Posts Tagged ‘Surface Transportation Board’

STB approves Canadian Pacific’s acquisition of Central Maine & Quebec

Canadian Pacific’s acquisition of the Central Maine & Quebec Railway (CM&Q) was approved by the federal Surface Transportation Board (STB) on May 1, and will take effect June 18, 2020.

The purchase from Fortress Transportation and Infrastructure Investors LLC, officially by the wholly owned Soo Line subsidiary of CP, was originally announced Nov. 20, 2019, and with approval now gives the Class I carrier trackage and facilities running from St. Jean, Quebec, Canada, to Searsport, Maine.

In a filing with the STB, CP said it plans to upgrade CM&Q’s system to Class III standards with an investment of up to $75 million. STB members had no objections to the acquisition and dismissed comments and conditional requests by Springfield Terminal Railway Company, among others.

CM&Q owns approximately 244 miles of rail lines in Vermont and Maine and has operating rights across another 57 miles, according to the STB. The Canadian portion of CM&Q has about 237 miles of track which also will be transferred in the sale.

SMART Transportation Division represents 52 members on the CM&Q in the Transportation, Mechanical and Engineering Departments who belong to GO-049, which is represented by General Chairman Rick Lee.

Read the STB’s decision.

Financial acquisitions of G&W, Central Maine & Quebec completed

Just before the start of the new year, deals that resulted in the Genesee & Wyoming (G&W) and the Central Maine & Quebec (CM&Q) changing hands were finalized.

The Surface Transportation Board in November cleared the way for Brookfield Asset Management and GIC, a Singapore wealth fund, to acquire Genesee & Wyoming, which controls Class II and III railroads in 41 states and, if considered collectively, has holdings that qualify it as a Class I carrier with more than 13,000 track miles.

A review by the Committee on Foreign Investment in the United States (CFIUS) permitted the acquisition to be finalized, and completion of the deal was announced Dec. 31. G&W is now a private entity and its stock is no longer traded publicly.

In the case of Canadian Pacific’s acquisition of CM&Q, the federal Surface Transportation Board still must sign off on the deal, which was announced Nov. 20, to make it official. Financial terms were finalized on Dec. 30, CP announced.

Once approved by the STB, CP’s purchase from Fortress Transportation and Infrastructure Investors LLC would give the Class I carrier trackage and facilities from St. Jean, Quebec, Canada, to Searsport, Maine.

SMART Transportation Division represents 52 members on the CM&Q in the Transportation, Mechanical and Engineering Departments who belong to GO-049, which is represented by General Chairman Rick Lee. CM&Q owns 481 miles of rail lines primarily in Quebec and Maine.

STB grants exemption for G&W acquisition

Disregarding comments by the SMART TD New York Legislative Board to the contrary, the Surface Transportation Board (STB) has granted an exemption to Brookfield Asset Management and DJP XX LLC that clears the way for their acquisition of short-line/regional railroad operator Genesee & Wyoming.

Genesee & Wyoming controls Class II and III railroads in 41 states and, if considered collectively, its holdings qualify it as a Class I carrier with more than 13,000 track miles.

The notice, published in the Federal Register Nov. 1 after a 3-0 vote by the board, concludes a postponement of the $8.4 billion acquisition put forth by the STB in late July. The acquisition, when completed, will make G&W a privately held company.

Brookfield Asset Management owns and operates assets in the utilities, transport, energy and data infrastructure across North and South America, Asia Pacific and Europe while DJP XX LLC is a subsidiary of GIC, a global investment firm that manages Singapore’s foreign reserves.

In early September, an attorney representing New York State Legislative Director Samuel J. Nasca filed reply comments asserting that the notice of exemption should be rejected or revoked because of the magnitude and nature of the transportation involved.

Nasca’s filing expressed concern regarding the role of foreign interests, including GIC, which would own 27% of equity in DJP XX and has links to the government of Singapore, and was not listed on the exemption application to the STB. He also identified Brookfield as controlling rail investments in Brazil — more than 10,000 km of rail tracks and stated that GWI controls rail carriers that are located in other countries including Canada, Australia and the United Kingdom and are not subject to Board jurisdiction.

Moreover, Nasca argued, employees could face negative ramifications if the deal went through.

“A number of the GWI carriers operate in or through New York State, and are represented by SMART/TD in collective (bargaining). Those GWI carriers not so represented by SMART/TD are nevertheless important for SMART/TD employees as such carriers interchange traffic with other GWI-represented carriers, or with other carriers outside the GWI family,” his filing stated. “Accordingly, SMART/TD employees stand to be adversely affected by Brookfield management decisions revising the structure of GWI or taking actions which may divert business to other units of the Brookfield organization.”

The board disregarded the concerns expressed for workers, about foreign interests and about the scale of the acquisition as well.

“SMART/TD-NY’s comments about the magnitude and nature of the transportation at issue do not support rejection of the notice or revocation of the exemption,” the board stated in the Federal Register notice.

STB member Marty Oberman, while voting to approve the exemption, did express some reservation about the magnitude of the exemption, stating in the Federal Register filing:

“This is by far the largest and most geographically diverse collection of railroads impacting the U.S. freight network ever to be processed as a class exemption under the Board’s existing regulations,” Oberman wrote. “In my opinion, this proceeding raises significant questions regarding whether transactions of this magnitude were contemplated when the class exemption regulations were adopted, and therefore raises questions as to whether it is appropriate for such major transactions to be eligible under those regulations in the first place.”

The proposed acquisition of G&W is expected to close by the end of 2019 or early 2020 pending review by the Committee on Foreign Investment in the United States (CFIUS).

Read Sam Nasca’s filing that opposes the exemption.

Read the entire Federal Register notice here.

STB’s rail energy committee to hold meeting May 15

A notice of a meeting of the Surface Transportation Board’s (STB) Rail Energy Transportation Advisory Committee (RETAC) appeared in the Federal Register April 30.

The meeting, which is open to the public, is scheduled for 9 a.m. Wednesday, May 15, at STB headquarters, 395 E. Street SW, Washington, D.C. 20423.

The stated purpose of the meeting is to continue discussions regarding rail performance, capacity constraints, infrastructure planning and development, and the effective coordination among suppliers, carriers and users of energy resources. Items potentially on the agenda include a performance measures review, industry segment updates, a presentation on energy transportation logistics and a roundtable discussion.

RETAC was formed in 2007 to provide guidance to the STB on issues concerning the transportation of coal, ethanol and other biofuels by rail.

Click here to read more from the Federal Register.

Trump administration renominates candidates to transportation positions

A number of candidates to transportation-related oversight posts in the federal government whose nominations were returned to President Donald Trump in early January have been renominated to those posts.

Thelma Drake has been renominated to be the administrator of the DOT’s Federal Transit Administration (FTA) and Lynn Westmoreland, Joseph Gruters and Rick Dearborn are again under consideration for positions on the Amtrak board of directors.

SMART Transportation Division opposes the nomination of Westmoreland, whose voting record as a U.S. representative shows he has a long history of voting against Amtrak funding.

“As a longtime member of the House Transportation and Infrastructure Subcommittee on Railroads, Pipelines, and Hazardous Materials, Westmoreland has a hostile voting record against Amtrak, which includes efforts to eliminate federal funding for Amtrak entirely. In addition, Westmoreland has been an original cosponsor of the ‘National Right-to-Work Act’ on multiple occasions, which would significantly weaken our ability to collectively bargain. For these reasons, we oppose his nomination as it would undermine the core mission of Amtrak and its employees,” we reported when his nomination was initially introduced in October 2017.

Also renominated by the president are Michelle Schultz to the Surface Transportation Board (STB), and Michael Graham and Jennifer Homendy to the National Transportation Safety Board (NTSB). Homendy is currently serving a term on the board that runs out at the end of 2019.

Two nominations also were made to highway oversight positions — Heidi King to administer the National Highway Safety Administration (NHTSA) and Nicole Nason to administer the Federal Highway Administration (FHA).

These nominations will be considered by U.S. Senate subcommittees before potential advancement for consideration by the full Senate.

RRB nominees confirmed; Amtrak board choices go back to president

Six nominees to transportation-related agencies were confirmed by the U.S. Senate via unanimous consent Jan. 2, including three Railroad Retirement Board members.

Johnathan Bragg, Thomas Jayne and Erhard R. Chorle were all confirmed to the RRB.

Bragg, the labor member of the board and national vice president of the Brotherhood of Railroad Signalmen (BRS), will complete a term that expires this August and then commence a five-year term. Chorle, an Illinois attorney, will serve as RRB chairman with his term expiring in August 2022, and Thomas Jayne, a senior general attorney for BNSF, will represent management for a term that expires in August 2023.

Two vacancies on the Surface Transportation Board (STB) were also filled with the confirmations of Patrick Fuchs, who was a senior staff member of the Senate Commerce Committee, reporting to Chairman John Thune (R-S.D.), and Martin J. Oberman, a former chairman of Metra, as members. They each will serve five-year terms. The board now will have three of its five seats filled.

Finally, Joel Szabat was confirmed as the federal DOT’s Assistant Secretary for Aviation and International Affairs.

NS asked to confer with STB on implementation of Precision Scheduled Railroading

The Surface Transportation Board (STB) chairwoman has asked Norfolk Southern’s CEO to keep the board apprised as the carrier begins to add elements of Precision Scheduled Railroading (PSR) to its operations, Trains Magazine reports.

The letter from Ann Begeman, sent Nov. 27 to NS CEO Jim Squires, requests that the carrier begin weekly conference calls with the STB to report operational changes, the magazine reported in an article posted Nov. 29.

The requirement of updates from NS mirrors the approach STB has taken in handling another Class I that is trying out PSR.

Union Pacific (UP) announced in early autumn that it also had begun adopting aspects of PSR as part of its “Unified Plan 2020” initiative. PSR is a strategy by the late CSX CEO E. Hunter Harrison that he implemented at both Canadian National and Canadian Pacific and requires cargo to be ready when rail cars arrive for loading or risk being left behind, among other aspects. Both Canadian carriers reported financial benefits after these implementations.

When Harrison moved to CSX in early 2017 and began adding PSR to that carrier’s operations, CSX received substantial criticism from shippers amid reports of service problems as the year progressed. This drew the attention of STB and resulted in a hearing before the STB to address the carrier’s difficulties.

To avoid a repeat of those problems encountered by CSX, a letter from the STB sent in September to UP sought weekly updates on the implementation.

STB Vice Chairman Elliott announces departure from STB

Elliott

Surface Transportation Board (STB) Vice Chairman Daniel R. Elliott III announced he will leave the Board September 30, 2017. He informed President Donald J. Trump of his plans by letter.

Vice Chairman Elliott was appointed Chairman by President Barack Obama and joined the Board on August 13, 2009, following his Senate confirmation. He served as STB Chairman until December 31, 2014, and returned for a second term on June 26, 2015. He served as Chairman until January 25, 2017, when President Trump designated Ann D. Begeman as Acting Chairman.

“It has been an honor to serve the United States at the Surface Transportation Board. My tenure as Chairman and Vice Chairman of the agency has brought both rewards and challenges, but most of all an appreciation for the sophisticated rail transportation industry and its shippers that serve as the backbone of our nation’s economy,” Elliott said. “A lot has occurred since I first joined the Board, from new regulatory proposals to becoming independent from the Department of Transportation. But one thing has remained constant, and that is the distinguished group of professionals and good people at the agency that I have had the privilege of working with for the last eight years.

“During the six years that I have worked with Dan, I have always appreciated his genuine dedication and commitment to the Board’s work and to the transportation community—both shippers and railroads alike,” said STB Acting Chairman Begeman. “I particularly admire the respectful manner by which Dan treats everyone he meets. I will miss having Dan as a colleague, but wish him much success as he enters the next new phase of his career.”

STB Member Deb Miller said, “When I first came to the Board, the agency was in the midst of several difficult issues and as the Chairman at the time, Dan helped me quickly transition into my new role. Since then, the Board has undertaken a number of important regulatory initiatives in which he was instrumental. Dan will be missed at the Board, and I wish him well in his future endeavors.”

Prior to his appointment to the STB, Elliott worked in the UTU’s legal department.

U.S. Senator introduces railroad deregulation bill. Her biggest campaign donor? Union Pacific

DeSmogBlog reported that the top campaign donor for U.S. Senator Deb Fischer (R-Neb.) is Union Pacific Railroad – and, four of her top 11 donors are railroad companies.

This past June, Senator Fischer introduced the Railroad Advancement of Innovation and Leadership with Safety (RAILS) Act – a legislative initiative aimed at rolling back rail safety requirements including electronically controlled pneumatic (ECP) brakes.

If that isn’t disturbing enough, Senator Fischer is the chair of the Senate Surface Transportation Subcommittee.

Ann Begeman replaces Elliott as STB Chairman

Begeman

President Donald J. Trump has appointed Ann Begeman to serve as Acting Chairman of the Surface Transportation Board (STB). Begeman is currently serving a second, five-year term as a Member of the Board following her recent nomination by President Barack Obama Dec. 7, 2016, and her unanimous confirmation by the U.S. Senate Dec. 9, 2016. Ann first joined the Board May 2, 2011. Her current term expires Dec. 31, 2020.

“It is an honor to serve the public on the Board, and I am grateful to President Trump for the opportunity to lead the agency at this time,” said Begeman. “I look forward to continuing the important mission of the STB in my new capacity as Acting Chairman, working with the new Administration, my fellow Board Members, Daniel Elliott and Deb Miller, our dedicated agency staff, and our important stakeholders. I also wish to recognize former Chairman Daniel Elliott for his service and leadership, and his sincere efforts to facilitate a smooth transition during the change in administrations.”

Elliott

Prior to her 2011 appointment, Begeman held Senate staff positions on Capitol Hill for more than 20 years, playing a key role in the crafting of major transportation legislation, including the ICC Termination Act, which created the STB. She served as the Republican Staff Director for the Senate Committee on Commerce, Science, and Transportation under the leadership of U.S. Senator Kay Bailey Hutchison and as the Committee’s Deputy Staff Director and Transportation Policy Advisor under the leadership of U.S. Senator John McCain. Begeman has also served as Legislative Director and Acting Chief of Staff for Senator John McCain and as a Legislative Assistant for U.S. Senator Larry Pressler. She has also worked in the private sector, serving as a benefits specialist for First American Bankshares, Inc.

Begeman is a native of Humboldt, South Dakota. She earned a B.S. in business administration from the University of South Dakota.

STB signs Memorandum of Understanding with Canadian Government

dan-elliott-STB

Chairman Daniel R. Elliott

Chairman Daniel R. Elliott III of the Surface Transportation Board (STB) visited the Canadian Transportation Agency (CTA) in Ottawa, Canada, and signed a Memorandum of Understanding (MOU) to facilitate information sharing between the agencies.

The CTA is the economic regulator of the freight railroads and other modes of transportation in Canada. Chairman Elliott signed the MOU with Dr. Scott Streiner, chairman and chief executive officer of the CTA.

The MOU memorializes the ongoing relationship that the two agencies have cultivated in recent years. It recognizes the importance of their engagement to promote ongoing information exchanges on developments in rail transportation, best practices in their respective regulatory approaches, and recent regulatory activities and current events. The agencies will exchange only information that is in the public domain in the United States and Canada to ensure that no confidentiality concerns are breached. 

“The United States and Canada are linked in so many ways, not least of them by a vast rail network,” Chairman Elliott stated in Ottawa. “It is an honor today to be signing this Memorandum of Understanding between the STB and the CTA, marking our commitment to be a resource to each other in the economic regulation of freight railroads. This friendship will enable us both to engage in productive dialogue on better regulatory practices to our stakeholders and the citizens of our countries.”

Click here to view the electronic version of the MOU.

STB issues two decisions in passenger rail proceedings

STB_logoThe Surface Transportation Board released two decisions related to its oversight of Amtrak’s operations under the Passenger Rail Investment and Improvement Act of 2008 (PRIIA).

First, the Board decided that it would consider on-time arrival and departure at all stations along a passenger train’s route for purposes of assessing on-time performance. The Board will deem a train “on time” if it arrives at, or departs from, a station no more than 15 minutes after its scheduled arrival or departure.

The Board also announced that it is withdrawing its proposed policy statement on issues that may arise, and evidence to be presented in proceedings under PRIIA, in favor of a case-by-case approach to these complex matters.

“Reflecting careful consideration of an extensive public and stakeholder response to our most recent passenger rail proposals, these decisions will better position the Board to implement its responsibilities under the Passenger Rail Investment and Improvement Act of 2008,” stated Board Chairman Daniel R. Elliott III. “Improved passenger train on-time performance is an important goal, and the Board’s decisions will support that goal by clarifying the trigger for starting a proceeding, while allowing more complex and detailed issues to be resolved in the context of individual cases.”

Click the link to view the Board’s decision on On-Time Performance Under Section 213 of the Passenger Rail Investment and Improvement Act of 2008, Docket No. EP 726.

Click the following link to view the Board’s decision on Policy Statement on Implementing Intercity Passenger Train On-Time Performance and Preference Provisions of 49 U.S.C. § 24308(c) and (f), Docket No. EP 728.