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Union Pacific announces employee stock option plan

DALLAS – Union Pacific Corp. yesterday announced a new stock ownership plan for its full-time employees, including its railroad, to encourage them to improve safety and help solve its problems.

Under terms of the plan, each full-time employee will receive stock options of 200 shares that will vest in either one or three years, depending on performance against the company-wide safety and service target. The options are exercisable at a price of $55 for up to 10 years.

The options announcement comes as UP is struggling with one of the worst rail traffic crisis in history. UP stock closed trading yesterday at 54 ¾ a share. The shares have fallen 14% this year.

UP said earlier this month that during the past few months the number of front-line managers who quit their jobs doubled.

Bumper grain crop could lead to more rail service woes

WASHINGTON – More railroad shipping problems could be in store because of another year of expected U.S. bumper grain crops, said U.S. Agriculture Secretary Dan Glickman.

Glickman told a Senate panel that rail congestion, particularly on the Union Pacific, "remains a serious issue." Glickman is concerned that once again there will be grain on the ground because of rail shipping problems.

"Every disruption or delay in service leads to higher costs for our shippers, lower return for our farmers, higher prices for our consumers – domestic and foreign – and lost markets worldwide," Glickman said.

Glickman made his comments to the Senate Agriculture Committee. About 40% of all U.S. grain shipments move to market by rail.

"The current situation is intolerable," said Sen. Richard Lugar (R-Ind.), chair of the committee.

Glickman announced plans for a national agricultural transportation summit this summer to address the issue and try to find solutions.

Amtrak’s Empire Builder a success

CHICAGO -- The restoration of daily Amtrak Empire Builder service between Chicago and Seattle/Portland nearly one ago has been a success with ridership rising by more than 38%.

On-time performance has also improved to more than 90% in April.

RailAmerica buys Michigan rail line

BOCA RATON, Fla. – The 51-mile Saginaw Valley Railway Company was purchased by RailAmerica from CSXT.

Located in Michigan’s "thumb" region, the line runs from just east of Saginaw to Brown City, Mich. RailAmerica now has total trackage of 225 miles in Michigan. Terms of the sale were not disclosed.

RailTex acquires Ohio, Indiana railroads

SAN ANTONIO – RailTex, Inc., has agree too acquire for $14.1 million the stock of Central Properties, Inc., a privately held company which owns two railroads in Ohio and Indiana.

The Central Railroad of Indianapolis and the Central Railroad on Indiana operate a combined 154 miles of trackage in the state. This acquisition will create a 900-mile rail network in central Indiana and western Ohio.

Tongue River RR applies – again – to build coal route

WASHINGTON – Tongue River Railroad Co. is trying for the third time for the okay to build a rail shortcut from the Powder River Basin coal fields in Wyoming to utilities in the upper Midwest.

The fledgling railroad filed its third application with the Surface Transportation Board this week to permission to build tracks through rugged rangeland along the Wyoming/Montana border. The project, if approved, will shave 130 to160 miles off shipments to utilities in Minnesota, Wisconsin and other states.

The company asked the STB to set a 270-day review schedule for the application.

Pan Am to be helped by railroad company

MIAMI -- Pan American World Airways will be helped out of bankruptcy by a $28.5 million investment from Guilford Transportation Industries, a railroad company that has never run an airline.