UTU News Digest - Tuesday, February 16,1999

UTU Daily News Digest

Information of interest to operating railroad and transportation employees

Tuesday, February 16, 1999

IC's new intermodal yard no threat to superterminal

CHICAGO -- Illinois Central Corp. has acquired the former Southern Pacific intermodal yard in South Memphis, but officials say the newly obtained property doesn't mean the railroad has lost interest in the proposed Superterminal Memphis.

Illinois Central Corp., the parent company of Illinois Central Railroad, announced last week it had completed acquisition of the former Southern Pacific Railroad intermodal terminal on Florida Street. Acquisition of the 77.6-acre facility was part of a settlement with Union Pacific-Southern Pacific railroad that covered a number of unrelated issues, says Jack Burke, a spokesman with Illinois Central.

Sources familiar with the agreement between the two railroads say the newly acquired facility, located near I-55 and Mallory and bordered on one side by Florida Street, was acquired by default. The yard was previously Southern Pacific's before the railroad merged with Union Pacific. Southern Pacific reportedly owed Illinois Central about $3 million, so the property was handed over as part of repayment of the debt, sources say.

Although Illinois Central has not disclosed whether or not its Memphis operations will expand into this facility, officials say a move to the yard wouldn't affect the railroad's participation in the Superterminal project.

The proposed $360 million Superterminal is a 3-year-old idea that would bring together and handle all of the country's major railroads: Burlington Northern/Santa Fe, Illinois Central, Norfolk Southern, CSX and Union Pacific/Southern Pacific.

The project, which is the first of its kind in uniting five railroads, would be built on 1,000 acres of Frank C. Pidgeon Industrial Park and would include a $200 million joint-use intermodal terminal and $160 million in related road and rail construction and improvements. Most intermodal rail yards, including ones in major cities like Los Angeles and Chicago, serve only two railroads.

The project's proponents say having all the railroads at one site would create a more efficient means for the transfer of cargo containers from one railroad to another.

Even if only three railroads participate, the Superterminal would still be an economically viable project, says Robert Milner, a local logistics expert and member of the project's steering committee.

Already, Union Pacific/Southern Pacific and Burlington Northern/Santa Fe have said they will not participate in the project at this time. Union Pacific/Southern Pacific opened a 600-acre intermodal terminal in Marion, Ark., last summer to alleviate congestion at its Memphis yard. Because that $55 million facility has plenty of room for expansion, Union

Pacific representatives say the railroad won't need to participate in the Superterminal.

"After the merger with Southern Pacific, the Marion facility really helped because of its size," says Mark Davis, a Union Pacific spokesman. "It also enables us to not only absorb traffic at both locations, but to also have room for expansion."

The Superterminal project was initiated following Union Pacific/Southern Pacific's move. Promoters of the project think it would keep the other railroads from having to leave Memphis in a quest for space.

The Superterminal steering committee, including the Port Commission, the Uniport Association, the Office of Planning and Development and other local logistics experts, are negotiating with the railroads to participate in the project.

With Illinois Central's acquisition of the former Southern Pacific intermodal yard, the railroad could use the extra room for expansion to alleviate congestion at a terminal it currently shares with CSX railroad.

"We needed some expansion now," says Burke. "We would like to have a little more room. We are currently looking for the best use for that facility."

While admitting that an expansion was needed, Burke emphasized that a move by Illinois Central's into the newly acquired intermodal yard is only one of several uses the company is exploring for the property. He wouldn't disclose the other possible uses.

If Illinois Central does expand operations into the facility, an assumption that the railroad will not participate in the Superterminal project would be incorrect, adds Burke.

"We're in the process of a merger," he says. "Canadian National is going to be acquiring us and they've already signed a letter of intent that they would be participating in the Superterminal."

Pete Aviotti, chair of the Superterminal steering committee, says the newly obtained property isn't an indication that Illinois Central will choose not to be a part of the proposed intermodal yard.

"I don't think the acquisition will actually make any difference right now as far as their participation," he says. "I think possibly they have other kinds of things in mind for what they're going to use it for."

New Jersey proposes toughening bus safety rules

TRENTON -- Worried by a series of commercial bus crashes on New Jersey roads, lawmakers and state officials yesterday proposed changes that they say could enhance safety, including tougher testing rules for drivers, a lower speed limit, seat belts, and more spot checks.

Buses carry 129 million passengers in New Jersey each year. More than 400 private bus and van operators are spread across the state, with private companies running 3,700 buses and NJ Transit 2,000.

In addition, state Transportation Commissioner James Weinstein said his department this spring will implement tougher bus regulations that were required under a 1995 law. Weinstein, who became commissioner two months ago, said, "There are no good excuses for the time it took to get those regulations. It will not happen again."

The ideas, floated at a Senate Transportation Committee hearing, focused on ways to make sure buses are mechanically safe and drivers receive continuous training.

Five commercial buses have crashed on New Jersey roads since late December. In the first of the crashes, eight people were killed on Christmas Eve when an Atlantic City-bound bus ran off the Garden State Parkway and plunged down an embankment. In the most recent crash, the driver of an empty charter bus was killed Tuesday when he hit a tree on the Garden State Parkway.

Drivers were faulted in the first four crashes. But officials yesterday also said too many buses are potentially unsafe: About one in three of the buses spot-checked by the state in Atlantic City was at least temporarily taken out of commission for problems ranging from burned-out headlights to faulty brakes.

Nevertheless, the committee was told that New Jersey's bus safety record is among the nation's best, and that its inspection procedures are among the toughest.

"What we heard indicates the system isn't broken," Committee Chairman Andrew Ciesla (R., Ocean) said, "but there are things we can do to make it better."

Ciesla said he was concerned about the number of buses taken out of service during inspections. State police spokesman John Hagerty said the vast majority of violations could be repaired. More than 4,000 buses are inspected each year. "It's tragic that eight people had to die and many others got injured in bus accidents before the state bureaucracy moved toward these tougher standards," Sen. Nicholas Sacco (D., Hudson) said.

There were many suggestions for change:

Col. Carl Williams, the state police superintendent, said some bus drivers speed to get to Atlantic City quicker and use citizens band radios to stay away from troopers. He said others also were taking measures to avoid inspection. Williams also suggested that bus companies be fined when their bus drivers are fined. "If a driver is fined $100 for speeding, the bus company should get one for $1,000," he said.

Sen. Joseph Vitale (D., Middlesex) said buses and trucks should be limited to 55 m.p.h., even on roads that have 65 m.p.h. speed limits. "Getting buses and trucks to drive at reasonable speeds will go a long way toward protecting motorists and passengers," he said. But Weinstein opposed separate speed limits for cars and buses.

There was some talk of requiring seat belts on buses, but officials wondered who would be responsible if passengers did not use them.

Several lawmakers suggested the state take a closer look at training, saying bus drivers should be continually tested to make sure they are up to the job. They also suggested the state inform bus companies immediately of any violation.

James A. Crawford, executive director of the South Jersey Transportation Authority, which operates the Atlantic City Expressway, said his authority recently drew 1,000 bus drivers for a series of "refresher courses."

"Human beings operate these buses, and no matter how experienced or how well-trained, they are subject to the same human frailties that test us all," he said.

Representatives of the New Jersey Motor Bus Association said they welcome tougher enforcement of bus safety laws.

Senate President Donald DiFrancesco (R., Union), meanwhile, said any changes in the rules should be made in concert with other states, such as New York and Pennsylvania.

"New Jersey stops and checks more buses during random roadside inspections than any other state," Transportation Commissioner James Weinstein testified.

After the hearing, Ciesla predicted that several bills will emerge, but he said nothing will likely happen until the National Transportation Safety Board has issued a report on the fatal Christmas Eve crash. That could take months.

Sen. Joseph Vitale, D-Middlesex, said he will introduce legislation to return the speed limit for commercial vehicles to 55 mph from the current 65. But the lower limit for buses and trucks, in force in 10 states, drew objections because officials said traffic generally moves more smoothly when all vehicles have a uniform speed limit.

Canadian Pacific will defend against Wheat Board charges

WINNIPEG -- Canadian Pacific Railway (CP) will file a statement of defense to the

Canadian Wheat Board's (CWB) statement of claim against the company for breach of service during the winter of 1996-97 (Aug-July) "very soon", an official with CP said today.

CP has until Feb 22 to do so.

"The company's lawyers will file the defense before the deadline," Len Cocolicchio, CP spokesman said. He was unable to confirm whether that would be this week or on the deadline.

The CWB on Dec 23, 1998 filed a statement of claim with the Federal Court of Canada against CP for breach of service during the winter of 1996-97. The CWB alleges CP's poor service during that winter cost western Canadian producers an estimated Cdn $45 million.

CP has previously indicated that if the process ends up in court the company had "a very strong case that will prove the railway did not willfully discriminate against grain shipments."

Out-of-court discussions were held before the CWB filed its statement of claim in the court, Cocolicchio noted, but added that those talks failed to resolve the issue.

In a ruling issued Sep 30, the Canadian Transportation Agency (CTA) decreed that CP failed to meet its service obligation regarding the delivery of grain to major corridors and that there was "undue discrimination" against product moving to the Port of Vancouver in British Columbia during the harrowing winter of 1996-97 (Aug-July).

Detailed in the claim are costs and expenses—including items such as demurrage, additional carrying charges, loss of premium prices-- totaling over $25 million, and a claim for $20 million relating to the loss of business, and injury to economic relations, good will and reputation.

The CWB originally filed a level-of-services complaint with the CTA in Ottawa on Apr 14, 1997 against both of Canada's major freight carriers, but reached an undisclosed commercial agreement with Canadian National Railway Co. (CN) shortly after hearings began Mar 30, 1998. The hearings lasted until Jun 5.

Reno Air pilots at odds with American pilots

DALLAS -- Capt. Tom Kachmar says he and his fellow American Airlines pilots are amazed that Reno Air pilots are angry with them.

Kachmar figures Reno pilots will be the big winners if his union succeeds in forcing a quicker integration of Reno's pilots into the American work force.

"They're going to be much better off working for American, pay and benefit-wise," Kachmar said of the Reno pilots. "Pilots here are saying, 'Why are these guys upset when we're trying to raise their pay 50 percent?'"

The Reno pilots are upset, one of their leaders said, because American's pilots want to place them last on American's seniority list. That affects where pilots are based and which assignments they get -- captain, first officer or just a flight engineer.

"We'll certainly not turn our nose up at the money," said Capt. Bob Collins from his home in Reno, Nev.

"But if they take away the seniority I've worked for ... I not only will be giving up my captain's seat, but I probably would be forced to go to the East Coast and be a flight engineer," he said.

But Kachmar, a 15-year veteran with American who lives in Keller, Texas, near American's Fort Worth base, said his colleagues feel threatened by the arrival of the lower-paid Reno pilots.

"All of a sudden, Reno Airlines is flying routes that American used to fly, while some of our pilots are still furloughed," Kachmar said. "They're watching the flights they used to fly being flown by Reno Airlines, and they're extremely upset about it. These pilots aren't going to be happy if the Reno pilots are brought in senior to them."

The pecking-order fight began in December, when American's parent company, AMR Corp., bought Reno, a low-cost carrier that serves mostly West Coast points.

American's pilots, members of the Allied Pilots Association, want all AMR pilots -- including those folded in from Reno Air – immediately brought up to American's pay and benefits scale. But AMR wants to raise Reno pilots' pay only after they go through retraining to be part of the American team.

That led to the sick-out by American pilots, which has caused more than 6,000 flights to be canceled over the past 10 days.

Kachmar hasn't flown in two weeks. He said he cut himself with a pocketknife while doing home repairs, requiring 12 stitches. The American pilot said he and his colleagues are "down to earth" people who wouldn't dream of inconveniencing the flying public. He hopes any public resentment over the sick-out is short-lived.

"We don't expect any sympathy from the flying public," he said. "We just ask that they be patient and understand that this is a very important issue to us -- job security."