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April 2014 | www.railwayage.com
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April 2014 RAilwAy Age 1
From the Editor William C. Vantuono
Editorial and ExEcutivE officEs Simmons-Boardman Publishing Corp. 55 Broad Street, 26th Fl. New York, NY 10004 212-620-7200; Fax: 212-633-1863 Website: www.railwayage.com
“Theme in search of a movie”
dlai E. Stevenson II, who twice lost the Presidential election (in 1952 and 1956) and who later served as U.S. Ambassador to the United Nations under Presidents Kennedy and Johnson, was one of the most quotable politicians of his era. “A hypocrite is the kind of politician who would cut down a redwood tree, then mount the stump and make a speech for conservation,” he once said. Within the context of the recent National Industrial Transportation Leagueinduced STB hearings on mandatory competitive switching, I find Stevenson’s take on hypocrisy appropriate. Specifically, such hypocrisy applies to those who would “restore the old way of doing things [with] government’s heavy hand in place of limited regulatory freedoms, [a] regression to the regulatory regime of the late 19th century and most of the 20th century, when bureaucrats predominantly determined the level of railroad rates and service, and the timing of any changes,” to quote Contributing Editor Frank Wilner. Picture this scene from what can only be described as the railroad shipper version of the Théâtre de l’Absurde (where “logical construction and argument gives way to irrational and illogical speech and to its ultimate conclusion, silence”): A representative of Dow Chemical, who appeared before the STB in support of the NITL, reinforced NITL complaints about railroad rates, profits, and monopoly power. On its website, Dow touts a 71% boost in stock price over the past year, a 31% improvement in earnings per share, and the value of its own monopoly— patents, “which, unlike sole-served rail points, cannot be broken by manufacture elsewhere, its threat, or the use of trucks” (again, Frank Wilner). The American Chemistry Council, NITL’s co-protagonist, “boasts representing a $770 billion industry that generates 25% of gross domestic product, employs 800,000, and whose profits fuel $39 billion 2
annually in capital investment—numbers that dwarf railroad industry financial statistics and belie any insinuation of excessive bargaining power in the hands of railroads when rates are negotiated bilaterally” (Wilner yet again). AAR chief executive Ed Hamberger calls mandatory competitive switching “a solution looking for a problem.” This brings to mind the title of a great jazz composition penned for the great Woody Herman Thundering Herd big band some time ago. The composer/arranger, according to Woody’s introduction on the album (a live performance recorded in California), couldn’t think of a title for his piece. He wound up calling it “Theme in Search of a Movie.” Again, I go back to Frank Wilner: “A recurring and intractable thread tying together railroad history is that when the choice has been between economic liberty and government intrusion, selecting the latter has repetitively discouraged capital investment, diminished service quality, adversely affected safety, and sooner than later caused hand-wringing among those most dependent on rail transportation. Ignoring the lessons of history inspires, cultivates, and enables aggressors who are never short of, nor shy with, selfserving justifications.” Indeed, it was the NITL—now trying to persuade the STB to force re-regulation down the railroads’ throats—that once, with significant pre-Staggers Act rail shipper experience, argued that 1) price has meaning only in the context of service quality, and 2) higher freight rates are justified by increased capital investment and service improvements. Vaudeville, absurdism, parody, clichés, wordplay, nonsense: Call it what you like. It’s still hypocrisy. Hopefully, the STB’s ultimate conclusion will have the same effect as silence.
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Industry Indicators SHORT LINE AND REGIONAL TRAFFIC INDEX
FIVE WEEKS ENDING MARCH 1, 2014
mAJOR U.S. RAILROADS BY COmmODITY Grain Farm Products ex. Grain Grain Mill Products Food products Chemicals Petroleum & Petroleum Products Coal Primary Forest Products Lumber and Wood Products Pulp and Paper Products Metallic Ores Coke Primary Metal Products Iron and Steel Scrap Motor Vehicles and Parts Crushed Stone, Sand, and Gravel Nonmetallic Minerals Stone, Clay & Glass Waste & Nonferrous Scrap All Other Carloads TOTAL U.S. CARLOADS
FEB. ’14 79,224 3,280 39,669 25,100 121,164 55,512 433,398 6,204 13,420 24,461 16,058 14,274 40,026 17,069 66,186 71,447 18,149 28,062 11,152 17,003 1,100,858
FEB. ’13 70,528 3,723 36,024 26,452 121,130 54,483 448,969 6,040 13,894 24,236 17,527 14,944 43,118 16,367 68,503 73,425 16,538 26,388 12,069 18,561 1,112,919
% CHANGE 12.3% -11.9% 10.1% -5.1% 0.0% 1.9% -3.5% 2.7% -3.4% 0.9% -8.4% -4.5% -7.2% 4.3% -3.4% 9.7% 8.0% 6.3% -7.6% -8.4% -1.1%
Chemicals Coal Crushed Stone / Sand / Gravel Food & Kindred Products Grain Grain Mill Products Lumber & Wood Products Metallic Ores Metals & Products Motor Vehicles & Equipment Nonmetallic Minerals Petroleum Products Pulp, Paper & Allied Products Stone, Clay & Glass Products Trailers / Containers Waste & Nonferrous Scrap All Other Carloads
COmBINED U.S./CANADA RR
FIVE WEEKS ENDING MARCH 1, 2014
INTERMODAL mAJOR U.S. RAILROADS BY COmmODITY TRAILERS CONTAINERS TOTAL UNITS
FEB. ’14 119,567 874,240 993,807
FEB. ’13 110,869 872,209 983,078
% CHANGE 7.8% 0.2% 1.1%
7,494 206,056 213,550
5,921 202,775 208,696
26.6% 1.6% 2.3%
127,061 1,080,296 1,207,357
116,790 1,074,984 1,191,774
8.8% 0.5% 1.3%
COmBINED U.S./CANADA RR TRAILERS CONTAINERS TOTAL COmBINED UNITS
Source: Monthly Railroad Traffic, Association of American Railroads
AVERAGE WEEKLY U.S. RAIL CARLOADS: ALL COmmODITIES (not seasonally adjusted)
% CHANGE -4.7% -11.0% 3.0% 1.2% 4.3% 5.2% -8.1% 10.8% -1.9% 17.8% 12.1% -9.2% 4.7% -5.7% -3.6% 2.6% -2.0%
FEBRUARY 2014 - 331,273 FEBRUARY 2013 - 335,067 290,000 300,000 310,000 320,000 330,000
340,000 350,000 360,000 370,000 380,000
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RAILROAD EmpLOYmENT, CLASS I LINEHAUL CARRIERS, FEBRUARY 2014 (% CHANGE FROM FEBRUARY 2013)
CANADIAN RAILROADS TRAILERS CONTAINERS TOTAL UNITS
ORIGINATED FEB. ’13 41,757 22,492 22,081 11,227 21,232 6,072 9,953 7,996 19,414 8,882 1,977 2,250 17,199 10,194 42,727 9,617 79,997
TOTAL CARLOADS, FEBRUARY 2014 VS. 2013
CANADIAN RAILROADS ALL COmmODITIES
ORIGINATED FEB. ’14 39,775 20,028 22,747 11,357 22,140 6,386 9,150 8,860 19,053 10,464 2,216 2,043 18,009 9,617 41,185 9,870 78,373
Transportation (train and engine) 66,095 (1.47%)
Executives, Officials, and Staff Assistants 9,861 (0.23%)
Professional and Administrative 13,965 (-1.26%)
TOTAL EmpLOYEES: 162,316 % CHANGE FROm FEB. 2013: 0.05% Transportation (other than train & engine) 6,648 (-2.21%)
Maintenance of Equipment and Stores 29,677 (-1.23%)
Maintenanceof-Way and Structures 36,070 (-0.55%)
Source: Surface Transportation Board
EmpLOYmENT Up YEAR-OVER-YEAR AND FROm JANUARY Figures released by the Surface Transportation Board show Class I railroad employment rose 0.05% in mid-February 2014 from a year earlier, and rose 0.02% from January 2014. Only two categories grew over year-ago levels: Transportation (train and engine), up 1.47%, and Executives, Officials, and Staff Assistants, up 0.23%. Those two also scored monthly gains, as did Transportation (other than train and engine), and Maintenance-of-Way and Structures. 4
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FRA slams Metro-North on safety Stressing to the hilt its longstanding public emphasis on safety as a pinnacle industry goal, the Federal Railroad administration last month slammed MetroNorth Railroad for a “deficient safety culture” that favored on-time performance to operational safety procedures. FRa said the railroad’s operations control center routinely pressured employees “to rush when responding to signal failures,” and that workers had to overcome resistance in securing the track time needed to effect repairs on right-of-way maintenance and other systems needs. FRa’s action was spurred largely by the Metro-North derailment last December at Spuyten Duyvil (the Bronx), N.y., which killed four passengers and injured 70 others. That accident, however, appears so far not to have involved signal failure as much as excessive speed allowed by the train’s engineer, though neither FRa nor the National Transportation Safety Board (NTSB) has ruled definitively on that matter. Several observers, including MTa employees (including within Metro-North), have told Railway age that high employee turnover has put added stress on the railroad.
APTA urges transit investment
Oregon abandons bistate bridge plan Oregon’s Department of Transportation last month said it will abandon planning efforts for the controversial Columbia River Crossing project, which was to include a new interstate 5 bridge and (from Oregon’s perspective) light rail transit services on the bridge extending into Vancouver, wash. ODOT said it “will begin the process of orderly archival and closeout,” to finish in May. 6
at its 2014 legislative Conference, the american Public Transportation association (aPTa) released its recommendations for authorization of the transportation bill that is set to expire at the end of September. The aPTa plan calls on Congress to authorize a $100.4 billion federal transit program over six years, which would grow the current $10.7 billion annual program to $22.2 billion by 2020. aPTa’s plan also calls for policy changes “that will ensure that the industry provides effective and efficient public transportation,” said aPTa Chair Peter Varga. “The industry has come together and developed a consensus recommendation that creates american jobs and addresses the growing demand for public transportation.”
last month the Surface Transportation Board (STB) held a public hearing on a petition by the National industrial Transportation league (NiTl) to modify STB’s standards for mandatory competitive switching. The House Committee on Transportation and infrastructure sent a bipartisan letter to STB Chairman Dan elliot and Vice Chairman ann Begeman indirectly urging them to consider the consequences for railroads should the Board accept NiTl’s proposal, and strongly voicing the Committee’s intent to oppose such a policy change. The letter, signed by Chairman Bill Shuster (R-Pa.) and Ranking Member Nick Rahall (D-w.Va.), along with two others, did not directly address the massive increases in operating costs and the detrimental affect on the rail industry’s ability to invest capital that mandatory competitive switching would create. The aaR has spent considerable resources making that argument. (“we’ve done a good job in expanding the discussion beyond what we would lose financially,” aaR chief executive ed Hamberger recently told Railway age. “we’re able to show what would happen if 7.5 million annual switch moves become controlled by shippers. we’re looking at a greatly reduced ability to plan, mounting operational problems, increased labor and fuel costs, and crowded yards. we’re able to show that mandatory competitive switching would result in close to a dozen extra moves in many situations.”) instead, the letter emphasized what balanced regulation has done for the rail industry, and for the national economy, since the 1980 Staggers act partially deregulated the railroads to benefit both railroads and customers. “any policy change made by the STB that decreases the railroads’ efficiency, and limits their ability to reinvest, grow their networks, and meet the nation’s freight transportation demands both today and in the future will be opposed by this Committee,” the letter said.
top: William C. Vantuono
House T&I to STB: Proceed with care
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CN completes Deux-Montagnes line sale CN in late February closed the sale of its right-of-way principally used by agence Métropolitaine de Transports (aMT) regional trains between Deux-Montagnes and Montreal’s Central Station to aMT for C$97 million (US$87 million). aMT, overseeing public transport in the greater Montreal area, is acquiring CN’s 21-mile Deux-Montagnes Subdivision.
North America ILLINOIS DOT: On behalf of the states of illinois, California, Michigan, Missouri, and washington, formally granted the Siemens Rail Systems Division an official Notice to Proceed on 32 “Charger” diesel-electric passenger locomotives. MASSACHUSETTS BAY COMMUTER RAILROAD: Has filed a motion to block the Massachusetts Bay Transportation authority (MBTa) from awarding a $2.68 billion, eight-year contract to competitor Keolis Commuter Services. MBCR accused MBTa of “refusing to review MBCR’s formal protest in a timely manner.” REGIONAL MUNICIPALITY OF WATERLOO (ONTARIO): approved a C$1.9 billion (US$1.7 billion), 30-year 8
contract to grandlinq, one of three consortia competing to build an 11.8-mile light rail transit line, newly renamed ion.
Worldwide DEUTSCHE BAHN (GERMANY): Signed a $201 million contract with Bombardier for 29 class 442 Talent 2 suburban electric multiple-units (eMUs) as part of a framework deal for up to 321 trains, agreed to in 2007. The batch of 19 three-car and 10 five-car trains will be used on the Mid-german S-Bahn network around leipzig and are due to enter service in autumn 2016. FRENCH PUBLIC INSTITUTION OF RAIL SAFETY: granted an authorization for Commercial Operation (aMeC) for the
new-generation alstom Régiolis multiple unit, ordered by 12 French regions, and involving eurailtest, Certifer, infrastructure manager French Rail Network (RFF), and French National Railways (SNCF). KORAIL (SOUTH KOREA): awarded Hyundai-Rotem a $302 million contract to supply 10 KTX-Sancheon trains for the extension of the high speed rail network to Suseo and Mokpo in 2017. TRANSNET (SOUTH AFRICA): awarded $4.7 billion in contracts for 1,064 locomotives to four global original equipment manufacturers— general electric South africa Technologies (a unit of U.S.-based ge Transportation), CNR Rolling Stock South africa (Pty.) ltd., CSR Zhuzhou electric locomotive, and Bombardier Transportation South africa.
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Financial edge DaViD NaHaSS
Rail Equipment Finance 2014 roundup
or those of you unable to join the more than 400 attendees at Rail Equipment Finance 2014, “Financial Edge” is here to help. Generally, one could not have attended a conference more optimistic and enthusiastic about the marketplace. There were notes of caution throughout the conference regarding impending regulatory changes for tank cars. Generally, market reports focused on the potential for future growth and success. Clearly, attendees at REF 2014 are ready to deal. Rick Webb, CEO of Watco Cos., provided an overview of Watco’s growth opportunities and success tied to the boom in oil and gas drilling in North America. He addressed the current environment for tank cars and future changes in railcar design. Mark Gerlach and Joe Devoe let us know that investors are deploying money into rail and rail equipment at margins (interest rates) lower than equivalent companies in other industries. Both forecast ongoing demand for the near term. Tony Hatch discussed growth in freight traffic, emphasizing crude and intermodal. Hatch noted the broad commodity demand on the rails (with the exception of coal) and how growth in intermodal loadings—the growth story before crude by rail (CBR)—continue to be a source of future growth. Graham Brisben and Catherine Bernardo waded into hydraulic fracking and discussed growth and longevity of CBR and frac sand markets. CBR is a long-term play with great growth potential. Brisben noted concerns about equipment and potential corrosion, including the regulatory environment; he also noted that demand could be affected by oversupplied crude and by pipeline development. Bernardo highlighted an increase in drilling rig activity and the number of operating wells, long-term demand for natural gas and oil in North
America, and that available investment returns will continue to drive growth. On steel markets, Trey Savage and Robert Blankemeyer highlighted that slow growth (such as housing starts) and foreign competition have denied this market the strong upward trend many rail based commodities are seeing. William Rennicke of Oliver Wyman looked into the future of railroads in 10 years and how the commodity mix of carloadings drives changes in the rail network and rail investment.
Generally, market reports focused on the potential for future growth and success. National Steel Car’s Robert Pickel highlighted the projected production of new railcars for 2014 of 60,318 units, seeing continued growth and opportunity across many segments in the railcar fleet. Ted Baun provided news on improving demand for coal cars and coal loadings, noting that the downward trend in coal loadings will be slow and lengthy. On intermodal, consultant Ron Sucik discussed how intermodal loadings are an ongoing growth story for railroads in the U.S. Service and infrastructure improvements continue to take market share from trucks. Mike Nelson identified the need for investment in equipment for moving motor vehicles. Paddy O’Neill and Glen Courtwright informed us that the boxcar of the future (an item debated at REF) is the 60-foot Plate F boxcar. The future is now as that fleet has been undergoing replenishment
and replacement. The transition to the larger car needs to be managed with older 50-foot Plate C boxcars being maintained throughout the transition to insure availability of equipment to serve shipper needs. Betsey Snyder and Anita Ogbara of Standard and Poor’s gave an economic overview weaving a positive tale of economic growth, strong railroad capital, and fundamental strength. They noted that ongoing strength of operating lessors and railcar and component manufacturers is resulting from the underlying market dynamics in the industry today. In marketplace trends and topics, Eva Fromm O’Brien discussed liability for railcar (e.g., CBR tank railcars) owners in derailments. Eric Starks from FTR summarized the economic environment, echoing sentiments regarding strengthening economic outlook, growth in intermodal, and CBR growth. Kristine Kubacki noted increasing railcar production capacity may be unsustainable. Dave Murawski discussed tank railcar regulations and noted the frustration that many parties feel about the way the process is being handled. Timing and implementation of the changes impact which cars are being ordered today and will likely do so until the changes are finalized. He acknowledged that demand for tank cars will be at extraordinary levels for the next 18 to 24 months. Todd Kahn and Robert Pickel discussed covered hopper cars. Key takeaways are that although deliveries hit a three-year low in 2013, demand is likely to increase in 2014 and beyond. Demand will come from sand/cement and plastics markets. For sand/cement, the driver is hydraulic fracking; for plastics, the price of natural gas is driving production of jumbo hoppers for 2015 and beyond. A wealth of information distributed in two days! Next month we will cover locomotives and other key takeways.
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Update TÜV rheinland acquires risktec Solutions ltd. Cologne, germany-based TÜV Rheinland has acquired Risktec Solutions ltd., based in warrington, U.K. Risktec, with offices in the U.K, the Netherlands, the Middle east, and in North america, provides risk and safety services and offers technical training and education to highly regulated industrial sectors around the world. Risktec’s core industries include the oil and gas industry, nuclear power generation, and the railway sector. with its 230 employees, Risktec most recently generated sales revenue of more than $46.7 million, with efforts focused particularly on the markets of the U.K., North america, and the Middle east, TÜV Rheinland said. TÜV Rheinland’s own North american headquarters are in Newtown, Conn., with the company staffing offices in the U.S., Canada, and Mexico.
record 2013 earnings for Ari american Railcar industries recorded record earnings for full-year 2013, and a 3% rise in consolidated earnings during the fourth quarter compared with a year ago. aRi’s fourth-quarter 2013 net earnings were $24.4 million, or $1.14 per share, equal to the 2012 quarter. Net earnings were affected by $3.8 million after-tax loss from the sale of amtek Railcar. Quarterly revenue of $197.2 million was down 5% from 2012’s $20.7 million. For the full year, aRi had net earnings of $86.9 million, or $4.07 per share, compared to $63.8 million, or $2.99 per share, in 2012. Revenue in 2013 was $750.6 million, up from 2012’s $711.7 million.
Railway age april 2014
Freight cars: Growth, renewal continue
nderstanding the dynamic North American revenueearning rail equipment fleet is important to logistics system stakeholders including railroads, shippers, financial institutions, car builders, suppliers, and others associated with the industry. Railinc’s annual analysis of the fleet is focused on highlighting key trends and changes. For the second consecutive year, the size of the revenue-earning fleet increased by at least 14,000 cars, nearly reaching its 2009 level. At year-end 2013, it totaled 1.513 million units, up 0.9% from year-end 2012 to year-end 2013, compared with a 1.1% increase the previous year (Figure 1, p. 14). Tank cars drove the growth, increasing by 7.6% over 2012. Flat cars were up by 1.6%, while covered hoppers were unchanged. In contrast, box cars (including refrigerated cars) were down by 3.4%; hoppers by 2.7%; and gondolas by 1.7%. The average age of railcars in the fleet continued to decrease in 2013 (Figure 2, p. 14). For the second consecutive year, the average age was down, decreasing 0.1 years, to 19.9 years. More new cars were added as older cars left the fleet in 2013. This
suggests the economy continues to head in a positive direction, since historical data show that fewer new railcars are added to the fleet during, and immediately following, economic dips. More than 40,000 new cars have joined the fleet in each of the past three years, and the number of new cars added in 2013 was considerably higher than in 2009 and 2010 combined. Historically, the average age of the fleet and the number of cars added to the fleet mirror the economic environment (Figure 3, p. 15). When the economy is strong, as in the mid-1990s and mid-2000s, the fleet tends to be refurbished with the addition of new equipment. During periods of recession—such as around 1991, 2002, and 2009—the amount of added new equipment decreases significantly. During the past 20 years, the majority of new railcars added to the fleet have had a GRL (gross rail load) of 286,000 pounds, despite a decline that corresponded to the economic downturn in 2009 and 2010. This trend continued in 2013 (Figure 4, p. 15). A significant number of GRL 220 cars joined the revenue-earning fleet in 2013, though most were automotive flat cars. GRL 286 cars have dominated
William C. Vantuono
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new additions to the fleet since the early 1990s because they enable operational efficiencies that reduce costs and ease logistics challenges. The fleet continues to add GRL 263 cars and GRL 220 cars but at much smaller rates than the larger cars. Several sub-fleets of similar types of equipment comprise the revenueearning fleet. Railinc selected them for
analysis because they carry commonly shipped commodities and make up the fleet’s largest percentages: • After two consecutive years of growth, the covered hopper sub-fleet held steady in 2013 at 479,000 cars. Covered hoppers are the largest sub-fleet in North America, making up about 32% of the total. During the past four years, more than 30,000 new
small-cube covered hoppers have joined the fleet, more than all other sizes of covered hoppers combined. • The number of gondolas dropped by 1.7% in 2013 after increasing by 0.9% the previous year. • The tank car fleet continued its growth in 2013 to 339,000 cars, increasing 7.6%—the largest increase of any of the sub-fleets. GRL 263 cars
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still dominate the sub-fleet, though the number of GRL 286 cars increased considerably in 2013. Nearly 11,000 medium tanks—those with capacities between 22,500 and 27,500 gallons— joined the North American fleet in 2012 and 2013. Almost 30,000 large tanks with capacities greater than 27,500 gallons were added to the fleet during 2012 and 2013—nearly triple
the number of medium tanks. • The number of open hoppers decreased by 2.7% in 2013, to 145,000, continuing the sub-fleet’s steady decline. • The box car fleet, the smallest sub-fleet, is older than other sub-fleets and has decreased in size for several years, in part because of the addition of higher-capacity box cars and network
efficiencies that reduce the turnaround time of box cars. The size of the box car sub-fleet continued its downward trend in 2013, decreasing to 118,000 cars, and is down 14% since 2009. By David D. Humphrey, Ph.D., Senior Analyst, Railinc Corp., for Railway Age. Railinc (www.railinc.com) is a wholly owned subsidiary of the AAR.
april 2014 Railway age 15
Update Amtrak FY 2015 budget: “Something has to change” For its Fiscal Year 2015, which begins Oct. 1, 2014, Amtrak is requesting $1.62 billion in federal capital and operating support, an increase of approximately 16% from FY 2014. But more important, said Amtrak President and CEO Joe Boardman, fundamental changes are
needed in how the U.S. government supports intercity passenger rail. A portion of Amtrak’s annual operating profit on the Northeast Corridor, estimated at $300 million and based upon a ratio of operating revenue to operating expenses (“above the rail”
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costs), is used to cover some costs of state-supported and long-distance trains. This has to change, said Boardman, if the NEC is to continue as “vital to the mobility, connectivity, and economy of the entire Northeast. Continuation of current funding levels leave NEC infrastructure vulnerable to a bigger, costlier and far more damaging failure than anything yet seen.” “Infrastructure deterioration and changes in business patterns have reached a point where something has to change,” said Boardman. “If America wants a modern intercity passenger rail system, the problems of policy and funding must be addressed. The nation cannot afford to let a railroad (the NEC) that carries half of Amtrak’s trains and 80% of the nation’s rail commuters fall apart; the economic consequences would be devastating. A new federal policy and funding arrangement should create a significant and reliable multi-year capital investment program to reverse the decay of NEC infrastructure and support other intercity passenger rail projects. A strong federal commitment will allow Amtrak to plan and implement major multiyear projects such as replacing century-old NEC bridges and tunnels, and make critical capacity improvements such as the Gateway Program between New Jersey and New York.” “To provide additional funding for NEC improvements, Congress should fully fund the operating and capital needs of the long-distance routes so that NEC revenues can be reinvested in the NEC,” Boardman said. “By dedicating NEC revenue to meet NEC needs, it could be leveraged to pay for debt service on loans to address the most urgent NEC infrastructure issues. It also could be used to finance other funding solutions such as public-private partnerships, grants of assistance, and state and commuter rail agreements.” He said Amtrak’s long-distance trains have been a core federal responsibility since 1971, and Congress should fulfill its obligation by funding their full cost.
Joe Boardman, Railroader of the Year
Left to right: Railway Age Editor-in-Chief William C. Vantuono, Railroader of the Year Joe Boardman, and Railway Age Publisher Jon Chalon.
Joseph H. Boardman, President and CEO of Amtrak, accepted Railway Age’s 2014 Railroader of the Year Award on March 11 at a dinner at Chicago’s Union League Club attended by more than 400 of his industry colleagues. Boardman accepted the award, the magazine’s 51st, giving recognition to the dedication and hard work of Amtrak employees all across the nation. Prior to receiving the award, Boardman was honored with a special video presentation prepared by Amtrak’s Corporate Communications department that featured tributes from Amtrak board members past and present, among them current Chairman
Anthony Coscia, Tom Carper, and Hunter Biden. The presentation concluded with a message from Vice President Joe Biden. Nick Little, director of the Michigan State University Certificate Program in Railway Management, presented Boardman with a scholarship for an Amtrak employee who wishes to attend the program (bottom left). Following the dinner, Railway Age Publisher Jon Chalon presented Boardman with a commemorative portfolio and pen (bottom right) on behalf of all the railway industry suppliers who supported Railway Age’s January 2014 Railroader of the Year issue.
April 2014 RAilwAy Age 17
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Ontario Premier Kathleen Wynne says GO Transit train service between Kitchener, Ont., and Toronto will be bolstered significantly by the end of 2016. The pledged improvements are seen as part of the province’s C$50 billion “Big Move” plan being implemented by Metrolinx, among others. Two GO Transit morning inbound runs from Kitchener and two afternoon return trips are anticipated, Wynne said last month. A new layover facility and other improvements to the rail line might cut 30 minutes off the trip, currently averaging two hours. “This is a very important initiative for this region,” Wynne said. “This is a hub of innovation and creativity and what we need is an ability to move in and out of the region in a much more efficient way.” Previously, Wynne affirmed that a dedicated transit fund would be part of the province’s fiscal budget, but declined to identify the source for such funding. Wynne has said no taxes will be raised for such a purpose. “It is still ongoing. We are committed to building transit,” Wynne told Ontario local media as she defended the decision to reject any tax increases, a move many Ontario rail advocates have sought. Wynne insisted any increased taxation would affect middle-income earners most severely, though she has avoided defining the parameters of such earners. “But will there be a dedicated fund? Will it be transparent what those dollars will be used for? Yes, absolutely,” she said. At present, Greater Toronto and Hamilton Area agency Metrolinx is trying to advance its C$50 billion “Big Move” plan, including light rail transit (LRT) for numerous provincial locations, subway expansion for Toronto, and increased GO Transit regional rail service frequency and expansion efforts on several routes.
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Reading & Northern: Another growth year
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Port Clinton, Pa.-based Reading & Northern Railroad says 2013 was the most successful year in its 30-year history. The regional railroad—twice named Railway Age’s Regional Railroad of the Year—grew carload business by more than 14%. Overall traffic, including export coal, was up 9%. “This growth far outpaces the growth of other short line and regional railroads this year, which was about 5%,” notes owner/founder and CEO Andrew Muller. “Although the export market for anthracite coal was weak in 2013, our railroad showed double-digit gains in domestic coal movements and merchandise, which includes woodpulp, paper, metals, food products, plastics, and frac sand for Marcellus Shale drilling.” In terms of industrial development in 2013, R&N opened two new rail terminals to handle inbound metals for local customers. “These new facilities took significant truck traffic off the roads and helped support the local industries depending on this business, which employ 1,200 people in Schuylkill and Luzerne counties,” Muller says. “We also continued our unique practice of investing in off-line coal terminals by partnering with a terminal on the Ohio River to increase the movement of anthracite coal by barges.” R&N is currently working on at least four industrial development site searches along its system, and has recently rehabilitated its rail infrastructure to provide service to the newly expanding Cambridge Lee manufacturing facility in Leesport, which employs approximately 400 people in Berks County. R&N serves 41 on-line customers that provide jobs for more than 8,000 people. “Our railroad gets high marks for customer service because we run a scheduled railroad,” says Muller. “We provide each customer with a two-hour service window, and in 2013 our ontime performance was 98%.” In 2013, the R&N embarked on an “unprecedented” capital expenditure program. “In 2013 we purchased and installed 35,000 ties,” says R&N President Wayne Michel. “We also purchased four locomotives, 105 coal cars, a number of trucks and electric cars for our fleet, and a prime piece of industrial property near our headquarters for potential development. All of these purchases were made with future growth in mind.”
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Update ASLRRA 2013 Safety Awards The American Short Line and Regional Railroad Association 2013 Safety Award winners—Safety Person of the Year, Safety Professional of the Year, Most Improved Award, the President’s Awards, Jake Awards with Distinction, and Jake Awards—enable ASLRRA to recognize the continued efforts of members to maintain a high level of safety. Two-hundred ninety-five railroad members earned Jake Awards with Distinction for reaching the ultimate goal of achieving a 0.00 FSI (Frequency/ Severity Index) for the entire year. Twenty-eight additional railroads received Jake Awards for having an injury rate lower than the industry average of 2.42. • Safety Person of the Year: Ozzie España, Pacific Harbor Line. • Safety Professional of the Year: Thomas A. Leopold CSP, Anacostia Rail Holdings. • Most Improved Safety Record: Northern Plains Railroad. President’s Awards • Most hours of injury-free operation: Pacific Harbor Line. For maintaining the best safety rate in the following categories: • 500,000 or more man-hours worked: Union Railroad. • 250,000 to 500,000 man-hours worked: Pacific Harbor Line. • 150,000 to 250,000 man-hours worked: Missouri & Northern Arkansas. • 50,000 to 150,000 man-hours worked: Ohio Central. • Less than 50,000 man-hours worked: Minnesota, Dakota & Western. Sponsors: • Titanium Level: Genesee & Wyoming, Greenville & Western Railway, National Academy of Railroad Sciences, OmniTRAX, Zurich. • Steel Level: Aiken Railway, Georgetown Rail Equipment Company, MaxAccel, Rio Grande Pacific, Watco. • Iron Level: Adrian & Blissfield, Indiana Harbor Belt, Liberty International Underwriters. 20
Railway Age April 2014
Watching Washington FRAnk n. wilneR
Tax reform high agenda objective for rail
ore than D.B. Cooper and Judge Crater, the man most searched for in America was identified by former Senate Finance Committee Chairman Russell Long (D-La.): “Don’t tax me, don’t tax thee. Tax the man behind the tree.” Railroads often have been the “man behind the tree,” saddled with arbitrary, punitive, redistributive, and retaliatory taxes that reduce the plowback of earnings into modernized and expanded plant and equipment, and discourage job creation. Avoiding discriminatory taxes has been a struggle. America may not have secured its Pacific Coast had discriminatory taxes slowed 1860s railroad construction. An 1886 railroad case convinced the Supreme Court to extend to corporations the Constitution’s 14th Amendment protection against arbitrary takings of private property, such as through discriminatory taxes. The 1976 Railroad Revitalization and Regulatory Reform (4-R) Act specifically limited investment-sapping state taxation of railroads. Former Association of American Railroads (AAR) tax lobbyist Frank Duggan recalls congressional staff attorney Al Buckberg grumbling that every few pages of the tax code contain a railroad-friendly provision. It’s not by accident. Duggan’s AAR predecessor, Pat Matthews, was a close buddy of Rep. Wilbur Mills (D-Ark.), who for three decades chaired the tax writing House Ways & Means Committee. “Pat hosted an annual birthday party for Wilbur that even drew President Kennedy,” says Duggan. Union Pacific tax adviser Robert Casey was chummy with Mills, his successor Al Ullman (D-Ore.), and Sen. Long. Mills later joined Casey’s law firm; and Casey later joined Long’s
law firm upon Long’s retirement from the Senate. When Rep. Dan Rostenkowski (D-Ill.) succeeded Ullman as Ways & Means Committee chairman, former congressman Fred Rooney hired on as an AAR lobbyist. Recalls Duggan: “When Rosty was in a down mood, his secretary would call Fred to come by and cheer him up.” Under Rostenkowski’s leadership, there was inserted in the 1981 Economic Recovery Tax Act a provision giving railroads accelerated depreciation on track structure and tunnel
Railroads can’t move offshore, but high tax rates encourage many rail customers to do so. bores worth $2.5 billion in tax credits over five years. That tax relief, on assets whose depreciation had been frozen for up to a century, combined with the 1980 Staggers Act’s removal of excessive regulation and saved the industry from nationalization. Favorable revisions to Railroad Retirement payroll taxes followed; while short lines obtained a crucialto-their-survival investment tax credit. Investment generating and job creation tax relief again is on the rails’ agenda. With an unfunded mandate to install Positive Train Control, and a surge in intermodal and crude oil shipments begging yard, port terminal, track capacity, and motive power expansion, even this year’s record capital investment and maintenance
spending of $26 billion falls shy. As a member of Reforming America’s Taxes Equitably (RATE)— whose members include Boeing, FedEx, and UPS—the AAR is lobbying for a reduction in the top corporate tax rate, which is almost twice an 80-nation average and a drag on U.S. global competitiveness. A cut from 35% to 25% would, for all corporate America, increase domestic capital investment, reverse off-shore production, boost hiring, and repatriate earnings booked offshore to avoid higher U.S. tax rates. Although railroads, unlike most industries, cannot move their factory offshore, high corporate tax rates encourage many rail customers to do so, reducing transportation opportunities and forcing upward pressure on freight rates if revenue adequacy is to be achieved. Additionally, tax reform will encourage better tax-law compliance, lower administrative costs associated with tax collection, and create more taxpayers through increased domestic hiring. “There is a very close correlation between revenue, profits, investment and job creation,” says AAR President Ed Hamberger, who looks to the next Congress for corporate rejuvenating tax reduction, when tax-reform campaigner Paul Ryan (R-Wis.) likely will be the new Ways & Means Committee chairman. Expect Senate Finance Committee Chairman Ron Wyden (D-Ore.) to be on board, encouraged by tax-reform advocate President Obama. A chronicle of possessing the most effective economic arguments, supporting facts, and valuable friends on Capitol Hill has served railroads well in holding at bay those who would stall the engine of enterprise through high corporate taxation. April 2014 RAilwAy Age 21
Perspective: Short Line & Regional GARY C. VAUGHN
Are we killing the horse we rode in on?
merica’s railroads are the workhorses of the U.S. economy. In 2011, there were 17.6 billion tons of freight shipments, a significant portion of which were hauled by America’s railroads. This number is expected to rise to 28.5 billion tons by 2040—a 62% increase—and America’s workhorses, the railroads, are projected to grow their portion at a similar rate. Our state and federally subsidized highway system could not possibly handle that large an increase. America’s railroads can handle it—and the railroads pay their own way. America’s railroads own their property, build their own tracks, and maintain them. In 2012, America’s railroads re-invested more than $25 billion back into their own companies and infrastructure. Since 1985, railroads have invested $200 billion in infrastructure. These railroads are efficient as well, moving one ton of freight an average of 476 miles on a single gallon of fuel. Just as important: These iron horses are safe! Take a look at these 2004 through 2013 comparisons for America’s workhorses, the railroads: • Accidents/incidents down 41%. • Train accidents down 44%. • Derailments down 43%. • Main track accidents down 43%. • Yard accidents down 44%. • Human-factor-caused accidents down 53%. • Injury rates down 42%. 2013 was the safest year in railroad history by any measure. Yet more and more regulations continue to hamper operations and erode the effectiveness and productivity of our railroads. Since the 2008 Rail Safety Improvement Act, 42 new regulations have affected these workhorses (30 published to date and another 12 pending). And 1,566 Federal Railroad Administration Final Rules and Approved Changes have affected our
railroads since 1998. Compliance with these new Final Rules and Changes costs money—sometimes a lot of money. Recently the railroads have come under pressure from regulatory agencies and members of Congress to address problems concerning crude oil transportation. Several accidents since July 2013 have sparked an intense review of crew size, train securement, and hazmat commodity movements with the objective of creating new rules that have serious implications for all railroads. Extensive industry and regulatory agency discussions have not resolved the issues, and those meetings are still under way.
How much regulation can be added before the rail network just breaks down? Nonetheless, FRA Administrator Joseph Szabo has made clear that his down goal is to publish new rules that focus on Crude by Rail carriers this year. There are always improvements to be made when considering how we operate, train our employees, incorporate new technologies, and introduce new commodities and equipment in the rail transportation industry. Times and conditions change and require different approaches and new requirements. But experience and accurate information are essential when evaluating significant change for implementation. There are always consequences; the objective of any change is to improve conditions and avoid unexpected problems. A timely example of this is Positive Train Control, which is the most
sweeping and costly requirement imposed on the rail industry in its history, costing the railroads an estimated $20 billion. With a very limited return on investment from a safety perspective, many of these new rules and regulations are described as “unfunded mandates,” which means the railroads must comply, without receiving funds to do so. Many of these unfunded mandates have marginal value, yet continue to roll out of Congress, the FRA, and other regulatory agencies at alarming rates. One would have thought we had learned from the Staggers Act in 1980. By permitting a more customer-focused, market-based approach to railroading, the Staggers Act, which required a balanced view toward regulation, has greatly benefited railroads, their customers, and our economy at large, just as Congress intended when it passed the act. If we look at America’s railroads truly as workhorses, it is easily conceivable to consider each of these “unfunded mandates” (over 1,500 since 1998) as a stone or a weight placed in the saddle bag. Some stones (like PTC) weigh much more than others, but none is without cost or weight. Each new regulatory requirement demands work and cost on the part of the railroads every single year (i.e. recordkeeping, document retention, training, certification, etc.). But how many stones or weights can the federal government continue to add to the saddlebags of these iron horses before this world class network—the backbone of bulk freight movement in America— just breaks down? Are we slowly killing the American workhorse? Gary Vaughn is Senior Vice President Regulatory Relations and Compliance for Watco Cos. LLC. He also is chairman of ASLRRA’s Safety & Training Committee and a recipient of ASLRRA’s Safety Professional of theYear Award.
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Regional RailRoad of the YeaR:
aRkansas & MissouRi Sporting equipment and infrastructure quality worthy of a much bigger railroad, Arkansas & Missouri is seeking namesake-based customers of all kinds as it nears its three-decade mark.
rkansas & Missouri Railroad may not be a Class I rail leviathan. But when it comes to infrastructure, it’s a class act, ramping up for a bigger and brighter future. Springdale, Ark.-based Arkansas & Missouri (A&M), founded in 1986, operates on 140 miles of track, 134 of those miles its main line from southwestern Missouri through western Arkansas; with its Fort Smith, Ark., operations flirting with the Oklahoma border. That mileage is protected by continuous welded rail, rated at 286,000 pounds GRL, cleared for speeds of 49 mph and, unlike perhaps many smaller railroads, cleared for doublestack container traffic. The railroad’s equipment is equally up to date. A&M 26 Railway age april 2014
typically rosters 500 freight cars and, in 2013, acquired three EMD SD70AC3 locomotives to handle its growing business. Spurred by $23 million in such investments during 2013 and continuing into this year, A&M, in the words of Chairman Reilly McCarren, is intent on “upping its game,” as it has for 27 years, as it continues “to introduce new companies to the business-friendly environment of Northwest Arkansas and southwestern Missouri,” part of what McCarren describes as “a regional transportation enterprise.” Such can-do determination, backed by solid capital investment and a vision of truly regional scope, earns A&M Railway Age’s 2014 Regional Railroad of the Year award.
By Douglas John Bowen, Managing editor
HoMe turf interModAl opportunitieS
A&M interchanges traffic with three Class I railroads— BNSF, Kansas City Southern, and Union Pacific—as well as the Fort Smith Railroad. It’s good and reliable business, with good business partnerships. But A&M isn’t just a feeder or distributor functionary; the railroad is growing its own customer base. “Together with its sister company Allied Enterprises, [A&M has] transformed itself from a typical leased property startup in 1986, relying exclusively on handling traffic for its Class I connections,” McCarren says. In 2014, A&M has evolved into an operation “featuring facilities that allow it to handle traffic that
originates or terminates far from the rail line, and also handles significant volumes that move locally on the A&M’s line – either solely by rail or multimodally by rail and truck.” Expanding intermodal capabilities are taking hold on A&M in numerous ways. In Fort Smith, on the southern end of A&M turf, the transloading and warehousing activities of sister company Allied Enterprises, doing business as Ozark Transmodal, Inc., now encompass seven acres of outside storage and 100,000 feet of warehouse space, which not only provides storage for commodities such as paper, steel, and forest products, but also packaging and blending capability for plastic resins. april 2014 Railway age 27
Regional RailRoaD of the yeaR
An A&M consist sidles up to George’s Inc. Feed Mill in Springdale, Ark., one of two company sites served by the railroad.
“Overall, the facility handles almost 800 carloads annually spread between 20 different commodities,” McCarren says. Ozark Transmodal also expanded its operational schedule in 2012 from five days a week to seven days, with two shifts, resulting in increased staff, as well, to ensure continued customer satisfaction, according to Ozark Transmodal Inc. Manager Bob Thorn. otHer coMModitieS contribute
A&M’s customer base, of course, extends beyond intermodal business. Across the Arkansas River from Fort Smith, in Van Buren, Ark., company crews load the railroad’s fleet of cars with construction sand from a batch hopper at the Arkhola division of APAC Central. McCarren notes A&M loaded 10,600 cars in 2006, at the height of the building boom, before the Great Recession took its toll; about 6,600 carloads were generated in 2013 as the business slowly recovers. Much of this business is local. “These cars move in regular 28 Railway age april 2014
freight train service to 14 different receivers on the A&M,” McCarren notes. “With rare exception, the cars are unloaded by the train crews themselves, providing a rapid return of the air-operated cars for further loads. It is typical to turn cars twice weekly, and thrice-weekly is possible during periods of high demand.” Further north, in northwest Arkansas, A&M serves numerous poultry mills, freezer warehouses, food producers, and plastics processors. At least one of them is a national heavyweight known to millions: Tyson Foods, like A&M headquartered in Springdale, Ark., and tapping the railroad for reliable supplies of corn, mash, and gluten. “In addition, northwest Arkansas has spawned a healthy metal recycling industry in the last few years as well,” McCarren says. Here, the activity is “all conventional railroading, with road switch crews, either two-person conventional crews or single-person engineer-only crews for delivery and spotting the industries, and coordinating with
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In 2013, A&M improved its locomotive fleet by acquiring three EMD SD70AC3s.
the road freights north and south.” McCarren is especially proud of innovative service offered by A&M to one customer, a George’s Inc. feed mill in Cassville, Mo. “A&M frequently terminates 110-car-plus shuttles from BNSF at this location,” says McCarren, “but with a catch. George’s continues to operate its original, smaller feed mill in Springdale, Ark. Many trains feature a ‘split’; A&M power and crew will meet the train from the
BNSF and hustle the requisite number of cars down to Springdale, spotting on arrival. “With close coordination between railroad and feed mill, as many as 30 cars can be unloaded while still delivering the entire train back to interchange on time,” McCarren notes proudly. “It’s a rare railroad that operates express chicken feed trains, but A&M does what it takes to keep the customer happy—and using the rail mode.”
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“Customer satisfaction” may be a trite phrase, but it matters, McCarren says. In the company’s March 2013 in-house newsletter, A&M Express, the chairman said, “It’s important to note that we ourselves can’t create the need for transportation. The demand for our services derives solely from our customers’ economic activities. What we can do is provide the best service possible so that existing and prospective customers choose us to handle their traffic. That service is the only product we have to sell. Second only to safety, service quality represents our most important goal.” ShopS keep railroad running
Kenny Bryson works on injectors at A&M’s repair facilities in Springdale, Ark.
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If quality depends on reliability, A&M has prepared itself well. Its headquarters city, Springdale, also includes the railroad’s passenger and mechanical facilities. (A&M’s passenger excursion consist features a Vista-Dome, the ex-California Zephyr Silver Feather.) The new locomotive shop, completed in 2012, includes a five-ton and 30-ton overhead traveling crane, one through track for quick service capability, and two stub-end tracks for equipment requiring significant time in the shop. Nearly complete, says McCarren, “is a new ‘one-spot’ car repair facility that will bring car repair and locomotive repair forces together for the first time.” Nearby is a track equipment shop for the rebuilding and renewal of the work equipment fleet.
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With the pieces in place for maintaining equipment to run the service to please the customers, McCarren cautiously foresees another good year ahead for A&M, in part because “we remain committed to investment in our facilities and equipment.” With the Great Recession still a recent memory, the chairman is aware that nothing is guaranteed. “In 2009 the one-two punch of the recession and the Renewable Fuels Act reduced overall volumes by 40% in one year,” McCarren recalls. Still, “While volumes still haven’t recovered to 2008 levels, extra 994 Air Dryer.
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(left) Randell James replaces decals on a newly rebuilt and repainted tie inserter. (Above) Jorge Cano gives his attention to a sand car located in fort Smith, Ark.
focus on marketing and improved traffic mix brought revenue and financial performance to record levels in 2013.” The goal of “upping its game” remains in place, as it has for 27 years. Arkansas & Missouri has made it clear it knows its own role in the regional economy, and plans to keep delivering for at least another 27 years. RA ASCTD, The “CADDIE” Introduced.
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coos bay Rail link
A Balfour Beatty Rail Inc. track worker moves down the Coos Bay rail line in a tamping machine following replacement of ties and ballast along the 134-mile line in Oregon.
By Douglas John Bowen, Managing editor
An Oregon right-of-way, moribund for four years, gets the resources and support it needs from its stakeholders to serve an eager and rapidly growing customer base. 34
he premature obituary in 2007 was ominous enough: Died from a collapsed tunnel, the exclamation point to a deteriorating rail right-ofway. The Coos Bay branch of the Central Oregon & Pacific Railroad, then a RailAmerica property, had been shut down as too costly to repair. But stakeholders large and small in Oregon’s Lane, Douglas, and Coos counties didn’t accept such an outcome, and their concerns were heeded at the state and federal levels. “The economic impact on the South Coast communities was immediate and severe,” says Rep. Peter Fazio (D-Ore.), who staffs an office in Coos Bay, Ore. “Timber companies and other industrial
shippers were forced to truck their products, which was far costlier.” In 2009, the Oregon International Port of Coos Bay bought the derelict 111-mile branch, and rehabilitation efforts were under way. Fast-forward to September 2011, when Coos Bay Rail Link opened for business with a vengeance. The 134-mile short line is charging ahead in 2014, backed by a commitment from its owner, ARG Transportation Services, and by the Port of Coos Bay and the state of Oregon itself. With a donation of 23 miles of right-of-way from Union Pacific, stretching from Coquille to North Spit (outside Coos Bay), and along with the Coos Bay Bridge donated earlier by UP, fertile business conditions were in place for a short line railroad to put rail service back into action—and recognition as Railway Age’s 2014 Short Line of the Year. “We created something out of nothing,” Coos Bay Rail Link’s former General Manager Tom Foster says. “Together, we revived a transportation link vital to rural Oregon manufacturers and businesses that trade nationally and globally. We’re ecstatic about this honor.” Foster now is vice president of marketing for parent ARG Transportation Services. Adds Rep. Fazio, “The restoration of the rail line was an outstanding achievement and it deserves this national recognition.” Railway Age has followed the rapid rise of Coos Bay Rail Link with interest and continuous coverage, while Engineering Editor (and RT&S Editor) Mischa WanekLibman made it a point to be on the property herself in November 2012 to see the goings-on. Coos Bay Rail Link’s rapid rise to prominence caught the attention of editors and industry officials alike. Courting the customer base
On Aug. 16, 2011, Eugene, Ore.-based ARG Transportation Services signed an interim contract with the Oregon International Port of Coos Bay to operate Coos Bay Rail Link. ARG Trans at that time announced the appointment of Tom Foster as Coos Bay Rail Link’s general manager. Foster, along with ARG President Scott Parkinson, immediately and literally hit the ground walking, reaching out to former customers and potential new ones. Those customers needed reassurance that Coos Bay Rail Link was here to stay. Foster and Parkinson, among other Coos Bay Rail Link locomotives move carloads of lumber through the railroad’s North Bend rail yard.
april 2014 Railway age 35
shoRt line RailRoaD of the yeaR
Steve Partney (center) of Scott Partney Construction oversees installation of a new bent on a wooden trestle south of Coos Bay, Ore.
items, pointed to Coos Bay Rail Link’s financial backing of $31 million in grants an loans from 10 different sources, including SAFETEA-LU, Connect Oregon, federal TIGER II, the American Recovery and Reinvestment Act, and the Oregon state lottery, among others. Coos Bay Rail Link’s infrastructure needs were staggering: Nine rail tunnels, 150 water crossings that included three major swing spans and 115 steel and timber bridges, and miles of right-of-way clogged by trees and brush growth. Add to that the needs of 250 public and private grade crossings, 14 of which are signalized, and the task was daunting at the very least. Contractor teams led by Balfour Beatty Rail went to work, replacing 94,000 ties and delivering 54,000 tons of ballast. Grade crossing were upgraded. Signals were renewed. Drainage, a major overdue concern along the right-of-way and especially within the numerous tunnels, was addressed. One break: Coos Bay Rail Link was able to continue using much of the existing rail inherited from Southern Pacific, allowing it to run 286,000 pound loads once operations resumed. In October 2011, Coos Bay Rail Link began revenue operations. “Initially, we are providing service to customers as needed,” said Foster at that time, adding, “Forest products will be a major source of traffic.” Foster’s prediction was on the mark, with praise for Coos 36
Bay Rail Link’s efforts raining down from the likes of Eugenebased Seneca Sawmill Co., Allweather Wood, LLC of North Bend, Swanson Bros. Lumber Co., Inc. of Noti, and Coos Bay-based Treez. Better interchange, transloading capabilities
Foster and Parkinson also reached out to Class I partner Union Pacific, seeking an interchange in Eugene, Ore. “For our part, we have increased the supply of centerbeam railcars for lumber loading and fostered a strong working relationship at the local operations level to ensure a fluid interchange with UP,” says UP Senior Director-Short Line Marketing Todd A. Whitman. “We know of recent highway conversions of 1,860 trucks, equivalent to 620 railcars, off of intrastate state highways,” Whitman says. “We have been happy to support [Coos Bay Rail Link] with this endeavor and fully encourage their business development efforts.” At Eugene, Coos Bay Rail Link also interchanges with Central Oregon & Pacific and, via UP, with Portland & Western railroads. Coos Bay Rail Link negotiated with other short line railroads to improve shipper opportunities, resulting in rising traffic volume and, not coincidentally, increased employee staffing and more motive power (from one locomotive to five) required to handle the increased business. In the fourth quarter of 2013, Coos Bay Rail Link, aided by the Port of Coos Bay, completed a new siding in Finn,
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Ore., just west of Eugene, allowing the transloading of logs and rock products destined for the state’s coastal region. The facility is expected to generate at least 2,000 loads in 2014; the first car was loaded in late February. Indeed, Coos Bay Rail Link hopes to replicate its early established growth rate. In 2012, it moved 2,480 revenue car loads, “during a period when the railroad only had access to several major shippers for about half the year,” notes Port of Coos Bay CEO David Koch. “2013 saw Coos Bay Rail Link increase revenue traffic by 95% to 4,845 revenue cars.” Coos Bay Rail Link started operations in late 2011 with two customers; that’s now up to 13 in 2014. Says Foster, “Our traffic goal for 2014 is 7,300 carloads; if the first two months of the year are any indication, that goal will be met.” Coos Bay Rail Link is looking even farther ahead, signed a 10-year operating pact with the Port of Coos Bay last May. Says the port’s CEO David Koch, “The Port believes that Coos Bay Rail Link’s success as a railroad will grow significantly as it strives to meet ever-evolving shipper needs for competitive transportation options.” No obituary, that. Instead, a prediction of a hale and hearty future for Coos Bay Link, customers and8/17/2011 territory 8:26:11 the DEERail Railage Ad and Finalthe Proof2_PDF2.pdf railroad serves. Ra
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Genesee & Wyoming subsidiary San Diego & Imperial Valley bridges the gap between BNSF and Mexico’s Baja California Railroad.
Room foR moRe fReight?
rom a railroad standpoint, the reputation of San Diego, Calif., is first and foremost about passenger and transit service. Los Angeles-to-San Diego is Amtrak’s second-busiest corridor, with more than two million intercity passengers annually. That same corridor also carries close to four million commuter and other riders annually on Metrolink and Coaster trains. San Diego itself has light rail and streetcar service moving close to 122,000 passengers every weekday, ranking it fourth in ridership among U.S. light rail systems. San Diego’s freight rail business, on the other hand, seems to take place in relative obscurity. It has what is essentially stub-end service from one Class I carrier, a connection via short line to a nearby Mexican carrier, and a potential new outlet to the rest of the U.S. that is currently undergoing its latest attempt at reconstruction. BNSF and predecessor Santa Fe have served San Diego since the 1880s on a route that runs south from Barstow, San Bernardino, and Los Angeles. BNSF typically runs a manifest 40 Railway age april 2014
freight to and from San Diego five days or more per week, plus an almost daily vehicle train in both directions, as well as occasional unit trains of soda ash. Its traffic profile in San Diego involves vehicles, lumber, lumber products, soda ash, fly ash, cement, LPG, corn syrup, metal/steel products (primarily aluminum), grain and plastic, ethanol, and aggregate. Scheduling and capacity for freight traffic north of San Diego is dictated somewhat by the swarm of passenger trains this route carries: roughly two-dozen Amtrak Pacific Surfliners seven days a week, plus Monday-Friday commuter fleets involving 22 Coaster trains on the south end and 29 Metrolink trains on the north end. San Diego’s North County Transit District owns and dispatches the BNSF/ Amtrak/Coaster main line from the San Diego station north 60 miles to the Orange County line. Short line Pacific Sun Railroad (PSRR), a Watco subsidiary, performs local switching service along 45 miles of this corridor, from San Diego north to Stuart Mesa Yard near Oceanside. It also works a 21-mile branch from Oceanside
San Diego’s potential is huge, provided the region’s short lines and port can secure critical state and local funding. By BRuce e. Kelly, contributing editor
Port of San Diego
east to Escondido (shared with NCTD’s Sprinter diesel light rail transit service) , and a short industrial spur at Miramar, 14 miles north of San Diego. BNSF derives much of its San Diego traffic from maritime connections. The ports of Los Angeles and Long Beach dominate the West Coast container market, but the Port of San Diego (POSD) claims its own advantage by specializing in break-bulk and roll-on/roll-off cargoes. POSD’s National City Marine Terminal handles the import and export of vehicles and heavy equipment, with a 140-acre on-dock facility that’s able to hold 120 railcars for automobile loading and unloading. Ten percent of imported cars in the U.S. come through National City. POSD is also big on food. Its Tenth Avenue Marine Terminal has 300,000 square feet of on-dock frozen and refrigerated warehousing. And it does move containers: Dole Fresh Fruit containers that are discharged, cross-docked, and move as truckloads to northern California, Oregon, and Washington. As for bulk dry goods, POSD handles export bulk soda ash delivered by BNSF. Due to space constraints and storage restrictions, this service limited to less than 50 railcars at a time coming in or moving out. In 2008, the Tenth Avenue terminal began receiving windmill generator components from Japan, and that business grew to include windmill products from Europe and South America. Most get trucked to one of the many windmill farms sprouting up outside San Diego, but a few shipments have traveled further inland by rail. Due to a change in cargo mix at Tenth Avenue, POSD can no longer transfer shipments of windmill components onto railcars, but can still handle rail shipments of other heavy equipment and machinery. Additional automobile business is processed through a rail
terminal located at BNSF’s San Diego yard. This site unloads inbound autoracks carrying domestically-produced vehicles, and also loads outbound vehicles that have been trucked in from a Toyota factory in nearby Tecate, Mexico. As part of a statewide $2 billion Trade Corridors Improvement program, the California Transportation Commission in 2012 granted $25.9 million toward a $40.5 million total being invested in the San Diego area on upgrades to track, signals, and grade separations. The goal is to double rail freight capacity through the San Diego/San Ysidro/Tijuana border crossing, while eliminating as many as 31,800 truck trips annually. San Diego & Imperial Valley Railroad (SDIY), a Genesee & Wyoming subsidiary, is the direct recipient of that international traffic. Its 13-mile line from San Diego south to the border terminal of San Ysidro, Calif., bridges the gap between BNSF and Mexico’s Baja California Railroad (BJRR). SDIY also handles minor freight traffic on a branch from San Diego northeast toward El Cajon. Both segments of SDIY’s operation are on trackage shared with San Diego Metropolitan Transit System light rail trains. BNSF interchanges an average of 15 cars per day with the SDIY. During 2013’s fourth quarter, SDIY moved 1,301 carloads, of which 1,119 were carloads terminating or originating in Mexico. All of that could change, for the better, if current efforts to reopen a long-dormant rail line east of San Diego prove successful. In December 2012, the Pacific Imperial Railroad signed a 50-year lease (with an option for 49 additional years) authorizing it to make repairs and resume freight service on 70 miles of track known as “The Desert Line” between Division and Plaster City, Calif. When operated in conjunction with BJRR from Lindero west to Tijuana, and with SDIY from San
The Port of San Diego’s National city Marine Terminal handles import and export of vehicles with a 140-acre on-dock facility. april 2014 Railway age 41
Ysidro north to San Diego, this 130-mile route could offer what some consider is tremendous potential for international trade. The trackage PIR proposes to operate has changed hands many times since opening in 1919. Best remembered as the San Diego & Arizona Eastern Railway (a subsidiary of Southern Pacific), this route followed the U.S./Mexico border eastward from San Diego to a connection with SP’s (now Union Pacific’s) southern U.S. corridor. Nearly half of the route deviated into Mexico to avoid high mountains east of San Diego, but there was no avoiding California’s Carriso Gorge, where numerous tunnels and trestles guided trains along a narrow, cliff-hanging right-of-way. A hurricane in 1976 and winter floods during 1979-80 devastated portions of the SD&AE. SP repaired the route and sold it to the San Diego Metropolitan Transit Development Board. Trackage close to San Diego was developed for light rail, while a number of operators took their turn at handling freight business over the rest of the line. After wildfire destroyed two trestles in 1983, the track through Carriso Gorge went dormant for two decades. In 2004, the Desert Line/Carriso Gorge segment of the SD&AE reopened to limited service. During the next few years, tunnel clearances were improved in an effort to attract doublestack container business as well as autoracks. But securing enough capital and customers to fully restore this
BNSF and predecessor Santa Fe have served San Diego since the 1880s.
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second rail line to San Diego proved difficult at a time when there was growing interest in a proposed megaport at Punta Colonet, on the west coast of Mexico’s Baja California peninsula, about 150 miles south of San Diego. When the global economy declined, predictions for container volume through Punta Colonet declined as well. That, coupled with the immense cost of having to build 200 miles of completely new railway, led to a December 2012 announcement by the Mexican Ministry of Communications and Transport that it was shelving the Punta Colonet project. Pacific Imperial Railroad says its Desert Line is “uniquely positioned to service approximately 800 manufacturing facilities in proximity to the rail,” including the Toyota factory near Tecate. Such commerce would enter the U.S. and move east via PIR to a connection with UP, or west via PIR’s connection with BJRR. Moving west would mean access to San Diego, as well as a potential reach to the Los Angeles area via BNSF. However, overhead trolley wire between San Ysidro and San Diego may pose a restriction against high-profile cars such as autoracks. Don’t look for PIR to become a major avenue for export coal or oil. Port of San Diego says it doesn’t have the space or storage areas to handle bulk coal, grain, iron ore, etc., on trains, nor the space or storage capacity to handle import or export bulk liquids such as oil or ethanol. The desire to restore this international rail connection is
strong on both sides of the border. Baja California Railroad was scheduled to begin $20 million in track improvements in Mexico during 2013. PIR, meanwhile, faces an estimated $100 million in track, tunnel, and bridge improvements of its own. In a fourth-quarter 2013 report, PIR said a subcontractor had begun work to clear sand, dirt, and other debris from the tracks between Division and Campo, Calif. Rail flaw detection and rail integrity testing was expected to follow. Could PIR draw Dole and other container traffic eastward to populated markets like Phoenix and Tucson? Will it be approached by growers and manufacturers in Arizona’s Yuma County, who have been trying to develop a transportation hub with direct rail access to a Pacific port? The Desert Line seems like a logical choice for all of it, assuming PIR can promote its slower but more direct rail corridor between San Diego and Arizona (roughly 120 miles shorter than a BNSF/UP routing), and can compete against trucks moving along Interstate 8. PIR has said its initial focus will be cross-border business, which already presents abundant opportunity. If it decides to reach west for ocean trade as well, PIR will be knocking on some new doors. POSD says though its current rail volumes are handled efficiently to destinations served by BNSF, a rail outlet to the east “is always an interesting concept. Many challenges in terms of funding and commercial activity have to be overcome, but a more robust transportation system benefits everyone.” RA
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NSC’S New Crude oil “SliCk” By williAm C. VAntuono, editor-in-Chief
the latest entry into the crude oil tank car market is this CPC-1232specification, 31,800-gallon model from Canada’s national Steel Car.
ational Steel Car, which has been building freight cars in Hamilton, Ont., for 102 years, has entered the railroad tank car market with a 31,800-gallon DOT-111 “slick” (non-jacketed, non-coil) general-purpose (non-pressure) model built to AAR P-1577/CPC-1232 safety standards with half-head end shields and AAR-required rollover protection. NSC’s entry into the burgeoning tank car market bumps the number of manufacturers of this car type to six. And like
its carbuilder counterparts, and tank car lessors and endusers, NSC is actively participating in an ongoing rulemaking process to formalize specifications for a new-generation DOT-111 that will improve upon the voluntary CPC-1232 industry standard. NSC also offers a 29,000-gallon coiled/insulated model and later this year will be introducing a 25,500-gallon coiled/insulated car. A complete description of the 31,800-gallon car follows. rA April 2014 RAilwAy Age 45
nAtionAl Steel CAR “SliCK” tAnK CAR Physical Data Specification Stenciled Service nominal Capacity gross Rail load estimated light weight estimated load limit @ gRl length over Pulling Face length Between Strikers truck Centers Height, extreme width, extreme AAR Clearance Diagram inside Diameter Shell and Head thickness Shell material Head material tank Slope outage at 1% of shell full Head Shield Draft gear trucks wheels Roller Bearings truck Side Bearings
Dot-111A100w1 general purpose (non-pressure), non-insulated 31,800 gallons 286,000 pounds 74,500 pounds 211,500 pounds 59 feet, 3.5 inches 56 feet, 8 inches 45 feet, 9.75 inches 15 feet, 6 inches 10 feet, 8 inches Plate C 122.5 inches Half-inch (normalized) AAR tC128, grade B steel (normalized) AAR tC128, grade B steel (normalized after forming) 0.1762 inches/foot 317 gallons Half-height, half-inch-thick m-901-e m-976 spec (286K) 36-inch 6.5x9 Class K CCSt (constant-contact side travel)
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April 2014 RAilwAy Age 47
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DART DeliveRs Thirty years in existence, 18 of those with light rail transit, Dallas Area Rapid Transit has established itself as a stellar U.S. rail transit operator. By DouglAs John Bowen, Managing editor
n just three decades, or roughly one generation, Dallas Area Rapid Transit (DART) has smashed numerous “conventional wisdom” shibboleths—Texans won’t use public transit, won’t use light rail transit, won’t support LRT, won’t choose to live in urban centers—as it continues to succeed, and grow. And for those skeptics (in North Texas and elsewhere) who still hold to those beliefs, DART President and CEO Gary Thomas notes, “Our biggest challenge today is addressing the question, ‘How can we get this [DART service] in our community?’” Thomas, overseeing DART since August 2001, says DART’s growth reflects the drive by hometown Dallas to meet its 21st century needs. “It’s been a very fast 30 years, and it’s amazing to think of where we started, convincing the region to vote for something that it had no idea what we were going to
deliver,” he says. “People had confidence and trust of the leadership at that time, and they had a vision.” But it was, he acknowledges, a leap of faith for many as DART sought to employ a 1% sales tax among 13 North Texas municipalities “when we didn’t know what was going to happen.” What happened was growth in Dallas, which necessitated growth in bus and LRT service. Says Thomas, “Thirty years ago, traffic wasn’t as bad, and we weren’t yet the fourth-largest metro region in the country.” Airport access, downtown doings
And grow DART has, with current daily ridership hovering between 100,000 and 110,000 customers on its four LRT lines, stretching over roughly 85 miles, larger than many other highly touted (“and often equally excellent,” Thomas notes) U.S. LRT operations. April 2014 RAilwAy Age 49
DART says it averaged 96,272 passenger trips on weekdays in 2013; ridership is calculated by Automatic Passenger Counters.
“It’s been a very fast 30 years, and it’s amazing to think of where we started convincing the region to vote for something that it had no idea what we were going to deliver. People had confidence and trust of the leadership at that time, and they had a vision.” With the first 24 miles of DART’s Red Line debuting in 1996, “I think it cemented that confidence level,” Thomas says. DART LRT operations roughly doubled by 2002, and it is “doubling that again, to where we’ll have the longest light rail system in North America.” That growth includes an anticipated DART Orange Line link to Dallas/Fort Worth International Airport, one of the nation’s busiest air hubs, now scheduled to open Aug. 18, 2014. The official target opening date had been set for December, but Thomas notes that with the DART airport station “coming along” and with live catenary testing slated to occur this month, “Our goal is to have it open before the State Fair of Texas in late September.” “You’ll see a 12-month rollout,” Thomas points out, adding that the significance of airport access is a belief shared not just by himself and DART, but by D/FW Airport CEO Sean Donohue, who upon meeting Thomas for the first time remarked, “Every world-class airport has a good rail connection.” With airport access generating more anticipated ridership, DART and Dallas officials are also eyeing capacity constraints in 50 RAilwAy Age April 2014
DART’s downtown route structure, used by all four LRT lines. Though not yet decided, plans lean toward a second LRT route through downtown Dallas. “It is critical to long-term success of the organization; no one’s questioning that,” Thomas says. “The questions are: Where does it go, how do we pay? As DART [LRT] continues to grow, as people ride it, there’ll be more pressure,” Thomas says. And a second route also will offer positive redundancy in case one downtown right-of-way suffers any disruption and becomes blocked off or truncated for any considerable period of time. LRT capacity downtown also will aid any private, state, or federal plans for high speed rail serving Dallas in the future. “People are talking about HSR between Houston and downtown Dallas,” says Thomas, and if that’s ever to be done, DART must be ready to handle the passenger intermodal potential. “We want to be able to look back and have people say, ‘Somebody was really paying attention.’” Consideration was given to the use of a downtown streetcar line to augment and alleviate LRT access, “but it is a core capacity project, so it likely will be LRT,” Thomas says. “But we’ve got streetcar opportunities.”
DART Modal diversity embraced
D/Fw international Airport will be added to DART’s lRT reach, with the orange line extension opening Aug. 18, 2014.
Indeed, unlike many U.S. public transit agencies, DART has embraced the idea of rail submodes, particularly streetcar operations, as part of the transit mix. DART itself didn’t spearhead the effort to establish the $51 million, two-mile Oak Cliff streetcar project linking Dallas Union Station (and DART LRT) with the city’s namesake neighborhood; neighborhood activists did that. But DART quickly moved to assist the project, both financially and in the planning process, and DART has agreed to operate the new line once it becomes operational in 2014. Thomas believes the integration of Dallas LRT and streetcars is just starting, describing the latter as “the last mile” of integrated public transit, and noting numerous Dallas neighborhoods once served by streetcars seek to restore them. The Oak Cliff project, he points out, sought funding first through the federal TIGER grant program, awarded to the city and other non-governmental organizations (NGOs). “But as you look around the country in so many places, cities and transit agencies struggle with who’s going to do this. Here, it’s a team effort. The Council of Governments got the grant; the city said, ‘DART has the expertise to do this.’ So we’re building it; we’re operating it; we’ll maintain it, basically on behalf of the city of Dallas,” Thomas asserts.
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April 2014 RAilwAy Age 51
DART Expanding the customer base
Future expansion also includes the Cotton Belt project. “Our system is a hub and spoke system; the Cotton Belt is one of those crosstown corridors,” Thomas says. Owned by DART, with route and specific rail mode to be determined, it offers an opportunity to connect “across the region.” “We’re shooting for a 2025 time frame, but people ask, ‘How can we speed this up?’” he observes. Such expansion projects will cost money, and Thomas allows that generating such financial support won’t grow any easier in the years ahead. “The reality is, there’s not an endless stream of money to let the sales tax get caught up with long-term debt,” he says. DART will continue to look at grant options, and alternate funding opportunities including (but not limited to) public-private partnerships. As for the acceptance of public transit as an everyday occurrence in North Texas, “We’re getting there,” Thomas says. “But we continue to work at it. So much of our job is to educate folks on how to ride,” and some potential customers are still discouraged by cultural confusion and a lack of knowledge of how public transit works. “When you go out on the street, and ask how would you get from here to there, people still might not understand it,” the CEO observes. Is part of that a generational difference involving rail transit? “I think so,” Thomas says, noting DART and its regional
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52 RAilwAy Age April 2014
partners, Fort Worth Transportation Authority and Denton County Transportation Authority, introduced its successful GO Pass mobile ticketing application in September 2012. “Kids get that instantly,” he says. As in other U.S. cities with rail transit, younger DART riders also seem to transcend the limitations of “commuter” rail use, something DART seeks to exploit even more as it taps different markets. “That’s the goal,” Thomas says, “getting the word out, letting people know they can get to the mall, or where they need to go, whenever they need to go.” Thomas is optimistic good things will happen. “We’ve got an incredible team here at DART that has an incredible reputation. Cities inside our service area are good partners, as are those in the business community. We try to do what we say we’re going to do—with projects [that] are on or ahead of schedule, and within the budget established for them.” Weather woes recapped
Dallas and DART took a hit this past winter from severe weather, and Thomas says experience is a harsh teacher. “Every time we have a situation with weather—and we’ve had two, one in 2011 with Super Bowl, one last Served by DART’s Blue and Red lines, Mockingbird Station in North Dallas offers numerous transit transfer options.
December—we had to shut down the light rail for a time because of ice on the catenary. We had trains out running all night long, and because of the conditions related to the temperature and precipitation, the next morning I had 25 trains stuck on tracks—they lost power,” he laments. Answers exist, including work with ice-cutter heads on pantographs, “and we’re looking at those. But at what cost? And how often will they be needed?” Thomas asks rhetorically. “We really have to think this through.” Commiserating with TriMet LRT operations, Thomas notes that Portland, Ore., shared a similar fate this past winter. “Sleet is no problem; snow is no problem,” he says. “It’s the odd combination of rain and cold temperatures that don’t happen in a lot of places. Freezing rain causes the major problems.” DART can’t change the weather, “but we can communicate,” Thomas says. So as problems arose during the winter, “we told the media right away; we put out the word on Twitter and on Facebook. On the platforms, we have signs that can scroll messages. And we were better prepared to have our people out on the platforms.” Some media remained frustrated over “no solution” results, Thomas acknowledges, “but mostly we did get some acknowledgement from our customers” that DART was doing its best in a difficult situation. RA
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April 2014 RAilwAy Age 53
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Figure 1: (top) Forces on a wheelset in flange contact and under an angle of attack. Figure 2: (right) net low rail tractions and traction ratios showing resulting damage and the number of contact cycles.
Rolling contAct fAtigue Root cAuses
By HARRy TouRnAy, Senior Scientist, TTCi, for Railway Age
Use of self-steering trucks can result in a significant reduction of high impact wheel removals, compared to traditional, non-steering three-piece units.
igh impact wheels (HIW) have been a major cause for wheel removal. One of the root causes for HIW is high normal and tangential stresses generated at the wheel/rail contact patch. Tangential stresses are directly related to the steering forces (“tractions”) generated by the truck in order to negotiate a curve. As part of the AAR Strategic Research Initiatives Program, TTCI has: Associated HIW to the generation of high steering tractions developed by nonsteering (traditional three-piece) trucks at the lead axle, low rail contact patch in curves that are generally sharper than six degrees. Lesser tractions are also generated on lead axle, high rail contact; these may also contribute to HIW generation. Shown that the use of self-steering trucks can result in a significant reduction of HIW removals compared to threepiece trucks operating under similar heavy-haul (coal) conditions (RA, May 2011, pp. 38-39). Demonstrated that these high steering tractions are exacerbated by curving with excess cant (curving at speeds under balance), where both vertical loads and steering tractions are increased. Consequently, damaging steering tractions may be generated in curves shallower than six degrees under these conditions. Established, theoretically and under test, that steering tractions can be reduced by allowing the lead axle of the truck to steer into a more radial position in a curve. TTCI has proposed an improved freight car truck (IFCT) design concept to reduce lead axle low rail steering tractions (RA, July 2010, pp. 28-29). TTCI has also developed a test procedure using instrumented wheelsets to evaluate IFCT
designs offered by the supply industry. This procedure measures the lead axle, low rail traction ratio, or T/N, where T is the steering traction and N the normal load across the lead axle, low rail contact patch. Laboratory tests (Figure 1) were conducted using a single wheelset aligned at differing angles of attack to a set of rollers simulating the track; steering tractions were measured. This simulated lead axle contact in curves. Tests indicated that surface damage occurs on a C-class wheel under low rail tractions greater than approximately 14,000 pounds and a vertical load of 35,750 pounds (a traction ratio of 0.39, or 14,000/35,750). As Figure 2 shows, the typical dispatch adhesion of high adhesion locomotives is 0.32. This suggests that railcar wheels are being stressed at least as much in curves as locomotive wheels. In addition, surface damage can occur under low repeated cycles (of the order of 5,000 cycles), which suggests that the damage may not be fatiguerelated, but the initiator of subsequent fatigue damage. TTCI’s research to date suggests that the median value of T/N measured under test in curves up to 10 degrees should be as low as 0.37. However, extended tests are envisaged through 2015 to simulate the spectrum of steering tractions and vertical loads encountered in revenue service. To this end, TTCI is acquiring a rolling load machine that, among other applications, will be used to establish more accurate performance limits for C-class wheels, determine the benefits of improved materials and friction modifiers, and study the progression of observed damage to this generation of HIW, including the role of ice and lubrication in this process. (See also:TTCI Technology Digest TD-10-003, March 2010.) RA April 2014 RAilwAy Age 55
Ansaldo STS USA named Marco Fumagalli President and CeO, replacing Thomas lawton, who will remain as counsel to the company. Fumagalli will also retain his previous role as global Senior Vice President of Strategy, Quality, and improvement. A graduate of the Polytechnic of Milan (italy) and Stanford Business School, Fumagalli Fumagalli Stephens has been an employee of Ansaldo STS Ansaldo STS SFRTA since 2011. Before that, he worked for the Boston Consulting group. The company also appointed Roberto Passalacqua Vice President of the Railways & Mass Transit Business Unit in North America. Jason White will become Vice President of the Freight Business Unit. South Florida Regional Transportation Authority (SFRTA) named Jack Stephens executive Director, replacing Joseph giulietti, under a one-year contract. Stephens served as SFRTA Deputy executive Director since May 2003.
CSX TRANSPORTATION— Gary T. Sease named Vice President Corporate Communications.
Loram Maintenance of Way, Inc. appointed Justin Clarine Vice President engineering.
LAS VEGAS RAILWAY EXPRESS— Michael Barron elected Chairman.
LTK Engineering Services appointed Kevin Manuele Portland (Ore.) Office Manager. Natalie Cornell has joined the company as Senior Consultant, based in the company’s Ambler, Pa., headquarters.
WATCO TRANSPORTATION SERVICES—Larry McCloud appointed general Manager of Kalamazoo, Mich.-based grand elk Railroad.
SUPPLIERS AXION International Holdings, Inc. hired Claude Brown as Chief Operating and Technology Officer. Birmingham Rail & Locomotive Co. Inc. named David Gerstner Territory Manager, responsible for business development along the Atlantic Coast. GE Capital Rail Services named Tim Kubiak Fleet Operations leader. Tom Delaney named Audit Manager. Ken Campbell named engineering Manager-Coatings. Randall Hurley becomes engineering Manager-Shop. Harsco Rail named David Everitt interim President and CeO. Mary Mattox promoted to Marketing lead. HNTB Corp. named Patrick Watz, PE, Rail Transit Practice leader and Vice President, based in Minneapolis.
Pandrol USA LP named Breen Reardon Director of Sales and Marketing. Allen Goff named Regional Sales Manager, based in Omaha, Neb.
April 22-25 ASLRRA 118th Annual Convention Hilton San Diego Bayfront, San Diego, Calif. Tel.: 202-585-3443; email: firstname.lastname@example.org; website: www.aslrra.org.
May 20-22 RSSI Annual Exhibition gaylord Opryland Resort & Convention Center, Nashville, Tenn. Tel.: 502-327-7774; email: email@example.com; website: www.rssi.org.
June 1-4 ARDA Annual Meeting Calgary, Alberta email: amraildev.@gmail.com; website: ARDA.Bartwest.com/
June 12-13 Railway Age Crude by Rail Conference & Expo Arlington, Va. Tel: : 212.620.7208; email: firstname.lastname@example.org; website: www.railwayage.com.
100 YEARS AGO in
(APRIL 1914) PRIMITIVE WIRELESS The wireless telegraph stations of the Delaware, Lackawanna & Western are now experimenting with telephone conversations without wires. On a train filled with students from Cornell University last week, the Lackawanna gave the use of the wireless telegaph without charge; and the students sent 118 messages. From the company’s wireless stations at Hoboken [N.J.], Scranton [Pa.], and Binghamton [N.Y.], the messages were sent by telephone to the persons addressed.
APTA Rail Conference Montreal, Quebec Tel: 800-999-2782; website: www.apta.org.
June 30-July 2 AAR Damage Prevention & Freight Claim Conference Orlando, Fla. Tel.: 919-651-5027; email: gary_ email@example.com; website: www. regonline.com/DPFC2014.
September 14-16 AARS 118th Annual Meeting Union league Club, Chicago, ill. Tel: 331-643-3369; email: firstname.lastname@example.org; website: www.supt.org.
April 2014 RAilwAy Age 57
Do you have the most up-to-date FRA Regulations?
Use this handy index to verify that you have the most up-to-date version of the FRA regulations. The left-hand column lists the FRA Part number and the right-hand column list the latest revision date. Items highlighted in red denotes recent changes. (IFR = Interim Final Rule) FRA Part #
Last Update Effective:
FRA Part #
Last Update Effective:
40 . . . . . . . . .10-3-12 209 . . . . . . . .2-12-13 210 . . . . . . . .8-14-89 211 . . . . . . . .7-20-09 213 A-F . . . . .3-25-14 213 G . . . . . .7-11-13 214 . . . . . . . .6-25-12 215 . . . . . . . .6-25-12 216 . . . . . . . .6-25-12 217 . . . . . . . .6-25-12 218 . . . . . . . .6-25-12
219 220 221 222 223 224 225 228 229 230 231
. . . . . . . . .5-6-13 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . . .1-1-14 . . . . . . . .6-25-12 . . . . . . .12-19-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12
FRA Part #
232 233 234 235 236 237 238 239 240 242
Last Update Effective:
. . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .5-14-13 . . . . . . . .6-25-12 . . . . . . . .7-13-12 . . . . . . . .6-25-12 . . . . . . . .1-28-14 . . . . . . . .1-28-14 . . . . . . . .6-25-12 . . . . . . . .6-25-12
The following is a list of booklets reprinted from the Department of Transportation Code of Federal Regulations 49 CFR Parts 200 to 399 that apply to the rail industry. They are printed in a convenient format and are kept current with updates from the Federal Register which may be supplied in supplement form. Item FRA 50 or Code Part # Each more
209 211 BKTSSAF 213 BKTSSG 213 BKWRK 214 BKFSS 215 BKROR 217 218 BKRRC 220 BKEND 221 BKSEP
BKHORN 222 BKRFRS 224 BKHS 228 BKLSS 229 BKSLI 230 BKSAS 231 BKBRIDGE 237 BKLER 240 BKCONDC 242 BKBSS
Railroad Safety Enforcement Procedures & Rules of Practice Track Safety Standards (Subpart A-F) (Soon) Track Safety Standards (Subpart G) Railroad Workplace Safety Railroad Freight Car Safety Standards Railroad Operating Rules and Practices Railroad Communications Rear End Marking Device, Passenger, Commuter & Freight Trains Use of Locomotive Horns Reflectorization of Rail Freight Rolling Stock Hours of Service Locomotive Safety Standards Steam Locomotive Inspection Railroad Safety Appliance Standards Bridge Safety Standards Qualification and Certification of Locomotive Conductor Certification Brake System Safety Standards
9.95 8.55 9.50 7.25 9.50
8.95 7.85 8.55 6.55 8.55
6.25 10.50 11.00 22.95 9.35 6.25 12.75
8.50 5.60 11.50
Mech. Dept. Regs. Order 25 or more and pay only $24.50 each
Part 215: Freight Car Safety Standards
49 CFR 215. Prescribes the minimum safety standards for freight cars allowed by the FRA. Includes safety standards for freight car components, car bodies, draft system, restricted equipment and stenciling. Softcover, spiral.
Freight Car Safety Standards Order 50 or more and pay only $6.55 each
Part 231: Railroad Safety Appliance Standards 49 CFR 231. General requirements for safety appliances including: handbrakes, brake step, running boards, sill steps, ladders, end ladder clearance, roof handholds, side handholds, horizontal end handholds, vertical end handholds, and uncoupling levers. 106 pages. Softcover.
Railroad Safety Appliance
Order 50 or more and pay only $8.50 each
Passenger Safety Standards 22.80 Part 238, 239 - Order 25 or more and pay only $20.50 each
Signal and Trainâ€ˆControl Systems Includes Part 233, 234, 235, 236 Order 25 or more and pay only $17.55 each
Drug and Alcohol Regulations in the Workplace Part 40 & 219
Track and Rail and Infrastructure Integrity Compliance 33.00 Manual - Volume II, Track Safety Standards Update 1-1-14 Order 25 or more and pay only $30.00 each
Ph: (402)346-4300 â€˘ Fax: (402)346-1783 Email: email@example.com
A combined reprint of the Federal Regulations that apply specifically to the Mechanical Department. Spiral bound. Part Title 210 Railroad Noise Emission Compliance Regulations 215 Freight Car Safety Standards 216 Emergency Order Procedures: Railroad Track, Locomotive and Equipment 217 Railroad Operating Rules 218 Railroad Operating Practices - Blue Flag Rule 221 Rear End Marking Device-passenger, commuter/freight trains 223 Safety Glazing Standards 225 Railroad Accidents/Incidents Eff: 1-1-14 229 Locomotive Safety Standards 231 Safety Appliance Standards 232 Brake System Safety Standards
25 or more
Technical Manual for Signal and Train Control Rules. Includes Part 233, 234, 235, 236 - Spiral Bound Order 25 or more and pay only $39.10 each
1809 Capitol Ave, Omaha, NE 68102
Mechanical Department Regulations
The Railway Educational Bureau
There are no new proposals or final rules to report for this issue. Be sure to check back next month to see if there are any changes to FRA regulations.
Part 232: Brake System Safety Standards
49 CFR 232. Regulations and general requirements for all train brake systems, inspection and testing, periodic maintenance and training requirements, and end-of-train devices for Class I, II, and III railroads. Plus the introduction of new brake system technology. Softcover. 155 pages. Softcover.
Brake System Safety Standards Order 25 or more and pay only $13.50 each
800-228-9670 8 a.m. to 5 p.m. C.S.T., Monday/Friday
Add Shipping & Handling if your merchandise subtotal is: U.S.A. CAN U.S.A. CAN UP TO $10.00 $4.10 $8.55 25.01 - 50.00 9.80 15.70 10.01 - 25.00 7.20 11.80 50.01 - 75.00 10.90 19.80 *Prices subject to change. Revision dates subject to change in with laws published by the FRA. 4/14
Orders over $75, call for shipping accordance
Products Southco offers R4-10 two-state rotary latch Southco has expanded its successful line of rotary latching solutions with the launch of the compact R4-10 TwoStage Rotary latch, which allows for increased operator safety by eliminating false latching conditions in enclosure applications. The compact design of the R4-10 Two-Stage Rotary latch occupies minimal space within the enclosure, providing concealed latching and increased security. Southco’s R4 Rotary latch product class provides a clean exterior surface free of pry points and push-to-close convenience for doors and panels. Available in corrosion-resistant steel and stainless steel, these latches are suitable for demanding environments and can be used in a broad range of applications across industries. Additionally, R4 Rotary latches can be combined with Southco’s line of mechanical and electronic actuators and cables for a complete rotary latching system. global Product Manager James Stroud adds, “The R4-10 Two-Stage Rotary latch prevents false latching and is wellsuited to limited-space applications. The concealed nature of the R4-10 Two-Stage allows for improved industrial design for applications requiring enhanced security.” For more information about Southco’s complete line of R4
Rotary latching solutions, contact Southco, email: southco.com/contact/en, or firstname.lastname@example.org; website: www.southco.com.
REACT with Railserve’s emergency stop button
Snake Tray offers solar panel ice guard
Railserve’s emergency ACTion Technology (ReACT) allows rail employees to remotely stop locomotives with the push of a single button worn on their safety gear. Railserve already is using ReACT at all of its 65-plus service locations, demonstrating the feasibility of remote-stop technology on manned locomotives for use in North America. ReACT allows authorized employees to stop a train without communicating to the engineer, in situations such as when a vehicle enters a crossing in front of a train, when radio contact is lost, or when a close clearance suddenly arises. An emergency brake application is activated by pushing a button worn on a crew member’s safety vest. experience with ReACT shows the emergency stop can be accomplished in as little as a half car-length, or about 26 feet. That shorter stopping distance can mean the difference between a miss and a collision, and reduce the risk of personal injury or even death. For more information, contact Railserve, website: www.railserve.biz/.react.html.
Bay Shore, N.y.-based Snake Tray® has announced a new stainless steel ice guard for solar panels that prevents injuries due to falling ice. Snake Tray’s ice guard easily mounts to any type of solar panel manufactured, offering a secure safety solution for high pedestrian areas including parking lots, train stations,and roofs where injuries could occur. All Snake Tray products are made in the USA. For further information on Snake Tray products, contact Denise Facquet, Tel.: 800-308-6788, email: email@example.com; website:www.snaketray.com.
April 2014 RAilwAy Age 59
RAWrkSiteTrn1_2pg2013_Layout 1 6/18/13 4:43 PM Page 1
Products My Employees don’t have time for training.
Ashcroft touts wide range of pressure switches
Flexible Scheduling. Anytime. Anywhere.
oday’s railroads need cost-effective and flexible training choices. That’s exactly what The Railway Educational Bureau provides through Work Site Training. Work site training allows you to: • Maximize your training investment • Reduce employee time away from the job • Reduce travel costs by having the instructor come to your location • Increase the skill level of your employees • Improve productivity • Achieve your training objectives • Utilize your in-house expertise, equipment, and facilities
Some examples of training subjects include: Freight Car Inspection and Repair • AAR Field Manual Familiarization Rules 1 thru 83 • Introduction to FRA Safety Appliances (Part 231) • FRA Freight Car Safety Standards (Part 215) • Draft system defects and repairs • Inspecting draft system and center sills (Hands-on) • Truck and Wheel defects. Roller Bearing and adapter defects • Hands-on Gauging/Measuring wheel and truck defects Single Car Air Brake Test FRA Part 232 Brake System Safety Standards for freight and other non-passenger trains Train Yard Safety CORRESPONDENCE TRAINING • WORK SITE TRAINING • CONSULTING
The Railway Educational Bureau 1809 Capitol Ave., Omaha NE, 68102 Toll Free (800) 228-9670 • (402) 346-4300 www.RailwayEducationalBureau.com
ashcroft® pressure switches offer a unique selection of features to meet the requirements of most any industrial application. available in a variety of sizes and configurations, ashcroft® switches can be provided with NeMa 4 watertight and NeMa 7 explosion proof housings. each switch can be constructed with a variety of diaphragm materials, sanitary connections or with external media isolators for specialized installations. a wide choice of ranges from 0/10 in H2O to 0/7,500 psi and up to 600 psid complete the product offering. Some models include approvals by FM, Ce, aTeX, Ul, CRN, CSa, ieCex and may be available with a dual-seal rating and Sil capability. For more information, contact ashcroft, Tel.: 800-328-8258; website: www.ashcroft.
NxGen Rail Services offers high-speed inspection option Nxgen Rail Services has announced “the release of the world’s first high-speed rail inspection system capable of detecting missing and displaced rail anchors.” it eliminates the need to walk the track or manually inspect for anchor status from slow speed vehicles. The new software module within the NxTrack inspection system can automatically scan for clusters of missing anchors at 70 mph aboard the CRDX391 inspection car. it also provides detailed reports of any defects. The CRDX391 currently houses the anchor inspection software module; Nxgen plans to include it in all new inspection cars as well. Contact Nxgen, Tel.: 800-517-0455; website: www.nxgenrail.com.
Ad Index Company Aldon Company Balfour Beatty infrastructure, inc. Birmingham Rail & locomotive Brookville equipment Corp Cyclonaire Corp. Danella Rental Systems, inc. Diesel electrical equip. ellwood Crankshaft & Machine FreightCar America graham white MFg CO greenbrier Companies The Helm Financial Corp. Herzog Railroad Services, inc. HKX, inc. Hotstart interstate Diesel Service, inc. irwin Transportation Products Knoxville locomotive works lTK engineering Services MAC Products Michael Baker Jr., inc Michigan State University Miner enterprises MTU Phoenix Contact Plasser American Corp. Progress Rail Services lRS Protran Technology llC R&w Machine Division Railquip inc Railway Age Crude By Rail RCe Railway Tie Association Railway educational Bureau, The Siemens-Rail Automation Soft Rail Stella-Jones Sterling Rail, inc. Strato wi-Tronix, llC
Phone # 847-623-8800 888-250-5746 205-424-7245 814-849-2000 ext.226 402-362-2000 610-828-6200 219-922-1848 724-347-0250 312-928-0850 904-230-4525 800-343-7188 415-398-4510 ext 1610 816-233-9002 800-493-5487 509-536-8667 800-321-4234 724-864-8900 865-525-9400 215-641-8826 973-344-0700 781-255-7200 517-353-0860 630-232-3000 +1 248 560 8484 800-888-7388 757-543-3526 256-505-6402 862-251-1490 708-458-4200 770-458-4157 212-620-7208 866-472-4510 770-460-5553 402-346-4300 502-244-7400 888-872-4612 800-272-8437 512-263-1953 732-317-5406 630-679-9927 ext.307
847-623-6139 904-378-7298 205-424-7436 814-849-2010 402-362-2001 610-828-2260 219-922-1849 724-347-0254 312-928-0890 904-230-4526 503-684-7553 415-398-4816 816-233-7757 800-353-5736 509-534-4216 216-706-5010 724-864-0803 865-546-3717 215-542-7676 973-344-5891 517-353-0796 630-232-3055 +1 248 560 8485 717-948-3475 757-494-7186 256-505-6051 973-691-0043 708-458-3299 770-458-5365 212-633-1165 630-355-7173 770-460-5573 402-346-1783 502-253-3760 412-894-2846 512-263-9799 732-981-1222 630-679-9954
firstname.lastname@example.org 43 email@example.com 47 firstname.lastname@example.org 38 email@example.com 42 firstname.lastname@example.org 13 email@example.com 14 firstname.lastname@example.org 38 email@example.com 46 firstname.lastname@example.org 7 email@example.com 32, 33 firstname.lastname@example.org C2 email@example.com 52 firstname.lastname@example.org 17 email@example.com 14 firstname.lastname@example.org 51 email@example.com 37 firstname.lastname@example.org 19 goklw.com/contactus 3 email@example.com 20 firstname.lastname@example.org 53 email@example.com 16 20 firstname.lastname@example.org 23 email@example.com 3 firstname.lastname@example.org 9 email@example.com 31 firstname.lastname@example.org 29 email@example.com 15 firstname.lastname@example.org 44 email@example.com 30 firstname.lastname@example.org 24, 25 email@example.com 18 firstname.lastname@example.org 39 email@example.com 56, 58, 60 firstname.lastname@example.org 48 email@example.com 52 firstname.lastname@example.org 5 email@example.com C4 firstname.lastname@example.org 13 email@example.com C3
The Advertisers index is an editorial feature maintained for the convenience of readers. it is not part of the advertiser contract and Railway Age assumes no responsibility for the correctness.
Advertising Sales MAIN OFFICE Jonathan Chalon, Publisher 55 Broad St., 26th Floor New york, Ny 10004 (212) 620-7224 Fax: (212) 633-1863 firstname.lastname@example.org
AL, AR, IN, KY, LA, MI, MS, OH, OK, TN, TX emily guill 20 South Clark Street, Suite 1910 Chicago, il 60603 (312) 683-5021 email@example.com CT, DE, DC, FL, GA, ME, MD, MA, NH, NJ, NY, NC, PA, RI, SC, VT, VA, WV, CANADA – QuEbEC AND EAST, ONTARIO Mark Connolly 55 Broad St., 26th Floor New york, Ny 10004 (212) 620-7260 Fax: (212) 633-1863 firstname.lastname@example.org
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bELGIuM, PORTuGAL, SWITZERLAND, GERMANY, EASTERN EuROPE, bALTIC STATES, MIDDLE EAST, SOuTH AMERICA, AFRICA (EXCEPT SOuTH AFRICA), FAR EAST (EXCEPT KOREA, CHINA, HONG KONG, INDIA), ALL OTHERS, TENDERS louise Cooper international Area Sales Manager The Priory, Syresham gardens Haywards Heath, RH16 3lB United Kingdom +44-1444-416917 Fax: +44-(0)-1444-458185 firstname.lastname@example.org
SCANDINAVIA, THE NETHERLANDS, SPAIN, GERMANY, AuSTRIA, KOREA, HONG KONG, CHINA, AuSTRALIA, NEW ZEALAND, SOuTH AFRICA, RuSSIA, RECRuITMENT ADVERTISING Steve Barnes international Area Sales Manager The Priory, Syresham gardens Haywards Heath, RH16 3lB United Kingdom +44-1444-416375 Fax: +44-(0)-1444-458185 email@example.com ITALY, ITALIAN-SPEAKING SWITZERLAND Dr. Fabio Potesta Media Point & Communications SRl Corte lambruschini Corso Buenos Aires 8 V Piano, genoa, italy 16129 +39-10-570-4948 Fax: +39-10-553-0088 firstname.lastname@example.org
JAPAN Katsuhiro ishii Ace Media Service, inc. 12-6 4-Chome, Nishiiko, Adachi-Ku Tokyo 121-0824 Japan +81-3-5691-3335 Fax: +81-3-5691-3336 email@example.com CLASSIFIED, PROFESSIONAL & EMPLOYMENT Jeanine Acquart 55 Broad St., 26th Floor New york, Ny 10004 (212) 620-7211 Fax: (212) 633-1325 firstname.lastname@example.org
April 2014 RAilwAy Age 61
Railcars for Lease: · 52’-2500 Cu.Ft. Mill gondolas—263 GRL · 5125 Cu.Ft. Pressure Differential Covered Hoppers —263 and 286 GRL · 23,500 Gallon Tank Cars—Coiled and Insulated ---New Interior Plasite 3070 Linings Contact: Allan Lindy-479-935-9040 or email@example.com www.everestrailcar.com
Available For Lease
◆ Mill Gondolas - 65’ 6” interior length with 5’ sides and 52’6 interior length with 4’6” to 5’ sides. ◆ 3,600 cu. ft. Open Top Hoppers. 45 degree slopes for aggregate, coke, coal, etc. ◆ 4,240 cu. ft. tub bottom rotary gondolas Can be provided with or without interior bracing. For additional information and pricing, please contact John Goodwin phone (605) 582-8318 fax (605) 582-8304 www.carmathinc.com e-mail firstname.lastname@example.org
productS & ServiceS Reidler Decal Corporation St. Clair, PA 17970 Fax: 570-429-1528 email@example.com The Federal Railroad Administration's proposed new delineator configuration
Railwayage Reidler can help you comply with the FRA ruling by offering prismatic reflective yellow delineators that meet their specifications. • 4" x 150 fl Rolls (kiss-cut available) • 400 candlepower retroreflection • Application instructions provided
Give us a call at 800-628-7770 for more information The Leader in Railroad Markings since 1926
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APPLICATION ENGINEER VOITH TURBO SEE THE FULL JOB POSTING AT RAILWAYAGE.COM JOB BOARD
Rail Account Representative L&S Electric repairs on board locomotive electrical rotating equipment including alternators, generators, traction motors and auxiliary equipment as well as rebuilds or repairs locomotive trucks. We are seeking a seasoned sales professional with a minimum of five years of experience selling to the rail industry. This position will be responsible for managing and development of rail sales to Class I’s, Regionals, Short Lines and rebuilders. Extensive travel in North America required. Primary territory will be the East Coast. Competitive benefit and salary package. Background and drug test required. Send resume to: firstname.lastname@example.org
MARKETING & SALES MECHANICAL OPERATIONS VERMONT RAIL SYSTEM SEE THE FULL JOB POSTING AT RAILWAYAGE.COM JOB BOARD
Part 243 Training & Certification Part 242 Conductor Training Part 240 Engineer Training and re-certification -------------------------------------------------------Modoc Railroad Academy 916-965-5515 email@example.com
strAteGic PLANNiNG: • Commuter rail tranSitionS • fra ComplianCe programS • operationS auditing
Kansas City Office (913) 661-2424 oPerAtioNs trAiNiNG & coNsULtiNG: www.tcsrailservices.com • engineer training & CertifiCation other services: • exCellent HiStory witH fra, ntSB • Staffing • interim management • meCHaniCal & part 238(Qmp)
Trainers and Training Developers The Railway Educational Bureau is in the process of creating a training and development database to be used as a resource for the railroad industry. If you have experience training in an instructor-led environment and/or developing training materials for the rail industry, and are interested in becoming a part of our group, please send your resume to:
Railway Age Classified Section Jeanine Acquart • 212-620-7211 firstname.lastname@example.org s r
Find your rail industry job opportunities @ www.railwayage.com and www.rtands.com
Brian Brundige The Railway Educational Bureau 1809 Capitol Avenue Omaha, NE 68102 RECRUITMENT
EDNA A. RICE, EXECUTIVE RECRUITER, INC (713) 667-0406 FAX (713) 667-1651 Web address: www.ednarice.com Email: email@example.com
EDNA A. RICE, President 6750 West Loop South Suite 735 Bellaire, Texas 77401-4111 April 2014 RAilwAy Age 63
Perspective Frank CheChile
Unlocking land value to fund passenger rail
n 2007, the National Surface Transportation Policy and Revenue Study Commission Passenger Rail Working Group (PRWG) presented to the 109th Congress a plan for a national intercity passenger rail system that connects major population centers and serves rural areas throughout the 48 contiguous states. But with many rail lines having been abandoned, and federal funding policies emphasizing highway and aviation systems, the PRWG estimated that the investment needed to create such a system would be $357.2 billion in total capital costs and $8.1 billion in annual operating costs, through 2050. Regardless of what policies are adopted for passenger rail in the U.S., infrastructure investment requirements will continue to increase, and many different approaches will be needed to generate the necessary funding. One approach is for rail operators and owners to tap into the value of existing, underutilized assets, such as their real estate holdings. Parallel Infrastructure, a national right-of-way management and infrastructure development company, believes that a material new source of financing for intercity passenger rail can be realized in this manner. As a wholly owned subsidiary of Florida East Coast Industries with a heritage dating back to the railroad pioneering days of Henry Flagler, Parallel Infrastructure invests in and manages rights-of-way, creating significant value for both public and private owners. Our model is unique in that we provide both the capital and resources to develop revenue-generating assets on right-of-way property, and then share the returns with the property owner. This frees the owner to focus on capital and core operations, while benefiting
from a new source of revenue. We have used this model successfully to establish asset development agreements with 31 freight railroads on more than 2,000 miles of right-of-way. We manage more than 5,000 lease agreements and hundreds of separate land parcels, including some with existing buildings or structures, sized from one to more than 300 acres that are mostly adjacent to or near the right-of-way.
Passenger revenue and government subsidies combined don’t fully meet operating and capital needs. The opportunity to fully earn revenues from right-of-way real estate is huge. There are more than one million miles of transportation corridors in the U.S., owned principally by state departments of transportation, local governments, and private railroads. To provide a sense of scale, assuming that these right-of-way owners could earn just $1,000 per mile from the types of revenue-generating activities we undertake, these one million miles would generate $1 billion. Such a projection is well within reason when you consider that Parallel Infrastructure is generating approximately $50,000 per mile for the 351-mile-long Florida East Coast Railway (FEC) corridor. In addition to maximizing the monetary value earned from real estate assets
and providing additional recurring revenues for right-of-way owners, Parallel Infrastructure’s best practices approach and proactive right-of-way management services allow owners to access new capital by collateralizing these predictable revenue streams. For example, if a transit agency garnered $10 million in annual revenue from its land holdings, it could easily use that as collateral to secure $100 million in capital through a financing transaction. So, by first unlocking the value of underutilized real estate by leveraging a third-party’s capital and, in turn, leveraging the value of the annuities, an agency is positioned to take on previously unfunded or underfunded capital projects, such as passenger rail infrastructure improvements. When you look at intercity passenger rail systems across the country, passenger revenue and government subsidies combined do not adequately meet current and future operating and capital expenditure requirements. Certainly, there are many approaches to closing such funding gaps. But today’s marketplace indicates that proactive right-of-way management and infrastructure development can be a feasible part of financing solutions to quickly generate annuity streams that can be used as collateral to secure financing for capital projects. By aggressively monetizing ancillary assets in this collaborative and innovative manner, intercity passenger rail systems can be financially stronger, more viable, and better positioned to leverage steady revenue streams, revive dormant assets, and ultimately thrive in ways that have not been accomplished in the past 50 years. Frank Chechile is CEO of Parallel Infrastructure.
Why wait? Improve safety now! Wi-Tronix® announces overspeed monitoring enhancements. Waiting for PTC? Wi-Tronix® enhanced overspeed monitoring is available now for your entire fleet. This latest Wi-Tronix innovation provides critical information—tracking at-risk train handling behavior—while triggering real-time notification at dispatch centers. Optional in-cab alerting increases crew attentiveness and situational awareness. Once alerted, crews can take immediate corrective actions. Each locomotive equipped with a Wi-PU™ and the new Wi-Tronix overspeed monitoring option measures its actual speed compared to maximum allowable track speeds. A Railroad’s established track speed limits, including slow orders and any temporary speed restrictions, are pushed to the onboard Wi-PU. The Wi-PU continuously evaluates speed restrictions against the locomotive’s current location and speed. Alerts are issued when an overspeed condition occurs. Any locomotive currently equipped with a Wi-Tronix Wireless Processing Unit (Wi-PU) can be updated to include optional in-cab audible alerts. This feature is the latest innovation within the Wi-Tronix suite of products to enhance operational efficiency, service reliability and safety. Contact us to see why Class I’s, Passenger and Shortline railroads have equipped their fleets with over 7,000 Wi-Tronix systems.
Eliminate at-risk operating behaviors • Increase Situational Awareness & Crew Attentiveness • Improve Public & Railroad Personnel Safety • No wayside equipment required • Installs in a single shift