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lation, in the following areas and no others: (1) vertical and horizontal clearance requirements; ... (4) the installation or removal of industrial and spur tracks." Section 5 provides for prohibition as follows: "Prohibitions. Sec. 5. (a) No person shall

(1) fail to comply with any applicable standard, rule, or regulation

established or continued in effect pursuant to this Act; ..." If these provisions are interpreted to mean that state jurisdiction continues to apply with respect to use, design, materials, workmanship, installation, construction, servicing, repair and overhaul of industrial sidings; and further, if these provisions are interpreted to mean that where there is no state regulation the proposed federal regulations will not apply in these areas in connection with industrial sidings, then The National Industrial Traffic League would probably not wish to present testimony before your Committee.

If, however, the proposed legislation including the above quoted provisions, might be interpreted to the effect that any of these standards and regulations and the prohibitions and sanctions provided in connection therewith might be applied to industrial sidings in any case, whether there is or is not state regulation, then The National Industrial Traffic League has a vital interest in this legislation and respectfully requests an opportunity to prepare and present testimony both showing the impact of completely new regulation in areas where none has heretofore existed and evaluating the propriety of injecting regulation in such areas for the first time.

The League recognizes the many and extensive demands upon the time and energy of you and the members of your Committee and its Staff. We do not wish to take such time if it is clear that H.R. 16980 would have no application to the industrial sidings and spurs on the plant, warehouse or mine properties of the members of the League and other shippers throughout the Nation. If the bill would have such application, in any way, the League would desire to present its views. Respectfully yours,

L. J. DORR, Executive Secretary.

STATEMENT OF SAM HALL, CHAIRMAN, LEGISLATIVE COMMITTEE, THE NATIONAL

INDUSTRIAL TRAFFIC LEAGUE The National Industrial Traffic League (hereinafter referred to as the League) appreciates the opportunity to present to the members of the Committee its views with respect to H.R. 16980, the proposed Federal Railroad Safety Act of 1968.

IDENTITY AND INTEREST OF THE NATIONAL INDUSTRIAL TRAFFIC LEAGUE The National Industrial Traffic League is a voluntary organization of industrial and commercial shippers, and of associations or other groups of shippers, located throughout the United States. The members of the League represent all kinds of business enterprise, vary in the nature of their transportation requirements, and embrace all types of shippers-small, medium or large. No carriers, whether railroads or others, are eligible for membership in the League.

The League has been in existence for over sixty years and has, as the recognized spokesman for the users of transportation frequently presented evidence before Committees of Congress on bills pertaining to transportation and unrelated matters. Under its Constitution the League's fundamental object is to promote adequate national and international transportation.

SCOPE OF H.R. 16980 The achievement of safety in transportation is a desirable objective, and the League supports the principle that transportation by the nation's railroads should be conducted in a safe manner.

At the same time, it is important to be sure that proposed legislation does not actually create many more problems than it may solve.

At the outset, we wish to emphasize a basic policy of the League which we regard as extremely pertinent to the present matter. We refer to the subject of the sphere of carrier management in the American enterprise system.

The League policy on this subject, affirmed by its members, is as follows:

A-4 Responsibility and Freedom of Carrier Management. There should be the greatest degree of responsibility upon, the freedom of, carrier management in providing the public with the transportation service which it needs. Regulation should be limited to that reasonably necessary in the public interest and should not encroach upon the proper sphere of managerial discretion and responsibility either in the field of traffic or actual physical operation.

In other words, the League favors the solution of this problem on a voluntary basis, unless this is simply not feasible. The League is of the view that continuing progress is being achieved through the cooperative efforts of railroad management and labor, and with the support of the nation's shippers. We note the testimony presented before this Committee on this subject by the spokesmen for the railroads.

It is the League's view that the railroads have the strongest of motives for continuing efforts to achieve the maximum in railroad safety. The humanitarian reasons for strengthened by the economic reasons. The railroads are thus powerfully impelled to work constantly to continue to improve railroad safety. Frankly, we do not regard legislation as either a cure-all or as superior to the cooperative program we have mentioned. Thus, the basic position of the League is in opposition to H.R. 16980.

There are some additional aspects of this bill which we want to mention. The power to be vested by H.R. 16980 in the Secretary of Transportation is sweeping in scope. This brings immediately to mind the undeniable fact that illadvised, unwarranted or unduly rigid standards, however, well-intentioned, could impose a burden of literally millions of dollars upon the nation's railroads. Whether or not the League concurs in all respects with the railroads as to their alleged financial need, we do know that these carriers are not in a position to take on an added burden of millions of dollars to comply with standards that are not needed or justified.

Over and above this, of course, the ultimate bearer of such millions of dollars of added railroad expenditures would be the shipping public. It is the shippers who pay the freight rates and charges. If there is one thing the nation's economy does not need at this time it is another stimulus to the serious inflation which has been and is still occurring.

Nothwithstanding the objections of The National Industrial Traffic League and others, if a bill in some form were to be passed there are two additional points the League wants to emphasize.

The first relates to the promulgation of the railroad safety standards. The League, in such event, most earnestly requests that rule making pursuant to the Federal Administrative Procedure Act be required, with full opportunity for the presentation of facts by all concerned in advance of any final publication of binding rules. This is an absolutely essential protection which should be specifically provided in any final bill which may be approved.

The second item relates to an aspect of H.R. 16980 which is vital to the shippers of the nation and which must be carefully borne in mind. We here refer to the status of trackage on the plant property of industrial and commercial enterprises, constructed and maintained at the expense of such private companies, to which we shall refer for convenience as industrial sidings.

All of the industrial members of the League utilize rail transportation service in moving their goods and commodities. Most of such shippers have so-called industrial sidings-rail trackage within the plant or on the property area of such shippers. These tracks and sidings are usually constructed and maintained at the expense of the shippers and are designed to meet the specific and highly individualized needs of the plants they serve.

Staff personnel of the Department of Transportation have advised the League that the provisions of H.R. 16980 are not intended to apply to strictly private industrial sidings within the plants and on the property of individual shippers. However, the wording of the proposed legislation is, in this respect, at least ambiguous.

If it is not intended that the authority granted will extend to such private industrial sidings, the League requests that this be made explicitly cleear and that an exception to that effect be specifically incorporated by amendment into H.R. 16980.

The League is concerned that the present language of the bill could be interpreted to extend to industrial sidings within the plant and property area of shippers.

The League is strongly opposed to such a grant of authority and to the promulgation of detailed federal regulatory power with respect to such private industrial railroad sidings.

It is our conviction and concern that this would be completely unnecessary regulation unproductive of any good and would result in an enormous hardship upon the industrial and commercial shippers of the nation. We submit it is literally impossible from a central font of regulatory power to promulgate standards for application to the vastly different circumstances and conditions to be found in the individual private plant areas of shippers throughout the country from Maine to California, from Florida to Oregon, and in Alaska and Hawaii.

It is estimated there are more than 200,000 industrial sidings in the United States. They differ widely not only in physical layout, but in usage and, therefore, required standards of construction. Some industrial sidings may have handled over them tens of thousands of heavily loaded freight cars while other sidings may be used only once or twice a month and for relatively light shipments.

Overall standards could result in the imposition, to no purpose, of very substantial expense upon these individual companies. It takes no imagination whatsoever to recognize that, in turn, for many companies this would either necessitate or result in a decision to cease the use of railroad transportation and turn to other modes of transportation.

This would occur at a time when the railroads have just presented to the Interstate Commerce Commission a petition for the right to raise their rates and charges to meet asserted increased costs. I refer, of course, to the proceeding known as Ex Parte No. 259, Increased Freight Rates, 1968. Such a proceeding has followed very closely upon a similar proceeding, Ex Parte No. 256, Increased Freight Rates, 1967, 329 I.C.C. 854; 332 I.C.C. 280.

Over and above this, the imposition of so-called national standards, promulgated from Washington, made applicable to these industrial sidings on private plant property could very well result in certain companies simply going out of business, because they would not have available to them alternate modes of transportation and because they would not be in a position to bear the expense artificially imposed upon them to comply with any such national standards made without regard to the specific and highly individualized circumstances and conditions at individual plants and business establishments.

It is the view of the League that no necessity has been established for the extension of the authority contemplated in H.R. 16980 to privately owned industrial sidings within the plant area of individual industrial and commercial enterprises. It is the League's view that the individual railroads, in cooperation with their various customers, make the necessary arrangements to insure suitable and safe trackage arrangements, tailored to the individual and particular circumstances of the private plant area involved. This being an imperfect world, the League recognizes that for one reason or another there could be an accident on an industrial siding within the private plant property of a particular company. At the same time, it is the emphatic view of the League that there is no warrant whatsoever for the imposition from a national source of national standards to be applied to the multiplicity of individualized and varied plant layouts of individual companies throughout the length and breadth of this country.

CONCLUSION In summary, The National Industrial Traffic League is opposed to enactment of H.R. 16980. The League is of the view that the continuing cooperative effort between railroad management and labor looking to steady improvement in the safety sphere should be encouraged. The League does not regard the proposed legislation as any panacea. Rather, we are concerned that it could impose a backbreaking financial burden upon the Nation's railroads with results in no way related to the millions of dollars involved. Such a burden would also be seriously inflationary and ultimately be borne by the Nation's shippers.

If, notwithstanding the League's opposition, any legislation on this subject is to be approved, the League most earnestly requests that there be an explicit requirement that the standards be promulgated pursuant to rule making procedures which will afford all persons concerned the full opportunity in advance and in writing to present pertinent facts and other considerations bearing upon such standards.

Finally, The National Industrial Traffic League respectfully requests that an amendment be added to H.R. 16980 which would make it clear beyond question that the authority to be conferred by the bill does not extend to industrial sidings,

located upon the private property of individual industrial enterprises, and constructed and maintained at the expense of such companies. We recognize that no such extension of authority may have been contemplated in the sponsoring of H.R. 16980. Whether or not this was the case, the League submits that it should be made absolutely clear that such authority does not extend to such private industrial sidings whether there is or is not state regulation.

May we again state the appreciation of the League for the opportunity given to present its views on H.R. 16980.

STATEMENT OF ANTHONY HASWELL, EXECUTIVE DIRECTOR, NATIONAL ASSOCIATION

OF RAILROAD PASSENGERS My name is Anthony Haswell. I am executive director of the National Association of Railroad Passengers, with offices at 333 North Michigan Avenue, Chicago, Illinois. I appear here on behalf of this Association in support of H.R. 16980, which would authorize the Secretary of Transportation to establish safety standards, rules, and regulations for railroad equipment, trackage, facilities, and operations.

The National Association of Railroad Passengers is an Illinois not-for-profit corporation. Membership is open to users of all kinds of railroad servicecommuter, high speed intercity, and long distance and to anyone else who believes that rail passenger service is a valuable national asset which should be preserved and improved. Since our beginning in July, 1967, we have enrolled over 2,300 members from all parts of the country. Our specific objectives are to obtain

1. Stronger legal controls over discontinuance of passenger trains, and greater consideration of the over-all public interest in continued passenger service in individual cases.

2. Positive government action to aid, encourage, and promote rail passenger service, including equal treatment for railroads by government in

relation to other forms of transportation. Our activities in furtherance of these objectives include working for the passage of constructive legislation; opposing selected proposals for train discontinuances before regulatory authorities and the courts when, in our judgment, the over-all public interest justifies such opposition; and conducting a continuing educational program to acquaint the public with the advantages and benefits of good passenger service, and the underlying economie and political issues of the problem.

I wish to emphasize at the outset that despite the alarming increase in train derailments which has impelled the Department of Transportation to request enactment of this legislation, rail travel has been and still is the safest of any mode of transportation, calculated on the basis of number of fatalities per 100,000,000 passenger miles. However, we would not only like to keep it this way, but to make the best even better. If the present trend of train derailments continues, it seems certain that the good luck of rail passengers will end in a tragic wreck with multiple fatalities.

Many of the recent freight train derailments have occurred on main lines over which passenger service is also operated. News reports of passenger trains being detoured and delayed on account of freight wrecks seems almost a weekly occurrence. The same inadequate track conditions which are causing freight trains to leave the track can just as easily produce the same result for passenger trains. One of our better railroads had three major passenger train wrecks within a one year period beginning early in 1967; miraculously, no one was killed.

The introduction of this bill presents the Congress with an unusual opportunity. By prompt favorable action, it can prevent tragedy before it happens. We hope and pray that passage of this legislation will not have to await the day of a major passenger train wreck to impress upon all of us the gravity of the situation.

There are additional reasons apart from safety of passengers which persuade us to support this bill. One does not have to travel very far by rail today to discover that the quality of the ride leaves much to be desired. Were equipment and track maintained to high safety standards, the result would certainly be a smoother and more comfortable ride.

Safety standards for track maintenance will also have a favorable impact upon passenger service economics. Generally speaking, railroads cut back on track

maintenance upon discontinuance of passenger service over a particular line, even though a heavy freight operation remains. But if adequate standards of track maintenance were enforced, discontinuance of passenger service would not enable savings in maintenance of way expenses.

In the past 10 years there has been a spectacular increase in the speed, length and weight of freight trains, and in the size and capacity of freight cars. Track which is adequately maintained for today's 70 mile per hour heavy freight trains is more than adequate for passenger service at speeds up to 80 miles an hourwhich is tops for most of our present passenger trains. Thus if the railroads were required to maintain their track to adequate standards regardless of whether passenger service were operated, they would have less incentive to discontinue it, and more incentive to restore it over routes where it is already gone.

Finally, we call the committee's attention to the ever-increasing trend of railroads to expend resources on investments in outside businesses rather than on improvements to the railroad plant. Hardly a month goes by without an announcement by a railroad that it will spend a substantial sum to acquire a nontransportation business, that it is forming a holding company, or that it no longer wants to be called a railroad. Yet the money used for such "diversification" is badly needed for improvements to track, right of way, and other fixed facilities.

One railroad executive has recently estimated that if our railroads are to be adequately modernized for future needs, the railroads should be spending $1.5 billion a year for capital improvements to fixed plant. We believe that if the present bill were enacted, it would provide a strong incentive for management to put "first things first" and concentrate upon improvement of railroads rather than searching for outside ventures in the hope of a greater return.

We again emphasize that as of today, railroads are our safest mode of passenger transportation. Let's keep it that way! We urge enactment of HR 16980 without delay. And we commend Secretary Boyd, Administrator Lang, and the National Transportation Safety Board for their initiative in this field.

(Whereupon, at 12:10 p.m., the committee adjourned.)

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