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Thursday, August 27, 2009

BNSF seeks PTC slowdown

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BNSF is pushing Congress to scale back a requirement for carriers to install automatic-braking systems on most of their tracks, reports Bloomberg News. "Heavy-handed" legislation enacted last year would cost Fort Worth, Texas-based BNSF almost $2 billion, Chief Executive Officer Matt Rose said.

Rose predicts revenue will fall about $3 billion this year from $18 billion in 2008 primarily because of lower fuel surcharges.

"It's in everybody's best interest that we lower the cost of this installation tremendously and not just turn a tin ear to the railroads' whining about this," Rose, 50, said yesterday in an interview in Dallas. "This is one of those great examples of regulation gone awry where there will be unintended consequences."

So-called positive train control technology is designed to stop trains in perilous situations without an engineer's involvement. Congress acted after investigators said such a system may have prevented the Los Angeles crash between a commuter train and a Union Pacific freight train that killed 25 people in 2008.

Rose said BNSF is urging lawmakers to allow carriers to put the technology only on the busiest lines. The Federal Railroad Administration, which regulates rail safety, is now writing the rule to carry out Congress's mandate.

Outfitting all U.S. tracks would be a $10-billion expense for the industry, Rose said. BNSF has tested its own automated control systems and would have preferred to install the technology on its own timetable, he said.

The four largest U.S. railroads agreed last year to a common standard for the crash-avoidance technology. Under the law, railroads are required to install the technology on major routes by 2015. Then-Federal Railroad Administrator Joseph Boardman, who is now CEO of Amtrak, the U.S. passenger railroad, said the technology would have stopped the trains in the Los Angeles accident before they collided.

The Federal Railroad Administration plans to have a final rule on the technology out in October, Warren Flateau, an agency spokesman, said today in an interview.

Rose, citing the agency's analysis, said the technology would have a $600 million benefit for the $10 billion in costs. He called the cost-benefit ratio "horrible."

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