Market Matters Blog

Shutdowns Threatened by Class 1 Railroads Averted

Mary Kennedy
By  Mary Kennedy , DTN Basis Analyst
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Tank cars cross the Mississippi River south of downtown St. Paul, Minnesota. (DTN photo by Mary Kennedy)

MINNEAPOLIS (DTN) -- U.S. railroads will have more time to install new required safety systems thanks to legislation passed by Congress last week.

On Oct. 27 and 28, bipartisan votes by lawmakers in the House and Senate passed HR 3819, which extended the deadline for implementing positive train control (PTC) by three years, to Dec. 31, 2018. President Barack Obama signed the bill into law on Oct. 29.

Here is a link to the adjusted timeline planned for railroads to implement PTC by 2018: https://www.aar.org/…

The extension was welcome news to the rail industry, which had threatened slowdowns and/or shutdowns if the PTC deadline was not extended.

Association of American Railroads (AAR) President and CEO, Edward R. Hamberger said in a press release: "Members of the House and Senate are to be commended for taking the responsible action to extend the PTC deadline. This provides the certainty American industries and businesses need to serve the millions of Americans who rely on rail every day. The extension means freight and passenger railroads can continue moving forward with the ongoing development, installation, real-world testing and validation of this complex technology."

"The rail industry remains fully committed to being accountable and transparent in completing PTC, and we look forward to working with Congress to get a broader long-term surface transportation bill to the desk of the president expeditiously," added Hamberger.

Norfolk Southern Railroad also praised the extension, saying the extra time to implement PTC systems would allow the railroad to continue its service without interruption. In a statement on its website on Oct. 30, the company said, "Following this commendable step by Congress and the president, Norfolk Southern has rescinded its cessation of service notice for poisonous-inhalation-hazard commodities, and for passenger and commuter trains. The government's action makes it possible for Norfolk Southern to conduct lawful operations beyond the former deadline of Dec. 31, 2015, maintaining full access to the rail network for customers and passengers."

Agriculture groups also praised the deadline extension.

In a news release, NGFA President Randy Gordon said: "U.S. agriculture depends upon efficient and safe transportation involving all modes -- rail, truck, barge and vessels -- to move commodities to domestic and international customers."

National Farmers Union President Roger Johnson also applauded Congress' decision to extend the implementation of PTC, ensuring American family farmers, ranchers, and all those who rely on rail will not experience interrupted service.

"The entire country relies on freight rail to ensure delivery of everything from chlorine for drinking water to anhydrous ammonia for fertilizer," Johnson said in a news release on Oct. 28. "It has been clear for a while that the deadline was unreachable and could have done serious damage to the nation's economy if not dealt with."

Johnson added, "Each side of the debate had legitimate concerns that we now must work together to address for the benefit of American consumers and producers. We stand ready to work with Congress to ensure the timely implementation of PTC technology."

Prior to Congress extending the deadline for PTC implementation, agriculture and commodity groups had sought to keep railroads from suspending service if they failed to meet the original deadline. In a letter to the Surface Transportation Board on Oct. 23, 32 national agricultural producer, commodity and agribusiness organizations as well as NGFA state and regional affiliates, said they supported a petition filed with the agency arguing that "rail carriers cannot suspend unilaterally their common carrier obligation to serve shippers simply because they have not complied with the positive train control (PTC) requirement."

To read the full letter, visit: http://www.ngfa.org/…

Mary Kennedy can be reached at mary.kennedy@dtn.com

Follow Mary Kennedy on Twitter @MaryCKenn

(AG/CZ)

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