Tuesday, June 8, 2010
PTC Comment Response
Last week the Federal Railroad Administration submitted their response to public comments on the final rule on the implementation of positive train control (PTC) installation requirements to the Office of Management and Budget. That final rule was published in the Federal Register in January and a large number of public comments were filed before the end of the comment period on March 16th. The date of publication of that response has not yet been set. That response may be of importance to hazmat shippers as it may shed light on who the Federal Government expects to pay for the huge cost of installing these safety devices. Railroads want to increase the shipping costs for toxic inhalation hazard (TIH) chemicals to recoup the cost of installation. They argue that extensive sections of track where the PTC technology will be required to be installed will be included solely because of those TIH shipments. TIH shippers and users clearly object to such a tax on their operation, maintaining that all of the railroad customers derive significant benefit from these new systems and should be required to share in the cost of implementing those system improvements. This has been playing out before the Surface Transportation Board in a couple of cases between Union Pacific and US Magnesium. The potential settlement between UP and USM along with the response to TIH shipper comments on this rule will have a significant impact on the final decision about who will pay for PTC implementation costs. Just don’t expect a final determination any time soon; too much money is at stake.