House Bill Would Extend PTC Deadline, While Shippers Seek to Force Rail Carriers to Carry TIH/PIH cars

First of all . . Welcome to the new format of "Transportation Law Today" which has been in hiatus for few months, but the blog is back and thanks for your patience.

 

House Bill, H.R. 3651, the "Positive Train Control Enforcement & Implementation Act of 2015" introduced by T&I Committee Chairman Bill Shuster (R-PA), with at least 76 sponsors, finally offers a vehicle to address the looming 12/31/15 deadline for Positive Train Control implementation.  The Act would extend the implementation deadline three additional years, or until 12/13/2018, with the potential for a one-time, discretionary extension of an additional 12 months if the Secretary of Transportation determines the criteria for such an extension in the Act are met.

 

This bill would extend the current congressionally-mandated deadline for PTC implementation, a development virtually all stakeholders recognized was necessary to prevent severe fines for noncompliant railroads by the FRA.  An extension also addresses the threatened cessation of rail service by carriers of Toxic/Poisonous by Inhalation (TIH/PIH) materials, and passenger traffic over non-compliant freight rail networks whose tracks are used by Amtrak and commuter railroads.

 

In a related development, TIH/PIH shipper associations the American Chemistry Council, the Chlorine Institute, and the Fertilizer Institute, have filed both a lawsuit against the Class I railroads in U.S. District Court in Washington, as well as Petition for Declaratory Order before the Surface Transportation Board.  Both the suit and the STB Petition seek rulings that railroads cannot embargo, or fail to transport, chemical shipments after 12/31/15 if PTC is not yet implemented, but rather, the statutory Common Carrier Obligation of 49 USC 11101 requires the railroads to transport the cars. 

 

The statutory extension of H.R. 3651 would eliminate both the enforcement deadline, as well as the threat of embargoed chemical & passenger traffic.

 

At present the stakes are still high as the PTC deadline is not yet resolved, however, with the introduction of H.R. 3651, at least path to an extension finally exists.

STB to Determine if Rail Tariff requiring HazMat Indemnity from Shippers is Reasonable

The Surface Transportation Board (STB) announced its decision today to determine if a railroad's requirement of indemnity from shippers for hazardous material liability is reasonable.

The STB has accepted the Petition by the Union Pacific to determine if it is reasonable to include in its tariff, or shipping rates, for hazardous materials shipments, a requirement that the railroad be indemnified from liabilities arising from haz mat incidents caused by the shipper's negligence. The tariff-based indemnity provisions relate to the loading, sealing, and securing the commodity, or the condition of the equipment tendered by the shipper (known in the industry as the packaging). The UP's tariff does not indemnify it from liabilities cause by its own negligence or fault.

Procedurally, this issue is similar to a former ex parte docket item the Board had pending for some time (Docket EP-677). That docket was closed, after significant comment by carrier and shipper interests, in favor of an actual controversy rather than what the Board at the time considered a policy statement in the abstract.

Even though the petition before the Board is the UP's request to consider its tariff imposing indemnity requirements on its shippers, the Board has opened the proceeding to comment from the public, outside of the original parties to the petition. According to the Board's Order, anyone interested in joining the proceeding is to file with the Board by December 27, 2011.

Ultimately, this proceeding picks up where prior docket EP 677 left off to some extent in that the Board now has a live case to decide the reasonableness of rail carriers imposing indemnity obligations on the shippers of hazardous materials.