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Given the present and prospective problems in railroad operating safety, three areas, wherein additional safety standards or regulations may logically be in order, stand out as important from a potential cost standpoint. These are (1) more careful track inspection and spot maintenance programs; (2) more thorough periodic freight equipment inspection (with some resulting change in maintenance practice); and, (3) more thorough employee safety training.

Similarly, there are three areas in which present costs may be significantly reduced by an expanded program of safety regulation. These are (1) the reduction in the number and cost of personal injuries; (2) reduced damage to track, equipment and lading; and, (3) improved reliability in operations as related to fewer train accidents and personal injuries.

A very general assessment of the potential costs and cost savings in these areas indicates that the first direct cost to the indutsry under this bill would result from the need for increased inspections by its own personnel. We can envision that as little as $10 to $30 million annually spent on more frequent and closer inspection procedures would, in themselves, produce the most significant improvement in railroad accident experience. These inspections would also pinpoint areas to which our standards and regulations should be directed.

In 1966 the railroad industry spent $1.3 billion on maintenance of way and $1.8 billion in maintenance of equipment. In other words, the industry already spends about 30 cents of its gross revenue dollar in the major areas to be covered by this bill. The bill would not necessarily increase that amount. The industry should be able to meet our standards and regulations within the limits of their normal maintenance programs.

Thus, what seems likely is that a constructive program of regulations and enforcement will net out with little or no change from normal railroad operating costs.

We would respectfully point out here that a fundamental principle of safety regulation requires that regulations be written only where the value of the probable safety results is commensurate with the cost of carrying out and adhering to these regulations. The Policy Statement of the Federal Aviation Agency, issued in 1965 and well-known to the committee, makes this principle clear. It says on page 20 of that statement :

"It is simply not possible to pursue safety for safety's sake in an effort to achieve the highest level of safety without being seriously limited by the compromises necessary in the interests of a reasonably costed, efficient and viable system."

Our program of railroad safety regulation is, and always will be, guided by this principle.

Mr. SPRINGER. They ought to be based on some kind of a survey because you are coming in with this far-reaching bill and there is nothing that is not regulated, as I look at it.

This is the most far-reaching bill I ever had before this committee having to do with safety. This bill includes everything, including the kitchen sink and including personnel. We never had any other bill like this before us in the safety field.

Mr. LANG. I think you will find, Mr. Springer, that the Aviation Act is every bit as sweeping in the authority it confers on the Secretary to regulate air transportation safety as this one. Mr. SPRINGER. I am not so sure about that.

The CHAIRMAN. Mr. Jarman. Mr. JARMAN. Mr. Lang, just roughly, how much personnel do you have in the safety program that you are now authorized to have under present law?

Mr. LANG. We have a total authorized staff in the Bureau of 246 personnel. Of those, about 180 are deployed in the field and about 150 of those are inspectors. The other 30 are clerical personnel in the field. So, we have essentially 150 personnel today out in the field actually conducting inspections.

Mr. JARMAN. I am not clear what your response to Mr. Springer was. Did you indicate that you will be able to give to the committee

a rough estimate of what you anticipate in increased personnel and cost if this bill is enacted into law?

Mr. LANG. Yes, sir. That is to say, the cost to us, that is, the cost that we would incur in Government cost.

Mr. JARMAN. I understand.
Mr. LANG. Yes, sir.
Mr. JARMAN. You will be able to give us a rough estimate on that?
Mr. LANG. We will.

(The information requested follows:) FEDERAL RAILROAD ADMINISTRATION STATEMENT ON Cost OF BROADENED RAILROAD

SAFETY REGULATORY AUTHORITY TO FEDERAL GOVERNMENT We are not able at this time to determine accurately the level of increased personnel necessary to implement the broadened regulatory authority as contained in the draft bill.

We can reasonably predict, however, that the new authority will require some augmentation of our present staff resources in the Bureau of Railroad Safety and some redeployment of our present personnel into areas where the opportunities for improving overall railroad safety performance are greatest. Of the present authorized strength of 246 positions, approximately 180 are deployed in the field. According to our preliminary estimates this total force could increase by as many as 75 positions over the three-year period following passage of this legislation. This increase in personnel would provide technical staff to work on the development of new regulations and staff to enforce these new regulations in the field.

Therefore, it would seem that the appropriation limitations as contained in H.R. 16980 are not unreasonable, as they relate to our preliminary staffing requirements.

Mr. JARMAN. Will you be able to indicate to the committee roughly what you estimate the amount of money would be in financing the Federal-State relationship that is set out in the bill, funding of States for certain activities that they would handle under the safety program?

Mr. LANG. Well, that, Mr. Jarman, is considerably more uncertain at this point because we have not entered into any extensive discussions with any of the States to determine the extent to which they would be interested in participating.

We think that a number of States would have an interest, those most importantly who have already some form of railroad safety regulation.

I ought to point out here, however, that our idea here is that where States were interested in participating in the inspection and enforcement process that their own personnel would in a real sense substitute for our own, that is to say, where State personnel were making the requisite number of inspections there would not be a need for Federal personnel to go over that same ground except to the extent that it was necessary to monitor in a general way the State programs to be sure that they were up to the kind of standards that we had set.

So, most of the money that might be given to the States as reimbursement for their participation would be in lieu of money which we would otherwise be spending on our own field inspection personnel. How this would net out at this point is very difficult to say.

Mr. JARMAN. Thank you.
I think that is all the questions I have.
The CHATRMAN. Mr. Devine.
Mr. DEVINE. Thank you, Mr. Chairman.

Mr. Lang, on the first page of your statement you suggest that during the period of 1961 to 1967 the increasing train accident rate was approximately 66 percent. Then on page 5 of your statement you say a 76-percent increase.

Which one is correct?

Mr. Lang. The 76 percent is the figure that one computes from comparing those accidents reported to us in 1961 to those reported to us in 1967. However, as I pointed out in my statement, our reporting criteria are based on a dollar-damage lower-limit figure and as the cost of railway equipment has gone up and the cost of repairing that equipment has gone up we have found, which is not unexpected, that accidents that today cost, as an example

Mr. DEVINE. We are not talking about costs; we are talking about percentage of accidents. One says 66 percent and one says 76 percent.

Now, which is it?

Mr. LANG. The 76-percent computation is computed on the basis of those reports that are made to us. However, if one accounts for the effect of inflation that moves into the so-called reportable accident category, some accidents which in 1961 would have been less than $750 in expense and adjusts for this, you come to a somewhat lower figure as the actual increase.

In this case both of these figures are, we think, very large. So, whichever one you take, one I think reaches the same conclusion.

Mr. DEVINE. You say also you are willing to accept the finding of the Interstate Commerce Commission that there is no direct relationship between these railroad accidents and the hours of service limitation.

Mr. LANG. No, sir; we are not willing to accept that and neither is the Commission, as we understand what they told the committee. What they said was that the statistics available to them neither prove that there is some connection between hours of service and accidents nor disprove it. They don't prove one thing one way or another.

Mr. DEVINE. Except that they were unable, according to your statement, to establish any direct relationship.

Mr. LANG. That is correct, sir.
Mr. DEVINE. In the hours of service limitation.
Mr. Lang. That is, strictly speaking, correct.

However, because they were unable to do so does not mean it cannot be done. I think this was the thrust of the chairman's earlier question and I agree with him that we should be taking another look at this to see if later evidence available to us might not prove more conclusively one way or another that there was some correlation. The Commission's study was inconclusive.

Mr. DEVINE. It would suggest to me that you have previously formed your conclusion and now you are seeking facts in order to substantiate your conclusion,

Mr. Lang. No, sir; that is not correct. We have not formed a conclusion.

Mr. DEVINE. That is all, Mr. Chairman.

Mr. Watson. Would the gentleman yield at that point to keep things in context?

If you had not reached a conclusion on that point, why could you not have simply said, “We have not reached a conclusion," rather than give the language that was just indicated ?

I think you have complicated the matter and you are in a position of contradicting yourself virtually in response to every question.

Now, why could you not simply have said, “We do not have the facts; we have been unable to get the facts; we have not reached a conclusion," rather than make such a statement as that? Mr. Lang, isn't that a fair question? Mr. LANG. I am perfectly willing to accept your language as being fairer than mine, Mr. Congressman.

Mr. Watson. Why didn't you tell the committee that rather than having this elicited through the form of questions of this committee?

Mr. LANG. I am afraid it proves only that my command of the English language is something less than complete.

The CHAIRMAN. Mr. Kornegay.
Mr. KORNEGAY. Thank you, Mr. Chairman.

First, I want to join you, Mr. Chairman, and the gentleman from Illinois in expressing my great disappointment, amazement, and chagrin over the speech of the Secretary made out in Denver and I am frank to say that in my opinion it is highly inaccurate, misleading, and certainly not in the interest of getting good legislation. I find the statement certainly inconsistent with the facts as I understood them to be from the experts who testified before the subcommittee in connection with the hearings on the Gas Pipeline Safety Act.

I have not had the opportunity to study very carefully this bill you are speaking on today, Mr. Lang. But, from the questions that have been asked from persons who looked at the bill, I would say your testimony is that if you compared the railroad safety bill that you are speaking of and the gas pipeline safety bill you will probably find that there are a whole lot of areas that coincide and are very similar.

In fact, some of the language in the safety bill, the railroad bill, looked as if it were lifted completely and totally out of the Gas Act and also that in the end the Gas Act may be a much stronger bill if it had not the many pitfalls and loopholes as enumerated.

You say this bill does not touch or affect the railroad operations unless they are actually engaged in interstate commerce; is that true?

Mr. LANG. In handling interstate commerce, this would also include intrastate railroads that interchange traffic with interstate railroads.

Mr. KORNEGAY. That would be in interstate commerce and under the definition of interstate commerce, but, as I understood your statement, in answer to the chairman's question, the provisions of this bill did not cover activities generally described as affecting interstate commerce.

Mr. Lang. Yes, sir; it does.
Mr. KORNEGAY. Is that correct?
Mr. LANG. It does.

Mr. KORNEGAY. Well, that would be my reading of section 2, subsection 6, but I must have misunderstood you when you said that it didn't affect local operations.

Mr. LANG. I believe that the question related to subway systems. Mr. KORNEGAY. What about local transportation systems? Mr. LANG. Well, these subway or local transportation systems are unconnected to the interstate rail network.

Mr. KORNEGAY. Would this cover people, say, working in the railroad shops?

Mr. Lang. Yes, sir; it would. Mr. KORNEGAY. Would it cover the man that sells the tickets in the station?

Mr. LANG. Yes, sir; it would.

Mr. KORNEGAY. Does it cover the man who takes the tickets? Does it cover the president of the railroad, too?

Mr. LANG. You bet it would.

Mr. KORNEGAY. And it would give the secretary the authority to have the final say to pass on the qualification of the people that I have enumerated, such as ticket taking, ticket selling, and the president of the railroad ?

Mr. LANG. Only to the effect that these have any bearing on the problem of safety.

Mr. KORNEGAY. Well, the bill does not say that.

Mr. LANG. I think the bill was intended to be very explicit in that regard. Section 3 right at the outset states that the intention of the bill is to promite safety and

Mr. KORNEGAY. Provides from time to time, subsection 3, “Rules, Regulations, or Minimum Standards, Governing Qualifications of Employees.”

Mr. Lang. Only to the extent that they were in some way connected with safety.

Mr. KORNEGAY. Do you disagree that some officers' estimate or version of what ought to be a safety practice would under this bill give you the authority to disqualify that particular officer of the company?

Mr. Lang. I don't think, if I understand you correctly, it would ; no. The practices which were followed in the operation of the railroad, to the extent that any of our regulations touched those practices, would have to conform to those regulations to any employer of the carrier

Mr. KORNEGAY. What about the man working out in the shop? Suppose his ideas on safety failed to conform with what the Secretary thought safe? Would he give the Secretary the authority then to come in and disqualify the mechanic or the man working in the railroad shop ? Mr. LANG. No, sir.

Perhaps I should explain a little further what we have in mind here in this regard to make sure that there is no misunderstanding. Mr. KORNEGAY. Maybe I don't understand it.

Mr. Lang. In answer to the chairman's question, I pointed out that there may be certain what you might call certain critical jobs—from a safety standpoint-being performed in connection with railroad operation or the maintenance of equipment used in those operations which required of those doing that work that they meet certain minimum standards so far as their qualifications; that is to say, they know their job or know certain aspects of their job, including perhaps very importantly any safety regulations that might have been promulgated by the Secretary. It would be to that extent only.

Mr. KORNEGAY. Suppose he is satisfied with the standards of the brotherhood and the management insofar as his job is concerned, but the Secretary disagreed and the Secretary overruled; would he have the authority to take some action to remove him from the job even though his qualifications came up to the standards required by the management?

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