UTU News Digest - Tuesday, March 9, 1999

UTU Daily News Digest

Information of interest to operating railroad and transportation employees

Tuesday, March 9, 1999

New York: Amtrak to unveil high-speed service

NEW YORK -- Amtrak is betting much of its future, and that of high-speed rail in the United States, on the premise that its soon-to-be-unveiled 150-mph trains will be competitive with airplanes and automobiles in the Boston-New York-Washington Northeast Corridor.

The long-awaited new trains, whose secret name and other vital statistics were being released at a news conference today, will start running in October along tracks that Amtrak currently uses.

By electrifying the entire 470-mile route, straightening curves and using 20 new trains sets that incorporate tilt technology, Amtrak figures to chop as much as 90 minutes off its 4 1/2-hour Boston-to-New York service and up to a half-hour off its current three-hour Washington-to-New York service.

As added incentives, the fare will be about 30 percent less than the current $199 walk-up air shuttle rate, and Amtrak will expand some of its current amenities, which include more spacious business-class seats, power outlets for computers, a dining car and full lavatories.

Amtrak views the Northeast Corridor as a model for other high-speed rail proposals in the Great Lakes, along the Southeast and Gulf Coast and throughout California and the Pacific Northwest.

It also is hoping that America will finally follow Europe's lead toward a transportation system that offers an alternative to congested highways and crowded airport terminals.

The national railroad refused all comment before today's unveiling of the new $2 billion service.

"It provides a reasonable and perhaps better third option for travel in the area,'' said Anne Chettle, spokeswoman for the High-Speed Ground Transportation Association, a Washington rail organization.

"The train is already popular in the Northeast. In other areas of the country, they are committed to their cars or airplanes. This way trains will seem less pie-in-the-sky to them,'' Chettle said.

Amtrak currently transports about 9 million people each year along the Northeast Corridor, some 7 million between New York and Washington and an additional 2 million between New York and Boston.

There will be minimum time-savings with the upgraded service between Washington and New York because that route already is electrified. The Achilles heel of the Boston-to-New York service, however, has been the requirement that diesel trains switch to electric locomotives for air quality reasons before completing the trip into New York City. That adds about a half-hour to the journey.

In recent years, Amtrak has spent millions improving the track and adding electrical service from New Haven to Boston. It has also spent $710 million on new train sets that are modeled after the French bullet train, the TGV. While not as fast as the 185-mph TGV, the new Amtrak trains will glide around corners using technology that gently tilts the cars. That doesn't promote speed as much as it prevents centrifugal force from throwing the passengers into a car's walls.

TEXAS: BNSF Spending $2.5 Billion for Capital Improvements in 1999

FORT WORTH -- Burlington Northern Santa Fe Corporation yesterday announced it plans to spend approximately $2.5 billion for capital improvements to its railroad network in 1999. The planned investments, which include about $400 million in new locomotives to be financed with operating leases, will allow BNSF to continue to improve its ability to provide consistent service and to create capacity for future growth.

Approximately $812 million of the $2.5 billion will be spent to maintain and upgrade track, signals, bridges and tunnels throughout the company's 31,000-mile network. More than 800 miles of rail, both new and secondhand, will be laid, 2.4 million ties will be installed and 12,500 miles of track will be resurfaced.

About $456 million will be invested in capacity expansion projects that will enable BNSF to handle more traffic, to move it more efficiently and to improve the company's on-time performance. Expansion projects include double- and triple-tracking key routes, primarily in Texas, New Mexico, Colorado and Wyoming, and the building or expansion of a number of yards and facilities in locations including: Palos, Ala.; Barstow and Commerce, Calif.; and Clovis, NM.

To meet the increasing demand for rail transportation, BNSF is acquiring 476 high-horsepower locomotives for $733 million, the largest single-year total in railroad history, which should alleviate the locomotive shortage BNSF has struggled with since its 1995 merger. As a result, at the end of 1999 one out of every three BNSF road locomotives will be less than 48 months old. Beginning in 2000, BNSF expects new locomotive acquisitions to significantly decline compared with 1999.

Los Angeles: MTA to get more buses to end standing-room-only rides

LOS ANGELES -- The Metropolitan Transportation Authority must add 277 buses to its routes by the end of the year to comply with a court-ordered decree, a federal mediator ruled.

The decree was set in 1996 after the MTA settled a civil rights suit filed by the Bus Riders Union and the National Association for the Advancement of Colored People's Legal Defense and Educational Fund. But federal Special Master Donald Bliss found Monday that the agency had not complied with a requirement to buy more buses and improve its fleet.

By 1997, the MTA was supposed to have no more than 15 passengers standing for an average of more than 20 minutes.

"The message is clear," said Rita Burgos, a member of the union, which negotiates on behalf of 350,000 daily bus riders. "It's now time to comply and do what they should have been doing all along. This is a victory for the disabled, the elderly and low-income workers."

In his 57-page ruling, Bliss ordered an additional 532 buses be bought by 2004. The agency already has ordered 2,095 buses through 2004.

"My initial reaction is that his ruling is excessive," said MTA chief Julian Burke. He said the outlay for buses will exceed $100 million while causing MTA's annual operating costs will jump by more than $50 million.

New Jersey: NJ Transit plans $1.3 billion to add seats

TRENTON -- New Jersey Transit is proposing to spend about $1.3 billion in the next few years to buy train cars and renovate facilities to ease crowding on trains.

Agency officials say the proposal would not only provide seats for most of the 2,600 riders who currently have to stand during rush hour, but also would accommodate the 12,000 new riders expected to come on board as NJ Transit expands service during the next five years.

The plan calls for NJ Transit to buy 200 single-level cars and 40 new locomotives for about $525 million by 2002. Another 200 bi-level cars and 17 locomotives would be purchased for $505 million and delivered by 2004.

Rail yards and facilities would undergo about $266 million worth of renovations to handle the additions.

The plan will be presented on Wednesday, but no vote is expected that day, said state Transportation Commissioner James Weinstein, who is the chairman of NJ Transit's board of directors. Those who have seen the plan have reacted favorably.

"It was the most comprehensive plan I've seen in a long time," said Suzanne Mack, head of the North Jersey Transit Advisory Committee, a citizens' group.

Officials said they are still discussing how the plan would be financed. The state's Transportation Trust Fund will dry up in June 2000 and would have to be renewed. The project would also be competing for dollars with other mass-transit plans.

Commuters won't have to worry about fare increases, officials said. Revenue from anticipated ridership increases would offset the cost of expansion, they said. Fares have been stable for almost nine years.

The decision to purchase bi-level cars was made to avoid other logistical problems. There is a limit to the number of trains and cars that can be brought into the platforms at New York's Penn Station at a given time. Officials decided adding a second level to the cars would make room for more passengers in the same amount of space.

Atlanta: Who is responsible for rail crossings?

ATLANTA -- The death of 5-year-old twins in a car-train accident last month has raised troubling questions about who was responsible for installing a warning device at the south Fulton railroad crossing -- and enforcement of the county's zoning rulings.

Fulton County planning officials insist they approved zoning permits for Atlanta Auto Auction on condition that the company install a railroad signal at Stansell Road, where the twins -- a girl and a boy — were killed just off the company's property.

But auction executives said they thought it was beyond their authority to install a railroad signal, an act they argue rests with the county, state or federal government. They said they offered to pay for installation but never heard back from the county.

Auction officials also said state transportation officials recommended against putting a warning device at the crossing, a charge state administrators deny.

All agree now, however, that Stansell Road, which connects the sprawling auto auction complex to Roosevelt Highway, should be shut down. "The fewer number of crossings, the fewer number of opportunities for accidents," said Marion Waters, traffic operations engineer at the state Department of Transportation.

The County Commission has also ordered its transportation officials to survey all crossings in south Fulton in the wake of the accident.

"We need to make sure the public gives more caution to those hot spots," Commissioner Michael Hightower said. "We need to identify those locations (that) our people feel are dangerous."

It was Feb. 23 when Melvin Lawrence dropped off his girlfriend, Shenandoah Combs, at Atlanta Auction, where she worked in the reconditioning shop, and headed out of the lot onto Stansell Road, apparently to take her children to school. Seconds later, his Chrysler LeBaron was hit by a CSX train. Quentavious and Shantavious Combs were killed instantly. Their 10-year-old sister, Shanquilla, was critically injured.

Lawrence told police he didn't see the 45-mph train, but a witness said Lawrence sped up rather than stop at the sign in front of the tracks. Lawrence has been charged with two misdemeanor counts of vehicular homicide and one count of failing to stop at a railroad crossing.

In the days since, auction executives and state and county officials have been sorting through the site's history.

"We have tried to get this unsafe situation corrected repeatedly and it persists," said Dennis Berry, president and chief executive officer of Manheim Auctions Inc., the company that owns Atlanta Auto Auction. "Hopefully, the right things will be done, including making the crossing safe and allowing the auction to go about its business."

Manheim Auctions is a subsidiary of Cox Enterprises, the same company that owns The Atlanta Journal-Constitution. In 1996, Atlanta Auto Auction asked Fulton County planners to approve land disturbance permits and zoning changes for expansion at its 150-acre site.

"We have long been in favor of putting a signal there," said Manheim's Berry, noting that the company also made an offer to the county to pay to install a signal after a fatality along the tracks in 1995. Jim Demetry, the auction's lawyer, suggested efforts to install a signal languished because his client thought that it was a government duty.

"We cannot legally install a signal," he said. "We can not go out and put one up on our own. It involves the county, state Department of Transportation and some federal overlay as well."

Fulton officials said last week that companies can install signals provided the county has approved the plans. Waters, the state transportation official, said the auction should have contacted CSX, which would install and maintain the signal. The auction would be billed for the work, which could run as much as $150,000. Waters said his office would have coordinated the company's plans, but never heard from it.

Auction officials said state transportation officials had recommended against installing a signal at the crossing, but according to Waters, "We never denied any road signal here."

Auction officials said they decided Stansell Road should be closed to the public after getting no help from the county for a railroad signal. The company said it favored another entrance to the auction from Buffington Road. "We have documentation that we tried to close (Stansell) road," Berry said.

San Jose: Electrification fails vote on Caltrain

SAN JOSE -- A sweeping plan to electrify the Peninsula's commuter rail line didn't pass muster last week. But Caltrain riders may take solace in another action approved by the rail line's parent agency: the addition of two more late-night trains between San Jose and San Francisco.

In another action likely to please some passengers, Caltrain's Joint Powers Board voted to keep open the Atherton station.

The big-ticket item for this month's board meeting was the proposal to look at spending $376 million to switch from diesel engines to electric power. Although the proposal lost by one vote, it might still survive.

Before the meeting, when it appeared a vote against a study of electrification was imminent, critics had accused the board of wasting a chance to modernize the 78-mile line, which runs from Gilroy to San Francisco.

"If the JPB were a parent, they would be guilty of child abuse for how they've treated Caltrain,'' said a fuming Richard Silver, executive director of the Rail Passengers Association of California, the day before the board met.

The electrification study was meant to be part of a regional transportation-planning project organized by the Bay Area's Metropolitan Transportation Commission.

Transit officials said the original $900 million plan to modernize Caltrain has been whittled to $343 million largely because agency members -- San Mateo, Santa Clara and San Francisco counties -- would put up only minimal local matching money to obtain federal funding. The Caltrain staff reasoned that it would do little good to electrify the train if it were running on creaky tracks, decaying bridges and outdated signals.

But the issue could come up for another vote. Two years ago, the board killed a $656 million plan to extend Caltrain to downtown San Francisco, saying it was better to invest limited resources in improvements such as electrification.

Washington: STB issues CN-IC environmental report

WASHINGTON -- Surface Transportation Board (Board) Chairman Linda J. Morgan announced today that the Board's Section of Environmental Analysis (SEA) has issued its Final Environmental Assessment (Final EA) in the case concerning the proposed "Canadian National-Illinois Central" railroad merger.

Reflecting SEA's independent analysis and incorporating input from federal, state and local agencies, the Final EA expresses SEA's belief that, with recommended mitigation addressing hazardous materials transportation and related impacts to environmental justice populations, the proposed merger will not present the potential for significant environmental impacts.

The Final EA addresses written public comments submitted since SEA issued its Draft Environmental Assessment (Draft EA) on November 9, 1998, and includes SEA's final recommendations for mitigating the potential environmental impacts of the proposed merger. SEA assessed the potential environmental impacts the merger could have on safety, transportation systems, land use, energy, air quality, noise, biological resources, water resources, historic and cultural resources, and environmental justice, and addressed such potential impacts in its Draft and Final EAs.

SEA determined that there would be potentially significant impacts on only one issue area, hazardous materials transportation safety. Accordingly, SEA is recommending mitigation in the Final EA that would address potential, merger-related increases in hazardous materials transport, including potential disproportionately high and adverse impacts these increases could have on minority and low-income populations. With these final mitigation recommendations, SEA believes there will be no potential for significant environmental effects on hazardous materials transportation safety or environmental justice populations. SEA determined that none of the other environmental issue areas would have a potential for significant environmental effects, and thus do not warrant mitigation.

On July 15, 1998, filed a joint application with the Board seeking authority for CN to acquire control of IC and form a single system. Under the proposal, CN and IC anticipate only relatively minor changes in rail operations. The proposal does not include any rail line abandonments and only five minor construction projects. Within the United States, the combined CN-IC system would cross fifteen states (Alabama, Illinois, Indiana, Iowa, Kentucky, Louisiana, Michigan, Minnesota, Mississippi, Nebraska, New York, Ohio, Tennessee, Vermont, and Wisconsin).

In preparing the Final EA, SEA fully considered all comments received in response to the Draft EA; consulted further with federal, state, and local agencies; and conducted additional environmental analysis where appropriate in preparing the Final EA and in making its final environmental mitigation recommendations to the Board. The Final EA also responds to public comments made on the Safety Integration Plan prepared by CN and IC, in consultation with the Federal Railroad Administration, to explain how the applicants propose safely to integrate their separate systems if the proposed merger is approved. However, because safety integration is an ongoing process, the Safety Integration Plan is an ongoing document that will continue to be modified and refined, should the Board approve the merger, until the proposed transaction is safely implemented.

In making its final decision either to approve, approve with conditions, or deny the proposed merger, the Board will consider the entire environmental record, including all public comments, the Draft EA, the Final EA, and SEA's final recommended environmental mitigation. The Board plans to conduct oral argument on March 18, 1999 and an open voting conference on March 25, 1999. The Board plans to issue its final written decision on May 25, 1999. Any party may file an administrative appeal within 20 days after the Board's final written decision.

For additional information, contact Michael Dalton, SEA Project Manager for the proposed merger, at (202) 565-1530. Information also may be obtained by telephoning SEA's toll-free Environmental Hotline at 1-888-869-1997 [TDD for the hearing impaired: 1 (800) 877-8339], or by accessing SEA's website for the merger at www.cnicacquisition.com, or the Board's Website at www.stb.dot.gov.

RailAmerica Completes $12.5 Million Common Stock Placement

BOCA RATON, Fla.-- RailAmerica, Inc. announced that on March 3, 1999 it completed a private offering of approximately $12.5 million of restricted common stock to investors.

Pursuant to the offering, the Company sold approximately 1.4 million shares of its $.001 par value common stock at a price of $8.8125 per share and issued approximately 210,000 warrants to purchase an equivalent number of shares of common stock at an exercise price of $10.125 per share within one year of the transaction's closing date. Exclusive of the warrants, this transaction increases RailAmerica's outstanding shares to approximately 11.1 million.

Net proceeds to the Company from the offering were approximately $12.0 million. First London Securities Corporation of Dallas, Texas acted as placement agent. The securities sold in this offering have not been registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from such registration.

RailAmerica plans to use the proceeds primarily to help fund its proposed equity investment in Freight Victoria, the entity that will acquire Australia's V/Line Freight Corporation (V/Line Freight) railroad. The Company recently announced that its majority-owned consortium, Freight Victoria, was selected as the successful bidder for V/Line Freight with a purchase price of approximately $103.7 million. V/Line Freight, the rail freight business of Australia's Victorian Government, provides services across southeastern Australia over almost 3,000 miles of track. It is anticipated that Freight Victoria will take over operations of V/Line Freight within the next sixty days.