June 2013 Railway Age Magazine

ailway ge R A

June 2013 | www.railwayage.com

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RailwayAge

JUNE 2013

visit us at www.railwayage.com Features Amtrak sprints toward a higher speed future

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Rail flaw detection

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Helping railroads make the grade on safety

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2013 Equipment Leasing Guide

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News/Columns From the Editor

2

Update

10

Watching Washington

16

Perspective

48

18

Departments

28

Industry Indicators

4

Industry Outlook

6

Market

8

People

42

100 Years Ago

42

Meetings

42

Products

43

Advertising Index

45

Professional Directory

46

Classified

47

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On the Cover Amtrak is preparing for its new ACS-64 locomotives to ply the Northeast Corridor beginning this fall.

Photo courtesy of Siemens Mobility.

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June 2013 Railway Age 1

RailwayAge

From the Editor William C. Vantuono

Crashworthiness standards pass the test

T

he May 17 derailment of a MetroNorth train and the collision that resulted from the derailment have attracted widespread media coverage. As expected, videos and photos of the accident have “gone viral” on the Internet, prompting a lot of comments. Many comments, as I’ve observed, have been ill-informed.

For the record, while the National Transportation Safety Board is in the midst of its investigation and will not release its formal report for quite some time, preliminary reports indicate that a cracked rail joint may have caused the derailment. The engineer of the train that derailed has said that he spotted “an unusual condition” just before his train derailed and leaned to the left, and was struck by a train on the adjacent track moving in the opposite direction.

One online comment drew my attention: “It’s a miracle anyone survived this crash.”

This comment accompanied a profanitylaced video posted by a few teenagers on skateboards who came upon the accident scene. It’s odd that someone would post such a comment when the video clearly showed both trains—brand-new M8 EMU consists traveling in opposite directions— upright on the tracks. Of course, there was a lot of damage, particularly to the roadbed, but there were no telescoped or jackknifed cars.

Out of a combined 700 passengers, there were about 72 injuries, none of which proved life-threatening. (This is not to dismiss the few serious injuries that did occur.) For a derailment and crash at speed, the fact that there weren’t more injuries has nothing to do with miracles.

It has to do with the very high crashworthiness standards to which the state-of-the-art M8 equipment was built.

The passengers and crew of Metro-North trains 1548 (the one that derailed) and 1581 can thank the Federal Railroad Administration and its industry operator and supplier partners, and the American Public Transportation Association PRESS

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June 2013

(Passenger Rail Equipment Safety Standards) Task Force, for cooperatively developing the standards that preserved a great deal of the structural integrity of the Kawasaki-built M8 cars—specifically, the side- and frontal-impact standards, among which are very strong corner collision posts. These corner posts help absorb and dissipate, through the railcar’s structure, crash energy forces that could otherwise be transferred to passengers. This is commonly known in the industry as CEM (crash energy management).

According to APTA, “Standards have become an important program activity.

APTA, through its policy and planning committees, has played a major role in creating active working structures within the organization focused on the development of standards. Hundreds of industry volunteers serving on numerous working committees have developed standards for bus, rail transit, and commuter rail operations, maintenance, procurement, and ITS. These consensus-based standards are making a real difference to the management and operations of these organizations. These standards are now being used to achieve operational efficiencies and safety improvements in services, facilities, and vehicles.”

APTA some time ago was designated as an SDO (Standards Development Organization). A permanent funding mechanism supports APTA’s standards activities, and the organization created a standing committee, now called the Standards Development and Oversight Council (SDOC), to oversee and lead APTA’s efforts in standards. These activities helped save lives in the Metro-North derailment, and will continue to contribute significantly to the safety of our industry.

Crashworthiness standards are developed with the hope that they will never be put to the test in real life. In Metro-North’s case, they passed that test.

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 ARTHUR J. McGINNIS, Jr., President and Chairman JONATHAN CHALON, Publisher jchalon@sbpub.com WILLIAM C. VANTUONO, Editor-in-Chief wvantuono@sbpub.com Douglas John Bowen, Managing Editor dbowen@sbpub.com Luther S. Miller, Senior Consulting Editor lmiller@sbpub.com Contributing Editors: Alex Binkley, Roy H. Blanchard, Lawrence H Kaufman, Bruce E. Kelly, Anthony D. Kruglinski, Ron Lindsey, Ryan McWilliams, Jason H. Seidl, Frank N. Wilner Creative Director: Wendy Williams Art Director: Sarah Vogwill Corporate Production Director: Mary Conyers Production Manager: Jessica Cajas Production Director: Eduardo Castaner Marketing Director: Erica Hayes Conference Director: Jane Poterala Circulation Director: Maureen Cooney Western Offices 20 South Clark Street, Suite 1910, Chicago, IL 60603 312-683-0130; Fax: 312-683-0131 Engineering Editor: Mischa Wanek-Libman mischa@sbpub.com Assistant Editor: Jennifer Nunez jnunez@sbpub.com George Sokulski, Associate Publisher Emeritus gsokulski@sbpub.com International Offices 46 Killigrew Street, Falmouth, Cornwall TR11 3PP, United Kingdom Telephone: 011-44-1326-313945 Fax: 011-44-1326-211576 International Editors: David Briginshaw, Keith Barrow, Kevin Smith Customer Service: 800-895-4389 Reprints: PARS International Corp.

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Industry Indicators SHORT LINE AND REGIONAL TRAFFIC INDEX

TRAFFIC ORIGINATED

FOUR WEEKS ENDING APRIL 27, 2013

CARLOADS

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 Crush Stone, Sand, and Gravel Nonmetallic Minerals Stone, Clay & Glass Waste & Nonferrous Scrap All Other Carloads Total U.S. CarLoadS

APR. ’13 65,380 3,476 35,543 26,216 119,573 55,306 426,716 5,925 14,035 23,668 23,858 14,791 40,582 17,680 69,139 88,975 21,348 28,971 12,583 17,047 1,108,722

APR. ’12 78,891 3,033 38,200 25,381 122,640 37,782 429,802 6,158 12,942 22,971 32,463 13,432 44,165 19,031 65,271 78,016 20,642 31,439 12,721 18,382 1,113,362

% CHANGE -10.3% 14.6% -7.2% 3.3% -2.5% 46.4% -0.7% -3.8% 8.4% 3.0% -26.5% 10.1% -8.1% -7.1% 5.9% 11.5% 3.4% -7.9% -1.1% -7.3% -0.4%

329,208

319,902

2.9%

1,437,930

1,433,260

0.3%

CARLOADS

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 INTERMODAL

FOUR WEEKS ENDING APRIL 27, 2013

MAJOR U.S. RAILROADS

by Commodity TRAILERS CONTAINERS TOTAL UNITS

APR. ’13 111,902 850,117 962,019

APR. ’12 116,618 830,348 946,966

% CHANGE -4.0% 2.4% 1.6%

6,590 209,017 215,607

6,097 205,051 211,148

8.1% 1.9% 2.1%

118,492 1,059,134 1,177,626

122,715 1,035,399 1,158,114

-3.4% 2.3% 1.7%

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 11.6% 53.6% 6.9% 5.1% -9.6% -3.0% 22.2% 14.6% -5.3% -22.3% 43.8% 17.0% 4.0% -5.5% 26.9% -1.7% 3.1%

APR. 2013 - 373,535 APR. 2012 - 347,636 290,000 300,000 310,000 320,000 330,000 340,000 350,000 360,000 370,000 380,000 Copyright © 2013 All rights reserved.

Railroad employment, Class I linehaul carriers, APRIL 2013 (% change from APRIL 2012)

CANADIAN RAILROADS TRAILERS CONTAINERS TOTAL UNITS

ORIGINATED APR. ’12 42,268 15,417 27,513 12,192 22,492 7,220 9,309 7,194 22,912 11,659 1,627 2,048 17,683 12,967 36,218 11,031 87,884

TOTAL CARLOADS, APRIL 2013 VS. 2012

CANADIAN RAILROADS ALL Commodities

ORIGINATED APR. ’13 47,183 23,686 29,407 12,810 20,338 7,005 11,376 8,242 21,691 9,055 2,339 2,396 18,393 12,250 45,944 10,845 90,575

BY Commodity

Transportation (train and engine) 65,813 (0.91%)

Executives, Officials, and Staff Assistants 9,744 (2.10%)

Professional and Administrative 14,102 (2.66%)

Total employees: 163,775 % change from APR. 2012: 1.11% Transportation (other than train & engine) 6,787 (-0.26%)

Maintenance of Equipment and Stores 30,052 (0.93%)

Maintenanceof-Way and Structures 37,277 (1.04%)

Source: Surface Transportation Board

Employment up year-over-year and from past month Figures released by the Surface Transportation Board show Class I railroads employed 163,775 people in mid-April, up 1.11% from April 2012, and up 716 people, or 0.44%, from the previous month of March. All categories save one gained year-over-year, with Transportation (other than train and engine) notching the sole year-over-year loss, down 0.26%. Leading the winners year-over-year was Professional and Administrative, up 2.66%.

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Industry Outlook Kawasaki marks Yonkers anniversary

Kawasaki Rail Car, Inc. joined with New York State officials, elected representatives, and transportation professionals May 9 to celebrate 25

years of manufacturing railcars at its Yonkers, N.Y., plant. During the past quarter-century, Kawasaki has produced more than 2,500 railcars at the facility. Kawasaki has made railcars and component parts for a variety of transit systems, including MTA New York City Transit, MTA Long Island Rail Road, MTA Metro-North Railroad, Port Authority Trans-Hudson Corporation (PATH), Connecticut DOT, Massachusetts Bay Transportation Authority (MBTA), and the Maryland Transit Administration.

Metrolink project hits legal obstacle

A judge has rejected the environmental impact report (EIR) for a proposed Metrolink line from Riverside to Perris, ruling that the Riverside County (Calif.)

Transportation Commission failed to address such issues as train wheel noise and pedestrian safety.

The judicial ruling stalls the 24-mile, $232.7 million project that would extend Metrolink regional passenger rail service from Riverside to Perris.

Superior Court Judge Sharon J. Waters ruled the commission can proceed with design and planning activities for the project, but cannot proceed with any construction.

The commission said the decision “indefinitely delays” the project.

Judge Waters said complaints by Friends of Riverside’s Hills, including the EIR’s failure to adequately address the effect of rail lubricant on the soil, pedestrian safety, train wheel squeal, and construction noise, were of valid concern. The group’s lawsuit said the transportation commission did not follow the guidelines of the California Environmental Quality Act, which requires governmental agencies to disclose a project’s impact and work to reduce them.

A spokesman for Friends of Riverside’s Hills said the group is willing to help the commission address the concerns raised in the suit.

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CP increases 2013 capex spending Canadian Pacific last month said it would add up to C$100 million to its original 2013 capital spending plan of C$1.1 billion, funded by a higher than anticipated 2013 cash flow projections. “As our railway continues to transform, we see opportunities to accelerate enhancements to key sections of our North American system,” said Chief Executive Officer E. Hunter Harrison. “By taking these opportunities now to further improve our operations, we will be better positioned to respond to our customers’ shipping needs.”

The projects, moved forward from scheduled 2014 work, are primarily focused on productivity, safety, and efficiency, CP said.

REMSA, RSI to co-host Brazilian trade pavilion The Railway Supply Institute (RSI) and Railway Engineering-Maintenance Suppliers Association (REMSA) will be co-hosting the USA Pavilion at the Business on Rails trade show, Nov. 5-7, 2013, in São Paulo, Brazil.

“The exclusive USA Pavilion represents the first U.S.-based railway supply association-sponsored exhibition opportunity at Business on Rails, which attracts more than 7,000 railroad and railway supply industry attendees with exhibitors from more than 14 countries,” said REMSA Executive Director David Soule.

“The South American market holds promise for North American railroad suppliers, and the USA Pavilion will showcase companies that are interested in exhibiting internationally without having to spend resources on making all of the arrangements themselves,” said RSI President Tom Simpson.

The cost to exhibit in the USA Pavilion is $15,000 for RSI/REMSA members; $25,000 for nonmembers. The pavilion layout will include a common exhibit area with refreshments, seating, and meeting space, with booth space for each exhibiting company. Translators will also be present.

The USA Pavilion provides additional benefits to exhibitors, including support and guidance from the U.S. Department of Commerce, and the opportunity for personalized introductions to potential business partners and customers; briefing papers on South American railroad investment and advice on translation and materials shipping; transportation advice including visa and customs, as well as airport, hotel, and convention center transfers; and access to the USA Pavilion room block at the Renaissance São Paulo Hotel.

Nearly half of the available exhibit booths have been reserved at the REMSA/RSI-sponsored pavilion.

DIsCoVeR sIeRRA GoLD...

AGAIN! Join us for golden moments in crosstie business learning and networking.

The Railway Tie Association will gather again in the Sierra Mountains on the shores of breathtaking Lake Tahoe for the 95th Annual Symposium and Technical Conference. Be there to strike gold with new knowledge about trends and developments in our crosstie industry.

And make time to relax in all manner of Sierra splendor in a resort where just about any fun you want to enjoy is served your way!

AgAin this fAll, lAke tAhoe will be the bAckdrop for industry thought-leAders shAring:

Learn, network and engage industry leaders at 2013’s best crosstie event: Railway Tie Association 95th Annual Convention

O c t o b e r 8 -1 1 , 2 0 1 3 Hyatt Regency Lake Tahoe Hotel Incline Village, Nevada

The latest track and tie research Hardwood industry update Insights from major railroads, short lines and railroad contractors Legislative reports RTA General Business luncheon featuring Kayak.com board chairman Terry Jones like the water? Lake Tahoe has it all for you. golf your game? Sign up for our tournament. rather spend time with fine wine — or great shopping? We’ve got great trips arranged. And plan to celebrate our industry’s success at the All Black (& a Little Gold) Nevada-themed party in the Hyatt ballroom.

The Railway Tie Association 115 Commerce Drive, Suite C Fayetteville, GA 30214 Voice: (770) 460–5553 Fax: (770) 460–5573 www.rta.org

© 2013 The Railway Tie Association

Market

Greenbrier Cos. unveils Multi-Max with adjustable decks The Greenbrier Companies unveiled its new Multi-MaxTM automotive railcar May 29 in Cleburne, Tex. Similar to the AutoMax II® design, and with “extensive input from major railroads,” the rack features adjustable decks for both bi- and tri-level service without adding or moving decks. New design enhancements allow for deck adjustments to now be completed on site at loading locations, saving automotive shippers time and money. In addition to streamlined deck adjustments, Greenbrier says, this unit is built as a standalone rack that can be installed on existing 89-foot low-profile flat cars, requiring significantly less upfront investment for fleet owners.

AMTRAK: Received $30.2 million from the Federal Railroad Administration to repair damage caused by Hurricane Sandy to the Northeast Corridor.

EDMONTON: Ordered from Axion International Holdings, Inc. ECOTRAX™ specialty rail ties to be used for grade crossings on the city’s light rail transit system.

MARTA: Authorized a revised contract, with URS Energy and Construction, Inc. to design and build the Atlanta Streetcar, with the total price now set at $59 million, up from $52.2 million.

METROPOLITAN WASHINGTON AIRPORTS AUTHORITY: Awarded the first of three design-build contracts for Phase 2 of Washington Metropolitan 8

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June 2013

Area Transit Authority’s (WMATA) Silver Line to Capital Rail Constructors, a joint venture of Clark Construction Group and Kiewit Infrastructure South, with Parsons acting lead designer. A contract for project management services has also been awarded to Jacobs Engineering, continuing the role it performed on Phase 1.

Worldwide AURIZON (AUSTRALIA): Signed an agreement with GE Transportation’s Optimization Solutions division to implement an integrated rail network planning and optimization system.

GE will be supplying its Movement Planner system, which will be integrated with planning and scheduling applications from SolveIT Software, an Australian firm, for

Aurizon (formerly QR National), Australia’s largest freight railroad.

ROMANIA: Received three bids for the sale of a 51% stake in CFR Marfa, the national rail freight operator, with short line operator Omnitrax one of the bidders. Also in pursuit: Romania’s two largest independent rail freight operators—Grup Feroviar Roman, and Transferoviar Grup, which is part of a consortium with Austrian-based financial investors Donau Finanz.

CZECH RAILWAYS: Placed an order worth $47 million with Skoda Transportation for an additional seven Regiopanter electric multiple-unit (EMU) trains, including five three-car trains and two two-car trains. Delivery must begin with 15 months, with final delivery of all equipment to occur by mid-2015.

The Greenbrier Cos.

North America

Update Supply Briefs

NS’ Moorman: Best yet to come

Knorr-Bremse opens Maryland plant Knorr-Bremse has opened its new Rail Vehicle Systems plant in Westminster, Md., in order to cope with “ongoing growth of the U.S. mass transit market and of three current major orders for HVAC systems.” The company held a ceremony May 9, with KnorrBremse owner and Chairman of the Supervisory Board Heinz Hermann Thiele joined by Maryland Gov. Martin O’Malley. The company says the new plant triples the capacity of its older facility also in Westminster, and soon will employ almost 300 employees. This location will develop, manufacture, and sell product lines for rail vehicles on more than 20,000 square meters of production and office space.

UP, GATX host conference on ethanol safety training

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Railway Age June 2013

N

orfolk Southern Corp. “has made great strides over its 30-year history, posting its bestever performance over the past two years—and the best is still to come,” CEO Wick Moorman told shareholders at the company’s 31st annual meeting, held May 9 in Williamsburg, Va. “Our railroad is on track to continue to do great things as we continue emphasizing operating efficiency and productivity. I’m excited and optimistic about our company’s future,” Moorman told the gathering.

Moorman noted that even with a downturn in coal traffic in 2012, NS still recorded its second-best year for revenue, operating income, net income, and earnings per share, topped only by 2011: “Our railway operating revenues exceeded $11 billion for the second consecutive year. Merchandise revenues increased 6%, and intermodal revenues increased 5%, while coal revenues declined 17%.

“Our total traffic volume for 2012 remained about even with the previous year. Our merchandise volumes were up 2%, intermodal volumes were up 5%, and our coal volumes declined by 13%.

“In merchandise, we benefited from

higher carloadings in the chemical, automotive, and forest products sectors, and we expect these trends to continue in 2013.

“Chemical traffic is being driven by the revival of much of the basic chemical industry in this country due to the growing production of gas and oil through directional drilling and hydraulic fracturing, along with the growth of shipments of crude oil to east coast refineries.

“Autos are up on account of increasing sales of automobiles, which is a good news story for the U.S. economy, and our forest products traffic is reflecting the growing signs of life in the housing industry.

“In intermodal, steady traffic gains were supported by our dependable service, competitive routes, and investments in public-private partnerships to improve rail infrastructure. We continue to see strong market forces encouraging the move of container and trailer traffic from the highway to rail, and we continue to invest to make that happen,” Moorman said.

“Coal, of course, was a challenge, as the market continued its worldwide slump. Even though it remains a wildcard, we are confident it will stay an essential component of our business.

NORFOLK SOUTHERN

Hands-on safety training was a key feature at a Union Pacific ethanol rail safety conference involving approximately 90 participants representing more than 15 ethanol shippers, who traveled from a 500-mile radius to participate.

Joined by equipment supplier GATX Corp., Union Pacific educated customers on the railroad’s safety and security measures. Key focus areas included: non-accident release reduction; emergency response techniques; and safe loading and unloading procedures. GATX provided a tank car for the training session that demonstrated safe practices for transferring ethanol to tank cars. The conference also featured a panel discussion with industry safety experts, including representatives from Union Pacific, the Ethanol Emergency Response Coalition, and the Federal Railroad Administration.

Despite a slump in coal volume, Norfolk Southern notched its second-best year in its 30-year history, CEO Wick Moorman told company shareholders last month.

We’re optimistic that we are at or at least close to the bottom for much of our coal business, and that higher natural gas prices and more normal weather patterns will mean that our thermal coal volumes will strengthen in the next few quarters.

“In 2012 we did a good job managing expenses, and in fact we reduced them 1%, largely through improvements in system velocity. This tight expense control and focus on improved productivity meant that even with a more than $500 million decline year over year in coal revenues in 2012, our operating ratio increased by only one percentage point for the year. “ We obviously prefer to see it going in the other direction, but in fact such a small increase is a positive reflection of our balanced portfolio of business and efficient operations,” the CEO asserted.

Moorman said NS’s public-private partnership investments in strategic rail corridors such as the Heartland and Crescent Corridors “position intermodal business as a major competitive strength.

“New intermodal facilities opened over the past two years help us build business, while creating jobs in communities and strengthening local economies,” Moorman said.

He praised the skill of employees and their efforts to sustain NS’s “industry leadership in safety, service, and environmental responsibility.

Moorman’s remarks came one day before NS announced the appointment of James A. Squires as president of the railroad, effective June 1. (See page 46.)

Squires, 51, was executive vice president Administration prior to his promotion. Moorman will remain as Chairman and CEO. Norfolk Southern last month also awarded its Thoroughbred Chemical Safety Award to 54 customers for safe handling of chemical products during 2012.

Given annually for 17 years by Norfolk Southern, the award recognizes companies and facilities that ship more than 1,000 carloads of federally regulated hazardous material over NS’s rail network without a single incident for the year.

Fifty-one corporations and three plants reached this goal during 2012, NS said.

“These customers safely shipped more than 127,000 total carloads of chemical products used to manufacture various consumer goods,” said Moorman.

“Shipments included industrial chemicals, petroleum products, biofuels, and sulfur—all vital products for consumers and the U.S. economy, but potentially dangerous if not handled carefully,” the CEOsaid.

“We congratulate these valued customers for their industry-leading performance in chemical safety, and we thank them for contributing to our railroad’s safe operations,” Moorman said.

CN, AMT discuss sale of Montreal rail line CN is holding discussions with Montreal’s Agence metropolitaine de transport (AMT) on the possible sale of CN’s Deux-Montagnes line, including the Mount Royal tunnel, used by AMT regional trains.

“As soon as CN told us they wanted to unload this line, we saw that as good news,” AMT CEO Nicolas Girard said in an interview with the Montreal Gazette. “If we can own railway lines and be masters in our own house, it gives us more flexibility and allows us to improve service for customers.” AMT hopes to secure an agreement by year’s end.

The 18.6-mile, 12-station Deux-Montagnes route is AMT’s busiest, carrying 45% of the agency’s annual ridership.

AMT traffic currently dominates the line’s use, though CN operations take precedent at present between 8:30 a.m. and 3:30 p.m. and between 8:30 p.m. and 5:30 a.m., essentially limiting AMT to traditional “commuter” rail service.

Acquiring the line would allow AMT better opportunities to bolster not just service frequency during rush hours, but on off-peak and weekend periods as well. AMT seeks to add roughly 4.6 miles of double-track rail to the route, along with bridge reconstruction, an overpass addition, and two new station stops.

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June 2013 Railway Age 11

Update Amtrak Board extends CEO Boardman’s contract Amtrak’s board of directors has extended the contract of President and CEO Joe Boardman “for his achievements in improving operational and financial performance, and to provide continuity of leadership critical to the ongoing implementation of the company’s strategic plan.”

“We are extremely pleased with the progress Amtrak has made under the leadership of Joe Boardman,” said Chairman Tony Coscia. “The changes Joe is managing within the railroad are resulting in real accomplishments, and it is important for him to stay on, continue his work, and provide leadership for the challenges and opportunities that lie ahead.”

At its May 2013 meeting, the Amtrak board of directors approved a two-year renewable contract for Boardman (photo at left), who was appointed President and CEO in November 2008.

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Railway Age June 2013

Amtrak CEO Joe Boardman is credited with overseeing record ridership and revenue on the nation’s intercity rail carrier.

“As a result of the good work Amtrak employees across the company are doing to implement our plans and produce our achievements, the board of directors asked me to continue in my role,” said Boardman.

During Boardman’s tenure, Amtrak “has experienced many accomplishments including: record ridership and revenue, continued reductions in the need for

federal operating support, a significant pay down of debt, the best ever systemwide on-time performance, expansion of state-supported services, the introduction of Wi-Fi service and eTicketing, and the creation and implementation of a corporate strategic plan,” Coscia said.

“In addition, he is managing new equipment orders for Northeast Corridor and long distance services, a major planning effort for the development of next-generation high-speed rail, a comprehensive employee safety program, enhanced security initiatives, and numerous capital projects to improve Amtrak infrastructure, stations, maintenance shops, and other facilities,” Coscia said.

Boardman previously served as Federal Railroad Administrator during the administration of President George W. Bush, and was the longest serving Commissioner of the New York State Department of Transportation.

Siemens wraps up Invensys Rail acquisition, looks ahead Siemens Rail Automation, which is part of the company’s Mobility and Logistics Division-Infrastructure & Cities Sector, has completed its acquisition of Invensys Rail, saying it was “expanding the company’s footprint in the global rail automation market and strengthening its technology offerings, including Positive Train Control.” The acquisition includes Invensys Rail’s divisions in North America, Northern Europe, Southern Europe, and Australia (Asia-Pacific).

Invensys Rail President and CEO John Paljug was named head of the Siemens U.S. Rail Automation business unit, headquartered in New York City.

More than 500 Invensys employees will be joining Siemens Rail Automation with the acquisition, including 300 in Louisville, Ky., and 210 in Marion, Ky. “In the North American marketplace, the combined Siemens and Invensys businesses truly compliment each

other,” Paljug told Railway Age. “There’s very little overlap in our products and services portfolios.

Invensys brings strengths in traditional freight and transit signaling and communications; Siemens is very strong in the transit field. Combined, we have a strong marketplace presence in North America with lots of credibility, and are looking at new opportunities.” One such opportunity may grow from the comany’s interest in PTC in North America.

Paljug said he is “very impressed with the people in both companies. Our customers expect great things, and I expect the same. I’m confident that we’ll be able to serve our customers better than ever.”

Siemens has also signed an agreement to acquire the railway yard retarder business of Sona BLW Präzisionsschmiede, Remscheid,

John Paljug now heads the Siemens U.S. Rail Automation business unit.

Germany, and has completed the acquisition of Sky Eye Transportation Systems GmbH, Braunschweig, Germany, improving the company’s range of IT solutions for transportation planning and scheduling tasks.

The Siemens Infrastructure & Cities Sector, with approximately 90,000 employees, “focuses on sustainable technologies for metropolitan areas and their infrastructures.”

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June 2013 Railway Age 13

Update FRA issues industry-wide safety advisory on flat switching operations 





The Federal Railroad Administration (FRA) on May 3 issued an industry-wide safety advisory to warn about safety hazards associated with flat switching operations on railroads.

“Since 2009, six railroad employees sustained fatal injuries placing themselves between unsecured rolling equipment during switching operations, including one employee who was killed last year,” FRA said.

In flat switching, railcars are diverted to the proper track to make up a train by one of two methods, either by “manually kicking” or “shoving to couple.”

When railcars are “kicked,” they are uncoupled from the switching locomotive while in motion, allowed to roll freely, and are expected to couple with the other railcars upon impact with the new train.

When railcars are shoved to couple, they are not uncoupled from the switching locomotive until they have already coupled with and are secured to the new consist.

Through investigations of one of the six fatalities, FRA identified switching yard characteristics “that may increase the risks of unsecured rail equipment rolling back onto an employee if an irregular grade is present in a flat switching yard.”

During kicking operations,

Operation Lifesaver, Inc. touts safety during Crossing Awareness Day Operation Lifesaver, Inc. programs and partners across the U.S. marked International Level Crossing Awareness Day (ILCAD) on May 7.

OLI said statistics show that vehicletrain collisions and injuries at highway-rail grade crossings were lower across the U.S. in 2012, and crossing-related fatalities were flat, but rail trespass deaths and injuries rose.

This year, 45 countries worldwide are holding events in observance of ILCAD, OLI noted.

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Railway Age June 2013

employees “are at greater risk if the rail car doesn’t couple securely with other railcars already resting on the destination track,” FRA said.

“Kicking railcars is efficient but it can also have significant consequences if rail carriers don’t have operating rules to safeguard employees to ensure that kicked rail cars are securely coupled,” said Federal Railroad Administrator Joseph C. Szabo.

“Where there is risk of a rollback, shoving to couple provides absolute certitude,” Szabo added.

In 2010, FRA released recommendations developed by the Switching Operations Fatality Analysis Working Group (SOFA) that have been adopted by individual railroads in their operating rules.

The Safety Advisory, 2013-03, warns railroad management and employees about the inherent dangers of employee movements between unsecured rolling railcars. It advises railroads to review and follow SOFA recommendations previously set forth in an FRA 2011 Safety Advisory and, where conditions exist, to develop operating rules that safeguard employees, and advises employees to follow the rules.

For more information, access FRA’s website, www.fra.dot.gov.

“As Operation Lifesaver joins countries around the world in observing the fifth annual International Level Crossing Awareness Day, we take pride in the efforts that have contributed to a continued reduction in U.S. crossing incidents,” said OLI President Joyce Rose.

She added that given the “growing demand for public transit, passenger, and freight rail services, our mission of rail safety education is more relevant than ever.”

SPRINTER back in service: NCTD The North County Transit District (NCTD) put its SPRINTER diesel light rail transit (DLRT) back into service early Saturday morning, May 18, restoring rail service to northern San Diego County, Calif., that had been suspended for two months (RA, April, p. 13).

An NCTD’s press briefing two days earlier included an invitation for media, issued the previous day, to ride and photograph SPRINTER on a demonstration run.

SPRINTER service was disrputed due to unanticipated wear on the trains’ brake rotors. NCTD has not yet explained the cause for the wear, which could cost the agency up to $3 million.

The agency substituted bus service during the service disruption.

Charlotte mulls streetcar plans

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Charlotte, N.C.’s City Council last month pondered reviving a stalled 2.5-mile streetcar extension, shelved earlier this year due to pressure from state-level officials and to acrimony between the council and Mayor Anthony Foxx.

Construction of the first 1.5-mile segment is under way. A new plan would fund the extension without tapping property taxes, while also technically removing the project from the city’s Capital Investment Plan.

City Manager Ron Carlee renamed the project the CityLynx Gold Line, linking it by name more closely with the city’s existing Lynx LRT Blue Line, run by Charlotte Area Transit System (CATS). The Gold Line would interface with the Blue Line LRT at the Charlotte Transportation Center.

Carlee reportedly told the City Council odds were good for 50% federal funding, similar to expectations advanced by other U.S. cities, could give the project the support it needs. But Charlotte would have to secure $63 million in matching funds.

June 2013 Railway Age 15

Watching Washington Frank n. wilner

Rail’s role looks bright for crude oil market share

R

egardless of whether Congress approves construction of the final phase of the 1,700-mile crude-oil carrying Keystone XL pipeline from the oil-soaked sands of Alberta, Canada, and North Dakota’s Bakken Shale oil formation south to Gulf Coast refineries, the railroads will continue to grow their market share of crude oil transport.

Modern methods of extracting oil— using sand, chemicals and water under high pressure, called “fracking”—have unlocked previously unimagined quantities of North American crude, with predictions that by 2020 America alone will become the world’s largest producer of crude oil. Fracking technology has made North Dakota second only to Texas as America’s largest crude oil producer, with Alaska third.

While railroads have been transporting oil since the 19th century—in wooden barrels prior to the introduction of tank cars—they are reemerging as a decisive and safe transport partner to domestic oil producers. And that’s because existing and proposed pipelines do not have the capacity to transport the North American crude oil now being produced.

Unlike pipelines, railroads provide logistics flexibility. A string of 200-ton locomotives pulling 120 tank cars of crude oil allow railroads to move as much oil daily in 10 unit trains as will the Keystone XL pipeline—850,000 barrels daily.

But unlike the fixed-route pipeline, railroads can deliver oil virtually everywhere the nation’s 163,000-mile track network reaches—and with unrivaled flexibility to change destinations immediately as refinery needs shift.

So important have railroads become to the delivery of new sources of crude oil that rail crude oil shipments have

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increased by 20 fold since 2009, with railroads delivering almost 234,000 tank-car loads to refiners in 2012— some 167 million barrels, which is 7% of the nation’s crude oil production and up from under 3% in 2011.

• BNSF alone will be serving 50 scattered refinery destinations by 2014.

Unlike pipelines, railroads provide logistics flexibility.

And new oil-unloading rail facilities can be constructed within months.

• New oil-unloading rail facilities can be constructed in months. Morgan Stanley Research reports that new rail oil-unloading facilities, with capacity to handle one billion barrels daily, are being built or planned to help transport an annual increase by 2016 of three billion more barrels daily.

“Producers are beginning to realize that rail provides better opportunity” in the form of shorter duration contracts [one-to-five years vs. 10-15 years for pipelines] and flexibility to serve diverse destinations, reports Morgan Stanley.

• Kinder Morgan Energy Partners— a pipeline operator—is constructing a crude-oil-by-rail facility in Houston to receive 210,000 barrels daily of Canadian and Bakken Shale oil.

• Refiner Phillips 66 has committed to receiving by rail at a New Jersey

refinery 91 million barrels of oil over five years—some 50,000 barrels daily.

• A Philadelphia Sun Oil refinery, which was relying on more expensive imported oil, has shelved plans to close after contracting to receive by rail 33,000 barrels daily of North Dakota Bakken Shale oil.

• PBF Energy intends to ship by rail 80,000 barrels daily of Canadian crude oil to its refinery in Delaware.

• Valero Energy has ordered some 5,300 new tank cars to move 30,000 barrels daily of Canadian crude oil to its refineries in Louisiana and California.

With misguided self-interest— misguided because pipelines cannot handle the capacity of North American crude oil coming on line—pipeline interests are asserting railroads are not a safe mode of transport, which is demonstrably incorrect.

The former managing director of the National Transportation Safety Board, Peter Goetz, has analyzed the data— including a pipeline-funded study by the Manhattan Institute that sought to paint harshly railroad crude-oil transport. He says that while spill accidents are rare for both modes, railroads are a safer choice. He reports that for every million barrel-miles moved, pipelines spill more than twice as much oil as railroads do.

Since 2002, railroads have had but 35 incidents where more than five gallons were spilled. In 2010, a single pipeline rupture spilled 800,000 gallons near Michigan’s Kalamazoo River.

Energy derived from crude oil generates jobs, improves mobility, and enhances the quality of life, with flexible, financially strong, and safe freight railroads playing a crucial role in helping America to regain its energy independence.

passenger trains on Twentieth Annual Conference

freight railroads

October 15 & 16, 2013 / Washington Marriott Hotel / Washington, D.C. presented by

REGISTER ONLINE: www.railwayage.com Joseph C. Szabo Federal Railroad Administrator

Joseph H. Boardman President & CEO, Amtrak

2013 Recipient W. Graham Claytor Jr. Award for Distinguished Service to Passenger Transportation

October 15, 2013 Keynote Address

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CONFERENCE FEE AND HOTEL: The registration fee for Passenger Trains on Freight Railroads is $925, which includes admission to all conference sessions, conference documentation containing all available proceedings, and social events. The Washington Marriott Hotel, 1221 22nd Street NW, Washington, DC 20037, has set aside a block of rooms at $289 single/double for attendees. These will be held until 30 days prior to the conference; those reserving after that date will rely upon room availability. Contact the hotel directly at (202) 872-1500 for room reservations (mention group code “Railway Age”). You will receive room confirmation directly from the Washington Marriott Hotel. CANCELLATION POLICY: Confirmed registrants who cancel less than one week prior to the conference are subject to a $250 service charge. Registrants who fail to attend are liable for the entire fee unless they notify Railway Age in writing prior to the conference.

Amtrak sprints toward a higher speed future The Northeast Corridor’s “New Jersey Raceway” is receiving some of the most significant improvements since the original NECIP and NHRIP projects. By William C. Vantuono, Editor-in-Chief

W

ith the exception of roughly 20 miles in Rhode Island on the North (New York-Boston) segment of Amtrak’s Northeast Corridor, where Acela Express trains attain speeds of 150 mph, the relatively tangent four-track main stretching from New Brunswick to Hamilton, N.J., is the fastest railroad line in North America.

The 24-mile “New Jersey Raceway,” also known as the “Speedway,” was originally constructed by the Pennsylvania Railroad and electrified with variable-tension catenary in the 1930s. Over the years, PRR/Penn Central Metroliners, the United Aircraft TurboTrain, the European X2000 and ICE high speed trainsets, the Acela Express, and other types of equipment have proven their high-speed mettle on it.

In cooperation with NJ Transit, a team of Amtrak engineers, led by Deputy Chief Engineers Dave Staplin (Track), James Richter (Structures), Robert Vorhollo (Electric Traction), Keith Holt (C&S), Steven Falkenstein (Maintenance), and Al Fazio (Section Improvements), is in the midst of the NJHSRIP (New Jersey High Speed Rail Improvement Program), a multi-year, multibillion-dollar project that, when completed, will enable top train speeds of 160 mph and improve reliability and capacity for Amtrak and NJT. It’s the most ambitious undertaking on the NEC since NECIP (Northeast Corridor Improvement Program) and NHRIP (Northeast High-speed Rail Improvement Program).

Among the improvements are constant-tension catenary, higher-speed interlockings, track additions and realignment, and resignaling. Two Speedway projects are moving ahead simultaneously. The “Midline Loop Project,” located near Monmouth Junction, N.J., will eliminate a cross-the-plant move at Jersey Avenue (New Brunswick) and allow NJT trains to reverse direction above the right-of-way, bolstering Inner-Zone NJT service. Nearby, NJT will be expanding capacity at Amtrak’s County Yard to improve storage capacity, also relieving conflicting moves generated by trains entering the NEC at the yard near Jersey Avenue Station. NJT and Amtrak are coordinating design of the two projects.

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Concept of operations

The NJHSRIP currently extends as far west as “Ham” Interlocking and includes new high speed interlockings consisting of No. 32.7 crossovers at “Delco” and “Adams” and provisions for the Midline Loop track and an NJT North Brunswick Station to be constructed by NJT at a former Johnson & Johnson manufacturing facility. The Loop would eliminate at-grade crossings of the entire four-track alignment by NJ T trains that currently originate at the Jersey Avenue Station. Elimination of the at-grade crossings effectively increases available train capacity in this segment of the NEC. In conjunction with other improvements, the Loop will allow for future service increases for Amtrak and NJT. (The planned operation for this segment of the NEC is illustrated opposite.)

The reconfiguration of the NEC between “County” and “Ham” interlockings is directly related to NJT’s and Amtrak’s concept of operations (ConOps) for “high performance commuter and regional rail” coupled with “improved high speed [intercity] rail.” This segment of the NEC is to be configured to a specific service plan, while retaining flexibility to adapt to alternate or temporary service patterns.

Service patterns that are anticipated on this reconfigured section of the NEC include operational requirements that serve as a basis of the configuration design: Amtrak HSR: This consists of through service, stopping at Newark, N.J. with limited stops at Metropark (Iselin, N.J.) operating at speeds of up to 160 mph on Tracks 2 and 3 (inner tracks). Ultimately this service will be provided by Tier III equipment (preferred design), which will first supplement, and then replace, the existing Tier II (Acela Express) fleet; the planned configuration supports higher speeds and current service levels. Currently, Amtrak operates one HSR frequency per hour; the near term goal is to increase this to two frequencies per hour. A longer-term design goal is the operation of three HSR frequencies per hour.

Amtrak Regional and Keystone Service: This includes through service with selected station stops at

The Siemens-supplied ACS-64 will become the Northeast Corridor’s new workhorse. See page 22.

Planned NEC Service patterns: Newark to Trenton

June 2013 Railway Age 19

AMTRAK’S HIGHER SPEED FUTURE

Newark and/or Newark Liberty International Airport, and/ or Metropark and Trenton. Currently, Amtrak Regional service also provides for a limited number of stops at Princeton Junction and New Brunswick. This service is provided by Tier I equipment with maximum speeds of up to 125 mph. Trains stopping at Trenton today use “Fair” Interlocking; this general dispatching pattern is expected to continue. Included in this class of service are the Amtrak longhaul trains. The design goal for this service is two frequencies per hour to accommodate future state-supported services.

Amtrak Long-Distance Service: This consists of through service to points beyond the NEC with station stops at Newark and Trenton. Current service levels and stopping patterns are expected to remain unchanged, with the potential exception of Trains 50/51, the Cardinal, to run daily after receipt of additional long distance equipment (Viewliner IIs) now in production. Long-distance equipment is designed to Tier I standards and will be capable of 125 mph service once the current “Heritage Fleet” is retired.

NJT Outer Zone Express Service: This consists of Regional Express Service with trains operating on Tracks 2 (eastbound) and 3 (westbound) east of “Adams” and Tracks 1 and 4 (inner tracks) west of “Adams.” Service is provided predominantly by electric locomotives and MultiLevel coaches in push/pull configuration at speeds of 100 mph to

This segment of the NEC is to be configured to a specific service plan while retaining flexibiliity.

110 mph. Outer Zone stations are Trenton, Hamilton, and Princeton Junction. On the shoulders of the peak, NJT Outer Zone trains add stops in New Brunswick. This service currently operates on Tracks 1 and 4 between Newark and “Midway” Interlocking in order to overtake and pass NJT’s Inner and Middle Zone trains and will continue to do so but in a shorter, more efficient zone in the future. Outer Zone trains will utilize the new “Delco” and “Adams” interlockings to move from/to the inside tracks. The currently planned track and signal configuration provides for the potential implementation of the proposed new station in North Brunswick. Outer Zone express trains might service this new station on the shoulders of the peak but are not expected to serve it during the height of the peak. NJT Outer Zone expresses will operate in revenue service to Trenton and be serviced and yarded at NJT’s Morrisville Facility.

NJT Middle Zone Service: This consists of SemiExpress service between New York Penn Station and Jersey Avenue Station, with a possible extension to the new station in North Brunswick. Service will be provided with existing Arrow III EMU equipment that will be supplemented and ultimately replaced by electric-locomotive-powered 20

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June 2013

MultiLevel consists. Speeds for this service are expected to be in the 80 to 100 mph range and will generally operate on Tracks 1 and 4. The majority of Middle-Zone trains are expected to be yarded at an expanded facility near County Yard/ Loop, reducing requirements to deadhead equipment to/from Morrisville. The configuration of the projected improvements also permits these trains to continue to Trenton on the outside tracks with no interference to HSR service. If the proposed North Brunswick Station is not implemented, improvements will be made to the Jersey Avenue Station, including adding an eastbound platform alongside Track 4. This would permit this station to function properly with the Loop.

NJT Inner Zone Service: These trains will serve stations between Newark-Penn Station and Rahway (inclusive), operating on tracks “A” and “B” between “Elmora” and “Union” interlockings, and then operate either west along the NEC to Jersey Avenue and/or Trenton, or down the North Jersey Coast Line, which joins the NEC at “Union.” Track or platform configuration currently permits inter-zone transfers at Rahway. North Jersey Coast Line service is also supplemented by frequent express trains that operate without stopping between Newark and “Union” and that then depart the NEC. Freight: Operation of local freight (Conrail, CSX, Norfolk Southern), although largely diminished in volume from levels of 10 years ago, is expected to continue in the current or a similar pattern. Currently, locals are operated from Morrisville Yard on the west end of the project or from Edison Yard on the east end, with traffic relayed to/from “Lane” Interlocking, where it exits the NEC. Amtrak says that a cab speed of 160 mph will be available on Tracks 2 and 3 only, “County” to “Ham,” with possible extension east to Edison, N.J. (MP 28). Maximum cab speed on Tracks 1 and 4 will be 125 mph, with capacity optimization at 80 mph.

Preliminary planning for higher future service levels for Amtrak and NJT is under way. Additional coordinated planning is required to determine precise requirements; Amtrak and NJT say they are “confident that our current projects build toward these future additional requirements.”

Signalization and train movement patterns

All tracks “County” to “Ham” will be signaled for NORAC Rule 562 (cab, no wayside). In order to improve capacity on Tracks 1 and 4, controllable “station” signals will be installed at Princeton.

Additional possible projects allowing higher levels of service include an added track through Elizabeth, N.J.; increased trans-Hudson capacity and station capacity in New York; added or realigned tracks through Newark, Linden, and Rahway; and additional infrastructure near Trenton.

NJT’s work on the Midline Loop Project, expanded County Yard, and preliminary analysis of the North Brunswick Station has considered the ability to add or extend tracks in this area.

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AMTRAK’s HIGHER SPEED FUTURE

Amtrak’s next-generation electric Taking full operational advantage of the track, catenary, and signaling improvements under way on the Northeast Corridor will require new equipment. Amtrak’s AEM7 electric locomotives have served the railroad well, nearly 40 years since their introduction. The Bombardier/ Alstom HHP8s are approaching 15 years in service and will soon be due for a mid-life overhaul. It’s time for new power, and it has arrived in the form of the Siemens ACS-64 (Amtrak Cities Sprinter, 6.4 MW/8,320 hp) electric locomotive, 70 of which are being built.

The first units of the $466 million order will be field tested this summer for entry into revenue service on the NEC this fall, augmenting, and eventually replacing, the AEM7s, each of which have average mileage of more than 3.5 million miles, with some approaching 4.5 million miles.

Three ACS-64s will undergo a comprehensive testing program this summer—two in Pueblo, Colo., at TTCI, and one on the NEC. Production of the remaining units will occur through 2016.

Components for the ACS-64s were supplied by Siemens plants in Norwood, Ohio, Alpharetta, Ga., and Richland, Miss., as well as from 70 suppliers representing more than 60 cities and 23 states, in keeping with a 100% federal

domestic content requirement.

The new locomotives will handle Northeast Regional trains at speeds up to 125 mph on the NEC, and also up to 110 mph on Keystone Service trains between Philadelphia and Harrisburg, Pa. Long-distance trains operating on the NEC also will be powered by the new locomotives.

Amtrak says the ACS-64 offers high efficiency, reduced life cycle cost, and better reliability and availability than Amtrak’s existing electrics. In terms of traction capability with the maximum specified trainload, the ACS-64 can accelerate 18 Amfleet coaches with a Head End Power (HEP) load of 1,000kW to 125 mph in just over eight minutes.

The ACS-64 is designed for easier maintenance, and will improve energy efficiency through regenerative braking that feeds energy back into the power grid. Regenerative braking up to 100% rated power is possible.

The ACS-64 features an integral monocoque wide-body, double-cab design suited for push-pull operation. The carbody is comprised of four major elements—underframe, sidewalls, operator cabs, and three detachable roof sections. It is designed to allow compression forces of 800,000 pounds of buff load and is equipped with an AAR

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Railway Age

June 2013

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AMTRAK’S HIGHER SPEED FUTURE

F-type coupler with a push back mechanism to achieve full anticlimber engagement.

Instead of a “conventional” mechanical safety concept in accordance with American Crash Standard AAR S-580 with collision and corner posts, the ACS-64 features a front end Crash Energy Management (CEM) system that provides better safety to crews while offering the advantage of lower weight and better reparability.

The locomotive has a center walk-through engine room.

More space is available for components, maintenance access is much better, and component thermal effects are minimized, enabling better ventilation. This is the standard engine room layout for the Siemens European EuroSprinter and Vectron locomotives, and most of the electrical components are identical.

Since Amtrak’s NEC has three a.c. catenary voltages, the ACS-64 is designed for 25kV 60Hz, 12.5 kV 60 Hz, and 12 kV 25Hz. A rotary switch in the converter connects the transformer windings for the required configuration.

The traction control system consists of two cubicles located in the center of the locomotive on both sides of the walk-through, each containing components for one two-axle truck as well as the HEP supply.

Each converter cubicle has two water cooled input inverters (four-quadrant choppers) and three water cooled output inverters with IGBT power semiconductors. The two input inverters feed one common d.c. link for the three output inverters in one cubicle.

Two of these output inverters are connected to the two a.c. traction motors of one truck in a single-axle control configuration, and one output inverter provides the redundant feed for the HEP and locomotive auxiliary systems.

Traction and locomotive control is performed by the Siemens SIBAS® 32 control system. The core of the control system is the Multi-Vehicle-Bus (MVB), interfacing with the subsystem control computers, all the I/O stations, as well as the Man-Machine Interfaces such as controls and displays on the engineer’s console.

The ACS-64 contains a 100% redundant HEP and AUX inverter system. It can operate at full speed at 100% traction power with one failed HEP inverter, or with a potential delay with one or two traction inverter or traction motor failures. System-critical components such as traction motors, inverters, and control system components are derived from service-proven systems. RA

June 2013 Railway Age 23

Conquering Rolling Contact Fatigue

Electron microscope view showing rail surface crack angle and damage depth.

Eddy Current inspection may be a technology

By Ryan McWilliams, Contributing Editor whose time has come.

G

age Corner Cracking (GCC) of rail and wheel from Rolling Contact Fatigue (RCF) has been historically difficult to measure due to technology limitations in quantifying the length and depth of such cracks. Even though ultrasonic inspection of rail takes place on a daily basis in North America, the technology of ultrasonics is limited to internal rail defects and does not lend itself to detect surface defects in most cases. Other technologies for detecting surface defects have been trialed with little real world success due to implementation limitations, accuracy concerns, and scaling issues.

RCF is due to a ratcheting of each loading cycle (wheel pass), which exhausts the ductility of the steel and eventually generates an incipient crack. If a rail wears faster than RCF generates cracks, then there is no problem other than the fact that rails are prematurely replaced due to wear instead of flaws. Most infrastructure owners would prefer a balance where they can get the most life possible from their rail.

Although we are addressing rail RCF specifically, wheel RCF is also a concern that should not be overlooked.

As the British experienced in 2000, this rail condition, if left unattended, can have catastrophic consequences. This was the cause of the Hatfield derailment that killed multiple passengers and brought the entire U.K. network to a grinding halt.

Factors that cause GCC have become a subject

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June 2013

that industry experts contemplate, evaluate, and refine on a regular basis. The basic premise is that Longitudinal Steering Forces, which are a function of lateral wheelset shift, Lateral Wheel/Rail Forces, which are a function of axle Angle of Attack (AoA), and Vertical Load from static weight and dynamic movement all play a key role along with material properties and operational conditions.

Now introduce a few more variables such as lubrication, wheel/rail profiles, track curvature and alignment, cant deficiency (train speed/superelevation), primary yaw stiffness (holds axles parallel), and changes from system wear just to ensure that the problem is not too easy to evaluate and address.

There is an ICRP (International Collaborative Research Program) addressing this subject in detail. Research personnel from around the globe are coming together to share experience, data, and resources. More information on this subject can be found at www.railadvisor.com search term “magic wear rate.�

While there are a handful of engineers working on the subject of cause and effect, railway management and track crews have the job of maintaining their systems along with measuring and monitoring on a daily basis to ensure safe and efficient rail conditions. Even though the measurement and management tools are not perfect, we have to tip our hats to the crews with boots on the ground that are trying to

and Gage Corner Cracking

Eddy Current inspection device being used on Norfolk Southern track.

mitigate this problem to the best of their ability. The railroad doesn’t usually stop just because a couple components have a few small cracks—or does it?

At one time in the not so distant past, the operating condition and material properties of the wheel/rail interface caused rail to wear at a rate fast enough to wear away most surface cracks. Today’s materials are lasting much longer, and the good news is that we are doing more with less. Our long lasting assets are allowing us to run more efficient operations, but they come with a tradeoff. This efficiency is not free. We are trading our old problems and concerns for new ones. In this case, we can run heavier trains and still enjoy longer rail life at the cost of increased crack growth, which must be managed to ensure safe and efficient operations.

GCC has become more common in North America in recent years due to many factors. The most common remedy for GCC management is the implementation of a grinding program that removes just enough railhead to eliminate the cracks but not so much that good rail is ground into dust and discarded by way of the drainage ditch. This “magic wear rate” refers to the rate of wear (both natural and artificial) required to optimally manage RCF. It is a simple concept that recognizes that when there is no wear, the rail will fail due to RCF, but when there is excessive wear, asset life is unnecessarily wasted. This is the basis for preventive rail grinding programs worldwide.

While grinding programs are more and more prevalent, the tools to ensure proper grinding (GCC related) have been missing until just recently. Since there has been no way to tell just how deep a series of cracks might be, most grinding

programs have relied on local knowledge and a bit of educated trial and error. New on the scene are Eddy Current inspection devices. Although Eddy Current has historically been one of the technologies that has experienced difficulty measuring accurately in the field, there are a few case studies that are bringing hope to this inspection method and giving confidence that measuring and monitoring GCCs is a reality whose time has come.

The development of a manually pushed Eddy Current system has been in process for some time. Testing in Germany, Europe, and North America has resulted in the Deutsche Bahn’s (DB) approval (March 2011) of the “Manual Eddy Current Test Instrument WPG D340” or “Draisine” (the German word for trolley). The Draisine is a four-channel Eddy Current instrument with adjustable probes set to measure the gage corner and head of rail for surface flaws including such flaws caused by RCF. Actual surface and near surface condition is measured, stored, and processed realtime for rapid evaluation of the rail surface condition. This measurement device provides information to include flaw location and calculated damage depth, which can aid in grinder operations and assessments.

North American testing and trials began early in 2011 at TTCI. Early in 2012, the DB approved the full production version of the Draisine for use on all DB track in Germany.

2012/2013 saw further testing at TTCI as well as at the Union Pacific Western Mega Site and the Norfolk Southern Eastern Mega Site for pre- and post-grind RCF/GCC measurement evaluation. NS was instrumental in providing yet another location where pre- and immediate post-grind June 2013 Railway Age 25

RAIL FLAW DETECTION

measurements were taken to ensure that the inspection device could “see through” surface grinding marks. The following information is from the NS Virginia Division: • Curvature: 6 degrees.

• Superelevation: 3.5 inches.

• Rail size: low 141RE, high 136RE. • Rail age/installed: low 2003, high 2010.

• Tie: wood.

• Fastener: Victor 8 x 18-inch plates with Pandrol clips.

• Ballast: granite.

• Annual tonnage: 41 MGT. • Typical number of railcars with power: Vast majority of traffic is eastbound loaded coal trains with two six-axle locomotives pulling 120 cars (no DP or helper).

• Average train speed through the curve: Timetable speed 35 mph, figure actual speed between 30 and 34 mph.

• Braking/accelerating: Steady pull due to level grade.

• No repeating annual maintenance requirements or issues.

Pre-grind data was gathered from both high and low rails over a 400-meter section of curves, including two bridges that had not been ground for some time due to fire hazard concerns. The grinding train was scheduled to make five passes on the low rail and two passes on the high rail based on the NS grinding plan (historic) and profile objectives.

To further evaluate the measurement system, a section of

Compact design Arrives at site fully assembled Minimal foundation Refill sand indicator in silo Receives 25 tons; full-truck delivery Automatic shutoff when locomotive box is full Safe sanding; no fall protection

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low rail was identified, and measurements were taken immediately after each of the five grinding passes. With each pass of the grinding train, a slight reduction in the RCF damage depth was measured.

Even after the fifth pass, some minor damage was observed visually. If it were not for the Eddy Current system, there would be no way to know if these residual cracks were half a millimeter deep (a non-issue) or 10 millimeters deep (a serious problem).

Conclusions made at the end of the pre/post-grinding measurement sessions were that the Draisine was able to accurately measure the surface cracks and it was also able to “see through” the surface irregularities caused by the grinder.

Further validation was required to confirm the actual crack length, angle, and depth.

Subsequent testing of four random sections of rail were measured with the Draisine and then removed from track and sent to the NS lab where actual crack length, angle, and depth were measured.

Each of the 18-inch sections removed were sliced into one-inch sections and polished for evaluation under the electron microscope. Measured crack length, angle, and corresponding damage depth were compared to the Eddy Current measurements.

The images were magnified to show the multiple branches

RAIL FLAW DETECTION Setting up to measure the 30-meter section immediately post-grind.

A grinding train has just passed though the section.

of cracks as well as the specific crack angle. This example showed the Draisine measured damage depth and corresponding damage depth measured in the lab (2.021 mm measured in the lab vs. 1.95 mm measured by the Draisine in the field).

The other three sections were evaluated in the same manner with the field vs. lab results within 10% of each other in all cases.

The photos on page 24 are the electron microscope view quantifying the crack angle and damage depth from the surface of the rail at 2.021 mm. As a result of the combined

testing in Europe and in North America, there is now a legitimate level of confidence that the Draisine Eddy Current system can be reliably utilized as a pre and postgrind management tool for accurately measuring surface crack length and calculated depth based on crack angle.

Systems such as this can be utilized to provide field services and management personnel a greater level of confidence that one of the most expensive assets on the railway is properly maintained.

With recent advancements in Eddy Current inspection technologies, higher speed versions of this technology are being fit to both hi-rail and cart-based platforms to allow more seamless integration into typical operations. RA

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June 2013 Railway Age 27

Helping railroads make the grade on safety CSX, Front Row Motorsports join forces on grade crossing, trespassing hazards.

T

he typical individual who tries to “beat the train” by driving around lowered crossing gates, or who decides to take a shortcut by walking on a railroad right-ofway, is between the ages of 18 and 34. That description also fits one of NASCAR’s largest demographics—which is why CSX decided to use America’s second-largest professional sports venue (second only to NFL football) as a vehicle for its “Play It Safe Around Railroad Tracks” public safety campaign.

Twenty-seven-year-old David Ragan, one of NASCAR’s rising stars, is bringing CSX’s safety message to a national audience, adding to the well-established success of programs like Operation Lifesaver. Ragan’s No. 34 Ford Fusion, which he drove to Victory Lane at Talladega Superspeedway on May 5, is campaigned by Front Row Motorsports, itself an up-and-coming team in NASCAR’s top-tier Sprint Cup Series. When the 34 is adorned in CSX’s bright blue and gold locomotive colors, with PLAY IT SAFE almost shouting from the car’s rear quarter panels—as it has been seen twice so far this season, at Richmond, and at the All Star Race at Charlotte—it’s one of the more distinctive racecars on the track. That’s important when your company’s message is competing with those of 42 other prime sponsors at speeds approaching 200 mph.

Ragan is an effective and enthusiastic spokesperson for exercising caution around railroad tracks, a message that has been picked up in the national media. It’s estimated that “Play It Safe” has reached millions of people—at the track, in print, and on line.

Without a doubt, the Front Row Motorsports partnership is an expensive corporate-citizenship undertaking for CSX, as NASCAR sponsorships don’t come cheap. Is it worth the cost, especially for an industry whose public safety record has seen continuous improvement?

CSX chief spokesperson Gary Sease summed it up best when he said, “If we save just one life, it’s worth it.” RA

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CSX Corporate Communications Director Gary Sease, Ragan, and Virginia State Sen. Bryce Reeves show the decal, with dozens of signatures, that was applied to No. 34 at Richmond.

Photos by William C. Vantuano

Even at speeds approaching 200 mph, CSX’s “PLAY IT SAFE” message is highly visible on David Ragan’s Ford Fusion.

David Ragan straps himself into No. 34 for a pre-race practice session (top). “Tie Goes To The Train” is one of several safety messages devised by sports marketing firm Exit10.

By WILLIAM C VANTUONO, Editor-in Chief

A fan signs the “I Promise to Brake For Trains” decal that was applied to No. 34’s hood at Richmond. Among the signatures were those of NASCAR icons Richard Petty and Bobby Allison.

June 2013 Railway Age 29

Equipment leasing: The best of times?

Hydraulic fracturing has driven the equipment leasing field, but other needs remain.

The good news is obvious; the bad news is actually hard to find.

By Anthony Kruglinski, Financial Editor

BRUCE KELLY

T

hose of you who are regular readers of Railway Age and our Financial Edge column will recall that, over the years, I have made frequent use of Charles Dickens’ “It was the best of times, it was the worst of times.” It’s a favorite of mine because it gives the writer the option of discussing good news and not-sogood news. However, this year it seems that no matter how I bob and weave while applying the quotation to the North American railcar leasing industry, I am left with only: “It was the best of times.”

I started this Guide to Equipment Leasing with an understanding that a good part of it had to be about the fracking of hydrocarbons and the rail transportation business that this unbelievable energy phenomenon has

occasioned. Frankly, fracking is almost all that anyone in the rail equipment leasing fraternity wants to discuss: The movement of “frac” sand in small-cube covered hoppers.

The movement of crude oil by rail (CBR) drawn from fracked wells in the West and Midwest. The potential for moving vast amounts of LNG by tank car from the production locations in the east to end users around the country and, with some law changes, to ports for export.

We are even hearing about the potential for building and leasing natural gas tenders to the nation’s railroads to fuel a new generation of natural-gas-powered locomotives.

Clearly, for anyone building or leasing or operating cars that serve needs of the fracking industry, it is the best of times.

June 2013 Railway Age 31

equipment leasing

Well-oiled machinery: Tank cars are the hot equipment leasing item as U.S. energy production shifts gears.

Coal cars For coal cars, it’s not the best of times, but neither the worst. Here is an industry where I was sure I was going to find some way to use my “worst of times” quote. Rocked by the economy and by a national shift in choice of hydrocarbons (coal to gas), I was sure I was going to hear complaints from people leasing coal cars to the industry.

And to be honest, these aren’t the best of times for this segment of the industry. However, it does not appear that they are the worst of times either: • Utility stockpiles in the Northeast are down from earlier periods.

• PRB and Illinois Basin coal is being seen as competitive when delivered by rail.

• Coal consumption nationally is reported to be trending upward, tracking the increase in natural gas prices that has already been reported.

• RFPs for new coal car leasing have been reported in the market as lessees who dumped coal cars at lease-ends in the past few years are now apparently considering new leasing to meet increased needs.

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Our sources in the leasing industry report that they are operating under the assumption that there will be a long term need for coal cars and that some improvement in their market is expected in the 4th Quarter of 2013 and during 2014.

My partner David Nahass has been representing power generators and their railcar needs for nearly two decades.

When repeated queried (by me) on the future of coal car availability and values over the past few years, he has repeatedly predicted that, while the market may seem to be on a downward trend, it would stabilize at some point and run at a level (adjusted from prior years) that it could sustain long-term. I hate it when he is right!

Grain cars Surely, I thought, it must be some of the worst of times in the market for leasing grain cars, right? Well, while you would think so, there is some reason to think things could be worse. For instance, it was pointed out to me that while there has not been any significant grain car building, the older 4,750 cubic-foot-fleet needs replacing over the long term. (Each time scrap prices go up, more of these cars are scrapped.) The weather situation is also unclear for this year’s harvest. Although it has been too wet to plant much of this year’s crop (5% of the corn crop is in the ground this year compared to a target of 30%), it is still not as bad as last year’s drought.

CHEMLOGIC INC.

Surprisingly, however, when I conducted my industry interviews with equipment leasing insiders this year, it was virtually impossible to find the other half of the quotation!

No one was complaining that it was the worst of times.

The right equipment. The right lease. The right people.

Taking your product to market efficiently and reliably requires the right equipment. First Union Rail has just what you need: superior railcars and experienced professionals who can offer leasing terms and structures that make sense for your company. Let us help move your business forward with: Railcar operating/capital leases • High-quality, diverse fleet • Fleet management services Ready to learn more? Call today at 847-318-7575 • Firstunionrail.com © 2013 Wells Fargo & Company. All rights reserved. First Union Rail Corp. is associated with Wells Fargo & Company, a company that is not regulated as a financial institution, a bank holding company or an insurance holding company in Canada. MC-4332

Railcar Leasing We’ve doubled our fleet to more than 10,000 cars.

And with one of the youngest and most diversified fleets in the industry, Macquarie Rail provides leasing and financing in a wide array of structures and terms.

Macquarie Rail Inc. is a rapidly growing freight car lessor serving the North American marketplace

Call +1 (312) 756 3882 www.macquarierail.com

June 2013 Railway Age 33

equipment leasing

The closest that we could come to “worst of times” may be reported full-service lease rates as low as $75 per car per month. (More modern 5,150 are reported being quoted at $300 per car per month.)

Centerbeam flats For centerbeam bulkhead flatcars, I expected to continue to see more of the awful story of massive fleet parkings and losses on top of losses. The reality? Things aren’t so bad.

To begin with, an increase in housing starts and in lumber moving to ports for export has reportedly gotten Class I centerbeam fleets out of the weeds and working. Leasing companies with parked fleets have been dribbling these cars into the North American working fleet over the past year or so, and this continues to happen, with more and more cars being leased.

Lessors are reporting inquiries from Class I railroads and shippers for new requirements. Lessees are receiving quotes ranging from $300 to $500 for full-service operating leases for terms of up to one year. (Multi-year commitments achieve better pricing.) So, it’s clearly no longer the worst of times.

Autoracks and intermodal In our interviews for this guide, we have received reports of Class I’s purchasing autoracks to be attached to TTX

flatcars for service in the North American fleet.

Unfortunately, we have been told that the railroads in question have been buying these racks for cash and that leasing (other than the TTX operating leases on the flatcars) has not been involved.

We have also received almost universal reports that the market for leasing intermodal equipment is in excellent shape.

Small-cube covered hoppers At this point in time, we have to shift back to the “best of times” side of the ledger and talk about a rebound in the building of small-cube covered hoppers for sand and cement service. According to our sources, this market has rebounded big time: • Higher gas and oil prices have renewed active drilling of wells that require the frac sand that is carried in these types of hoppers.

• Older cars are garnering lease rates of $500-plus per car per month, full-service for as long as three to five years.

Newer 3,250 cars are doing even better.

• We are told that there are virtually no sand cars sitting unutilized. The “overbuilt” situation with OEMs and sand cars that was existent for some months last year apparently has been broken by new orders for some new cars, 1,000 or so.

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810-714-4626 • progressrail.com Scan for more information on our inventory.

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equipment leasing

A mix of freight car types, as seen in this Union Pacific consist, reflects the relatively healthy demand for various equipment needs.

We have also received reports that the market for cement cars is tighter than it has been for some time, perhaps reflecting growing commitments to invest in the nation’s infrastructure.

UNION PACIFIC

Fracking As I said at the beginning of this Guide, the “best of times” are clearly being had by anyone in our industry who has anything to do with the movement of anything that is required for the extraction of hydrocarbons using the latest fracking techniques. As we said above, this certainly includes the provision of leased sand cars to bring sand into the wells at which fracking plays a role in extracting oil

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James D. Husband, President 1307 Jamestown Road, Suite 101; Williamsburg, VA 23185 (757) 903-4606 Fax: (757) 903-4705 jhusband@railsolutionsinc.com www.railsolutionsinc.com

and/or gas. We’re probably also shipping pipe and machinery by rail to these sites.

It also includes the tank cars that are being built and leased by a variety of parties to end-users that need to move the extracted oil and gas to wherever it wants to go.

But before we go into the leasing industry report we’ve compiled, we thought we would give you some “50,000foot” views on just why rail is such an important component to the fracking story.

We have been told by more than one source that one of the profound impressions that they have taken away from discussions with end-users of tank cars for CBR and natural gas is that the costs of buying or renting the cars to transport RailSolutions Offers: • Railroad Equipment Appraisal and Valuation Services • Portfolio Analysis and Lease Valuation Services • Equipment Remarketing • Railcar and Locomotive Inspections, and Technical Services • RailSolutions Publishes the Investors’ Guide to Railroad Freight Cars and Locomotives – A comprehensive reference manual covering market and valuation data on virtually all types of railcars and locomotives used in North American rail freight services.

June 2013 Railway Age 35

equipment leasing

Shippers know that the old rules for moving oil by pipeline don’t apply to crude oil by rail.

The efficient transit times that our rail system has achieved for various kinds of freight are adding to the attractiveness of CBR. In fact, the only reason the fracking industry has been as successful as it has been (other than extracting the oil and gas) is the existence of a rail system that (via Class I, II and III railroads) can pick up loads almost anywhere and deliver them almost anywhere. If you

read reports of fracking opportunities in Europe (where the rails are crowded with passengers) or Africa (where there are few railroads), read them with the knowledge that the fracking will most likely have to be accompanied by a multi-billion-dollar pipeline.

The tank car report Conversations with a number of sources in the leasing industry resulted in reports indicating that, while there may be some “spot” availability to build some cars in 2014, the bulk of the railcar builders are “built out” until 2015. This appears to be the case for the full range of tank car types including jumbo LPG cars as well as 30,000-plus-gallon general purpose tank cars and insulated-coil cars.

What about leasing? If you can find the cars you need, even older ones, expect to pay $1,200 per car per month, full service, to the operating lessor that has the cars.

What about putting in your order now and arranging the leasing (finance or operating) later? That makes sense if you can decide what you want to buy.

What are we talking about? We spoke to one lessor that already has a wide variety of tank car types in its fleet and that has chosen for now to acquire “only” 29,000 insulated-coil cars. There appear to be at least two reasons for this decision: • Investing in a slightly smaller, but insulated and heated tank car opens up the option of putting the cars into either Canadian oil sand service or service in the U.S. moving lighter density oil.

The older 4,750 cubic-foot grain car fleet needs replacing over the long term.

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BRUCE KELLY

these products seem minor compared with the amount of profit that can be made in moving the products themselves.

“I almost get the impression that someone needing these cars will pay anything to get them,” said one source. I haven’t been privy to similar discussions regarding rail shipping rates, but it would seem that the same rule may apply.

Experience with CBR is teaching shippers that the old rules for moving oil by pipeline (the oil goes where the pipeline goes) don’t apply to CBR. If a better price can be had at a refinery on the East Coast than the Gulf Coast, rail can deliver that extra profit. The advent of 100-car unit trains of CBR just makes things more efficient.

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June 2013 Railway Age 37

equipment leasing

Plastic pellet cars The plastic pellet car marketplace is also extremely strong in light of the relatively cheap natural gas that is available to the pellet producers. A closer look, however, would show that there has been some retrenchment in this market due to the edging up of gas prices as well as the apparent need to digest earlier large builds of new equipment.

My company, Railroad Financial Corporation, has advised end-users on more than 3,000 plastic pellet car acquisitions during the past two calendar years. From this activity we have observed the following: We make 20th century railcars work for the 21st century.

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Photos by WILLIAM C. VANTUONO

• The regulatory process has already begun to assess the need for new safety rules for CBR. It seems likely to some observers that ultimately a rule will be put in place requiring jacketing of the kind already present on insulated cars. Better to have cars which are already jacketed than the need to shop the cars for an aftermarket retrofit that could cost as much as $60,000 to $65,000 per car.

What do new cars cost? Assume $110,000 to $120,000 for general purpose 30,000-plus-gallon cars and $130,000 to $135,000 for the insulated coil-variety.

What kind of experience are operating lessors having with their tank car fleets? One lessor told us that his overall “retention” rate (leased cars renewed by the lessee) for his fleet was approximately 80%. The retention rate for this tank car fleet was 97%+.

What are the issues faced by operating lessors of CBR and LNG tank cars? Not surprisingly, one of the issues for full service lessors of CBR tank cars is the amount of mileage that is incurred on their cars during a given year and the cost of maintaining the cars. For instance, a 100-car unit train could (we are told) travel 100,000 or miles a year in CBR service where normal tank car mileage for the rest of the fleet could be just 15,000 to 17,000 on average per year.

The solution to the problem? Mileage limits/surcharges on the full-service CBR leases.

at ’s it’s wh

• New plastic pellet cars (5,800 to 6,200 cubic-footcapacity) are being priced by builders at approximately $100,000-plus.

• Operating lessors are renting similar sized, but older, cars for $400 to $650 per car per month, full-service for terms of five to seven years. Shorter terms are available at a higher cost. (Operating lessors in this market are trying to capture premium rents for as long as possible.)

It has been reported that $30 billion woth of petrochemical facility expansions or greenfield building is expected in the Gulf Coast area over the next five years.

New railcar building will be required to support this additional production capacity.

We expect significant opportunities to replace older, suboptimal equipment in the near future.

in

de si

that COun ts

Keeping railway operations running smoothly takes reliable equipment – right down to the gears that keep locomotives moving. We’ve spent more than 50 years producing precision engine and traction gearing for locomotives. OEMs keep coming back to OCG, because they know it’s what’s on the inside that counts.

Conclusions In the 30 or so years I have been involved in this industry, there have been other periods of relative euphoria.

However, these earlier periods of “good times” were almost always followed by a significant market drop lasting for years, during which time excess railcar building was digested. For instance, there were overbuilt boxcars and grain cars in the late 1970s that polluted the market until the late 1980s. Often, these periods of adjustment resulted in some significant distress for the players involved.

Even with this historical perspective as a warning flag, I have been hard pressed to see any near-term discernable downside to the railcar building that has been going on to service the hydrocarbon industry. The estimates of available to-be-fracked oil reserves continue to rise. So do the new railcar orders that are tied to them.

Will there be a market crash? It’s not easy to predict, but if these CBR and LNG railcars are briskly amortized by the profits they have the capacity to earn, no one— neither lessor nor lessee—should get hurt. RA Anthony Kruglinski is President of Railroad Financial Corporation and the Chairman of Rail Equipment Finance 2014, March 2-5, 2014, in Palm Springs, Calif.

Chicago • Addison • Lombard 125 years of precision gears for the most demanding gear applications.

(630) 543-9570 www.oc-gear.com sales@oc-gear.com June 2013 Railway Age 39

equipment leasing

RailwayAge Leasing Resource Directory

Macquarie Rail Inc. is a rapidly growing freight car lessor serving the North American marketplace.

Through combining an experienced team of rail veterans with the strength and expertise of the Macquarie Group, we are building a diverse portfolio of equipment to serve the varied needs of railroads and rail shippers.

CIT Rail owns more than 100,000 railcars and 450 locomotives leased to approximately 500 customers, and provides financial solutions to the bulk freight transportation marketplace. It supports the North American transportation system by working with freight shippers, receivers and carriers to customize financial solutions for each customer’s individual needs. As a full service lessor and owner of one of the youngest, most diversified fleets of rail assets in North America, CIT Rail brings unparalleled asset management expertise and commitment to the transportation sector.

Macquarie Rail Inc. 1North Wacker Drive, 9th Floor Chicago, IL 60606 Telephone: 312-756-3880 Facsimile: 312-756-3847 railinfo@macquarie.com www.macquarierail.com

citrail.com

The David J. Joseph Company

The David J. Joseph Company’s (DJJ) Rail Equipment Group offers a wide variety of rail transportation services at any point in the life of a railcar. The company is active in equipment marketing with flexible sale and lease options, including short term, long term, net, modified and full service leases. As an operating lessor, as well as large user of railcars transporting company bulk commodities, DJJ is sensitive to the equipment needs of railroads and private industries.

The David J. Joseph Company Rail Equipment Group 300 Pike Street • Cincinnati, OH 45202 (513) 419-6200 • f (513) 419-6221 www.djj.com • contact: info@djj.com QR code generated on http://qrcode.littleidiot.be

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With over 100 years experience in the rail and finance industries, Progress Rail Equipment Leasing. is a full-service professional leasing firm specializing in leasing railroad maintenance equipment.

We finance and refinance MOW equipment, intermodal equipment, locomotives, railcars, and other rail-oriented equipment. Our experts’ dedication and uncompromising focus on quality sets us apart from the competition.

Progress Rail Equipment Leasing develops leasing programs to cut equipment costs and provides leasing structures that are tailored to meet the rail industry’s specific and ever-changing needs. In addition, we offer finance and operating leases, sales/leaseback programs, and short and long-term rentals.

Progress Rail Equipment Leasing 15173 North Road, Fenton, MI 48430 (810) 714-4626 Voice • (810) 714-4680 Fax Website: www.progressrail.com/leasing

First Union Rail is one of the leading railcar leasing companies in North America. At First Union Rail we specialize in providing superior equipment, customized financing, operating lease structures, as well as marketing and transportation management services.

First Union Rail is a relationship-driven, flexible organization, committed to continually exceeding our customers’ expectations by providing greater value, more quality, and the highest standards of service.

Richard Seymour First Union Rail 847-318-7575 (P) • 847-318-7588 (F) www.firstunionrail.com A Wells Fargo Company

equipment leasing

The pages of the 2013 Guide to Equipment Leasing (pages 40 through 41) contain the profiles of companies that provide equipment leasing and financial services and products to the rail industry. All of these firms have advertisements elsewhere in this section or have used paid profile space to present their background and capabilities.

RailSolutions Flagship Rail Services, LLC is committed to providing innovative rail car leasing products and services to North America’s vital rail industry. Let one of our experienced professionals show you how. Visit us at our website: www.flagshiprail.com, or call us at 1-866-4-RAILCARS. Gene Henneberry, President and CEO Flagship Rail Services, LLC 300 S. Riverside Plaza, Suite 1925 Chicago, IL 60606

Locomotives Railcars Sales Leasing 505 Sansome Street Suite 1800 San Francisco, CA 94111 p: 415-398-4510 f: 415-398-4816 www.hlmx.com

RailSolutions provides a broad variety of railroad equipment-related consulting, technical and advisory services to financial institutions, railroads, shippers and fleet operators with a primary focus on equipment valuation and appraisal services. Additional areas of expertise include railcar and locomotive inspections, equipment repair and overhaul cost analysis, and portfolio valuations. RailSolutions draws on over 40 years of railroad industry experience in developing multiple quantitative valuation models supported by both a sound base of market data and advanced analytical techniques.

James D. Husband, President 1307 Jamestown Road, Suite 101 Williamsburg, VA 23185 757-903-4606 • Fax: 757-903-4705 www.railsolutionsinc.com

Infinity Rail is an operating lessor with a fleet of over 6,000 freight cars and 17,000 units of intermodal equipment. We offer our customers both financial and operational flexibility. We offer Full Service, Net and Per Diem Leases to shippers and all Class I, regional and short line railroads. A broad spectrum of general use and specially modified equipment is represented in the Infinity portfolio. Our railcar fleet consists of boxcars, covered hoppers, flatcars, gondolas, open top hoppers and woodchip hoppers. Our in-house mechanical expertise allows us to offer you equipment maintenance and modifications that keep your leased railcars working for you.

Larry Smith, Vice-President-Equipment Sales (678) 296-9709 • lsmith@infinityfunds.com Lee Martini, Assistant VP-Sales & Leasing (678) 904-6315 • lmartini@infinityfunds.com CORPORATE OFFICES 1355 Peachtree Street • Suite 750 South Tower Atlanta, GA 30309 • www.infinityrail.com

June 2013 Railway Age 41

People

Meetings

High profile Norfolk Southern Chairman, CEO, and President Wick Moorman announced the appointment of James A. Squires as President of the railroad, effective June 1.

Squires, 51, was Executive Vice President Administration.

Moorman will remain as Chairman and CEO. Squires will be responsible for the corporation’s administration, finance, law and corporate relations, and planning and information technology divisions. Squires joined Norfolk Southern in 1992 and served in several law positions Squires Norfolk Southern before being named Vice President Law in 2003, Senior Vice President Law in 2004, Senior Vice President Financial Planning in 2006, Executive Vice President Finance in 2007, and Executive Vice President Administration in 2012. He holds degrees from Amherst College and the University of Chicago.

“Jim is a forward-thinking railroader and a well-tested leader,” Moorman said. “As President, he will ensure that Norfolk Southern stays at the forefront of strategic planning, innovation, and financial performance.”

July 30-31

LAS VEGAS RAILWAY EXPRESS— John McPherson elected Chairman of the Board; George Rebensdorf elected Director.

NORFOLK SOUTHERN—promoted Cindy Earhart to Executive Vice President Administration, succeeding James A. Squires (High Profile, above).

Juan K. Cunningham, currently Assistant Vice President Executive, has been named Vice President Human Resources. Earhart’s and Cunningham’s placements became effective June 1.

Senior Vice President Energy and Properties Daniel Smith is retiring after 37 years with the company, including 10 at his latest post.

David Lawson has been named Vice President Coal Marketing. Michael McClellan has been named Vice President Industrial Products. Jeffrey Heller was named Vice President Intermodal and Automotive Marketing.

The appointments of Lawson, McClellan, and Heller are all effective as of July 1.

SUPPLIERS Faiveley Transport North America named Kevin Masterson Services Sales Director, overseeing the aftermarket with transit agencies.

C. Jack Martinson joins the company as Vice President OEM Sales-Transit.

IRELCO, LLC named Marc Trani 42

Railway Age

June 2013

President of Unity Railway Supply Co., Inc. and IRECO, LLC, succeeding Bob Grandy, who retired.

Lilee Systems named Patrick Lutzko National Accounts Manager–Freight.

STV, Inc. named Aron Silver, P.E., as a Transportation & Infrastructure Division Western Region as vice president, based in Roseville, Calif.

SYSTRA promoted Joseph Sais, P.E., to Executive Vice President, Engineering, based in the company’s New York office.

100 YEARS AGO in

(JUNE 1913) MONORAIL ABANDONED The monorail extending from Bartow station on the New York, New Haven & Hartford, New York City, to Belden’s Point, about 2 miles, has been given up. The company operating it, which is controlled by the Interborough Rapid Transit Company, has been reorganized, and a standard gage surface electric railroad will be put in operation over this route. The monorail was operated for passenger business a considerable length of time, but it has not given satisfaction.

Agricultural Transportation Summit Westin O’Hare, Rosemont, Ill. Mike Steenhoek, Tel.: 515-727-0665; Website: www.soytransportation. org; www.ngfa.org/meeting.cfm.

September 29-October 2 Railway Interchange 2013 Indianapolis, Ind. Carol Steckbeck, Tel.: 919-303-5140; Email:csteckbeck50@gmail.com; Website: www.railwayinterchange. org/registration.html.

September 29-October 2 APTA Annual Meeting Hilton Chicago, Chicago, Ill. Yvette Conley, Tel.: 202-496-4868;

Email: yconley@apta.com; Website: www.apta.com.

October 2-3 Southwest Association of Rail Shippers Conference Hyatt Regency Phoenix, Phoenix, Ariz.

Jack Dail, Tel.: 425-818-8240; Email: jdailconsulting@ comcast.net; Website: www.railshippers.com.

October 9-11 95th Annual Railway Tie Association Symposium and Technical Conference Hyatt Regency Lake Tahoe, Incline Village, Nev. Tel.: 770-460-5553; Website: www.rta.com.

October 15-16 Railway Age Passenger Trains on Freight Railroads

Washington Marriott, Washington, D.C.

Jane Poterala, Tel.: 212-620-7209; Email: jpoterala@sbpub.com; Website: www.railwayage.com

Products

Pro

TranSolutions offers MyEZClaim online service

Min Mob

events

conference proceedings Stay informed of the latest information on Intermodal, the fastest-growing form of surface freight transportation.

MyEZClaim is an online service providing easy-to-use freight claim management capabilities from just about anywhere. The system provides an automated central repository on all carrier loss and damage claim activities.

The centralized system allows multiple users to work in MyEZClaim at once, with no need to email multiple copies of files back and forth.

Unlike a simple spreadsheet, MyEZClaim allows the user to keep all data for each claim within one system, including photographs, invoices, packing slips or other documentation. Email functionality allows the user to email from within the system, keeping email records with carriers in the same place as all other information for the claim.

In addition, MyEZClaim offers reduced filing time by streamlining several claims activities. The system automatically generates a universally accepted claim form for all shipping modes while simultaneously organizing the data into the user’s database. MyEZClaim also automatically generates carrier follow-up letters at 30, 60, 90, and 120 days after a claim has been filed. Editable versions of the system’s forms can be downloaded for free at www.transolutionsinc.com/blog. The software reduces filing time per claim from hours to just 10 minutes.

MyEZClaim comes loaded with productivity features, such as navigation with quick access to frequently used functions and expanded search capabilities. The system incorporates several failsafe mechanisms into the claim form, such as reminders when a mandatory field has not been filled out. Fields flagged as mandatory can be customized, allowing managers to decide which information to track. Once a carrier is selected, the claim form will autopopulate with the carrier’s previously entered information to speed filing time.

TranSolutions also offers additional modules and tools to manage overcharge claims, return authorization, and vendor claim management. Contact Vanessa Glavac at TranSolutions Inc., 22015 N. Calle Royale, Scottsdale, AZ 85255; Tel.: 800-457-8746; Fax: 480-473-2454; Email: Vanessa.Glavac@TanSolutionsInc.com; Website: www.TranSolutionsInc.com.

Access the presentations from the

Miner e that is i laptops the inst formatt The n height c that are Rule 62 when a much a There determ each fo Profile Mob produc

New Intermodal Age Conference & Expo

Topics include: • Securing and tracking cargo • Improving efficiency through technology • Managing the national equipment pool • Labor’s critical role • Successful public-private partnerships • Panama Canal expansion • Government policies that need to change • Improving infrastructure: federal grants

Purchase available presentations for $250 Contact us at conferences@sbpub.com or 212-620-7208 to purchase access to these presentations and more.

36

Railway age

May 2013

June 2013 Railway Age 43

Ash

The ash availab static p in Hast for nitro case an offers ± pressur or 5,80 mm) dia email: i

Products Grout/mud drilling system from Fecon Drilling

Fecon Drilling Products introduces the GL14 Support Trailer, a self-contained Grouting and/or Mud Drilling support system for drilling applications. Hydraulic lift assist ramps allow easy access to features like the 200 gallon water supply tank for back flushing and cleaning, 58 gallon hopper for grout mixing, and 500 feet of grout line hose reel capacity. The GL14 Support Trailer also has lockable storage for tools and drill rods. The 6-foot x 14-foot flatbed trailer can be towed by truck or by the Fecon GL300 Drill Rig, with four wheel brakes for safe highway towing. For more information, contact Courtney Shafer, Tel.: 513-6964430; Email: cshafer@fecon.com.

Control that noise!

NEL Frequency Controls, Inc. has released a reduced height profile option for its ultra low phase noise OCXO (Oven-Controlled Crystal Oscillator) at 100 MHz. Ideal for telecommunication systems, synthesizers, GPS, radar, and instrumentation applications, it is available in 5V and 12V. The O-CIH-X Series has a 0.4-inch height profile in addition to the 0.5 inch original model. It offers close-in phase noise of -105dBc/Hz and -185dBc/Hz phase noise on the floor.

The O-CIH-X comes in a small, compact form factor with dimensions of 1-inch by 1-inch and consumes significantly less power than alternative solutions. Stabilities range from ±50 ppb with temperatures of -40°C to 75° C. Contact Andrea Weitzenfeld, Tel.: 312-870-5656; Email: aweitzenfeld@winsbyinc.com; Website: www.nelfc.com.

44

Railway Age

June 2013

Ad Index Company

Phone #

Fax

Email address

Beena Vision Systems, Inc.

678-597-3156

678-597-0156

info@beenavision.com

CIT

212-461-5713

212-461-5694

abby.cohn@cit.com

37

Cyclonaire Corp.

402-362-2000

402-362-2001

sales@cyclonaire.com

26

Danella Rental Systems, Inc.

610-828-6200

610-828-2260

pbarents@danella.com

23

David J. Joseph Co., The

513-419-6200

513-419-6221

txs@djj.com

30

Ellwood Crankshaft & Machine

724-347-0250

724-347-0254

ecgsales@elwd.com

12

First Union Leasing Corp.

847-384-5392

847-318-7588

richard.seymour@wachovia.com

33

Flagship Rail SVCS, LLC

312-559-4801

312-559-4842

kelli.kaul@flagshiprail.com

37

FreightCar America

312-928-0850

312-928-0890

ewhalen@freightcar.net

Helm Financial Corp.

415-398-4510 ext 1610 415-398-4816

bwind@hlmx.com

38

Herzog Railroad Services, Inc.

816-233-9002

tfrancis@hrsi.com

14

816-233-7757

Page # 5

3

Infinity Rail LLC

678-904-6306

908-904-4908

lsmith@infinityfunds.com

38

LTK Engineering Services

215-641-8826

215-542-7676

tfurmaniak@ltk.com

15

railinfo@macquarie.com

33

Macquarie Rail

312-756-3880

312-756-3847

Michigan State University

517-353-0860

517-353-0796

15

New York Air Brake

607-257-7000

607-257-2389

paula@onlinesms.com

C2

Overton Chicago Gear

630-543-9570

630-543-7400

sales@oc-gear.com

39

Progress Rail Services

256-505-6485

256-840-2651

bcox@progressrail.com

35

R&W Machine Division

708-458-4200

708-458-3299

jwarner@rwmachine.com

9

Rail Solutions

703-922-3800

703-922-8229

railsol@aol.com

34

Railquip, Inc.

770-458-4157

770-458-5365

sales@railquip.com

22

Railway Tie Association

770-460-5553

770-460-5573

ties@rta.org

Railway Educational Bureau, The 402-346-4300

402-346-1783

bbrundige@sb-reb.com

7 C3,44

Sealeze Unit Of Jason

804-275-1675 ext.235

smaclaughlin@sealeze.com

Sierra Club

202-488-1140

jimdougherty@aol.com

26

Sterling Rail, Inc.

512-263-1953

512-263-9799

rwmertz@sterlingrail.com

C4

Transcore

214-461-6443

800-923-4824 www.transcore.com

27

TTX Company

312-606-1450

felix.castillo@ttx.com

11

13

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 jchalon@sbpub.com 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 eguill@sbpub.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 mconnolly@sbpub.com

AK, AZ, CA, CO, IA, ID, IL, KS, MN, MO, MT, NE, NM, ND, NV, OR, SD, UT, WA, WI, WY, Canada – AB, BC, MB, SK Heather Disabato 20 South Clark Street, Suite 1910 Chicago, IL 60603 (312) 683-5026 Fax: (312) 683-0131 hdisabato@sbpub.com 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 lc@railjournal.co.uk

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 sb@railjournal.co.uk 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 info@mediapointsrl.it

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 amkatsu@dream.com CLASSIFIED, PROFESSIONAL & EMPLOYMENT Jeanine Acquart 55 Broad St., 26th Floor New York, NY 10004 (212) 620-7211 Fax: (212) 633-1325 jacquart@sbpub.com

June 2013 Railway Age 45

products & services Reidler Decal Corporation St. Clair, PA 17970 Fax: 570-429-1528 marketing@reidlerdecal.com The Federal Railroad Administration's proposed new delineator configuration

RFP

LOS ANGELES COUNTY METROPOLITAN TRANSPORTATION AUTHORITY (Metro) REQUEST FOR PROPOSALS Metro will receive proposals for OP30433100, Consulting Services for Heavy Rail Vehicle Acquisition, Technical Support per specifications on file at the LACMTA Office of Procurement & Material Mgmt, One Gateway Plaza, Los Angeles, CA 90012 (12th Floor).

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

TO ADVERTISE CONTACT Jeanine Acquart PH 212.620.7211 • FAX 212.633.1325 E-MAIL jacquart@sbpub.com

TRAINING

Part 243 Training & Certification Part 242 Conductor Training Part 240 Engineer Training and re-certification -------------------------------------------------------Modoc Railroad Academy 916-965-5515 info@modocrail.com

All proposals must be received on or before June 20, 2013, 4:00 P.M. Pacific Time at the address listed above, sent to the attention of Joe Marzano. Proposals received later than the above date and time will be rejected and returned to the proposer unopened. A Pre-Proposal conference will be held on May 30, 2013 at 10:30 A.M. in the Board Overflow Room, 3rd floor located at the address above.

You may obtain a copy of the RFP, or further information, by contacting Joe Marzano at (213) 922-7014 or by email at marzanoj@metro.net

RECRUITMENT

EDNA A. RICE, EXECUTIVE RECRUITER, INC (713) 667-0406 FAX (713) 667-1651 Web address: www.ednarice.com Email: resume@ednarice.com

EDNA A. RICE, President 6750 West Loop South Suite 735 Bellaire, Texas 77401-4111

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:

Brian Brundige The Railway Educational Bureau 1809 Capitol Avenue Omaha, NE 68102 46

Railway Age

June 2013

Railway Age Digital Edition For More Marketing Power contact JACQUART@sbpub.com

equipment Sale/Leasing

Available For Lease

◆ 5,150 cu. ft. Pressure Differential (PD) Covered Hopper Cars. Food grade interior linings but don’t necessarily have to stay in food grade service.

PROFESSIONAL DIRECTORY

◆ Mill Gondolas - 65’ 6” interior length with 5’ sides and 52’6 interior length with 4’6” to 5’ sides ◆ 4,170 & 4,200 cu. ft. Gondolas - Interior bracing removed. OK for C&D, coke, scrap, aggregates, etc. ◆ 3,600 cu. ft. Open Top Hoppers. 45 degree slopes for aggregate, coke, coal, etc.

For additional information and pricing, please contact John Goodwin phone (605) 582-8318 fax (605) 582-8304 www.carmathinc.com e-mail jgoodwin@mwrail.com

GLOBAL RAIL TENDERS

Kansas City (913) 661-2424

www.rrtemps.com

We offer: - Certified Locomotive Engineers - Certified Conductors - Train Dispatchers - Yardmasters - Brakemen/Switchmen - Mechanical For Your Temporary Needs!

employment

Trac-Work, Inc. is currently seeking a Superintendent in Shreveport, LA. Must have experience railroad track construction. We offer a competitive benefits package. Please forward resume to eallen@trac-work.com or fax resume to 972-875-1298. www.trac-work.com EOE Rail Track Superintendent, Brea California VTMI SEE THE FULL JOB POSTING AT RAILWAYAGE.COM JOB BOARD Sr. Sales Account Executive - Houston, TX The Kansas City Southern Railway Company SEE THE FULL JOB POSTING AT RAILWAYAGE.COM JOB BOARD

Signal Supervisor - Jackson, MS The Kansas City Southern Railway Company SEE THE FULL JOB POSTING AT RAILWAYAGE.COM JOB BOARD

Turning Opportunities into New Business Get up-to-the-minute business intelligence by subscribing to GlobalRailTenders.com Powered by

CANADIAN PACIFIC Signal Maintainer – Multiple Locations SEE THE FULL JOB POSTING AT RAILWAYAGE.COM JOB BOARD

Trainmaster Grand Canyon Railway SEE THE FULL JOB POSTING AT RAILWAYAGE.COM JOB BOARD June 2013 Railway Age 47

Perspective JOHN D. HEFFNER

Court mulls retirement, unemployment coverage

T

he United States Court of Appeals for the District of Columbia Circuit has been considering two significant cases involving Railroad Retirement Act (“RRA”) and Railroad Unemployment Insurance Act coverage.

One case, Rail-Term Corp. v. United States Railroad Retirement Board, involves an American subsidiary of a Canadian company providing software and railroad dispatching services for carriers that cannot justify employing their own dispatching staff. After two Board employees orally advised Rail-Term that it was not eligible to have its U.S. employees covered, the company established its own retirement program.

Subsequently, after the Board staff conducted a coverage inquiry, the Board (management member dissenting) found Rail-Term covered despite the fact that it did not own any railroad lines, furnished no common carrier railroad service, and was not under the control of or affiliated with any railroad. The Board reasoned that dispatching service furnished for unaffiliated clients was “so inextricably related” to providing common carrier service that it was “by osmosis” a common carrier and therefore covered under the Act. Rail-Term appealed the Board’s ruling on reconsideration (management member dissenting), substantially affirming its initial decision. Rail-Term asserted that the Board decision failed to follow agency precedent, violated the plain language of the statute, and was contrary to the evidence presented. The Court held the matter in abeyance, directing Rail-Term to seek a ruling from the Surface Transportation Board as to whether it is a “common carrier.” It has been pending for more than a year.

In a second case, Indiana Boxcar Corporation v. Railroad Retirement Board, the 48

Railway Age

June 2013

D.C. Circuit Court upheld longstanding precedent allowing short line railroads to take advantage of Union Pacific Corporation v. United States that insulates noncarrier railroad holding companies from coverage under the RRA. Indiana Boxcar is a typical “mom and pop” short line railroad holding company that owns several small carriers. It also provides consulting services for unaffiliated clients such as public

The scope of coverage could severely affect the nation’s short lines. agency rail line owners, rail shippers, and other short line railroads. Indiana Boxcar has two management employees who receive compensation subject to FICA for work for unaffiliated clients, and receive separate compensation from the subsidiary railroads subject to Railroad Retirement Taxes for work for the carrier subsidiaries.

After a coverage inquiry, the Board (the management member dissenting) found Indiana Boxcar covered. On reconsideration, the Board majority concluded that Union Pacific was only intended to apply to publicly held companies where the holding company and the subsidiaries did not share officers and directors. But the Board made little effort to distinguish numerous agency decisions issued during the past 20 years finding other closely held short line railroad holding companies outside its coverage.

Indiana Boxcar sought judicial review asserting that the agency’s ruling

departed from long-standing precedent, specifically UP without providing a rational explanation for that departure; that its ruling was contrary to the plain language of the statute; and that the ruling did not reflect the substantial evidence as to the correct allocation of employee compensation for uncovered work for the holding company and covered work for the individual railroads.

ASLRRA supported Indiana Boxcar as an amicus curiae.

Each of the rulings is significant. A ruling in Rail-Term finding coverage for an independent contractor providing dispatching services would have grave implications for numerous railroad and transit industry vendors. Are maintenance functions, or employee drug and alcohol testing frequently performed by contractors, any less “inextricable” than dispatching? The Board had reasoned that railroad dispatching is subject to FRA regulation and that trains cannot move without dispatching; therefore dispatching is essential to common carriage. But trains can’t move without properly functioning track, signals, and equipment, all subject to FRA regulation. Similarly, trains won’t function for long without revenue collection and a staff of substance-free employees.

Moreover, many short line holding companies have built their business model on the expectation that administrative personnel at the headquarters level are not covered under the RRA. The fact that corporate ownership may shift from publicly owned to privately held back to public again makes continued adherence to UP necessary to ensure certainty for the industry.

John D. Heffner practices law with the Washington, D.C., office of Dallas-based Strasburger & Price, LLP..

Do you have the most up-to-date FRA Regulations?

Reb Says...

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 . . . . .6-25-12 213 G . . . . . .9-13-10 214 . . . . . . . .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 . . . . . . . . .1-1-13 . . . . . . . .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 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .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 Code

FRA Part #

209 211 BKTSSAF 213 BKTSSG 213 BKWRK 214 BKFSS 215 BKROR 217 218 BKRRC 220 BKEND 221 BKSEP

Railroad Safety Enforcement Procedures & Rules of Practice Track Safety Standards (Subpart A-F) 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 BKHORN 222 Use of Locomotive Horns BKRFRS 224 Reflectorization of Rail Freight Rolling Stock BKHS 228 Hours of Service BKLSS 229 Locomotive Safety Standards BKSLI 230 Steam Locomotive Inspection BKSAS 231 Railroad Safety Appliance Standards BKBRIDGE 237 Bridge Safety Standards BKLER 240 Qualification and Certification of Locomotive BKCONDC 242 Conductor Certification BKBSS

232

Brake System Safety Standards

Each

26.40

8.25 7.85 7.85 5.85 7.35

4.15 3.50

3.80 2.75

12.25

10.95

5.25 9.40 10.00 19.95 8.35 5.25 11.75

4.75

7.85 4.75 11.00

10.00

9.00

13.75

9.00

12.50 Each

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

BKPSS

Passenger Safety Standards 20.80 Part 238, 239 - Order 25 or more and pay only $18.95 each

BKSTC

Signal and Train Control Systems Includes Part 233, 234, 235, 236 Order 25 or more and pay only $16.00 each

17.50

Drug and Alcohol Regulations in the Workplace Part 40 & 219

35.00

The Railway Educational Bureau 1809 Capitol Ave, Omaha, NE 68102

Ph: (402)346-4300 • Fax: (402)346-1783 Email: orders@transalert.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 229 Locomotive Safety Standards 231 Safety Appliance Standards 232 Brake System Safety Standards

BKMFR

46.00

Mech. Dept. Regs.

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Part 233, 234, 235, 236–Rules & Regulations Governing Railroad Signal and Train Control Systems

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Part 213 Track Safety Standards and Part 238 Passenger Equipment Safety Standards – FRA is amending the Track Safety Standards and Passenger Equipment Safety Standards to promote the safe interaction of rail vehicles with the track over which they operate under a variety of conditions at speeds up to 220 m.p.h. The final rule revises standards for track geometry and safety limits for vehicle response to track conditions, enhances vehicle/track qualification procedures, and adds flexibility for permitting high cant deficiency train operations through curves at conventional speeds. The rule accounts for a range of vehicle types that are currently in operation, as well as vehicle types that may likely be used in future high-speed or high cant deficiency rail operations, or both. The rule is based on the results of simulation studies designed to identify track geometry irregularities associated with unsafe wheel/rail forces and accelerations, thorough reviews of vehicle qualification and revenue service test data, and consideration of international practices.

Dates: This regulation is effective July 11, 2013.

49 CFR 233, 234, 235, and 236. Requirements for signal system reporting; maintenance standards; grade crossing signal system safety. Includes material modification of a signal system or relief from requirements plus instructions, standards, and rules governing the installation, inspection, maintenance, and repair of signal and train control systems. Spiral-bound. Softcover, 225 pages.

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Regs Governing RR Signal & Train Control Sys.

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