Committee Hearings – Week of 02-25-18

With both the House and Senate back in Washington this week there are a relatively small number of hearings being held on both sides of the Capitol. Two Senate hearings may be of specific interest to readers of this blog; DHS authorization markup and an oversight hearing looking at PTC implementation.

DHS Authorization

On Wednesday the Senate Homeland Security and Governmental Affairs Committee will hold a markup [.PDF download] of HR 2825, the DHS Authorization Act of 2017. The bill was passed in the House by a substantially bipartisan vote in July of last year. It is unusual that the Committee is taking up the bill without introducing a bill of its own, but the Senate has been busy with nominations and other ‘incidental’ business.

PTC Implementation

On Thursday the Senate Commerce, Science, and Transportation Committee will conduct an oversight hearing on the implementation of positive train control (PTC) technology by passenger railroads. The Committee asked for reports from both the GAO and the DOT Inspector General on the topic and both reports will be presented at this hearing. The witness list includes:

• Susan Fleming, Government Accountability Office;
• Barry J. DeWeese, Department of Transportation OIG;
• David L. Mayer, Metropolitan Transportation Authority; and
• Richard Anderson, Amtrak

HR 4766 Introduced – PTC Extensions

Earlier this week Rep. DeFazio (D,NJ) introduced HR 4766, the Positive Train Control Implementation and Financing Act of 2018. It would amend 49 USC 20157, removing the discretionary authority of the Transportation Secretary to approve alternative PTC implementation plans that extend past the current PTC deadline of December 31^st, 2018.

The Amendment

Section 2 of the bill removes two specific sub-paragraphs of §20157. First it removes §20157(a)(2)(B), thus removing the authority for railroads to propose alternative implementation schedules extending beyond 12-31-18. It also removes §20157(a)(3) which provides the Secretary with specific guidance on how such alternative schedules may be approved. A number of conforming amendments are also made.

Grant Program

Section 3 of the bill would add paragraph (m) to §20157 to establish a grant program administered by the Secretary to aid passenger railroads in their implementation of PTC. That grant program would be funded through December 31^st and $2.6 Billion would be authorized for those grants.

New Passenger Routes

Section 4 of the bill would add a new paragraph (n) that would prohibit railroads from starting operation of new passenger line routes “unless a positive train control system is fully implemented and operational on such route”.

Moving Forward

DeFazio is a senior member of the House Transportation and Infrastructure Committee to which this bill was assigned for consideration. This means that it is possible that this bill may be considered in Committee.

Two things mitigate this bill from being positively considered. First, removing the authority for extending PTC implementation deadlines past December 31^st could mean that certain passenger (and perhaps some freight rail) lines may have to suspend operations after that date if their PTC implementation has not been completed and approved by that date. This is, of course, the incentive that DeFazio intends this bill to be to drive the earliest possible implementation of PTC for passenger rail lines. Unfortunately, this also means that potentially affected railroads and their supported communities can be expected to oppose this legislation.

The second factor that by itself will almost certainly mean that the bill will not be considered in Committee is the funding of the $2.6 Billion grant program. Coming up with this new money will be a nearly impossible hurdle to overcome.

Commentary

The recent Amtrak derailment is almost certainly a major impetus for the introduction of this bill. If the timing alone was not enough of a clue, then the §4 provisions would be the final give away. Still, DeFazio is not a new comer to the expression of concerns about the ‘slow pace’ of PTC implementation. Anyone that has been paying attention over the last five years or so should not be surprised by either the provisions of §2 or the grant program in §3. Unfortunately, this bill comes too late in the game to either be effective or even pass.

PTC systems will be in place on all passenger rail lines (and many if certainly not most freight lines) in the not too distant future (just do not hold your breath for 12-31-18 on every line). It will eliminate a certain class of human-error related railroad accidents. It will not, however, signal a new, significantly safer era of railroad transportation. Mechanical problems and rail defects will still cause many (most?) accidents and I expect we will see an increase in attacks (inevitably including cyber attacks on PTC systems) by nut jobs and radicals of a number of different persuasions.

Railroads will be incrementally safer because of the costly PTC systems (and still immensely safer than our highways), but I do not believe that anyone ten years from now will claim that it was a cost-effective way to increase the safety of this transportation mode.

HR 3651 Introduced – PTC Extension

Earlier this month Rep. Shuster (R,PA) introduced HR 3651, the Positive Train Control Enforcement and Implementation Act of 2015. This bill would extend the current PTC implementation deadline from December 31st 2015 until 2018. This is one of the two bills that I briefly mentioned in my Friday post on the pending  STB action on PTC issues.

The bill makes a number of revisions to 49 USC 20157. Changes include:

• Establishing a date to submit revised plans to implement PTC {revised §20157(a)(1)};

• Revising the date by which the PTC plan is to be completely implemented {revised §20157(a)(1)};

• Providing authority to the Secretary of Transportation to extend the revised deadline {revised §20157(a)(2)};

• Add requirements for interoperability and risk-based implementation prioritization {new §20157(a)(3)(A)};

• Require annual PTC implementation progress reports from railroads {new §20157(c)}; and

• Allow for phased implementation of PTC technology within the new schedule {new §20157(h)(2)}.

Moving Forward

This is a somewhat contentious issue and I expect that we will be seeing two interesting markup hearings later this month. There are, however, 134 cosponsors of this bill from both parties and Schuster is the Chair of the House Transportation and Infrastructure Committee, so this bill will move forward expeditiously in the House. I expect that it will reach the floor of the House before the end of the month.

The Senate has already addressed this issue in HR 22, the larger surface transportation authorization bill which is still pending action in the House, so it would seem that this bill should be able to be considered and adopted in the Senate rather quickly.

It is very likely that this bill will reach the President’s desk before the STB can take action on the petition that I described last Friday.

Commentary

The railroads have been complaining for years now about the regulatory roadblocks that have impeded their efforts to implement PTC. That combined with their frequent reporting on the technical issues that they have had with designing separate systems that could operate with each other should have made it clear to any observer that the railroads would not complete the implementation of PTC by December 31^st, 2015. But Congress has pretty much ignored the problem.

The Federal Railroad Administration and the railroads had to resort to issuing threats to get the attention of Congress. The FRA very publicly told Congress that unless they didn’t do something that the FRA would have to start levying some pretty steep daily fines on the railroads starting on January 1^st. The railroads responded that they would be forced to shut down operations before January 1^st to both avoid the FRA fines and greatly escalating their potential liability costs from any rail accident due to high probability of having punitive damages assessed.

HR 22 would probably be a better legislative vessel for solving this problem because it would also provide longer term authorization for surface transportation programs in general, but that is still tied up in a lot of congressional squabbling about funding issues. I expect that Shuster will move this bill forward rather than wait on HR 22. While there are some objections in the safety community about ‘letting the railroads slide’ on PTC implementation, those objections will almost certainly be easier to overcome than the perennial spending squabbles that are holding up HR 22.

House Hearing on PTC Deployment

This morning the Railroads, Pipelines, and Hazardous Materials Subcommittee of the House Transportation and Infrastructure Committee held a hearing on “The State of Positive Train Control Implementation in the United States”. I was not able to provide advance notice because the hearing was not listed on the Congress.gov website (the House site I normally monitor for hearing information) until after the hearing had started.

The witnesses were an interesting mix of government and industry representatives:

∙ Ms. Sarah Feinberg, FRA;

∙ Mr. Russell Kerwin, Metrolink/AECOM;

∙ Mr. Frank Lonegro, CSX Transportation;

∙ Mr. Charles Mathias, FCC; and

∙ Mr. Donald Orseno, Metra Commuter Railroad

The PTC system is required by law to be installed and operable on all tracks where passenger rail operates and on Class I rail lines that are used to transport toxic inhalation (TIH) chemicals. The deadline for installation, again by law, is December 31, 2015. Some of the passenger railroads have mainly completed their PTC installations and most will apparently have their installations complete by the deadline, though the individual systems may not be approved by the FRA by that time. The freight railroads will not, however, be anywhere near meeting that deadline.

Two interesting comments about the problem can be found in the written testimony from the FRA and CSX:

FRA (pg 2) – “FRA reserves the right to use any and all enforcement tools from civil penalties to emergency orders, to require the railroads to make progress on PTC implementation to ensure public safety prior to January 1, 2016.”

CSX (pg 8) – “Operating certain trains on nonPTC-compliant tracks could be an unacceptable choice for some railroads, and the impact of railroads’ decisions on commuters and industries that rely on rail service could have significant effects that have not yet been fully examined.”

FRA is stuck. The December deadline was set by Congress and they are required to enforce the deadline. They have yet to come up with their detailed enforcement plan, but at some point in the process (CSX does not expect to have their PTC plan fully deployed until 2020) there will be imposition of some really significant fines (eg: up to $25,000/day for each line segment where PTC is not deployed).

The freight railroads may have to make a decision if they are willing to continue to allow passenger railroads to operate on their lines where PTC is not functioning. The potential liability for an accident on a line that is legally deficient in safety makes the lawyers and bankers for the railroads extremely nervous.

The issue for the transportation of TIH chemicals on lines where PTC is not yet functioning has the same issue. It is even made worse because the railroads have frequently made public their concern about their potential liability for transporting these chemicals without the PTC concerns. It is very likely that railroads will refuse to transport these chemicals on lines that do not have approved PTC deployments.

The ‘easy solution’ to the problem is for Congress to extend the deadline. There would certainly be a great deal of opposition to such an extension from the safety community. There is currently a bill on the Senate side of the hill, S 650, that is awaiting floor action in that body. There is currently no bill being considered in the House. I expect that that will change as a result of this hearing.