that would govern UTU members after the merger.
In a statement Friday, current UTU President Mike Futhey commented, "This confirms my view that if the merger should proceed, it should be the merger promised members and all conflicts should be resolved in a SMART constitution poor to submission to the members for ratification." (Judge Adams observed that prior to succeeding Paul Thompson as president of the UTU, Futhey had “submitted a declaration on behalf of the plaintiffs in their motion for a preliminary injunction, and had expressed opposition to Thompson’s method of promoting the merger and proceeding to a vote on the issue.)
Metrolink to raise rail fares July 1Metrolink train riders in Southern California will see fares rise an average of 5.5% beginning July 1, which agency officials tied directly to the increased cost of diesel fuel.
"We did not anticipate diesel fuel doing what it did this year," said a Metrolink spokeswoman. "We budgeted for $2.50 per gallon, and now it's over $4.50 a gallon. And we buy 6 million gallons a year."
Another fare increase averaging 3.5% is scheduled for July 2009. Fares cover approximately 45% of Metrolink's operating costs.
Proxy battle for CSX “too close to call”The shareholder's meeting to decide whether two activist hedge funds would seat five dissident nominees on CSX's 12-member board of directors adjourned yesterday, with the results of the proxy voting "too close to call at this time," according to CSX CEO Michael Ward. The votes are currently being tabulated and will be certified by an independent inspector of elections. The official results are expected to be announced at a 10:00 a.m. EDT meeting at CSX headquarters in Jacksonville, Fla., on Friday, July 25.
The challenge to CSX management was mounted by Children's Investment Fund (TCI) and 3G Capital Partners LP, which control at least 8.7% of CSX Corp.’s common stock and have an interest in an additional 12.3% through stock swaps. TCI and 3G are claiming that they have placed four candidates on the CSX board: Gilbert Lamphere, Managing Director of Lamphere Capital Management, a private investment firm, and a former CN director; Alex Behring, Managing Director of 3G Capital; Tim O'Toole, Managing Director of London Underground Ltd. and a former Conrail executive; and TCI Managing Partner Christopher Hohn.
“We want to express our gratitude for the continued support of our shareholders,” Ward said in a statement issued after the shareholders’ meeting closed. “We have met with a large number of our shareholders over the past few months, and we appreciate their candor and insight regarding our company. We remain committed to creating further value for all of our shareholders, and we look forward to building on our progress toward making CSX the safest, most productive North American railroad.”
The hedge funds depicted CSX as a high-cost, low-performing carrier that long trailed its peers in productivity, pricing, and cost control, and suggested that raising prices and cutting capital spending would represent a turn in the right direction. CSX found this to be a simplistic view of a complex business, particularly a railroad's need to invest prudently and substantially in its long-term future. As for shareholder value under the stewardship of Michael Ward, CSX noted that the price of its common stock has more than tripled since Ward succeeded John Snow in 2003.
The fight for seats on CSX’s board had its moments of high-flown rhetoric and lower-flying invective, ranging from a request in the U.S. Senate (and independently, on CNN) for an inquiry into “foreign” interests trying to take over a railroad vital to national security, to the railroad’s accusation that the hedge funds “want to suck cash out of the company, then sell out and leave somebody else to clean up the mess,” to the hedge funds’ assertion that CSX moved the shareholders meeting to “the middle of a swamp in New Orleans” to discourage attendance. (In the middle of that swamp stands a freight classification yard, rebuilt since Hurricane Katrina, that CSX said it wanted to show off to shareholders.)
The proxy fight attracted an unusually high level of interest because, as the Wall Street Journal pointed out on the day of the vote, “Trains in the U.S are undergoing a boom not seen in decades, spurred in part by railroads’ fuel-efficiency advantages over trucking and their ability to bypass the country’s increasingly clogged highways."
What happened as the votes were counted in that Louisiana swamp will help to determine how fully CSX will participate in that boom.
Patriot Corridor ruling due Oct. 20The Surface Transportation board said Thursday that it expects to deliver a ruling by Oct. 20, to become effective Nov. 4, on the application by Norfolk Southern and Pan Am Railways to create and jointly own a new rail carrier, Pan Am Southern LLC, to serve a route called the Patriot Corridor, including Albany, N. Y., and the greater Boston, Mass., area. The Springfield Terminal would operate and establish rates for the PAS lines.
STB said it had decided to accept the application as a "minor transaction" requiring no formal environmental review. Key dates in the procedural schedule for consideration of the application are: July 7 (for comments on whether an environmental reviews is warranted); July 11 (notices of intent to participate); Aug. 11 (comments on the primary application); and Sept. 5 (responses to comments).
As described earlier by Norfolk Southern, Pan Am Railway would transfer to the joint venture its 155-mile main track between 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 provide cash and other property valued at $140 million, of which $87.5 million will be invested over a three-year period in capital improvements to the Patriot Corridor.
Peter A. Cannito recipient of Railway Age’s Graham Claytor AwardMTA Metro-North Railroad President Peter A. Cannito is the 2008 recipient of Railway Age’s W. Graham Claytor Award for Distinguished Service to Passenger Transportation.
Now in its 15th year, the award is given annually by the magazine to honor those who have contributed to the advancement of passenger rail in America. The award is named for the late president of Amtrak. Cannito, who will retire from Metro-North next month, will be presented with the honor at Railway Age’s Passenger Trains on Freight Railroads Conference in Washington D.C. on Oct. 22, 2008.
“Pete Cannito stands tall among the industry’s great railroaders,” said Railway Age Editor-in-Chief William C. Vantuono. “It’s his love of the industry, passenger railroading in particular, that has enabled him to make so many significant contributions. This award is well-deserved, because it honors a lifetime of notable achievements.”
“I was proud to be working at Amtrak during Claytor’s tenure when we were working to improve and expand the quality of rail passenger service nationwide, so this award holds particular meaning for me. I’m deeply honored,” Cannito said.
As President of Metro-North since June 1999, Cannito has overseen major investment in new railcars, new and rebuilt shop facilities and technological improvements, all with the intent of improving customer service and increasing ridership and revenue. During his tenure, Metro-North has set records in ontime performance, ridership, customer satisfaction, fleet performance, and safety.
During his 41-year railroad career, Cannito acquired extensive experience and acumen in managing all aspects of railroad operations, maintenance, engineering, construction, and new car development for some of the largest, most complex railroads in the industry, among them the New York Central, Penn Central, and Amtrak. After serving in the U.S. Marine Corps, he joined the New York Central in 1967 and worked his way through Canisius College in his hometown of Buffalo, N.Y., graduating in 1971 with a Bachelor of Science degree in Business Administration. He left the Penn Central in 1974 to join Amtrak, where he rapidly advanced through several operations, maintenance, and engineering positions. In 1988, Cannito became Vice President of Engineering for Amtrak, taking responsibility for maintenance and upgrade of the railroad’s infrastructure and rail vehicle fleet nationally. He directed the procurement of new passenger equipment, including the GE Genesis Series Locomotive Program, the Superliner Program, and Viewliner Program, and managed the program to introduce high speed rail in the Northeast Corridor. He was also responsible for the construction of the Atlantic City Line from Philadelphia Atlantic City, N.J., and reactivation of the Empire Connection from New York Penn Station to Metro-North territory at Spuyten Duyvil on the Hudson Line. Cannito joined ABB Traction in 1995 as Executive Vice President, overseeing all new and remanufacturing efforts for equipment in the heavy and high-speed rail markets in the U.S. Then, in 1997, he was named Vice President of Rail and Transit Programs for Raytheon Infrastructure Inc. A 1963 graduate of Bishop Timon High School in Buffalo, Cannito also has attended The Harvard Business School Advanced Management Program. He currently is a member of the Canisius College Board of Regents.
Among previous Graham Claytor Award recipients are former New York City Transit Authority and Amtrak President David L. Gunn, former Metropolitan Transportation Authority Executive Director and former U.S. Department of Transportation Deputy Secretary Mortimer L. Downey, National Association of Railroad Passengers Executive Director Ross B. Capon, American Public Transportation Association President William W. Millar, Capitol Corridor Joint Powers Authority Managing Director Eugene K. Skoropowski, and the late U.S. Senators Daniel Patrick Moynihan and Clayborn Pell.
Established in 1994, the W. Graham Claytor, Jr. Award for Distinguished Service to Passenger Transportation honors the memory of the late Amtrak President W. Graham Claytor, Jr. A decorated World War II veteran, Claytor served as CEO of the Southern Railway, Secretary of the Navy, and Deputy Secretary of Defense and had an illustrious legal career prior to his 12 years of service as president of Amtrak. His skillful leadership, railroad expertise, and political skills are widely credited with Amtrak’s survival during particularly turbulent years.
AAR seeking railway supplier assistance for legislative initiativesAssociation of American Railroads President and CEO Ed Hamberger has contacted colleagues in the railway supply trade associations asking for help in fighting reregulation, and in passing railroad infrastructure tax incentives (S. 1125 and H.R. 2116). Legislation for both is currently before the Congress. AAR is asking railway suppliers to sign an open letter to Congress opposing reregulation and supporting tax incentives.
“As you know, legislation to reregulate the freight railroads is a greater threat today than ever before,” Hamberger said in a letter to the Railway Supply Institute (RSI), Railway Systems Suppliers Inc. (RSI), and Railway Engineering-Maintenance Suppliers Association (REMSA) “There is no greater threat to our industry today. Reregulation would slash rail revenues and result in drastic reductions in spending on equipment, supplies, and maintenance. The proponents of reregulation have powerful allies on Capitol Hill, and they are pulling out all the stops to convince Congress that railroads are hurting other American businesses. [We] know how far this is from the truth. The vast majority of American businesses benefit greatly because rail is able to transport everything from raw materials to finished products more efficiently and cost effectively than any other mode. All these businesses would be harmed if reregulation passes. Because your members’ fortunes are linked directly to the health of the railroads, they stand to lose even more under reregulation.”
Hamberger said Congress needs to be informed “that there is broad business opposition to reregulation.” The open letter enables suppliers that are members of the trade associations, as well as affiliated suppliers, to add their names through electronic means. AAR is coordinating this effort with Go21 (Growth Options for the 21st Century), a grass-roots lobbying organization with which it is closely aligned. Go21’s Russ McGurk is spearheading this project and can be reached at (703) 519-4740. Suppliers can sign on to the open letter to Congress by going to go21.advocacyinteractive.com.
Minneapolis OKs its portion of Central Corridor LRTMinneapolis city leaders have approved the Metropolitan Council's proposed layout for the Central Corridor Light Rail line, which runs primarily through sister city St. Paul but which will join the existing Hiawatha Line in Minneapolis near te Downtown East/Metrodome Station.
Construction on the 11-mile Central Corridor Line is expected to begin in 2010, with revenue service beginning in 2014.
"Minneapolis is showing our enthusiastic support for this important light rail link," said City Council Member Sandy Colvin Roy, who chairs the City Council's Transportation and Public Works Committee. "We also know there are a lot of details left to be worked out with out partners, and that’s not surprising, considering that we’re talking about making such a significant investment in improving out transportation system."
The Minneapolis action dealt only with the preliminary design plans, which includes elements such as general dimensions and locations of the light rail alignment, station locations and access for commuters with disabilities. Aesthetic considerations, such as public art, station design, and streetscapes are not part of these preliminary design plans.
UP continues sponsorship of tank car safety courseUnion Pacific Wednesday said 24 emergency response personnel representing 12 states spanning the nation had completed the most recent tank car safety course sponsored by the railroad.
The five-day, 40-hour course was held at the Association of American Railroad's Transportation Technology Center near Pueblo, Colo. UP covered all attendees' expenses, with no cost to communities or organizations.
The training covers a variety of safety subjects including how to identify tank car types, fittings and tank car construction features during an emergency. Participants also receive hands-on experience in assessing tank car damage, making repairs, controlling the release of hazardous materials from damaged rail cars and using protective clothing and self-contained breathing
apparatus.
Amtrak removes old NEC bridge, readies new oneAfter at least two false starts, Amtrak June 24 succeeded in removing the existing drawbridge spanning Connecticut's Thames River. The move physically severs Amtrak's Northeast Corridor until a replacement, a lift bridge, is floated into position.
Amtrak has reduced service north of New York during the four-day replacement process, which began June 24. Amtrak is is providing bus shuttles to Connecicut and Rhode Island points and also limited through-rail service between New York and Boston via Springfield, Mass, on its Inland Route.
The new bridge was to be installed beginning Wednesday. Amtrak expects the NEC to reopen June 28.
Houston sets ceremonial groundbreaking for LRT expansionHouston's Metropolitan Transit Authority will host a ceremonial groundbreaking Thursday for the East End light rail line, the first of five scheduled to be completed by late 2012, and the first LRT construction in the city since its initial Red Line opened in 2004.
Metro spokespeople say the agency will build the future lines in 4,000-foot segments, completing each before work starts on the next, to minimize disruptions of traffic and business that marred construction of the Red Line and generated negative coverage and political resistance.
Metro also expects to break ground for the North and Southeast lines this summer, but only after it receives assurance that the Federal Transit Administration will pay half the cost of those lines. By contrast, Metro expects to build the East End and Uptown lines using oher revenue sources.
Virginia legislators introduce bill to extend 'The Tide'Catching Virginia Beach local officials off guard, two Virginia legislators whose districts include the municipality have introduced a bill to extend Norfolk's light rail line, "The Tide," across the border and close to the Virginia Beach oceanfront.
Delegate Robert Tata and state Sen. Frank Wagner, both Republicans,envision LRT reaching the Virginia Beach Convention Center. Tata said the extension would offer a hassle-free commute to those who live in Virginia Beach and work in downtown Norfolk.
Legislation introduced by the two, HB6028, would seek a public/private partnership to advance the extension, with the state soliciting private-sector interest. The private company or consortium would theoretically recoup its investment and a profit by being given a contract to run the rail and charge riders a fare.
In response to observations that Virginia Beach officials remained undecided (or indecisive) on such action, Tata said, "It's time for this to happen, whether they favor it or not."
Hampton Roads Transit President Michael Townes, said, "We’re excited that Delegate Tata understands that extending The Tide into Virginia Beach is important to Virginia Beach and the region of Hampton Roads," he said. "Whether this bill passes or not, the indication is that our General Assembly members are understanding of light rail and are trying to find ways to be supportive." Townes declined comment on the public-private partnership approach.
By contrast, HRT board member Jim Wood, who also serves on the Virginia Beach City Council, expressed surprise, observing, "It’s kind of out of the blue."
Norfolk expects to open its 7.4-mile, $232 million light rail line in early 2010.
Alstom leads consortium building Dubai tram networkA consortium comprised of Paris-based Alstom, Belgian/Dutch Besix Group, and Sercoa has signed a contract with Dubai's Road Transport Authority for the first phase of the Al Safooh tram network, worth nearly $860 million, with an option to oversee the second phase.
Phase 1 is scheduled for completion in 2011, at which time 11 trams would begin operation on a 6.2-mile route servicing 13 stations. Phase 2 would add 14 more trams and extend the route 2.5 miles, with 13 more stations.
Alstom notes Dubai will be the first city in the Gulf region to employ trams, and is modeling the tramway to mirror the catenary-free system used in Bordeaux, France. Al Safooh system stops will be fitted with specially designed automatic platform screen doors to enable street-level air-conditioning for maximum passenger comfort.
AAR urges Congress to aid rail capacity expansion Testifying Tuesday before the Senate Committee on Commerce, Science and Transportation, addressing the issues of climate change and transportation, Association of American Railroads President and CEO Edward R. Hamberger urged Congress to pass legislation allowing the rail industry to bolster capacity, noting railroads already are an environmentally friendly, energy-efficient option.
"First, pass the Freight Rail Infrastructure Capacity Expansion Act (S.1125/H.R. 2116) which provides a 25% tax credit for investments in new track, intermodal facilities and other projects that increase capacity,' Hamberger said. "That credit would be available not just to railroads but to any entity that invests in rail capacity expansion."
Hamberger also called for passage of the Short Line Railroad Investment Act, which, he said, "extends a targeted tax credit for smaller railroads that expired at the end of last year."
Congress should also help foster public/private partnerships in which the public pays for the benefits it receives and railroads pay for the benefits they receive, Hamberger said. "The Chicago CREATE project, the Heartland Corridor, and the Alameda Corridor are all examples of such projects in which public and private dollars are leveraged together to produce public benefits that otherwise would not be realized," he pointed out.
UP, NS launch motor vehicle co-loading serviceUnion Pacific and Norfolk Southern have introduced an Automotive Interline Co-Loading Service permitting the motor vehicles of more than one manufacturer to be loaded in a single railcar. In the first shipment, Chrysler minivans and Ford F150s were co-loaded at a Norfolk Southern facility in Melvindale, Mich., and unloaded 2,241 miles away at Union Pacific’s facility in Mira Loma, Calif. “Co-Loading will create the ability to ship vehicles sooner by generating railcar quantities of vehicles by combining smaller destination facility shipments,” said David Julian, president-Automotive & Supply Chain Services for Norfolk Southern.
Caterpillar buying Brazilian railroad supplier Caterpillar, Inc., announced Tuesday that it will buy MGE Equipamento & Servicos Ltd., a Brazilian supplier of freight car and locomotive components, for its Progress Rail Services division. Founded in 1991, MGE has about 400 employees. The transaction will mark Progress Rail’s first expansion outside of North America. Reuters quoted MGE’s general director, Ronaldo Moriyama, as saying that Progress Rail has locomotives that can be modified with Caterpillar engines at MGE’s plant in Brazil and then leased throughout South America. Moriyama said the Brazilian railroad market is also strong, noting that the state of Sao Paulo plans to invest $10 billion in railroads by 2010, and a high speed train link between Rio de Janeiro and the city of Sao Paulo is planned.
New York MTA faces capital spending cutsSoaring construction and operating costs and declining revenues may force the New York Metropolitan Transportation Authority to cut up to $2.7 billion worth of projects from its $23.7 billion 2005-2009 capital spending program. Service reductions and fare increases are also in sight. The proposed cuts, which were disclosed June 23, would sideline some station improvements and eliminate or delay other projects, including $223 million in signaling projects. While ridership in this year’s first quarter increased more than 5% on MTA’s three big rail operations—New York City Transit and the Long Island and Metro-North commuter lines—the authority’s income has dropped. For example , revenues from taxes on real estate transactions, a mainstay of operating subsidies, is now projected to be $280 million below projections this year.
MSU certificate program graduates inaugural class Seventeen participants of the inaugural session of Michigan State University’s Certificate Course in Railway Management representing several railroads and a major railroad supplier graduated on June 20, following more than 160 classroom hours and 40 hours of independent study. Railroad executives, including several authorities on railroad operations and principles of international operations, and financial analysts from Wall Street and Chicago, provided content. The course was led by two well-known railroad economists, Robert E. Gallamore, Ph.D., and Steven R. Ditmeyer, “who both couple an outstanding railroad career with excellent teaching credentials,” says Dennis Neilson of MSU’s Railway Management Programs.
Robert C. VanderClute, Senior Vice President-Safety and Operations, Association of American Railroads, addressed the graduates, speaking about the challenges facing railroads in the next several years and the need to “think outside the box to solve the problems that need to be confronted in the years ahead.”
The Railway Management Program has been funded in large part by gifts from Dennis J. Gilstad, president, founder, and chairman of rail equipment and financial services company FCM Rail, Ltd, and Edward A Burkhardt, founder, president, and CEO of Rail World, Inc. and Rail World Holdings LLC. Both presented units to the group. “Help create an international social/business network through [this program],” Gilstad remarked to the graduates. “Keep in touch with Michigan State University and your colleagues for an optimization of this and future investments in ‘your’ rail education.” Burkhardt emphasized that this course is “just what the rail industry needs, a straight-forward management course for the future leaders of the industry.”
The next Certificate Course is scheduled to begin Oct. 5, 2008, at Michigan State University. For more information on the course, see the Railway Management Program website, www.raileducation.com. For further information, contact Dennis Neilson, Railway Management Programs, MSU, (517) 355-3363, email neilson@msu.edu;or Bill Wick, (804) 742-1218.
Rail operating employment slides in AprilEmployment in railroad transportation departments continued to slide in April. In the biggest single employment category--transporation (train and engine)--the numbers dropped 2.7% to 68,554 in April compared with April 2007. In the transportation (other than train and engine) category, employment declined 7.9% to 6,623. Total railroad employment in April was down 1.61% to 164,577 from April 2007, although it was up 0.7% from March 2008 due to seasonal increases in maintenance forces.
Supplier NewsRailComm has provided a turnkey wireless remote control system for 25 switch heaters in the Maryland Transportation Authority’s Baltimore Northwest Yard. The system includes RailComm switch heater controllers communicating to a central office via a dedicated data radio network. RailComm’s Domain Operations Controller (DOC®) system resides in the central office and provides the operator with a user interface.
SafeRack, LLC, a supplier of truck and railcar loading rack and fall protection equipment for the petroleum, biofuel, specialized chemical, food/pharmaceutical, cement, and other industries, has launched a new website, www.SafeRack.com. First-time visitors to the site, or those unfamiliar with SafeRack’s products and services, can learn more about the company by accepting the invitation from the site host and clicking on the Post-It note on the right-hand side of the home page. Return visitors are offered easy access with a click on the appropriate category in the left-hand navigation bar. Visitors also have the ability to view SafeRack’s latest news and press releases, order a product catalog, and request a quote for a project.
First of 37 Siemens LRT cars arrives in EdmontonEdmonton, Alberta Monday received the first of 37 new SD160 light rail vehicles manufactured by Siemens Transportation Systems, also marking the 30th anniversary of Edmonton's first delivery of U2 light rail cars from Siemens.
The new equipment will operate on the city's South LRT extension, set to open in stages between April 2009 and April 2010, and also to increase capacity on Edmonton's existing line.
"Edmonton's public transportation system represents the kind of environmentally sustainable infrastructure that cities must adopt. This recent growth and development of the city's LRT system is an example of how the federal Gas Tax Fund supports important economic and environmental infrastructure projects in Canada," said Laurie Hawn, speaking on behalf of Minister of Transport, Infrastructure, and Communities Lawrence Cannon.
"By investing in Edmonton's LRT we are not just investing vehicles or rail lines, we are investing in a system that is sustainable, is good for the environment and will increase the comfort of our passengers," said Mayor Stephen Mandel.
"It is the City of Edmonton's dedication to innovation and reliability that has continued to drive our continued strong partnership for over three decades," said Mario Peloquin, director of business development, Siemens Canada Ltd. Transportation Systems.
Siemens is manufacturing and testing the equipment at its plant in Sacramento, Calif.
NS's Moorman: The renaissance is realNorfolk Southern CEO Wick Moorman says there's growing evidence that "the transportation marketplace has changed fundamentally in ways that favor the railroad business. . . . We think there is more change on the way," he added in a presentation at the Merrill Lynch Global Transportation Conference in New York.
Moorman acknowledged that "2008 is turning out to be even a little softer than we anticipated." But he saw many signs of strength.
One was export coal. "Coal was our strongest performer in the first quarter," he said, "driven by strong export demand, which should continue throughout the year. We'll probably reach 20 million tons over Lambert’s Point in Norfolk, and five million tons over Baltimore. This would represent more than a 50% increase over the full-year 2007 export coal tonnage. . . . For the first time in many years, we will also move 2.5 to 3 million tons of steam coal to Europe. The dynamics of the export market continue to be in our favor as U.S. producers see increased demand for coal to Europe and Asia."
In the intermodal arena, international volume has been hurt by a soft economy and a resulting slump in imports, but at home the picture is different, said Moorman. "There are clear signs of escalating intermodal demand across our network and in particular within the eastern half of our market. Five-dollar-a-gallon diesel fuel provides powerful incentive to ship by rail, and we are introducing new intermodal lanes and moves and improving service performance to take advantage of additional opportunities. In the last eight weeks, we have seen our domestic intermodal volume pick up as more truckload carriers pursue conversion from highway to rail,” he said.
Moorman also addressed the "longer-term dynamics of the transportation market place and some of the ongoing changes that we believe are occurring."
"This is particularly important because of the nature of our business," he said. "The amount of capital we deploy, the time that it takes to deploy the capital, particularly in assets like infrastructure and terminals, and then finally the long lives of many of our assets, makes it essential that we think in terms of where the business will be not just in six months or a year, but in five years, 10 years, or even longer."
One change, he said, is the nature of international traffic flows. "Over half of our international traffic in the first quarter moved over East Coast ports, and we are seeing similar trade patterns continue in the second quarter," he said. "When the planned widening of the Panama Canal is completed, it may well accelerate this trend."
A second set of changes "are set against the backdrop of what seems to be pervasively high fuel prices and shipping costs, along with what may be a sustained period of a cheaper dollar. They're the growing strength of U.S. exports, the reemergence or at least strengthening of North American manufacturing, and a focus on what is being called regional production, the idea that goods should be produced closer to the point of consumption in order to reduce transportation costs."
A "macro change," said Moorman, "is the growing recognition of our nation's infrastructure requirements and what I would argue is the absolute necessity of accelerated investment in rail infrastructure to avoid what is clearly a looming transportation crisis."
Amtrak ’09 funding package moving through CongressThe House Appropriations Committee-Subcommittee on Transportation and Housing and Urban Development has approved $1.439 billion in Fiscal Year 2009 funding for Amtrak, a slight increase over current funding, but $346 million below Amtrak's request of $1.785 billion. The legislation provides $475 million for operational support, and $850 million for capital expenditures and debt service. It also includes $114 million to meet the back pay required by new labor contract agreements (and recommended by Presidential Emergency Board 242). Separate from Amtrak funding is $60 million for federal/state matching funds grants, up from $30 million in FY08.
The Subcommittee’s action follows the full House’s approval on June 11 of the Passenger Rail Investment and Improvement Act, which authorizes between $1.8 and $2.3 billion a year in funding for Amtrak over the next five years. The full House Appropriations Committee is scheduled to take up the legislation on June 26; consideration by the full House, and any Senate action, has not yet been scheduled.
Within the context of soaring fuel prices and travelers flocking to trains in volumes not seen in years, “Broad, bipartisan support exists for the higher spending needed to expand intercity passenger train service for all Americans,” commented the National Association of Railroad Passengers. “While NARP is aware of the budgetary constraints that the Subcommittee faced, we urge the full Committee to raise the total appropriation to $1.9 billion. This larger amount would fully fund Amtrak’s requested operations and capital needs, and its obligations for back pay,” and pay for repairs to 80 damaged passenger cars "that Amtrak did not request to repair and return to service. Repairing these cars should be a critical priority for Congress and Amtrak. It is the fastest way to provide the capacity needed to handle the large number of passengers that has begun to flood Amtrak’s entire system. Amtrak's nationwide ridership jumped 11% in the last seven months over the same period last year."
US&S lands more work in ChinaUnion Switch & Signal has been awarded two contracts worth $22.31 million for ATC (automatic train control) on extensions of the Shanghai Line 2 metro. The first contract is for the Shanghai Line 2 East Extension project, which will extend the existing system eastward by 18.37 miles to provide service to Pudong International Airport. The second contract is for the Hongqiao Integrated Transportation Hinge Mating project (“West-West Extension”), a westward extension of 5.32 miles that will link the present system with Hongqiao Airport. US&S’s contract values for the two projects are $17.63 million and $4.68 million, respectively. US&S will supply its AF-900 profile-based ATC system for signaling and train control. AF-900 integrates ATP (automatic train protection), ATO (automatic train operation), and ATS (automatic train supervision).
The East Extension will add 11 passenger stations and 32 new trains. The West-West Extension will add three passenger stations, two of which will serve Hongqiao Airport. The project also includes retrofit of 37 existing trains in order to enable control of platform screen and security doors that will be installed on both extensions. According to Shanghai Shentong Metro Group Co. Ltd. Executive Vice President Zhu Husheng, “Shanghai Metro Line 2 has been in revenue service for more than eight years, and the signaling system has been running smoothly. We are pleased to have US&S on the signaling project for the extensions.”
AF-900 is the core technology utilized on Copenhagen’s driverless metro. It is also being applied on new driverless metros being constructed in Brescia (Italy), Rome, Milan, and Thessalonica (Greece).
Flooding takes toll on U.S. freight volumeMidwest flooding woes contributed significantly to a 4.4% decline in U.S. carload freight for the week ended June 14. The impact was nearly uniform nationwide; volume declined 4.4% on in the West and 4.5% in the East, the Association of American Railroads reported. Intermodal traffic also suffered, down 4.8% from the year-ago period. Total volume was 333.3 billion ton-miles, down 3.5% from the comparable week in 2007.
Commodities gaining ground included metalic ores, up 14.6%, food and food products, up 6.8%, and grain, up 6.2%. Commodities recoding declines included motor vehicles and equipment, down 17.6%, lumber and wood products, off f17.1%, and farm products other than grain, down 16.1%
Canadian railroad carload freight fell 7.7% for the week versus year-earlier levels, though intermodal traffic rose 1.7%.
In Mexico, carloads on Kansas City Southern de Mexico rose 4.7% over the year-ago week, while intermodal volume declined 2.4%.
A Department of Railroads for California?California State Sen. Denise Ducheny (D-San Diego) has introduced legislation that would create a Department of Railroads, bringing California's wide range of rail programs into a single agency. High speed rail, of which Ducheny is a strong advocate, would be part of the consolidation.
Ducheny, who chairs the Senate Budget Committee, said after introducing S B. 53: "I really want to see high speed rail happen." She believes this will be hastened by consolidating the High Speed Rail Commission with existing rail programs, including state-subsidized Amtrak and freight services and the grade crossing functions of the Public Utilities Commission.
American Railcar to build cars in IndiaThrough subsidiaries, American Railcar Industries and Amtek Auto Ltd. have agreed to form a 50-50 joint venture to manufacture and market freight cars and car components to customers in India "and other countries to be agreed upon."
The two companies said in an announcement Friday that they expect to begin construction of a manufacturing plant in India later this year and begin railcar production in 2009.
"We are excited to be joining with the strong management team of Amtek to build railcars in India," said American Railcar CEO James Unger. "We believe Amtek's depth of manufacturing experience and knowledge of Indian markets supports our partnership’s short and long-term prospects for growth within India. We believe there is also a significant opportunity for component sourcing in India."
Carl Icahn backs off deal for GreenbrierBillionaire investor Carl Icahn has reduced his stake in Greenbrier Cos. Inc. to 8.17% following terminating negotiations with the company and American Railcar Industries to acquire Greenbrier.
Icahn on June 11 had said that a business combination between Greenbrier and American Railroad was not possible due to some unresolved issues and that he might sell off all or some of his stake in Greenbrier. Icahn owns about 54% of American Railcar, and had reported a stake of 9.45% in Lake Oswego, Ore.-based Greenbrier prior to the sale.
Shares of Greenbrier were down 2.8% to $21.83 Friday morning on the New York Stock Exchange.
Kevin R. Haugh named president of CXT® Inc.L.B. Foster Co. has named Kevin R. Haugh Vice President and General Manager-Concrete Products and president of its wholly owned subsidiary, CXT® Inc. Haugh will direct the company’s CXT Concrete Ties and CXT Concrete Buildings businesses.
Haugh began his transportation career with Union Pacific in 1977. He progressed through various trainmaster positions from 1977 to 1989, ultimately attaining the position of Manager-Terminal Operations. He then moved to Midwest Railroad Construction as Executive Vice President, a position he held from 1989 to 1993. In 1993, he joined Rail Switching Services, Inc. (later The Railserve Companies) as Executive Vice Presiden-Marketing and Sales before his promotion to President. In 2001, he joined CANAC as Executive Vice President and Chief Commercial Officer. In 2004, Savage Services Corp. acquired CANAC, and Haugh served as Senior Vice President-Rail Services. Haugh earned a B.A. in Business Administration from California State University-Fullerton, and an M.A. in Business Administration from the University of Tennessee.
“We are very fortunate to bring Kevin into our organization,” said L.B. Foster Company President and CEO Stan Hasselbusch. “His extensive railroad operations and marketing background will give him a unique perspective of opportunities to expand our market position in the rail industry with our concrete ties business. It will also allow him to immediately contribute to the growing success of our concrete buildings business. We welcome him to the L.B. Foster family and look forward to his continuing accomplishments.”
CXT Concrete Ties has three prestressed concrete railroad tie manufacturing facilities: Spokane, Wash., Grand Island, Neb., and Tucson, Ariz. CXT Concrete Buildings is a producer of precast concrete restrooms and utility structures, with plants in Spokane and Hillsboro, Tex.
Floods cut BNSF profits; UP halts embargoBNSF announced that flooding in the Midwest will reduce its second-quarter earnings to about $1.30 a share versus the $1.38 expected by a consensus of Wall Street analysts. "The flooding that has occurred in this regions continues to cause network outages and disruptions to Banff's operations," the railroad said in a regulatory filing Wednesday.
Earlier, Union Pacific had said that the region's worst floods in 15 years would reduce its earnings for the quarter by about five cents a share, though in a subsequent announcement UP affirmed its full-year profit forecast of $3.88 to $4.13 a share, compared with analysts' estimates of $4.06.
UP was forced to embargo traffic through the Cedar Rapids, Iowa, area, which 60 to 70 of its freight trains cross on an average day.
UP Chairman and CEO Jim Young told the Merrill Lynch Global Transportation Conference in New York Thursday, "We've had a heck of a challenge. Every railroad in Iowa was shut down." He said the UP line had been reopened, and in Omaha Executive Vice President Jack Koraleski announced the end of the embargo. Young said, however, that it would take around 10 days to get traffic back to normal levels.
India orders KONI dampers and shock absorbersIndian Railways has placed a $1 million order with ITT Corp.'s Energy Absorption business for KONI branded dampers and shock absorbers. ITT said Thursday that the more than 3,000 dampers or shock absorbers covered in the order are for Diesel Locomotives Works Varanasi, Chitteranjan Locomotive Works, Rail Coach Factory Northern Railway, and Bharat Earth Movers. ITT, which has headquarters in White Plains, N.Y., operates on the Asian subcontinent through its fully owned subsidiary, ITT India.
"The contract to provide four major Indian rail companies with state-of-the-art dampers reinforces ITT's position as a leading supplier to one of the world's fastest growing transportation systems," said Peter Zuiddan, railway division manager for ITT Energy Absorption.
Houston LRT plan will take to the streetsHouston's City Council has approved a plan allowing the Metropolitan Transit Authority permission to build five light rail lines on city streets. But the accord, approved 13-2, allows the council to review any and all proposals for street running operations.
The vote paves the way for the authority to break ground next month with its expansion plans, probably starting with the East End line. Plans call for the completion of all five lines by 2012.
Opponents of the plan cited problems including restricted traffic flows, danger to children and the elderly, and their belief that light rail in general will attract too few riders to justify the cost.
But most council members were not persuaded by the purported negatives. "I'll say it loud and clear: No longer is the city of Houston waffling on rail," declared Councilman Peter Brown. "With gas headed to $8 a gallon and oil to $200 a barrel, we have to rethink Houston as the happy motoring paradise."
Several councilmembers, however, noted the agreement includes a "Good Neighbor Practices" provision aimed at holding the MTA responsible and responsive to local input.
California short line to test RailPower genset enginePatriot Rail Corp. subsidiary Sacramento Valley Railroad (SAV) is testing a Railpower Technologies Corp. 2,000-hp RP20BD locomotive as it seeks to reduce emissions in the Sacramento, Calif., region. The three-engine genset-type locomotive is designed to provide fuel savings of 30%-to-50% compared with conventional locomotives under comparable circumstances, and reduce nitrogen oxide (NOx) emissions by at least 70%.
Based in McClellan, Calif., SAV provides rail freight services on seven miles of line at McClellan Business Park, located near Sacramento. SAV interchanges with Union Pacific and BNSF.
“The RP20BD locomotive is a perfect fit for the stop-and-go switching operations at SAV. With its innovative use of three engines, this locomotive produces power when needed while reducing emissions and using less fuel when idling,” said Stan Wlotko, Boca Raton, Fla.-based Patriot’s senior vice president-operations. “Railpower is a leader in this technology and we appreciate them letting us test this locomotive. We are excited about possibly utilizing locomotives like these on all of our railroads, not only for the positive impact on the environment but for the operational efficiencies as well.”
Railpower Technologies, based in Brossard, Quebec, says 105 of its genset locomotives currently are in service.
RiskMetrics backs four dissident CSX nomineesThe RiskMetrics Group, a major adviser in proxy fights , has thrown its support to four of the five candidates nominated for the CSX board of directors by two hedge funds, Children’s Investment Fund Management and 3G Capital Partners. RiskMetrics recommended that CSX shareholders vote for Alex Behring, Christopher Hohn, Gil Lamphere, and Tim O’Toole. The fifth candidate, Gray Wilson, was not included in the endorsement. Votes on the dissident slate will be cast at the annual shareholders meeting in New Orleans June 25.
In a statement issued Wednesday, CSX took strong issue with the RiskMetrics move. “RiskMetrics has inexplicably chosen to second-guess the U.S. District Court for the Southern District of New York, which found that the TCI group principals ‘testified falsely in many respects’ and violated securities laws in connection with CSX,” said the company. “In addition to trivializing the court’s findings and applying its own governance standards, RiskMetrics gave little weight to CSX’s outstanding performance and governance, instead favoring the claims and mischaracterizations of the TCI Group. In fact, CSX ranks as number one or two among Class I railroads in all key recognized performance measures.”
CSX reminded shareholders that “on June 11, the court found that the two hedge funds ‘have sought to control CSX for over a year. As obstacles to control surfaced, they adapted their strategy for achieving control, making disclosures only when convenient to their strategy.’” CSX went on to say: “We believe that these intentions conclusively demonstrate that the TCI Group’s nominees are not qualified to represent the interests of all CSX shareholders.”
Earlier this week, another advisory group, Proxy Governance, recommend that shareholders vote for two of the five dissident nominees, Behring and Lamphere, but failed to endorse the other three.
Amtrak set (again) to replace Thames River BridgeFollowing two postponements, Amtrak now plans to install a new vertical lift bridge over the Thames River in Connecticut, between June 24 and June 27, necessitating the closure of the Northeast Corridor between New Haven, Conn., and Boston.
Amtrak will provide alternate train and bus service during the four-day period, including three Boston-New Haven-New York Inland Route trains via Springfield, Mass. Amtrak also is contacting bus operators to provide connecting bus service.
The company said unexpected difficulties in dismantling the existing 90-year-old bridge have caused the delays. Workers experienced unanticipated difficulty in dismantling the old drawbridge's concrete counterweight.
Floods will impact railroad earningsDevastating floods caused by severe storms in the Midwest that have disrupted operations of several railroads and caused shipment delays of up to three days have prompted at least one railroad—Union Pacific—to cut its second-quarter earnings outlook by 5 cents per share. UP, in a June 17 filing with the Securities and Exchange Commission, said the amount is based on a preliminary estimate of network outages and other weather-related problems. UP’s earnings are now projected to be in the lower end of the railroad’s previous guidance of 90 cents to 98 cents per share, below a Wall Street target of 96 cents. On average, railroad earnings are expected to be impacted by 2 cents per share, according to some analysts.
The extensive flooding caused several line shut-downs, six alone on UP, and have prompted rerouting of traffic. For example, coal shipments are being diverted from flooded areas in Iowa, Missouri, Nebraska, and Kansas. Detroit Edison, which provides electricity to 2.2 million customers in southeastern Michigan, is having coal shipped north of the flooded area through Minneapolis and Chicago. Ohio-based AEP’s regular coal shipments are detouring south of the flooded areas to its coal terminal in Metropolis, Ill.
UP has made its coal shipments, which with other energy-related products like petroleum coke account for 20% of the railroad’s traffic, a priority. UP’s north-south main line has been reopened, and limited service on its east-west main was expected to resume today.
The delays in railroad coal shipments come at a time when tight supply caused largely by 1) increased demand from China, India, and other developing countries for export coal and 2) flat domestic coal production have contributed to higher coal and electricity prices. Utilities are saying their coal stockpiles so far have been sufficient to ward off shortages. Many also purchase coal through long-term contracts at prices that were set before the flooding, which should limit the flooding’s impact on the prices they pay. But longer term, coal prices, which have more than doubled since the beginning of the year, could rise even further, according to analysts.
Midwest flooding affects Amtrak serviceMidwest flooding woes affecting rail freight service have also disrupted Amtrak's Southwest Chief between Chicago and Kansas City. Amtrak is substituting bus service in both directions between Kansas City and Galesburg, Ill., due to flood problems on BNSF right-of-way. Amtrak will continue to run buses for part of the route until at least Friday, a spokesman said.
Bus substitution also has occurred for Amtrak's California Zephyr between Omaha and Denver, while service through Iowa was suspended. Further north, the Empire Builder last week had been detouring between Chicago and St. Paul, Minn., due to flooding. Amtrak subsequently substituted bus service to intermediate points between St. Paul and Chicago, but at present service to Portage and Columbus, Wis., has been suspended due to flood-related problems.
Oberstar expresses doubts on EJ&E sale to CNRep. James Oberstar, D-Minn., says he's not fully convinved that the purchase of the Elgin, Joliet & Eastern Railway Co. by Canadian National is in the best interests of the Chicago metropolitan area.
"It may be a benefit for downtown Chicago, removing rail congestion there, but it poses a huge burden on small communities," said Oberstar, chairman of the U.S. House Transportation and Infrastructure Committee.
Some suburban communities insist CN's aquisition of the EJ&E, and its plans to increase traffic on the route, will exacerbate automotive traffic problems and block emergency vehicle access, as well as generate increased noise and air pollution.
A CN spokesman reiterated the Class I railroad's stance that the acquisition would ease a freight bottleneck in Chicago that affects freight traffic throughout the United States and Canada. CN also is offering $40 million to reduce the impact on communities, the spokesman said.
New communications director at UPUnion Pacific has named Donna Kush assistant vice president of Corporate Communications, in charge of UP’s employee communications, public relations, and advertising.
Kush brings more than 17 years of corporate marketing and communications experience to UP. Prior to joining the railroad, she was president of her own consulting firm, advising clients in the financial services, health care, fitness, and service industries. She also has served as chief of Communications and Public Affairs and manager of Offline Advertising for TD Ameritrade; and as manager of Marketing and Communications for the University of Nebraska Medical Center.
Kush holds a master's degree in journalism and mass communications from the University of Nebraska-Lincoln.
Poll finds Vancouver, Wash., now friendlier to LRTPortland, Ore., is considered a trendsetter for transit-oriented development driven in large measure by passenger rail. Its northern neighbor, Clark County, Wash., has resisted such an approach for at least a decade. But a new poll suggests Clark County may be reconsidering its options, particularly when it comes to light rail access for the county seat of Vancouver.
The poll, conducted by Portland-based Riley Research Associates, found that 62% of Clark County, Wash., residents interviewed support light rail as part of the $4.2 billion Columbia River Crossing project. The bridge project calls for a new 12-lane Interstate 5 bridge, and light rail, providng a bistate link between Portland and Vancouver. In 1995, Clark County rejected rail by a 2-1 ratio.
Overall results found 71% of those polled in the Portland-Vancouver metroplex favored the multimodal approach.
"I wasn't surprised at the sense of urgency for the bridge, but I was surprised at the acceptance or demand for the light rail line at 71%," said pollster Mike Riley said.
Separately, Portland's TriMet reported its MAX light rail and bus ridership gained 4.4% in May compared with May 2007, and was up 3.3% over April. Weekend LRT ridership rose 11.7%, while weekend bus patronage rose 7.6%, compared with the May 2007.
Boatright acquires SeamanBoatright Enterprises, Inc., Birmingham, Ala., has acquired Seaman Timber Co., Inc. of Montevallo, Ala. strengthening the company’s position in treated tie and timber sales and service. Boatright, founded in 1989, owns and operates the St. Marys Railroad and also supplies short lines and Class I’s. It consists of a Vegetation & Brush Spraying Division, a Rail Gear Division, and Boatright Safety Solutions, supplying customized reflective safety vests, holsters, and accessories.
Proxy firm backs two of five dissidents for CSX board Advisory firm Proxy Governance June 16 recommended two of five candidates on the the dissident slate, backed by The Childrens Fund, seeking to serve on CSX Corp.'s board of directors.
The firm, a subsidiary of Vienna, Va.-based investment firm FOLIOfn, Inc., urged shareholders to vote for 3G Managing Director Alexandre Behring and Lamphrere Capital Management Managing Director Gilbert Lamphere, a former director at Canadian National.
The three other nominees on TCI's slate include TCI Founder Chris Hohn, London Underground Managing Director Timothy O'Toole, and Gary Wilson, former chairman at Northwest Airlines Corp.
CSX's 2008 annual shareholders meeting will take place June 25 in New Orleans.
New pocket guide from Miner EnterprisesMiner Enterprises, Inc., has released Version 3.0 of its Installation and Inspection Pocket Guide. This updated publication contains information related to installation and inspection on Miner’s TecsPak® constant contact side bearings, draft gears, and brake beams.
“The side bearings portion of the guide includes information such as selection guides, setup height, wear indicators, as well as new and retrofit installation information,” says Vice President-Sales Richard Biehl. “The draft gear section features general descriptions of Miner’s gears as well as a procedure for determining the gear’s serviceability. The area of the guide relating to brake beams also includes a general description of the beams as well as inspection and strut hand change procedure information."
An electronic version of the guide can be downloaded from Miner’s website at www.minerent.com. A printed version can be obtained by calling (630) 232-3000.
Toronto boosts summer transit servicesThe Toronto Transit Commission announced Tuesday it would bolster streetcar frequencies beginning June 22 to handle anticipated ridership demand "to Toronto's favourite summer destinations." The move comes even as other North American transit agencies are scaling back weekend and off-peak rail services, or at least pondering such action.
By contrast, TTC said it will increase service frequency, including evening service, on its 509 Harbourfront, 510 Spadina, and 511 Bathurst streetcar routes; the Spadina line also "will be extended to Queens Quay and Spadina Avenue," TTC said. Bus services also will be augmented, TTC said.
Lockheed Martin lands Australian train control contractAustralian Rail Track Corporation (ARTC) has awarded Lockheed Martin a $72 million contract for the proof-of-concept phase of the Advanced Train Management System (ATMS), a communications- based train control technology for Australia’s national freight rail network. Lockheed Martin will design, develop, construct, and test an ATMS prototype on a 75-mile section of railroad in South Australia. This contract follows Lockheed Martin's completion of the ATMS Design Study Phase in April 2006, which produced a blueprint for development and rollout of ATMS.
Lockheed Martin, system integrator for the North American Joint PTC Project, will provide all elements of ATMS, including components installed in ARTC facilities; locomotive onboard processors; displays to provide warning to train operators and authorities; and automated switch controls to route trains along dispatched routes. ATMS communications will be enabled by an ongoing ARTC upgrade carried out by Australian telecommunications and information services company Telstra, using its Next G™ network. This upgrade was started in April 2007. The system is expected to be fully operational by 2011.
Lockheed Martin has subcontracted with Ansaldo STS Pty Ltd. of Brisbane, Queensland, to provide dispatch and wayside controls for ATMS. The company also anticipates sourcing services and products from Australia's information technology and railroad supply chains.
ARTC, a company under the Australia Corporations Act whose shares are owned by the Commonwealth and overseen by the Minister for Transport and Regional Services and Minister for Finance and Administration, has manages more than 6,000 miles of standard gauge track in South Australia, Victoria, Western Australia, and New South Wales. ARTC also manages the Hunter Valley Coal Rail network and other regional rail links in New South Wales.
FRA grant expands PTC in AlaskaThe Federal Railroad Administration has awarded a $735,000 grant to the Alaska Railroad to install and test its vital positive train control system, the Collision Avoidance System (CAS), on 68 locomotives. The grant is a final step in implementing the Union Switch & Signal-supplied CAS system throughout Alaska Railroad network. It will fund installation of locomotive onboard computers that interface with the railroad’s office safety servers, computer-aided dispatch system, and radio communication network. The CAS project was initiated in 2005.
FrontRunner WiFi off to a running startThe Utah Transit Authority is partnering with Nomad Digital, a Newcastle (U.K.)-based provider of high speed broadband communication, for WiFi service on its FrontRunner commuter rail system. The service is provided free of charge to passengers.
Nomad worked with local partner Wasatch Electric to install a high speed wireless broadband connection for the 12 double-decker trains on the new 40-mile FrontRunner line between Ogden and Salt Lake City. “In the six weeks since the railroad opened for business, the number of passengers using the WiFi service has already risen rapidly from 300 per day at the start of May to 700 per day by early June,” said UTA Chief Technology Officer Clair Fiet. “A high-speed and free WiFi internet connection for passengers is a key part of getting people out of their cars and onto the train. Every day more and more of our customers are realizing that one of the many benefits of riding by train is that they can use their commuting time productively, rather than focusing on the road.”
Nomad Digital Executive Chairman Nigel Wallbridge described the UTA WiFi network as “the fastest network that we have architected. Through the deployment of high-speed Redline WiMAX radios, and a trackside fiber network for the backhaul, we have created the fastest WiFi network in the world available to rail passengers. Taking advantage of a fiber optic network along the route, UTA’s wireless network is designed to give a premier Internet service to passengers as well as enable future plans for media delivery and other services.”
The UTA system is the first full-scale commercial rollout for Nomad Digital in the U.S. Nomad is already well-established internationally, providing passenger broadband services to Southern Railways and to the Heathrow Express in the U.K. It has also recently been awarded contracts to design, construct, and manage a broadband corridor for Virgin Trains on the London to Glasgow route, an onboard and station internet service contract for the Dubai Metro, and a nationwide network for the Norwegian State Railway.
CN, Transport Canada differ on status of flawed wheel setsAn emergency safety directive issued by Transport Canada during the weekend asks Canadian National to identify and remove approximately 10,000 wheel sets still presumed to be in use throughout North America. But a CN spokesman says the equipment not yet identified under the government's earlier recall likely had "been pulled out of service because they have exceeded their life expectancy or for any number of mechanical reasons."
The Transportation Safety Board of Canada last month reported that a manufacturing flaw in approximately 48,000 wheel sets, made by the CN between 1998 and 2001, had caused at least 15 derailments in Canada and the United States.
About 75% of the wheel sets have been identified and pulled out of service, following the board’s issuing a recall in 2002. In addition, the Association of American Railroads issued a recall in November 2001 of the wheels fitted onto about 5,000 tank cars, and followed with a recall notice for other freight cars shortly thereafter.
New York MTA damage and injury claims riseThe New York State Comptroller's Office has issued a report showing that the New York Metropolitan Transportation Authority has paid $1.1 billion to settle 86,875 personal injury or property damage claims filed by passengers, workers, and motorists since 1996, with payout reaching a new annual record of $144 million in 2007.
Claims against the Long Island Rail Road reached 1,936 in 2007, said the report--a twofold increase over 2003, primarily for clothes damaged by armrests (now being replaced at a system-wide cost of $3.6 million) and accidents caused by gaps between station platforms and trains (a total of 1,034 claims since 1998, of which 199 have been or will be paid a total of $16 million)."
How do MTA agencies compare with others? The Comptroller's report said: "The LIRR and Metro-North had the second and third highest judgment and claims cost per trip among the six largest commuter rail operators in the nation. Metro-North commuters paid $.25 per ride--twice as high as New Jersey Transit, which serves about the same number of rides. LIRR commuters paid $.19 per ride--50% higher than New Jersey Transit."
Comptroller Thomas P. DiNapoli's conclusion: "The MTA should work harder to make the system safer for riders and workers. It's about safety and savings. There’s still $1.2 billion of future liabilities to be paid, so the costs to settle judgments and claims will remain a significant budget expense."
MTA said in a statement issued June 12: "Since 1996 the employee injury rate has been reduced by 60% and in 2007 the MTA achieved its lowest employee injury rate ever. Since 1996 the number of customer injuries per million customers has decreased by 28% even while the MTA ridership is at record numbers."
U.S. carload, intermodal freight decline in latest weekU.S. carload freight declined 2.1% for the week ended June 7 from the corresponding week in 2007, while intermodal traffic also slipped 1.1% for the comparable period, the Association of American Railroads reported. Total volume of 33.6 billion ton-miles was almost identical to the comparable year-ago period.
Among commodities gaining ground were nonmetallic minerals, up 8.1%, food and food products, up 6.3%, and coal, up 2.5%. Declining commodities included metallic ores, down 19.4%, motor vehicles and equipment, down 18.6%, and lumber and wood products, down 16.5%.
Canadian railroad carload freight fell 3.0% for the week versus year-earlier levels, though intermodal traffic increased by 7.6%.
In Mexico, carloads on Kansas City Southern de Mexico rose 2.3 for the week versus the year-ago period, but intermodal fell 2.8%.
Floods disrupt UP service in MidwestUnion Pacific advised its customers Friday that floods in he Midwest have caused "significant damage" to its rail network, resulting in embargoes for traffic moving across parts of its east-west main line in Iowa.
"Rainfall in parts of Minnesota, Iowa, Illinois, Nebraska, Missouri, Wisconsin, and Kansas has reached the 8- to 10-inch range, resulting in stream and river flooding that has washed out or weakened bridges large sections of main line track," said UP Executive Vice President Jack Koraleski. He said the most significant impact going into the weekend was in Iowa, where 54 of 99 counties declared disaster areas.
Trouble spots identified by Koraleski included the following:
"Boone Subdivision. One main line rack is out of service near Haley, Iowa.
"Clinton Subdivision. Two main line tracks are out near Cedar Rapids, Iowa. The Cedar River flows under a UP bridge on this subdivision and operations personnel are monitoring this bridge closely for a possible washout. Two main lines are out of service near Tama, Iowa.
"Trenton Subdivision. Our main line track is out of service between Des Moines and Kansas City. Officials ordered the drainage of Saylorville Lake near Des Moines to relieve pressure on the lake, which raised the level of the Des Moines River, taking out Union Pacific track in the area for as long as a week."
Koraleski said that due to the widespread nature of the problem, the railroad has only limited reroute capability. As a result, the railroad issued embargoes that current conditions suggested could be in place for as long as a week. Generally, these impact all manifest and automotive traffic originating at points west of Beverly, Iowa (west of Cedar Rapids) and moving to points east of Beverly, including traffic interchanged over the Chicago gateway.
The embargo also applies to traffic moving in the direction. It excludes coal but includes other bulk commodities. A similar embargo on intermodal traffic was announced.
Meanwhile, the Cedar Rapids & Iowa City Railway reported that its Eighth Avenue bridge in Cedar Rapids collapsed into the river along with 15 of 18 cars that had been loaded with rock in an unsuccessful effort to stabilize the structure.
U.S. economic woes affect Canadian Class I'sA struggling U.S. economy is affecting the stock prices of Canadian National and Canadian Pacific, according to analyst Avi Dalfen of Blackmont Capital. Dalfen downgraded earnings estimates and price targets for both Canadian Class I railroads, citing "increased economic and market valuation risk."
"CN Rail's performance is highly leveraged to the U.S. economy," Dalfen said in a note to clients. Forestry products, accounting for 20% of the railroad's revenue, have slumped as the U.S. housing market has suffered. Though CP Rail is less reliant on the U.S. economy, its acquisition last year of the Dakota, Minnesota & Eastern Railroad Corp. increases CP's need for capital expenditure in a risky economic environment, Dalfen said.
Salt Lake City making TRAX for airportSalt Lake City and the Utah Transit Authority have signed an agreement to proceed with a $300 million light rail route from the city's downtown to Salt Lake City International Airport. Construction could begin by year's end, with completion slated for late 2012.
"This will serve a tremendous array of possible users," said city Mayor Ralph Becker.
The agreement also extends the fare-free zone for TRAX and bus riders in downtown Salt Lake City, in exchange for a city contribution of $35 million to the light rail project.
TRAX recently ordered 77 S-70 light rail cars, worth $277 million, from Siemens Transportation Systems, with an option for 180 additional cars, in part to anticipate equipment needs associated with additional light rail service to the airport.
LA reports rise in transit ridershipLos Angeles, at times described as a monument to the supremacy of the automobile, recorded rail transit ridership of 7.6 million in May, up 6% from the year-ago month, according to the Los Angeles (County) Metropolitan Transportation Authority. The number includes those using the area's two subway lines and three light rail routes.
"A lot of those riders are brand new riders, turning to public transportation because it's fast and cheap," said MTA spokesman Marc Littman.
Littman noted MTA bus ridership declined more than 5% in the comparable period, and attributed the decline to fare increases implemented last summer.
Alstom consortium lands Mexico City subway contractMexico City has awarded a $1.7 billion contract to a three-member consortium to construct a 15-mile, 22-station subway line in the Mexican capital. The consortium includes Paris-based Alstom, Carso Infraestructura y Construccion SA (Cicsa), owned by billionaire Carlos Slim, and Ingenieros Civiles Asociados (ICA).
Alstom will oversee electrical wiring and transport hardware, while the two Mexican companies will take charge of digging tunnels and infrastructure. Construction could start as soon as July 3, with a targeted completion by December 2011.
The line, running from west of the city's center through the center andd then south, is expected to carry about 500,000 riders per day.
"This would be the biggest public construction granted in this administration," Mexico City Mayor Marcelo Ebrard said.
H.R. 6003 offers states leverage for intercity rail improvementsU.S. intercity rail passenger service, including but not automatically limited to the current sole provider, Amtrak, may benefit from language in House Resolution H.R. 6003, passed Wednesday, that for the first time gives states access to capital grant money, and the ability to leverage such money, to apply to specific needs.
H.R. 6003 authorizes about $500 million per year for five years, fiscal years 2009 through 2013, which states can seek to match on a 50-50 basis as part of any plan to target improvements to passenger rail infrastructure, as identified by the states themselves. Observers have noted that intercity rail in general, and Amtrak in particular, have been denied this for decades even as the principle was applied to other modes, including more local rail transit projects.
H.R. 6003 also requires states to develop state rail plans, subject to USDOT approval. It also would give preference to passenger rail efforts projecting high ridership levels, increased on-time performance and/or reduced trip times, intermodal connectivity, and positive economic development impact, among other criteria.
Ross Capon, executive director of the National Association of Railroad Passengers, said establishing such a role for the states may be more important in the long term than the amount of money initially involved, and cautioned that the funds authorized have yet to be appropriated. "Our hope has been that this bill, in combination with high gas prices and a new level of common sense in Washington, would produce a funding mechanism that will grow in importance as it becomes established," Capon said.
The bill's provisions for Amtrak, among other items, direct the railroad and the states, including the District of Columbia, to define within two years a nationwide standard methodology for allocating revenue and costs, including shared costs, for operations and capital. Amtrak shared operating agreements with various states, under its 403(b) program, at present vary widely, and has prompted complaints from some state who believe the program lacks coherence and conformity.
H.R. 6003 also repeals an earlier congressional mandate requiring that Amtrak become "self-sufficient" by covering its full operating costs.
A full rundown of H.R. 6003's potential impact (presuming it survives relatively intact in conference committee, surmounts a threatened veto by the president, and is supported by the appropriations process) will appear in the July edition of Railway Age.
Judge says TCI violated securities laws, but denies injunction requestTwo weeks before an expected showdown at the CSX annual shareholder’s meeting that pits the railroad against a hedge fund alliance attempting to place five directors on CSX’s 12-member board, a federal judge ruled that the two funds—The Children’s Investment Fund Management and 3G Capital Partners, collectively known as TCI Group—did in fact violate securities law. The judge, Lewis Kaplan of the U.S. District Court for the Southern District of New York, also rejected all of the TCI Group’s counterclaims. However, he denied CSX’s request for an injunction against TCI and 3G that would prevent them from voting their shares , and so the proxy battle marches on toward what promises to be a contentious conclusion on June 25.
In a letter to shareholders released June 12, CSX said that the Court “ultimately concluded that the TCI Group engaged in a ‘plan or scheme to evade the reporting requirements’ of federal securities laws and that there is a ‘substantial likelihood of future violations.’ Unfortunately, the Court concluded that the law does not permit it to grant relief that would prevent the TCI Group from gaining the benefit of its illegal activity in the proxy contest. We urge you to consider carefully these violations and the pattern of deceptive conduct from the TCI Group—including false testimony under oath—as you evaluate whether the TCI Group nominees are fit to serve on the board of a U.S. public company.”
In his June 11 opinion, Judge Kaplan ruled that the TCI Group deliberately evaded disclosure obligations on beneficial ownership of shares amassed in swap positions and did not promptly disclose that they had formed a group of investors as they “sought to control CSX for over a year. . . . As obstacles to control surfaced, they adapted their strategy for achieving control, making disclosures only when convenient to their strategy.” But his ruling could not preclude TCI and 3G from voting their CSX shares, and that any penalties related to violations must come from the U.S. Securities and Exchange Commission or Department of Justice.
CSX sued TCI and 3G Capital Partners in March, seeking to block the hedge funds from running their slate of board candidates. The TCI Group countersued, accusing CSX of securities law breaches, including unlawfully enriching corporate directors, and engaging in “a long series of scorched earth tactical maneuvers.”
The Court’s opinion states, in part: TCI and 3G (“defendants”) “testified falsely in a number of respects, notably including incredible claims of failed recollection, to avoid responsibility for their actions. . . . Defendants have sought to control CSX for over a year. As obstacles to control surfaced, they adapted their strategy for achieving control, making disclosures only when convenient to their strategy. Defendants’ latest strategy for control will be tested at the annual shareholder meeting. And if this strategy is not successful, the Court perceives a substantial likelihood that the defendants would craft a new strategy for control without regard to their disclosure obligations. . . . [They] formed a group many months before they filed the necessary disclosure statement [and] acted in close coordination with each other and without making the public disclosure required of 5% shareholders and groups by the Williams Act, a statute that was enacted to ensure that other shareholders are informed of such accumulations and arrangements. . . . TCI intentionally entered into the [swaps], with the purpose and intent of preventing the vesting of beneficial ownership in TCI, as part of a plan or scheme to evade the reporting requirements of Section 13(d) [of the Securities Exchange Act] and thus concealed precisely what Section 13(d) was intended to force into the open.”
“The TCI Group has engaged in a pattern of deception and misstatements to hide the truth regarding its activity in CSX stock,” CSX said. “Among many other findings in the 115-page opinion, the Court concluded that . . . specific testimony of individual TCI Group members . . . was not credible.”
A copy of the full opinion is available at http://2008annualmeeting.csx.com.
Fedorka Named CIO of US&S Union Switch & Signal has appointed Stacey A. Fedorka to the newly created position of Chief Information Officer and Vice President of Information Technology. Fedorka, who will report directly to US&S President and CEO Dr. Alan E. Calegari, is charged “with establishing and implementing strategic direction in all areas of information technology,” US&S said in a statement on her appointment.
Fedorka brings over 17 years of technical and operational experience to her new position. She has served in several different capacities within US&S, among them Director of Business Process Improvement and Director of Corporate Services. She spent the past three years as Director of Information Technology, “transforming the IT organization from a ‘break-fix’ organization to one of business partner and strategic enabler.”
In February, Fedorka was named the 2008 Pittsburgh Chief Information Officer of the Year by the Pittsburgh Technology Council. She holds an undergraduate degree from the Indiana University of Pennsylvania and a graduate degree from the University of Pittsburgh.
University of Minnesota drops resistance to proposed LRT routeUniversity of Minnesota President Robert Bruininks said Wednesday the university will drop its objections to running the Central Corridor light rail down Washington Avenue in St. Paul, bisecting its East Bank campus.
The university had argued for an alternate route north of the campus, which would have kept the route off campus. It also had advocated a tunnel under Washington Avenue, based on concerns over pedestrian safety.
"The university does not want to be in the position of bringing this project to a grinding halt or jeopardizing its possible future," said Bruininks, who said he would ask the university's Board of Regents to approve the route. Bruininks defended the university's combative stance with other public agencies on the matter, which he said had generated "enormous progress" on concerns such as traffic, hospital access and the impact on sensitive research equipment.
Critics of the university's position, including the Central Corridor Management Committee and the Metropolitan Council, said such concerns were wildly exaggerated at best, and noted the university's proposed alternate route would have resulted in lower ridership, thus failing to meet New Starts criteria set by the Federal Transit Administration.
The 11-mile Central Corridor light rail line will link St. Paul's Union Station with Minneapolis' existing Hiawatha Line near the Minneapolis Downtown East/Metrodome Station. The university's support means the project likely will meet its September deadline for applying for a 50% federal funding match. Current cost estimate for the line is about $930 million.
Amtrak relents on substitute NEC serviceReversing its previous position, Amtrak has announced it will offer substitute rail and bus service linking Boston and New Haven, Conn. during its four-day shutdown of the Northeast Corridor east of New Haven to place a new bridge over the Thames River in Connecticut.
Amtrak also shifted its four-day construction period, which now will take place June 16 through 19. The construction window originally was to begin on June 14, a Saturday, but all trains will operate on a normal schedule that day, and most trains will operate normally on Sunday, the 15th.
During the revised four-day construction period, Amtrk now will run three trains in each direction between Boston and New York via Springfield, Mass., part of its Inland Route; originally, just one round-trip had been scheduled. In addition, a shuttle train will make three daily round-trips between New London, Old Saybrook and New Haven, Conn., connecting there with Amtrak Regional trains.
Substitute bus service will offer four non-stop trips between New Haven and Providence, R.I., as well as non-stop service between New Haven and Kingston, R.I.
Amtrak also will use the four-day window for a construction blitz to upgrade track, signals, and switches north of the Thames River.
The corporation initially used the planned blitz as justification for a near-total shutdown of service, despite protests from rail advocates and six governors from Northeast states.
Amtrak attributed its change in service plans to the two-day delay in implementing the project. "Before, (passengers) had ample notice and time to rearrange travel plans," said spokesman Cliff Cole, adding that "we didn't want to, during the week, leave people without a way to get to where they want to go."
The $76 million project involves replacing an existing bridge with a vertical lift span, which is being floated into position. Bridge construction has been overseen by Cianbro Corp. Pittsfield, Me., and by Amtrak personnel.
Owens-Corning names BNSF Intermodal Carrier of the YearBNSF has been honored by Toledo, Ohio-based Owens Corning as the 2007 Intermodal Carrier of the Year.
"BNSF intermodal’s commitment to safety, consistent service and open communications with Owens Corning has been essential to their success. With a changing marketplace, having a provider like BNSF allows us to supply our customers with high-quality delivery performance using a very efficient mode of transport," said Troy Stevenson, Owens Corning, Carrier Relations Leader, North America Dry Van & Intermodal Transportation.
"I think I speak for everyone up and down the line at BNSF when I say it is an honor to receive this recognition from Owens Corning," said Steve Branscum, BNSF group vice president, Consumer Products. "We strive to provide excellent intermodal service to our clients. This level of service comes directly from our employees" dedication to providing quality transportation services and commitment to our customers" expectations."
BNSF said it has won the Owens-Corning award four times since 2002.
Railworks salutes suppliers with first annual awardRailworks Corp. Inc. recently bestowed its first Annual Supplier of the Year Award to Hamel, Minn.-based Loram Maintenance of Way, Inc. "for their consistent support of the Northwest Maintenance Railway Club." Club Chairman Jim Hansen, who is Railworks' vice president-business development, bestowed the honor to Brian Koch, Bill Walls, Joe Ashley, and Gary Kohnert of Loram at a recent gathering of the club’s members in Lakeville, Minn.
Alstom signs MOU for Kazakhstan projectsAlstom signed a Memorandum of Understanding June 11 with Samruk, Kazakhstan's national holding company for such state-owned enterprises as Kazakhstan State Railway (KTZ) and the national airline, for rail and power generation projects. Kazakhstan President Nursultan Nazarbayev, Samruk President Kanat Bozumbayev, and Alstom Chairman and CEO Patrick Kron signed the MOU in Paris, under which Alstom and Samruk will cooperate on programs "for the economic and social development of this country."
Alstom also is negotiating with the Kazakh railway maintenance company, Kamkor, to modernize 145 VL-80 electric locomotives. The proposal involves Alstom supplying new components (transformers, asynchronous motors) for these locomotives. Also being evaluated is the assembly under license of electric locomotives in Kazakhstan.
Alstom says a second project under consideration is for it to supply four Pendolino high speed tilting trainsets, along with their maintenance, to run in service between Kazakhstan's capital, Astana, and Almaty, a distance of 1,200 kilometers (744 miles).
The MOU also foresees cooperation in modernizing power plants, and in integrating clean power technologies for electricity produced from coal, gas, or renewable energies.
Alstom also has expressed interest in aiding the "Bolashak" training program, which allows young Kazakh professionals to access training courses for various professional disciples; the company said it will offer internships to several Kazakh students in 2008.
Alton & Southern expands RailComm DOC systemAlton & Southern Railway Co., based in East St. Louis, Ill., has expanded its existing use of RailComm Domain Operations Controller (DOC) System by adding 14 remotely controlled solar powered switches at the Bowl and Crest sections of its yard. The switches will eliminate hand throw switches. A point-to-multipoint wireless data communications network will be established utilizing RailComm's RADiANT™ Data Radio technology, a RailComm statement noted.
Alton & Southern initially installed wireless remote control and yard automation system from RailComm in 2005, using 900 MHz and 2.4 GHz spread-spectrum data radio networks to control 31-plus switch machines along an 18-mile stretch of track within yard limits at East St. Louis.
Hostile amendments aimed at Amtrak fall shortThe House of Representatives Wednesday passed H.R. 6003, the Passenger Rail Investment and Improvement Act, by a margin of 311-104. In so doing, the House rejected one amendment aimed at slashing Amtrak's fiscal year 2009 funding of $1.4 billion in operating and capital assistance; a second amendment was withdrawn prior to a vote.
The amendment that was voted on, offered by Rep. Pete Sessions, R-Tex., would have prohibited "funds from being used for the long distance Amtrak route with the highest cost per seat/mile according to Amtrak's March 2008 monthly performance report unless the Secretary has transmitted a waiver for this route or a portion of it because the Secretary considers it critical to homeland security." The likely target of this amendment was Amtrak's Sunset Limited, which runs between New Orleans and Los Angeles on a tri-weekly basis.
A second amendment seeking reduced Amtrak funding was withdrawn by its sponsor, Rep. Jeff Flake R-Ariz.; it would have deleted funding to study upgrading Amtrak's Baltimore tunnels, considered by Amtrak to be a bottleneck for improved and faster service on its Northeast Corridor.
H.R. 6003 now goes to conference committee to reconcile differences with its Senate counterpart, S. 294. The White House Monday said it would veto such funding levels if approved by Congress, claiming Amtrak must improve its cost efficiency.
Patriot Rail acquires Louisiana & North West RailroadBoca Raton, Fla.-based Patriot Rail Corp. Tuesday said it has acquired the Louisiana & North West Railroad, headquartered in Homer, La. LNW operates a 68-mile route between Gibsland, La., and McNeil, Ark., with five locomotives and 27 employees; it interchanges with Kansas City Southern Railroad at Gibsland and with Union Pacific at McNeil.
"The LNW is an excellent fit with Patriot’s strategy of acquiring short line railroads with a solid customer base and considerable growth potential," said Gary O. Marino, chairman, president, and CEO of Patriot Rail.
The holding company also owns and operates four other short line railroads, including: Tennessee Southern Railroad (Tennessee and Alabama; the Butte, Anaconda & Pacific Railway (Montana); Utah Central Railway; and the Sacramento Valley Railroad (California).
Politicians cite CN for safety lapsesThe Canadian House of Commons Standing Committee on Transportation, Infrastructure, and Communities (TRAN) has issued a report giving CN an unsatisfactory performance rating on a safety management system (SMS) designed to offset accidents and other safety hazards, according to a published report.
The TRAN report cited CN for several safety concerns, among which are “failed communication between senior management and frontline workers on clearly defining management’s commitment to safety, “limited training for newly hired employees,” and intimidating workers “with regard to non-punitive reporting on safety violations.” The committee said it has “serious concerns regarding both the delays and the manner in which the SMS has been implemented by the railway.” On a scale of 1 to 5, with five being the highest level, CN was at level 1 or 2, which the report said “is not acceptable progress.”
Politicians on both sides of the border who have expressed opposition to CN’s acquisition of the Elgin, Joliet & Eastern Railway, a transaction now pending before the U.S. Surface Transportation Board, quickly jumped on the report. “CN wants to quadruple train traffic in U.S. communities at a time when it’s under serious scrutiny in its own backyard,” said Barrington Village President Karen Darch. Added Aurora, Ill., Mayor Thomas Weisner, “CN must be held accountable and explain how it will make safety a top priority before this acquisition is even considered.”
“The Standing Committee’s report does not say that CN is an unsafe railroad, and Barrington and other villages have made no showing that CN’s U.S. current or proposed operations though Chicago are in any way unsafe,” spokesman Mark Hallman told Railway Age. “This is a scare tactic by Barrington and other villages that would rather keep freight trains crawling along congested tracks through Chicago and less-affluent suburbs than let them flow efficiently through theirs. Our commitment to safety will extend to operations on the EJ&E.”
Hallman said CN “is constantly looking to improve its safety procedures and we are considering how to address the issues raised in the report.” However, he added, “it’s important to remember that CN is one of the safest railroads in America and that shipping goods by rail is far safer than by truck.” In 2007, CN’s U.S. train accident rate per million train-miles, as calculated by the Federal Railroad Administration, was 2.72, “significantly better than the U.S. industry average of 3.02,” Hallman said. This figure is based on 22.8 million miles traveled.
L.B. Foster business at record high in MayL.B. Foster Co. announced Tuesday that it booked orders valued at nearly $77 million in May, exceeding its previously monthly high of $64 million in February 2007.
"We think there is some pent-up demand in both the rail and construction segments of our business," commented the company's president and CEO, Stan Hasselbusch. He said orders in May were strong in three distribution products lines--Piling, New Rail, and Relay Rail--as well as in the company’s Coated Products and CXT® Concrete Buildings businesses.
White House poised to veto Amtrak fundingDespite a surge in train ridership as gasoline prices soar and airlines cut back on service, Amtrak faces the threat of a White House veto of legislation now moving through Congress that would increase its funding. H R. 6003, which would increase the Amtrak subsidy to $1.4 billion, "authorizes an unprecedented level of spending that does not hold Amtrak accountable to taxpayers for its spending decisions," said a Bush Administration statement Monday.
The White House said the bill does not provide incentives for competition on Amtrak routes and fails to make Amtrak funding contingent on "progress on reforms." In addition to increasing Amtrak operating and capital funding, the proposed legislation would set up a new matching grant program for state-supported trains.
In March, Amtrak carried 2.42 million passengers, up 11.5% from March 2007. Ridership in the Northeast Corridor increased 7% to 933,000. In the first six months of Amtrak's current fiscal year, ridership nationwide increased 11.7% to 13.5 million and Northeast Corridor ridership increased 11.9% to 5.4 million. Amtrak President Alexander Kummant was recently quoted as saying, "We’ll probably crack 27 million this year," compared with 25.8 million riders last year.
Tax credit extension bill suffers Senate setbackThe U.S. Senate Tuesday pondered the House-passed Tax Credit Extenders Bill, which includes a one-year extension of the short line railroad tax credit. But, according to National Railroad Construction & Maintenance Association (NRC) President Chuck Baker, the effort fell short despite attempts led by Senate Finance Committee Chairman Max Baucus (D-Mont.) to offer a substitute Senate Extenders Bill, which included, among other items, an extension of the short line railroad tax credit and a fix for the Alternative Minimum Tax constraints that kept some short lines from using the credit in the past.
Early Tuesday, Baker reported, "[Baucus] will ask for unanimous consent for his substitute amendment and, if he doesn't get it, he will then ask for a debate cloture vote so he can proceed to a vote on his substitute," says Baker. (Cloture is a Senate procedure that takes 60 votes and would allow Baucus to end debate on the issue and go to a straight vote on the substitute amendment, where 51 votes passes.)
Late in the day, Baker noted, "Regretfully, Senator Baucus fell short of the 60 votes needed for cloture on the tax credit extenders package. The vote was 50 for cloture and 44 against. Most of the Republicans voted no, generally because they objected to raising other taxes to pay for (offset) the tax credits included in the extenders package. This was the same issue that doomed the extenders package in the Senate last year, although the "pay-fors" were somewhat different this time."
He added, "The Democrats are insisting that they will stick with the 'pay-as-you-go' rules and not pass a tax credit extenders package without corresponding offsets. We are now probably in for a period of "chicken" where each side will wait to see if the other blinks on the pay-for issue."
Baker had urged all concerned to "contact your Senators and ask them to support the Baucus Tax Credit Extenders Substitute and, if he needs a cloture vote, also support cloture."
"This may be our last shot at extending and improving the short line railroad tax credit in 2008, so exercise every Senate contact you have," said Baker. "The tax credit is worth $165 million per year to short lines, which must invest one dollar to get 50 cents of credit. This legislation will spur additional infrastructure investment of up to $330 million per year, which is important to our NRC contractor and supplier membership."
NREC GenSet passes another testA National Railway Equipment Company twin-engine, 1,500-hp four-axle N-ViroMotive GenSet locomotive has just passed an operational test on California short line Modesto & Empire Traction Co. with flying colors.
"Our goal is to improve our already efficient railroad," said Ken Beard III, the railroad's vice president. "Fuel conservation and low emissions are a priority for us. We were more than pleased with the locomotive's excellent performance, fuel savings, tractive effort, and quiet running. It exceeded our expectations. We found that it pulled the equivalent of two to three of our existing 70-ton 600-hp units."
In business since 1911, Modesto & Empire Traction Co. operates a 2,000-acre industrial park known as the Beard Industrial District in Modesto, Calif. The railroad has a five-mile-long main line and operates and maintains an additional 28 miles of track within the Beard Industrial District serving numerous customers. M&ET serves customers whose products include wine, canned goods, paper products, corn syrup, cooking oil, feed & grain, lumber, and packaging materials. M&ET connects with BNSF and Union Pacific and also operates a 70-acre rail/truck transload facility encompassing 6,000 feet of unloading/loading tracks.
UTU ratifies national agreementConductors, brakemen, engineers, firemen, hostlers, switchmen, and yardmen represented by the United Transportation Union have ratified a new national rail agreement covering wages, work rules, and working conditions. Voting closed at midnight, June 9, and the American Arbitration Association, which conducted and tabulated the telephone balloting, reported that 18,076 votes were cast, with 15,313, or 85%, voting in favor of the agreement. Some 45,000 ballots were mailed, meaning 40% of those eligible to vote cast ballots. (Yardmasters voted separately on an agreement similar in most respects to the national agreement covering all other crafts represented by the UTU.)
The agreement is retroactive to Jan. 1, 2005, and remains in force through Dec. 31, 2009. UTU members covered by the agreement received a 17% wage hike, retroactive pay, no change in work rules, an increase in the meal allowance, and a cap on health care contributions with no reduction in health care benefits. Members will receive retroactive pay from the carriers within 60 days. New-hires will gain health care coverage in 30 days rather than the previous 120 days. The agreement also provides for arbitration, to begin within 30 days, to settle a dispute over entry rates tied to training.
The UTU received continuation of a COLA (cost of living adjustment) beginning in 2010 while the next national agreement is being negotiated. The union also retained locally negotiated crew-consist agreements, and the carriers dropped their demand to scrap or modify the Federal Employers' Liability Act (FELA).
The tentative agreement sent out for ratification was reached Jan. 23, following more than 38 months of negotiations with the National Carriers’ Conference Committee, which represents BNSF, CSX, Kansas City Southern, Norfolk Southern, Union Pacific, and numerous smaller carriers.
Panama Railway's Starling named KCS presidentKansas City Southern announced Monday that it has named David L. Starling as its president and chief operating officer, a move designed to "strengthen the company's growing international marketing initiatives and to take advantage of its increasingly important international rail corridor linking North America to global markets." He will also serve as president and CEO of Kansas City Southern Railway, replacing Arthur Shoener, who resigned. Sterling has spent nine years at the Panama Canal Railway, a joint venture of Kansas City Southern and Mi-Jack Products.
Michael R. Haverty, chairman and CEO of Kansas City Southern, said Starling's experience in Latin America, North America, and Asia "will expand KC's marketing opportunities for our increasingly internationally focused company, and his 23 years of operating experience will help us build on our current operating efficiency."
Haverty also expressed the company's appreciation to Schoener for helping KCS "build the capital assets that it will need to meet the growing demand of our customer-oriented rail services in the future."
Starling began his railroad career with the Frisco in 1971, and for 14 years held positions in operations on the Frisco and on Burlington Northern. Starling joined Mi-Jack Products in 1984 to help create a terminal operating company, In-Terminal Services. In 1988 he joined American President Lines as managing director of stack train operations for the Chicago region and later for the southern region. In 1995, Starling became APL's managing director for he Hong Kong/South China, and then served as vice president-Central Asia. In 1999, Sterling was named president of the Panama Canal Railway with responsibility for reconstruction of the line and its subsequent operation.
New York MTA rail ridership climbs steadilyThe New York Metropolitan Transportation Agency operates three of North America's busiest passenger railroads, and each of them reported a surge in ridership during this year’s first quarter compared with the first quarter of 2007.
Ridership on New York City subways increased to 393.71 million in this year's first three months from 375.4 million in the same period a year ago, or 4.8%. Long Island Rail Road ridership rose to 21 million from 20 million, up 5%, and ridership on MTA's other railroad, Metro-North, increased to 19.2 million from 18.21 million, up 5.4%.
The increases for March 2008, versus the year-ago month, were less spectacular in percentage terms--1.5% for the city subways, 1.4% for the LIRR, and 2.0% for Metro-North--but show that MTA's ridership gains for the three-month period have been sustained and not just a short-term fluctuation.
Supplier opportunity: Egyptian railway delegation visiting U.S.Officials from Egypt’s Ministry of Transport (MoT) and National Railroad (ENR) will be touring U.S. railway facilities the week of June 16 as part of a U.S. Trade and Development Agency orientation visit. The main goal of the visit is to introduce key ENR and MoT officials to state-of-the-art traffic operations centers, and demonstrating safe management of dense passenger and freight traffic over long distances in dark territory.
The Railway Supply Institute’s International Business Development Committee (IBDC) is providing U.S. railway suppliers with an opportunity to meet with the Egyptian delegation on Tuesday, June 17, 2008, from 1:00 to 4:00 p.m. at AAR headquarters (50 F Street NW in Washington, D.C., 4th Floor Conference Center). There will be a presentation from the delegation that will cover priority projects and potential funding sources. In addition to signaling and train operations technology, the delegation will address the status of Egypt’s rolling stock, including procurement and modernization plans. “We note that Egypt is a small to mid-sized international railway market, but one with experience and interest in U.S. technology,” RSI says.
The meeting will be chaired by RSI IBDC Chairman Matt London. Ample time will be available for one-on-one meetings. Suppliers interested in participating should contact RSI’s Nicole Brewin at brewin@railwaysupply.org.
SEC weighs in on CSX/TCI litigationIn its ongoing proxy battle with The Children's Investment Fund Management and 3G Partners, CSX, as part of a lawsuit covering several issues, is claiming that TCI violated its disclosure obligations by not including shares held by counterparties for derivatives known as “total-return equity swaps.” CSX says TCI used a particular type of derivative to influence the way underlying shares are voted in the proxy dispute.
U.S. District Judge Lewis Kaplan, who is overseeing the litigation and is expected to render a decision the week of June 9, asked the SEC for an opinion. The SEC, according to a report published in the June 6 Wall Street Journal, submitted a letter on June 4 to Judge Kaplan stating that hedge funds don’t need to count certain derivatives when determining how to report ownership stakes in companies. The SEC’s opinion was submitted by SEC staff, not the SEC commissioners.
“Total-return equity swaps are cash-settled and give their holders a cheap way to get exposure to a company's stock without the risk of owning actual shares,” the Wall Street Journal reported. “Hedge funds use swaps for leverage, tax considerations, and other reasons. The counterparties to the swaps are usually investment banks, which have business relationships with hedge funds. Companies have long complained that hedge funds use these swaps to hide their ownership interest. Federal securities laws require investors to disclose an equity stake in a company once it passes 5%.”
In the letter, SEC Deputy Director-Division of Corporation Finance Brian Breheny said the agency “disagrees” with CSX’s position because “the existence of a relationship between the hedge fund and the counterparty to the swap alone isn’t sufficient to have those shares count toward disclosure. . . . In our view, the conclusion is not changed by the presence of economic or business incentives that the counterparty may have to vote the shares as the other party wishes. . . . As a general matter, a person that does nothing more than enter into an equity swap should not be found to have engaged in an evasion of the reporting requirements.”
CSX, in a statement, said, “The letter gives the views of the staff of the SEC on the general legal standard in one of the many issues in CSX’s lawsuit against the TCI Group. The Court will determine the appropriate legal standard on this issue and how it is applied to the specific facts of this case. CSX will wait for the Court’s decision on this and all of the other issues in the lawsuit.”
U.S. freight traffic drops in latest week, but scores gains in MayU.S. carload freight declined 0.9% for the week ended May 31 from the corresponding week in 2007, while intermodal traffic also slipped 0.7% for the comparable period, the Association of American Railroads reported. Total volume of 32.7 billion ton-miles was equal to the year-ago period.
Canadian railroad carload freight fell even more sharply, off 7.6% for the week versus year-earlier levels, though intermodal traffic rose 4.6%.
For May, carload freight on U.S. railroads advanced 0.5%, with intermodal slipping 0.9%, compared with May 2007 volume. "Coal, chemicals, and grain together accounted for nearly 60% of U.S. rail carloads in May, and all three showed carload increases over last year," said John Gray, AAR senior vice president.
Canadian rail carload traffic in May declined 4.7% from year-ago levels, but Canadian intermodal traffic rose 4.5%. In Mexico, carloads on Kansas City Southern de Mexico declined 4.2% in May, and intermodal rose 4.8%, versus the comparable month a year ago.
FRA solicits intercity passenger State Capital Grant interestTrying to get a jump on fiscal year 2009, the Federal Railroad Administration has set June 30, 2008 as the deadline for applications to be considered for the Intercity Passenger Rail State Capital Grant program. The Bush Administration has recommended $30 million to fund state efforts to improve intercity passenger rail, offering a 50-50 funding match, and the measure is anticipated to pass congressional muster.
"Projects that demonstrate an on-time performance standard of 80% or greater, reduce travel time, increase service frequency, or enhance service quality for intercity rail passengers will receive favorable consideration for funding. Subsequent rounds of awards will depend on the availability of any remaining funds," the FRA said in a statement.
The National Association of Railroad Passengers praised the capital grant program despite its modest proposed funding, arguing that the procedure gives states leverage to maximize intercity passenger rail initiatives heretofore discouraged. "The amount is disappointing, but the precedent is important," said NARP Assistant Director Dave Johnson. "We want to see [the program] gain momentum and get bigger."
More information is available from the FRA on its website, www.fra.dot.gov/us/content/1954, or by contacting FRA's Rob Kulat at (202) 493-6024.
Canada safety officials fret over flawed wheel setsThe Transportation Safety Board of Canada is urging North American Class I railroads to track down at least 10,000 freight car wheel sets that may still be in use despite a recall for safety problems. The board attributes numerous derailments in Canada in the past 30 months involving defective wheel sets still in use, and assumes other incidents in the United States have also occurred, perhaps not attributed to the problem.
The board issued a massive recall in 2002, but only about three-quarters of the 43,000 flawed wheel sets have been identified. "Because we don't track it, we don't know where these wheel sets are," said TSB inspector Don Mustard.
Manufactured by Canadian National between 1998 and 2001, the wheel sets have been blamed for at least 15 derailments in Canada and an unknown number of accidents in the United States. In 2001, CN and the Association of American Railroads alerted other carriers that the defective wheel sets should be taken out of service, but the safety board says at least 12 derailments attributable to the flawed gear have occurred since then.
The board said the remaining 25% of flawed wheel sets recalled remain in service or otherwise unaccounted for. It said Canada should make its railways adopt better procedures for tracking wheels, and criticized AAR for requiring data on critical components like wheels to be kept by members for only five years.
Suppliers: Get ready for InnotransInnoTrans, the biennial international trade show for railway transport technology, innovative components, vehicles, and systems, will be held Sept. 23-26, 2008 at the Berlin Fairgrounds, Berlin, Germany. This year’s show will feature new technologies and equipment in the areas of railway technology, interiors, infrastructure, public transport, transport IT, services, and tunnel construction. Show management expects over 1,600 suppliers from around the world who will showcase their products and services to more than 64,000 attendees from five continents—an increase in the numbers of attendees and exhibitors. North American railway suppliers interested in exhibiting should contact InnoTrans North American Representative Mary Jo Balve at (732) 933-1118; (732) 245-4650 (cell); mjbalve@globaltradeshow.com (email). North American attendees can register here: InnoTrans Online Ticket Shop. For more information, see www.innotrans.com.
New life for a GP9In 1954 and 1955, the Canadian Pacific Railway took delivery of 17 GP9 general-purpose road switchers. Nearly 4,100 of the four-axle workhorses were produced by General Motors Electro-Motive Division between January 1954 and August 1963; of those, 646 were built for Canadian railroads. Power was provided by an EMD 567C 16-cylinder diesel engine that generated 1,750 hp. Many remain in service today, providing power for short lines and regionals, or in switching duties for Class I's.
Fifty-four years after it first saw CPR rails, one of the railroad’s GP9s has been given new life by Electro-Motive Diesel (successor company to GM-EMD) and has returned to service on CPR as a 710ECO™ Repower.
GP22ECO No. 7102, rebuilt and repowered with a U.S. EPA Tier 2-compliant, 8-710G3A-T2, 2,150-hp, single-turbocharged eight-cylinder diesel, “allows railroads to leverage their fleet investment by updating older yard and road switchers with the latest microprocessor-controlled locomotive engine technology, for lower emissions, increased fuel economy, greater reliability, easier serviceability, and predictable maintenance costs,” according to EMD Product Manager Kevin Bahnline. “These locomotives minimize fuel consumption while maintaining emissions compliance. Their 25% fuel savings and 50% lube oil reductions are especially important for railroads facing rapidly escalating costs. And up to 70% reduction in greenhouse gas emissions makes them eligible for both state and federal funding as clean air projects.” Bahnline adds that their EPA-certified emissions exceed Tier 2 requirements.
Also available with a 12-cylinder, 3,150-hp 12-710G3B-T2 powerplant, EMD’s new Repower series locomotives are equipped with the EM2000 microprocessor control system, “which significantly increases all-weather adhesion with tractive effort up to 87,500 pounds,” electronuc fuel injection, an AR10 traction alternator, and a fully-integrated Automatic Engine Start Stop (AESS) system. “A 90% parts commonality with existing fleets reduces spares inventory and makes service simple, with familiar tools and procedures,” says Bahnline. “The flexible software platform allows engines to be tuned for future emission compliance.” EMD claims a 15,000MWh (megawatt-hour) overhaul cycle.
No. 7102 is currently undergoing long-term product testing and evaluation in daily revenue service.
Alstom to provide Santiago, Chile, metro with 36 carsMetro de Santiago, serving the Chilean capital, has exercised a contract option for 36 Metropolis cars from Alstom, worth $71 million. Alstom will manufacture 12 three-car sets at its Lapa, Brazil, facility. Electrical traction and train control equipment is being provided from the company's manufacturing sites in France, while a passenger information system will come for Alstom's Montreal operations.
Delivery of the new cars is expected for the end of 2009. Alstom Chile's teams will install the bogies at one of Metro de Santiago's maintenance workshops and will also provide technical support during the warranty period.
UP not interested in California high speed rail planResponding to outreach by the California High-Speed Rail Authority, Union Pacific has said it is not interested in any discussion over use of any UP right-of-way for the state's proposed 220-mile high speed rail service.
Any sale or leasing of existing right-of-way is not open to discussion, UP said.
California voters this fall will be asked to approve a $9.9 billion bond to help fund the project. The total project is expected to cost $43 billion, with public/private partnership arrangements seen as a viable option for the overall plan's implementation.
A May 13 letter from UP General Manager Jerry Wilmoth states, "As your project moves forward with its final design, it is our request you do so in such a way as to not require the use of Union Pacific operating rights of way or interfere with Union Pacific operations."
According to Mehdi Morshed, the rail authority's executive director, "We have known all along that the railroads are not very likely to want to share their rights of way with people."
But one observer familiar with Sacramento politics called the UP statement "unnecessarily confrontational and negative" and a disappointment to the plan's supporters, telling Railway Age, "UP isn't even employing good political strategy, such as making preliminary suggestions for requirements or compensation. They just say 'no.'"
Senators want TCI investigated; Pentagon probe under wayCiting national security concerns, six members of the U.S. Senate Banking Committee have asked the U.S. Treasury Department to conduct a formal investigation of TCI (The Children's Investment Fund), the London-based hedge fund that is attempting to win five seats on CSX's 12-member board of directors, according to a published report. An internal assessment of TCI is already under way at the U.S. Defense Department, according to a Pentagon spokesman.
In a letter to Treasury Secretary Henry Paulson, the six senators, who represent both parties, said, “Very little is known about the investors in the TCI group or those investors’ agenda. They are anonymous and invisible to government regulators.” TCI, the letter suggested, could be a front for foreign governments and investors attempting to take control of CSX. “We welcome investment in this country,” Sen. Evan Bayh (D-Ind.), one of the letter’s authors, told USA Today. “But we have to make sure these are economic investments and not politically motivated.” USA Today added that TCI “refuses to divulge the names of its foreign investors.”
TCI responded by calling the request for a Treasury Department investigation a “scare-mongering tactic” and denied it wants control of CSX, the nation’s third-largest railroad. TCI said it only wants CSX’s board of directors and management to set “more ambitious financial goals.” The hedge fund, which already owns close to 9% of CSX stock, is engaged in a contentious proxy battle that will play out at CSX’s June 25 annual board meeting.
CSX, like most of the nation’s Class I railroads, serves U.S. military bases, transporting weapons and nuclear materials, and is vital to national defense. Two years ago, congressional outrage over the Bush Administration’s approval of a deal allowing Dubai Ports World, a Middle Eastern company, to oversee operations at six U.S. ports, ended in that company pulling out. The senators’ letter to the Treasury Department cited a similar, more recent scenario in Japan, where the Japanese government rejected TCI’s attempt to increase its stake in a Japanese utility company from 9.9% to 20%, based on national security concerns.
CSX spokesman Gary Sease said that Congress “has been concerned about security on critical national infrastructure for many years” and that if a review of TCI is undertaken, “CSX will cooperate fully.”
North Carolina adding third train linking Raleigh, CharlotteNorth Carolina Gov. Mike Easley Wednesday announced plans for a third intercity passenger train frequency between Raleigh and Charlotte to meet growing demand as well as ridership increases. The new train service will run at midday, with departures from Raleigh and Charlotte.
North Carolina's Department of Transportation officials say the service will take six-to-12 months to set up; rail cars and locomotives will need to be refurbished for the service.
NCDOT noted that from October 2007 to April 2008, ridership was up more than 22% on the Piedmont and Carolinian services, co-sponsored by NCDOT and Amtrak. Federal Congestion Mitigation and Air Quality (CMAQ) funds will provide $3 million per year for the start-up and operation of the service for the first three years.
"Ridership is increasing significantly along this route and adding a midday train run will meet the growing demand and provide needed services to North Carolina travelers who are looking for economical alternatives to driving," Easley said. "As fuel prices continue to climb, more and more people are turning to rail as their choice for transportation."
Bombardier boosts backlog and earningsBombardier, Inc. reported strong results Wednesday for its first fiscal quarter, with combined transportation and aerospace revenues up 23% to $4.8 billion. Net income climbed to $226 million, an improvement of $147 million compared with the same period last year. At the end of the quarter on April 30, the company's order backlog was $55.5 billion vs. $53.6 billion on Jan. 31.
Bombardier Transportation posed revenues of $2.4 billion, in the first quarter, on increase of $702 million over the same period last year. New orders worth $2.4 billion were recorded during the quarter, and the backlog stood at $31.4 billion on April 30.
The unit has recently made two expansion moves. Bombardier Transportation signed an agreement with Ansaldobreda, a subsidiary of Finnemeccanica, to continue its development of very high speed trains. Subsequent to the quarter, Bombardier signed an agreement with Transmashholding to develop a new family and new generation of locomotives for the Russian and export markets.
At Bombardier Aerospace, revenues also increased to $2.4 billion in the latest quarter and the backlog rose 6.0% to a record $24.1 billion.
In a move that was announced last Nov. 28, Pierre Beaudoin has now assumed the position of president and CEO of Bombardier. Lurent Beaudoin remains as chairman of the board.
Hearing set on railroad role in hazmat haulageThe Surface Transportation Board announced Wednesday that it will hold a public hearing in Washington, D. C., July 16 "to examine issues related to the common carrier obligation of railroads with respect to the transportation of hazardous materials." The STB is seeking to develop broader views than those that came out of hearing on the issue in April. In its announcement of the new hearing, the STB made these points:
"The common carrier obligation refers to the statutory duty of railroads to provide 'transportation or service on reasonable request.' A railroad may not refuse to provide service merely because to do so would be inconvenient or unprofitable. The common carrier, obligation, however, is not absolute, and service requests must be reasonable. . . .
"The board is interested in specific potential policy solutions to the liability issue, including solutions modeled on the Price-Anderson Act of 1957. The Price-Anderson Act was designed to ensure that adequate funds would be available to satisfy liability claims of members of the public for personal injury and property damage in he event of a catastrophic nuclear accident."
The board is also seeking comments on "whether there are unique costs associated with the transportation of hazardous materials and, if so, how railroads recover these costs." Persons wishing to speak at the hearing should notify the board by July 2.
Heavier trucks would be tied to fuel pricesA bill was introduced in the U.S. Senate Wednesday that would increase truck weight limits on federal highways from the current 80,000 pounds to 100,000 pounds when the price of diesel fuel is $3.50 a gallon or more. The Commercial Truck fuel Savings Demonstration Act of 2008 was introduced by Senator Susan Collins (R-Maine) and announced at a press conference at the Augusta, Me., headquarters of the Maine Motor Transport Association.
"Current laws that force trucks carrying more than 80,000 pounds off the federal interstate system and onto smaller, two-lane roads simply do not make sense," said Senator Collins. Only a handful of "grandfathered" states now permit weights in excess of 80,000 pounds.
The legislation would create a two-year pilot program, at the end of which the Government Accountability Office would prepare a report on safety and other issues raised by the program.
Trucking interests have already announced that they will seek increased truck weight and size limits when Congress begins its debate on a new, six-year transportation act next year.
CSX to shareholders: Performance trumps promiseCSX Corp. sent a letter to shareholders Tuesday asserting that the TCI Group "admits to having no plan for the company" as it attempts to seat "a handpicked block of nominees" on the CSX board at the company's annual meeting June 25. "We urge you to test their theories and their track record against the proven and solid performance offered by your board," said a letter signed by CSX Chairman, President, and CEO Michael J. Ward. "If you invested $1,000 in CSX stock five years ago, you would have earned a return of $3,466 on that investment--almost six times more than if you invested in the average S&P 500 company. This exceptional shareholder value is driven by your company's proven strategy and relentless execution."
The hedge funds that are challenging CSX's management have questioned the company's productivity record. In his latest letter, Ward observed: "CSX has achieved $500 million in productivity gains over the past four years, with another $400-plus-million expected through 2010 from sources such as enhanced fleet utilization and labor productivity. But it doesn't stop there. Process Improvement Teams are driving continuous improvements in areas such as crew efficiency and fuel use. (CSX saved over 8 million gallons of fuel last year and is on track to save an additional 10 million gallons this year.)"
Ward said the TCI Group has "purposesfully tried to obscure CSX's outstanding performance with bad math, flawed assumptions, and half truths. They've made demands that we believe would damage and impair the value of your investment--ideas such saddling CSX with 'junk' rated debt or doing a leveraged buyout at $50 a share, with the stock price now in the high $60s."
Watco Companies acquires Fitzgerald Railcar Services, Inc.Short line holding company and locomotive and car shop operator Watco Companies, Inc. has acquired Fitzgerald Railcar Services, Inc. FRSI provides railcar repair and maintenance services at shops in Fitzgerald, Ga., and Omaha, Neb. Both shops are now part of Watco Mechanical Services. The Fitzgerald shop is served by CSX Transportation and the Omaha shop is served by Union Pacific.
Watco CEO Rick Webb said FRSI “is a great fit with our current mechanical portfolio.” Mechanical Services, he said, “is a large part of our core business,” and the acquisition gives Watco opportunities to expand its customer reach. In particular, the Fitzgerald, Ga., shop provides an opportunity to expand repair services in the southeastern U.S.
Watco has two major tank car customers and plans to service those accounts at the Fitzgerald shop, which was built in 1981 and is believed to be one of the newest tank car shops in the U.S., with modern paint and lining facilities.
Watco, based in Pittsburg, Kan., operates 17 railroads in 15 states, and industrial switching locations and mechanical shops across the U.S. Watco owns Millennium Rail, Inc., which has eight car repair shops, and a transloading subsidiary, Reload Inc.
Permut named president of Metro-NorthHoward R. Permut, who was present at the creation of MTA Metro-North Railroad 25 years ago, will become president of the commuter railroad on July 15 when current President Peter A. Cannito retires. Permut is currently Metro-North's vice president of planning. "We interviewed a wide range of candidates, and I am delighted that the best candidate was an internal one," said New York MTA Executive Director and CEO Elliot G. Sander. "Howard has been part of Metro-North's creation and rebirth and his experience and unique perspective more than qualify him to lead Metro-North into the future."
Permut, a native New Yorker, was a member of the team that formed Metro-North out of Conrail's New York and Connecticut commuter operations. On Metro-North's birthday—Jan. 1, 1983—he became the railroad's first director of planning. He was steadily promoted to positions of greater responsibility as he led the development of programs to expand service, ridership, and revenue, including improved scheduling, marketing and advertising of new services, and increasing train station access via parking spaces and multi-modal connecting services.
Permut, who holds a master's degree in transportation from Northwestern University, began his career in Chicago in 1975 as a manager of capital programs for the Northeastern Illinois Regional transportation Authority. He joined the New York MTA as a senior policy planner in 1979.
NS: New coal delivery process laudedEastman Chemical Company has awarded Norfolk Southern its 2007 Global Logistics Supplier Innovation Award for new coal delivery process the railroad devised for Eastman’s Kingsport, Tenn., chemical manufacturing plant. “Norfolk Southern’s creative redesign of its service plan for the plant resulted in significant improvements in delivery schedules, consistency of operations, and efficiency,” said Terry Begley, Eastman Chemical vice president, global supply chain and quality.
Crossing fatalities drop sharply in first quarterU.S. railroads reported 51 grade crossing fatalities in this year’s first three months, down 36.3% from the 80 crossing deaths reported in the corresponding period of 2007, according to preliminary figures posted on the Federal Railroad Administration website on May 30. Trespasser fatalities in the first quarter of 2008 increased 3.2% to 96.
The total number of accidents and incidents in a January-March 2008 declined 10.8% to 2,915, and total fatalities were down 13.3% to 157. Train accidents declined 8.1% to 605, with collisions up 232.7% to 47 and derailments down 11.3% to 438. The number of yard accidents dropped 7% to 321.
Track causes were blamed for 207 train accidents, down 13.8%; human factors for 202 accidents, down 13.3%; equipment causes for 80, down 12.1%; and signal causes for 123, up 9.1%.
RailWorks names transit chief for L. K. Comstock RailWorks Corp. announced the appointment of Michael J. Holt, with 30 years of experience in heavy public and private construction projects, as president of the National Transit Division of its transits systems subsidiary, L. K. Comstock & Co., Inc. An honored name in the transportation industry, Comstock has completed more than 100 projects valued at more than $2 billion for more than 30 transit agencies. Holt most recently served as vice president and East Coast regional manager for MVH Constructors, Inc., an international program management, consulting, and construction services firm. Comstock’s National Transit Division is based at Norcross, Ga., and includes transit projects throughout North America outside the New York City metropolitan region.