So we are aware that even as we propose this step forward in the safety of railroad operations, we at the Department of Transportation have a long job ahead of us in finding and recommending to the Congress ways in which to assure that the railroad industry will be able to remain financially viable.

That is the first and only time I read in your statement that you were going to report to Congress; everything else you were taking in your own hands and not reporting to the Congress. Your rules and regulations and any broad powers that you have under this bill, you would have the sole power. This is the only time you are recommending that you would report to the Congress. I feel there should be some safeguard because in a safety act you might be going too far. There ought to be some report to the Congress.

I hope the committee goes into that more thoroughly.
The CHAIRMAN. Mr. Springer.

Mr. SPRINGER. Thank you, Mr. Chairman.

Mr. Lang, have you or anybody on your staff made an estimate of what the costs involved in putting these regulations in effect are to be? Mr. LANG. We have made some very preliminary estimates, Mr. Springer, but they are not good enough at this point, we didn't feel, so that we were able to recommend specific dollar figures.

There are several factors at work here: One, until we actually conduct rulemaking in these areas over which we do not now have authority but which we would get authority for under this kind of legislation, it is difficult for us to know what kind of regulations we would end up creating.

We have some ideas of what these might look like but until we have actually gone through them

Mr. SPRINGER. Give us an estimate.

Mr. LANG. Well, let me qualify my statement.

I will do so in just a moment but let me add one additional qualification at this point, or two, really.

First, we have been in the process in the last year since the Bureau of Railroad Safety was transferred from the Interstate Commerce Commission to the Federal Railroad Administration of reorganizing that Bureau. The outlines of that reorganization are now complete and we have begun to restaff in some critical areas in that Bureau.

We are also making some changes in the way in which we operate in the field. We are hopeful, although it is still too early to say what the results will be, that these will result in our being able to do our present job with fewer personnel than we now have.

Mr. SPRINGER. Mr. Lang, I am not talking about that.

How much is this going to cost the transportation industry that is going to be reflected in user charges? That is what I want to know. Mr. LANG. Our present estimates indicate that we would not be required under any of the regulations which we can currently visualize to increase our staff by more than 25 percent above its present level. Mr. SPRINGER. Mr. Lang, did you listen to my question?

Mr. LANG. I cannot translate that into dollar terms.

Mr. SPRINGER. Mr. Lang, listen very closely. This is simple question. What I want to know is, what will the cost of your estimate be in increased costs to the transportation industry which will be reflected in the cost of transporting an article aboard a train?

Mr. LANG. None, nothing, zero.

Mr. SPRINGER. You are positive?

Mr. LANG. Under the existing statutes, I am, sir.

Mr. SPRINGER. You mean with this law in effect?

Mr. LANG. Under our present statutes, none of the costs of railroad safety regulations are passed along to the carrier; they come out of the general fund.

Mr. SPRINGER. Mr. Lang, you are still not answering my question which I have asked three times. I am not asking you what it is going to cost in the form of enforcement of it; what I am asking you is: When you put regulations into effect, what does that cost in increased transportation costs? Not what it costs the Federal Government for enforcement, but what does this cost the general public?

Mr. LANG. I am sorry, Mr. Springer. I did misunderstand your question. I think I understand it now and my answer is that I cannot tell you.

Mr. SPRINGER. All right.

Now, you are frank. The automobile safety people said it would. not cost anything and when we got them in here and it cost $50 to $100 to $140 and everybody raised a little Ned with it the next year they came back in here and a Senator over on the other side had a hearing on it and tried to disprove it all when as a matter of fact we knew we had testimony here that it was going to cost at least $50 and nobody went higher than $100, and some of that cost $140 per passen

ger car.

I want some testimony, may I say, before we get through as to what this is going to cost the transportation industry and be reflected in the cost of transporting an article. There is not very much passenger business left. If you are going to set up standards here now, this is worthwhile, that is all right.

But I want to be sure the whole record is made so seomebody does not come back next year and say, "Well, it really didn't cost that much; the railroads are just adding it on like they did about the automobile industry," when we knew as a matter of fact it was going to cost more money and it was in the record when the testimony was taken.

I want to know before we get through with this what the additional costs are going to be, what those are going to reflect. If it is worthwhile, that is a different thing. I don't want to go ahead with the assumption everything is rosy and then next year it comes up about increased freight rates showing an increased cost as a result of your regulations. I want to know, now I don't want those objections coming from my district next year.

Now, can you give that to the staff? This is just as important to the fact that you are going to do the regulation. Can you do that?

Mr. LANG. We can make an attempt to do so, Mr. Springer.

I can tell you in advance the estimates we can give would be stated best only in ranges and they would be quite large ranges. (The information requested follows:)

FEDERAL RAILROAD ADMINISTRATION STATEMENT ON COST OF BROADENED SAFETY REGULATION TO THE RAILROAD INDUSTRY

It is not possible to estimate with any precision the net cost to the railroad industry, and thus to the railroad user, of a broadened program of Federal safety regulation. Reasonable estimates will be possible only as the information developed through rule-making in specific areas of regulation can be collected and assessed. It is possible, however, to make some general observations about this problem which can help put it in perspective.

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 CHAIRMAN. 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?