Freight railroads to spend $12B on capital spending

The Association of American Railroads has announced the nation’s freight railroads in 2011 are planning to spend a record $12 billion on capital expenditures, after setting a record with $10.7 billion in capital spending in 2010. According to the Great Expectations 2011, Railroads and Continued U.S. Economic Recovery report, these investments are potentially threatened by regulatory and legislative policies being considered in Washington, D.C.

"Even during the worst recession in a generation, freight railroads have been plowing record amounts of private capital back into the rail network each and every year, achieving one of the highest capital investment rates of any U.S. industry," said AAR President and CEO Edward R. Hamberger. "A regulatory framework that provides certainty will foster continued economic recovery and job creation."

While President Obama and other leaders have called upon private companies to increase capital spending and rev up hiring, the nation’s freight railroads have been spending record sums of private capital on the rail network and bringing people back to work. Railroad hiring at the end of 2010 was up 5.2 percent over the year before, according to the report and railroads are positioned to hire more workers in the coming years.

"The President has issued a clear call to American businesses, urging them to get off the sidelines and get back in the game by investing capital and hiring," Hamberger said. "Freight railroads have been in the game for the past 30 years, investing more than $480 billion to build and maintain America’s freight rail network with private capital and supporting jobs all across the country. Freight railroads have a great track record and are ready to continue investing in the national rail network so U.S. taxpayers don’t have to. But, we must have a regulatory framework that supports and does not hinder private investment."

 

UP to invest $12.9M in California track improvements

Union Pacific Railroad will continue improving California’s transportation infrastructure with a $12.9 million investment to enhance the rail line that runs from Watsonville to San Lucas. The 76-mile project includes installing new rail and more than 82,000 railroad ties along the railroad corridor through the central coast of California. Crews will spread 42,000 tons of ballast to ensure a stable roadbed.

DART adding more rush hour trains

Dallas Area Rapid Transit is developing plans to have more frequent light rail trips on the Red Line North/Orange Line to create space for current customers and make room for new ones looking for an alternative to skyrocketing gasoline prices.

The changes mean customers departing Red Line stations north of downtown Dallas in the morning, like Parker Road or Arapaho, will have more train trips to choose from. At the same time, customers leaving downtown Dallas in the afternoon to return to those stations or others like Mockingbird or Bush Turnpike on the Red Line, will have more frequent service too.



The new schedule will start April 11 and increases rush hour capacity 28 percent during morning and afternoon rush hours. By comparison, rush hour ridership increased 15 percent during the peak gasoline prices of 2008. The capacity will be increased by adding more frequent service over longer periods of time, creating more 7.5-minute departures instead of the current 15-minute departures. Four trips will be added during morning rush and six during the afternoon rush.

The departure frequency, or headway, was increased in December as a cost-cutting measure and to match ridership demand. There are no plans to increase capacity on Red Line South, Blue Line or Green Line trains based on current and projected ridership.

The increased Red Line North frequency was planned for implementation with the opening of the Orange Line to Irving in 2012. The rail service changes will require adjustments to all Red Line trips as well as some Blue and Green line trips. Some connecting bus routes may also have minor adjustments.

BNSF helps customers go green

In 2010, BNSF customers reduced emissions by more than 21 million metric tons of CO2, which is also equivalent to reducing the consumption and resultant emissions of more than 2 billion gallons of diesel fuel.

For the third year in a row, BNSF provided its intermodal, automotive, industrial products and agricultural products customers with customized letters that analyzed their total rail carbon footprint and savings compared to movements of those shipments via the highway.

Calculations are based on commodity type and weight and distance traveled by rail. The calculation also considers the different fuel efficiencies of trailer, container or carload shipments. The calculation methodology was developed in consultation with Clear Carbon Consulting.

"Rail provides enormous value in reducing the country’s overall transportation emissions and carbon footprint," said John Lanigan, BNSF executive vice president and chief marketing officer. "BNSF can move a ton of freight 500 miles on a single gallon of diesel fuel. That is at least three times more efficient than an all-truck option, which helps reduce our dependence on imported oil while also reducing traffic on our nation’s crowded highways."

Amtrak: 16 months of passenger growth

February marked 16 consecutive months of Amtrak ridership growth and was the best February on record with 2,099,010 passengers.

"The ridership increase shows the continued popularity of rail travel and the need for continued investment in passenger rail service," said Amtrak President and CEO Joe Boardman. "We anticipate demand for rail travel will increase with the rise of gasoline prices, and Amtrak is prepared to be there for passengers who want to leave the car behind."

This strong performance is part of a long-term trend that has seen America’s railroads set annual ridership records in seven of the last eight fiscal years, including more than 28.7 million passengers in FY 2010.

Specifically, there was a 7.6 percent increase in riders in February 2011 vs. February 2010, or more than 147,000 passengers. The 16 straight months of ridership growth spans from November 2009 to February 2011 and averages a six percent growth rate over this period.

Factors that are contributing to the success of Amtrak include a moderately improved economic environment allowing some recovery of business travel along the Northeast Corridor, sustained high gasoline prices, the increased appeal and popularity of rail travel, effective marketing campaigns and the introduction of Wi-Fi on the high-speed Acela Express trains.

Gov. Quinn signs bill to create new transit district

Illinois Governor Pat Quinn joined southeast suburban officials to sign House Bill 1644, which establishes the Southeast Commuter Rail Transit District. The new district will give local officials the tools they needto help build the SouthEast Service Line, a proposed Metra line connecting nearly 20 communities with downtown Chicago.

"Accessible commuter rail is an essential component of our transportation system," said Governor Quinn. "The SouthEast Service Line will provide access to an underserved area while creating jobs, sparking economic development and improving the quality of life in the southeast suburbs."

The planned SouthEast Service Line will link the 33 miles between Crete’s Balmoral Park and downtown Chicago’s LaSalle Street Station, with additional stops in Crete, Steger, South Chicago Heights, Chicago Heights, Glenwood, Thornton, South Holland, Dolton, 115th Street, Gresham and 35th Street stations on Chicago’s South Side. The project will cost an estimated $778 million and will open up service to one of the last regions of the metropolitan area without access to Metra.

The new line will provide greater access to jobs, reduce highway congestion and enable towns and neighborhoods along the route to pursue transit-oriented developments. Among the anticipated locations served will be St. James Hospital and Health Centers in Chicago Heights, the Ford Motor Co. plant on the South Side, U.S. Cellular Field and Chicago’s Loop.

The project was authorized in the 2005 federal transportation bill. Metra completed the last of the in-depth studies of the line in 2010. A final proposal is expected to be submitted to the Federal Transit Administration later this year.

"The Southeast Commuter Rail Transit District will bring commuter rail to an area with few transportation options," said Transportation Secretary Gary Hannig. "By creating this district, we are reaffirming our commitment to the SouthEast Service Line and giving communities a greater voice in the planning process."

 

UP invests $33.5M for Oregon track, rail facility improvements

Union Pacific Railroad will continue investing in Oregon’s transportation infrastructure with a $33.5 million investment to enhance the rail line that runs from Oakridge to Harrisburg, and to improve the rail yard in Eugene. The 75-mile track improvement project includes installing 26 miles of new rail and more than 81,000 railroad ties along the railroad corridor through the central part of Oregon.

Crews will also spread 42,100 tons of ballast to ensure a stable roadbed. Additionally, more than 100 crossings are being resurfaced, providing motorists a smooth transition across designated railroad crossings and crews will replace 15,400 ties and more than 5,000 tons of ballast in the Eugene rail yard.

NS receives approval for Ohio crossing work

The Public Utilities Commission of Ohio has approved authorization from the Ohio Rail Development Commission directing Norfolk Southern to install flashing lights and gates at the Benton-Carroll Road/County Road 23 (473-769H) grade crossing in Ottawa County.

NS must submit site plans and cost estimates for the project to the PUCO by May 31, 2011. Funding for the upgrade will be provided through federal funds. The railroad will be responsible for completing construction of the upgrade by Mar. 2, 2012.

To increase public safety during the construction of the project, the PUCO will assist the local government with the cost of improvements such as rumble strips, illumination, improved signage or other safety enhancements at the project location. Funding for the improvement will come from the State Grade Crossing Safety Fund and will not exceed $5,000.

Gates now owns 10% of CN

Cascade Investment, LLC., whose sole member is Microsoft founder Bill Gates, acquired 35,784 Common Shares of Canadian National Railway Company. With this purchase, Cascade now holds 37,392,378 shares, representing approximately 8.14 percent of the outstanding shares.

In addition, Bill & Melinda Gates Foundation Trust, a charitable trust for which Gates serves as a co-trustee, owns 8,563,437 shares CN representing 1.86 percent.

Gates is deemed to have beneficial ownership of and/or control or direction over 45,955,815 of the shares, representing approximately 10 percent of the outstanding shares.

Gates spent $8 million through his investment agency to increase his stake in the rail giant, Gates’ firm said in a statement, reports the Toronto Sun.

He first bought into CN in 2000 and has gradually increased his stake in the company since then.

PTC miles to be scaled back

The Federal Railroad Administration has agreed to a request by railroads to scale back the number of rail route miles over which positive train control must be implemented before January 2016, according to the report by the United Transportation Union.

Railroads asserted that since the Rail Safety Improvement Act of 2008 was passed ordering the PTC installation, followed by an FRA order mandating its implementation on 73,000 miles of track carrying HAZMAT and passengers, rerouting of HAZMAT trains has reduced the affected trackage.

New traffic patterns for shipping toxic chemicals means some 10,000 miles of track used to move the chemicals in 2008 are no longer expected to transport those products by 2016, said the railroads.

The FRA will institute a new rulemaking proposing to reduce the number of route miles by the 10,000-mile figure, which railroads say will save them hundreds of millions of dollars in installation costs.

An FRA spokesperson told the Wall Street Journal, "This settlement is consistent with the president’s recently issued Executive Order 13563 requiring agencies to review their significant rules and ensure that the safety benefits derived justify the costs imposed."

 

NS, UP among 100 best corporate citizens

Norfolk Southern and Union Pacific Railroad have been named to Corporate Responsibility Magazine’s 100 Best Corporate Citizens List for 2011.

Norfolk Southern ranked 79th on the magazine’s 12th annual list. This is the third time NS has been on the list, while UP was ranked 81 and appeared on the list for the second consecutive time.

The 100 Best Corporate Citizens List is based on 360 public data points relating to the environment, climate change, human rights, philanthropy, employee relations, financial performance and governance. The best corporate citizens are selected from among large-cap Russell 1000 companies, based on data provided by an investor data firm.

"We are committed to continuous improvement in economic, environmental, social and business practices that are good for our employees, communities, customers and stockholders," said Blair Wimbush, NS vice president real estate and corporate sustainability officer. "We are honored to be named one of America’s 100 Best Corporate Citizens and excited about the progress we are making in these areas."

Norfolk Southern’s 2010 Sustainability Report describes a number of initiatives, including NS’ goal to reduce greenhouse gas emissions by 10 percent by 2014 and reflects the corporation’s efforts in transparent corporate responsibility reporting.

"Our employees remain dedicated to Union Pacific’s mission to serve," said Jim Young, Union Pacific chairman and chief executive officer. "Customers continue to recognize the value we provide in delivering safe and reliable service, which is leading to new business and record levels of customer satisfaction.

"Whether it’s providing logistics solutions to our customers, working to overcome a natural disaster or contributing to improve the quality of life in our nearly 7,000 communities, our employees exemplify a commitment to safety, service and productivity that helps Union Pacific meet America’s freight transportation and infrastructure needs. We are proud to be recognized as one of Corporate Responsibility’s 100 Best Corporate Citizens."

 

Congress clears surface transportation extension

Congress passed the Surface Transportation Extension Act of 2011, legislation to extend highway, transit and highway safety programs through the end of September, clearing the measure for signature by the President. The legislation freezes funding at fiscal year 2010 levels for highway, transit and highways safety programs. The previous extension of programs expired March 4, 2011, and this legislation is critical to ensuring that transportation programs and projects are not shut down and that infrastructure construction jobs are not threatened.

"This legislation will provide some stability for transportation departments in every state and allow DOTs to continue planning and constructing transportation projects through the summer construction season," said Transportation and Infrastructure Committee Chairman John Mica (R-FL). "This extension of transportation programs will allow more time for the Transportation and Infrastructure Committee to develop a fiscally responsible, long-term reauthorization of transportation programs to create jobs and build our nation’s infrastructure."

STB issues decision on coal dust; BNSF releases statement

The Surface Transportation Board issued the following:

The STB has acknowledged that coal dust poses a serious problem for railroad safety and operations, and found that BNSF Railway Company’s attempt to mitigate those problems was not reasonable.

Arkansas Electric Cooperative Corp. had asked the board to prevent BNSF from using a rail side emission monitoring system that sought to measure coal dust blowing from the top of coal cars. If a certain emission standard was exceeded, the shipper of the cars would have been subject to unspecified enforcement measures.

The Board acknowledged the safety and maintenance issues brought on by coal dust fouling track ballast. And it found that BNSF may require shippers to take "reasonable measures" to address the problem. But the Board found the provisions of BNSF’s tariff "not reasonable" given the level of uncertainty and the available methods to control coal dust.

"Under the challenged tariff, the railroad would accept rail cars loaded with coal and then inform coal shippers at a later date whether and to what extent coal dust was released during transport," the decision said. "In addition, the tariff does not explain what consequences coal shippers would face if they are found to have tendered loaded coal cars to the railroad that subsequently released coal dust during transport. The challenged tariff also does not acknowledge any steps that, if taken by a shipper before coal cars are tendered to the railroad, would guarantee that the shipper would be deemed in compliance with the tariff."

The decision went on to say, "Rather than using this decision to define a specific, government-approved approach to the problem at hand, we expect the railroads and their customers will collaborate to develop a solution that guarantees that loaded rail cars are fit for safe travel, while also ensuring that commodity spillage during transport is minimized.”

In response, BNSF said it would take steps to comply with the Board’s decision by reassessing the specific implementing tariff rule.

BNSF stated, "In accord with the Board’s decision, we will continue to work with our customers to identify and promptly implement coal dust containment measures that will satisfy the STB-recognized need for coal customers to prevent coal dust emissions."

 

FRA proposes grade crossing hotline

The Federal Railroad Administration has proposed a rule that would make it easier for the public to report unsafe conditions at highway-rail grade crossings. The proposal would require railroads to establish toll-free telephone numbers to allow the public to report malfunctioning highway-rail grade crossing warning signals, disabled vehicles blocking crossings, or any other unsafe conditions at crossings.

Under the proposed rule, once the railroad receives a call from the public about a malfunctioning crossing signal or a vehicle stalled on the crossing, train operators in that area would be immediately notified of the unsafe condition in an effort to avoid an accident.

"Giving the public the power to report unsafe conditions at a highway-rail grade crossing can save lives," said U.S. Transportation Secretary Ray LaHood.

The proposal to establish Emergency Notification Systems would require railroads to post a toll-free telephone number and the Department’s National Crossing Inventory identification number at every highway-rail crossing and explicitly authorized pathway grade crossing. Currently, all of the larger, Class 1 freight railroads and larger passenger railroads have some type of system in place by which they receive notification of unsafe conditions at grade crossings. However, not all smaller railroads have such a system in place. Based on National Crossing Inventory data from the end of December 2009, the proposed rule would affect 211,401 highway-rail and pathway grade crossings and 594 railroads.

"With a uniform emergency notification system all railroads must follow, we could cut the number of highway-rail crossing incidents," said Federal Railroad Administrator Joseph Szabo. "Standardization would simplify the process for both the public and railroads, saving precious time and lives."

Fortune names UP most admired

Fortune named Union Pacific the most admired company among trucking, transportation and logistics companies. Fortune expanded the category this year to include railroads. The magazine publishes its annual World’s Most Admired list in the March 21 edition.

Union Pacific ranked No. 1 in seven of nine reputation attributes identified by Fortune:

• People management
• Use of corporate assets
• Social responsibility
• Quality of management
• Financial soundness
• Long-term investment
• Quality of products/services

The company ranked second in innovation and fourth in global competitiveness. Fortune’s research partner, Hay Group, surveyed 4,100 executives, directors and securities analysts to select companies they admired most from a list that began with approximately 1,400 companies.
"We are proud of this recognition by Fortune because it demonstrates that our employees’ commitment to quality, safety, service and productivity is valued by customers, communities and investors," said Jim Young, UP chairman and chief executive officer. "It also indicates that companies across many industries recognize the value Union Pacific delivers as a complete transportation and logistics provider."

 

KCS hires one, promotes another

Kansas City Southern has appointed Larry Haskell as assistant vice president IT operations and transportation systems and promoted Michelle Kelly from director to assistant vice president compensation and benefits.

"We are pleased that Larry has joined KCS’ IT organization," said Carl Harrison, KCS vice president information technology. "He is a versatile IT leader with expertise in quality assurance and operations management programs."

Haskell joins KCS from ActioNet Inc., where he served as the national program quality manager for an enterprise IT program within the FAA since 2009. He also spent three years with Ultra Electronics Airport Systems, Inc. as vice president of operations for the Americas and six years with American Century Investments in various IT leadership roles.

"In her short time with the company, Michelle has already made marked improvements in our employee compensation and benefits processes and programs and provides critical expertise and leadership to our team of human resources professionals," said John E. Derry, senior vice president human resources.

Kelly has 25 years of human resources experience in the railroad, healthcare, manufacturing, utility and retail industries. She joined KCS in 2008 from John Knox Village, where she spent four years.

AECOM joint venture wins contract to design LA “Regional Connector” Transit Corridor

AECOM, provider of professional technical and management support services for government and commercial clients around the world, as part of a joint venture, has been awarded a $21.5-million contract from the Los Angeles County Metropolitan Transportation Authority.

The joint venture will provide planning and engineering services for the Regional Connector Transit Corridor, a two-mile transit link between the Metro Gold line, Metro Blue line and Expo light rail transit systems throughout downtown Los Angeles. When completed, the three-station, 1.6-mile tunnel alignment will create a 50-mile north-south LRT line from Pasadena to Long Beach and a 16-mile east-west LRT line from East Los Angeles to Culver City.

"AECOM has an important opportunity to plan and design this key element of our regional transportation system," said Jim de la Loza, senior vice president and west region planning manager with AECOM. "The Regional Connector will enable all the region’s transit systems to operate more efficiently and attract higher ridership, thus reducing congestion, improving air quality and bringing the benefits of modern mass transit to more communities."

The project will reduce one-way light rail trips by 10-20 minutes, eliminate crowding at existing stations and provide access to downtown and regional destinations for more than 90,000 passengers daily. Starting at the Seventh/Metro Center station in downtown Los Angeles, the proposed alignment extends north along Flower Street before proceeding east at Second Street with a new underground station providing access to Bunker Hill and Disney Hall. Tracks continue east underneath Second Street, turning northeast to a new Little Tokyo/Arts district underground station and then into a new underground rail junction.

UP Foundation grants $7.4M to The Principals

The Union Pacific Foundation is granting $7.4 million in 2011 to continue funding The Principals’ Partnership and hundreds of projects submitted by nonprofit organizations.

Now in its 10th year, The Principals’ Partnership is the Union Pacific Foundation’s signature giving program. It will continue to serve as a professional resource to 1,000 public high schools in 21 states. Additionally, the foundation is providing grants to 760 charitable organizations in 22 states.

"We remain extremely committed to the efforts of The Principals’ Partnership," said Robert W. Turner, UP senior vice president for corporate relations and Union Pacific Foundation president. "High school principals play a vital role in shaping their students’ futures. Providing principals with professional resources helps them make positive changes in their schools and provides us the opportunity to connect with the communities we serve.

The Principals’ Partnership assists approximately 1,000 principals responsible for more than one million students. The program fulfills principals’ leadership needs through a number of opportunities, including research, networking and workshops. Instead of a one-size-fits-all approach, The Principals’ Partnership starts with the professional needs of each principal and offers an individually customized program to meet those needs. The program is offered at no cost to the school, the district or the principal.

Union Pacific funds The Principals’ Partnership programs in communities in Arkansas, Arizona, California, Colorado, Idaho, Illinois, Iowa, Kansas, Minnesota, Missouri, Montana, Nebraska, Nevada, New Mexico, Oklahoma, Oregon, Texas, Utah, Washington, Wisconsin and Wyoming.

L.B. Foster supplies 1,553 tons of rail for Iowa Interstate RR

L.B. Foster Company is supplying 1,553 tons of new rail to Iowa Interstate Railroad, LTD, for new track installation and spur improvements. A specially-equipped L.B. Foster work train will deliver approximately 80,000 linear feet of 115# standard continuous welded rail in May 2011 to an Iowa Interstate interchange.

The rail is manufactured and welded in lengths up to 1,600 feet by Steel Dynamics, Inc., at their Rail Products facility in Columbia City, Ind. and shipped on L.B. Foster’s company-owned weld train. SDI is a strategic partner of L.B. Foster and a supplier of quality welded cwr strings to the Pittsburgh-based rail products company.

"Maintaining our own weld trains helps to expedite cwr shipments from our supplier plants and provides better coordination of delivery to staging areas nationwide," said Jay Roach, L.B. Foster sales manager.

 

MassDOT land exchange clears way for MBTA station

The Massachusetts Department of Transportation has approved a land exchange agreement to facilitate extending the Green Line north of Lechmere Station to Somerville and Medford, Mass., while also advancing the NorthPoint mixed-use development project. The agreement between the Massachusetts Bay Transportation Authority and Pan Am Railways, approved by the MassDOT Board of Directors, allows for construction of a new Lechmere Station on the east side of O’Brien Highway in East Cambridge across from the current station location. The project will lead to new jobs and economic development for the area.

"This landmark agreement represents an important next step in the Green Line Extension project that will help create jobs in both the short- and long-term," said MassDOT Secretary Jeffrey Mullan. "At the same time, we have secured the use of important rights-of-way that are critical to our longer-term rail vision and are important for the Commonwealth’s transportation and economic future."

The MBTA is also obtaining crucial track and property rights necessary for MassDOT and the MBTA to build and operate the Green Line Extension, among other projects. In exchange for granting those rights to the MBTA, Pan Am is acquiring the property on which the existing Lechmere Station is located.

"The new Lechmere Station will benefit Cambridge residents by increasing the public transportation options available to them and enable the city of Cambridge to redevelop an important land parcel that will improve the overall vitality of the neighborhood," said Cambridge Mayor David Maher. "We are encouraged by the MBTA’s investment in East Cambridge by moving forward with Lechmere Station. This is an important step in completing the NorthPoint area so it can meet its full potential as a place to live and to work."

Among the key elements of the newly-approved agreement:
The MBTA and MassDOT will receive:

• All of the trackage and property rights necessary to build and operate the Green Line Extension, which have a combined value of $12.5 million. In addition to this real value, these rights provide a $5.5 million savings for MassDOT and the MBTA, which had expected to pay $18 million for these rights.

• Trackage rights off the Worcester Main Line to allow potential future passenger service from Worcester to Ayer. This will provide a connection between the Worcester and Fitchburg Commuter Rail Lines, and a potential future connection to North Station.

• Trackage rights to provide future passenger service to New Hampshire. This would allow for the extension of MBTA Commuter Rail service from Lowell to Concord, NH through Nashua and Manchester. That project would ultimately be sponsored and funded by the State of New Hampshire, similar to current Commuter Rail service to Rhode Island.

• While not part of the Land Exchange Agreement, Pan Am has agreed to assume costs associated with the required street and sidewalk improvements in the Lechmere area. The Green Line Extension project and the Commonwealth were planning to absorb this $9 million expense, which may now be deducted from the project’s total cost.

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