Tuesday, May 10, 2011

Railroad Replies to STB Complaint

Late last month I wrote about a complaint filed with the Surface Transportation Board (STB) about proposed railroad rules for the handling of railcars of toxic inhalation hazard (TIH) chemicals. As of yesterday there have now been three reply documents filed with the STB; a motion to dismiss, an answer to the complaint, and a reply.

Okay, you probably have to be a lawyer (I’m not) to understand the differences between, and the significance of, each of these documents, but the long and short of it is that these are the legal responses telling the STB that, in the point of view of the respondents, nothing has been done that deserves a response by the STB.

Motion to Dismiss

Last week RailAmerica and Alabama Gulf Coast Railway (AGR) filed a motion to dismiss the complaint. They noted that the tariff named in the industry complaint had been canceled/replaced on April 29th and that the SOP mentioned in the complaint was a presentation document for discussion with their customers, not a document subject to STB review.

Additionally, RailAmerica asked to be removed from the complaint since they were not a railroad and thus not subject to action by the STB.

Explanation of AGR TIH Procedures

Yesterday AGR and RailAmerica filed their Response to a Motion for Injunctive Relief. Again, I’ll leave the legal arguments for the STB to resolve and other lawyers to discuss. The interesting part of this filing for me is the description of the TIH railcar handling procedures outlined in the attached copy of the new tariff (AGR Tariff 0900-1) that replaced the one specified in the industry complaint.

There is a nice summary of the AGR handling process on page 25 of the reply document filed with the STB which I’ll reproduce below. If this is the actual process used by AGR, this looks like a reasonable way to handle the FRA rules put into place to ensure the safety and security of TIH shipments.

“TIH-PIH are inherently dangerous commodities and require special handling. AGR must provide safe transportation for TIH-PIH in accord with existing rules. To that end, AGR has developed a program imposing minimal additional burdens on the shippers. AGR’s program starts with notification from a shipper that a car is being forwarded for delivery to AGR. AGR is requiring the pre-notification so that it can verify that the recipient will be able to receive the car or cars when it is delivered, arrange to have an inspector available when the car or cars are received by AGR, arrange to have locomotives and crews available when the TIH-PIH car or cars arrive for interchange to AGR. Before accepting a TIH-PIH car or cars, AGR will inspect that car or cars to make sure of compliance with the requirements of 49 CFR 174.3. Once AGR accepts a car or cars it will put the car or cars into a priority train to immediately deliver the car or cars to the receiver. This train will depart within the 48 hour period required by 49 CFR 174.14, usually much sooner. The priority train will also provide more expeditious service and safer transit to receiver than handling the car or cars in the normal course of business that would require moving through yards, switching onto a regular train, and starting and stopping at different shippers along the rout to the receiver. The train will travel at the appropriate speed for safe operation based on the conditions of the rail line, time of year, weather and any other relevant factors deemed relevant by AGR operating and/or safety personnel. It is AGR’s belief that the transfer of TIH-PIH cars to a priority train will enhance the efficiency of the use of the TIH-PIH equipment fleet by expediting delivery to the destination.”
Of course, the devil is always in the details. For example, if a receiver is not prepared to receive a TIH railcar when delivered, they’ll be charged $1,000 per day until they are prepared to receive it. If an unsafe TIH railcar is delivered to AGR, they reserve the right to charge the shipper a penalty of $10,000. The amounts seem high to me, but I suppose they are intended to ‘encourage’ proper behavior by shippers and receivers so they probably need to be high.

In any case, this is not the tariff that was referenced in the industry complaint to the STB. It would be interesting to see the difference between the two documents to see if substantial changes were made.

Waiting for Industry Response

There will be an inevitable reply by one or more of the signers of the original complaint and maybe even a counter reply or two before the STB actually starts to consider the merits of the complaint; don’t expect anything quickly in this ‘action’.

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