Archive for the ‘Railroad News’ Category

FRA Tells Railroads to Submit PTC Plans

November 25, 2015

They won the extension, but now the railroad industry is being told that they had better make good use of the additional time.

The Federal Railroad Administration has sent letters to railroads warning them that they will be held to a strict schedule to meet the new deadline to install positive train control systems.

“The focus has to remain on getting PTC up and running and implemented as soon as possible,” Federal Railroad Administrator Sarah Feinberg said in a speech to a railroad conference last week. “I recognize that the legislation allows 2018 to be the goal and there can be a potential extension beyond 2018 to 2020. But the deadline is 2018. If you need to get to 2020, there are certain boxes that have to be checked in order to get there.”

In her letter to the railroads, Feinberg described what the FRA expects the railroads to do, which includes submit a detailed plan before the end of January for PTC implementation, with justifications for the pace at which the railroad intends to proceed.

Railroads are also to provide the FRA with annual reports thereafter.

Extensions beyond 2018 deadline will be considered only if a railroad had demonstrated a good-faith effort to comply with the federal mandate.

“What Feinberg was saying in her letter was ‘Don’t even send me a plan that says [you will complete installation by] 2020,’ ” an FRA official told The Washington Post. “Her main concern right now is that people are focused on 2020 and they’re not focused on 2018. She’s telling them, ‘If you happen to get to 2018 and you have met these criteria and benchmarks to be eligible [for an extension to 2020], then we’ll talk about it at that point.’”

Feinberg reiterated that point in her recent speech to the Railroad Safety Advisory Committee.

“Over the last year, I am sure you have observed that FRA is in a much more aggressive posture on PTC and everyone should expect for that posture to continue,” she said.

Pennsylvania Rail Bridge Projects Completed

November 25, 2015

The SEDA-COG Joint Rail Authority of Pennsylvania has finished three bridge projects costing $2.9 million.

The funding included a $1.8 million state Rail Transportation Assistance Program grant, a $1.1 million match from JRA and $150,000 from the Nittany & Bald Eagle Railroad.

The projects involved:

  • Raising by 2 feet the 10th Street Bridge in Tyrone in Blair County.Raising the bridge over DeWitt Run in Unionville in Centre County to increase space underneath from 15 to 45 inches. Also elevated was the Main Street grade crossing in Unionville.
  • Raising the bridge over DeWitt Run in Unionville in Centre County to increase space underneath from 15 to 45 inches. Also elevated was the Main Street grade crossing in Unionville.
  • Raising by 18 inches the bridge over Dix Run about a mile west of Unionville.

Razing Begins of Rochester Amtrak Station

November 24, 2015

Demolition work began earlier this month on the Amtrak-built 1970s era station in Rochester, New York, to make way for a new intermodal facility.

Amtrak passengers will use a temporary facility while the $29.8 million new station is built during the next 18 months.

The New York Department of Transportation said the new station is expected to open in summer 2017 and will feature retail space and more comfortable waiting and ticketing areas.

The design of the station has a two-sided, high-level passenger platform that will be accessed through a concourse from the station.

Station parking and bicycle and pedestrian access will be improved.

CSX previously had realigned its tracks by the station and installed a dedicated rail line for freight traffic.

Amtrak and CSX trains will continue to share two main tracks. As part of the project, CSX strengthened three railroad bridges near the station to carry the two additional passenger tracks being constructed to provide Amtrak train access to the new station.

Funding for the project included a $15 million Transportation Investment Generating Economic Recovery grant.

NYSDOT and the Federal Railroad Administration provided $3.5 million in funding for the preliminary engineering phase of the project, including $2.8 million secured through the American Recovery and Reinvestment Act.

The city of Rochester is contributing $500,000 toward final design and construction.

Rochester is served by the Chicago-New York/Boston Lake Shore Limited, the New York-Toronto Maple Leaf and four Empire Service trains between New York and Niagara Falls, New York.

NS Creates 2nd First Responders Locomotive

November 21, 2015

NS new unit

Norfolk Southern has painted a GP38-2 into a first responders livery that honors the training of emergency workers.

No. 5642 wears a livery similar to that of SD60E No. 9-1-1 and will be assigned to the NS Safety Train that travels throughout the railroad’s network.

The Safety Train is used to provide educational programs to first responders who might respond to railroad accidents.

CSX, FFA Launch Ag Education Program

November 21, 2015

CSX and the Future Farmers of America have joined in a program called “Growing Tomorrow” that seeks to educate the public about the importance of agriculture in America.

The program will highlight youth leadership and how young people can help shape the future of farming and railroads.

“This campaign is a great example of how CSX can come together with its nonprofit partners like FFA to highlight our combined impact in the community,” said John Claybrooks, CSX director of brand digital media.“Social media helps us generate strong engagement to a highly targeted audience and create positive brand association.”

CSX assistant vice president Tim McNulty said agricultural shipments on CSX have doubled during the past 10 years. “Agricultural and food products account for between 9 to 10 percent of total revenues. Just under $1 billion in CSX revenues for 2014, compared to about half of that 10 years ago,” McNulty says. “When we talk about agriculture, it’s not only grains, but also the finished products such as flour, food oils, ethanol, sweeteners, and by-products, as well.”

McNulty described CSX as an extension to the farmers’ reach by working with local processing facilities and rail-served elevators.

The agriculture education program relies posting on such popular social media platforms as Twitter and Instagram.
Stories submitted online received 1.3 million views throughout October and November with 67 percent of that content posted from Twitter and Instagram coming in second at 27.5 percent.

Mullen Lowe Winston-Salem, a digital marketing agency, helped execute the campaign.

Last NS RoadRailer Passes Through NE Ohio

November 19, 2015

Online reports indicate that Norfolk Southern’s RoadRailer trains made their last pass through Northeast Ohio on Tuesday.

No. 261, the last westbound RoadRailer, was led by NS 6782 and had a Union Pacific unit trailing.

A few photographers got out to make photographs of the last RoadRailer trains and posted them on

This included one fellow who flew his drone over the Triple Crown yard in Sandusky. Reportedly, this facility will be closed.

There has been speculation that some RoadRailer equipment may pass through in a positioning move now that regular service has ended.

NS announced earlier that it was phasing all out RoadRailer trains except those operating between Detroit and Kansas City.

CP Releases Details of Merger Offer to NS

November 18, 2015

Canadian Pacific took its bid to acquire Norfolk Southern to the court of public opinion on Wednesday by releasing the letter that CP CEO E. Hunter Harrison sent to NS chief James Squires proposing that the two companies merge.

Also, NS confirmed that it had received what it termed “an unsolicited, low-premium, non-binding, highly conditional indication of interest from Canadian Pacific.”

NS said CP offered to buy NS stock for $46.72 per share in cash and a fixed exchange ratio of 0.348 Canadian Pacific share per Norfolk Southern share. NS said that represented a premium of less than 10 percent.

Railway Age reported on Wednesday afternoon that CP shares stood at $138.58 at the close of Nov. 17 trading on Wall Street, well below its 52-week high of $209.98, and modestly above its 52-week low of $129.83.

NS shares closed at $86.97, compared to a 52-week high of $117.64 and a 52-week low of $72.10.

At the Nov. 17 stock closing prices, 0.348 per CP share times $138.58 would equal $48.23 per share.

Add to that CP’s offer of $46.72 in cash per NS share and the result is $94.95 per share or a 9.2 percent premium over the NS $86.97 closing price.

In releasing the letter that Harrison sent to Squires, CP said it wanted “to clarify the details of a proposal that would result in the creation of a pro-competitive, pro-customer, coast-to-coast transportation solution.”

Further, CP said in a statement that it was seeking to “correct any misconceptions about the sizable premium offered to NS shareholders.”

The letter to Squires was dated Nov. 9. Of late, NS stock has been on an upswing due to market speculation about the possible merger with CP.

CP also acknowledged that Harrison and Squires met last Friday as had been reported by the Wall Street Journal.

Aside from the details about how CP proposed to buy NS stock, Harrison laid out a list of benefits that a CP-NS combination would achieve:

  • Creates [a] transcontinental rail network connecting the major industrial production and population centers across North America, [with] global reach through premier ports located across the U.S. Gulf, Atlantic and Pacific North American coasts; integrated operations across at least 4 major rail gateways [and] enhanced service offering to shippers. [It] combines two premier railroads with exceptional safety records.
  • More than US$1.8 billion in annual operating synergies achieved over the next several years.
  • Substantial tax savings in addition to operating synergies.
  • Up to 45 percent pro forma EPS accretion with run-rate synergies.
  • Strong balance sheet, targeting mid BBB rating with approximately 4 times debt/EBITDA, and significant operating cash flow to deleverage to target leverage of 2.5 times within 2.5 years.
  • Collaborative Surface Transportation Board regulatory process
  • Financing commitment of US$14.2 billion from J.P. Morgan Securities LLC.

In the letter, Harrison wrote, “Moreover, as our combined network creates more comprehensive end-to-end shipment solutions for our customers while reducing congestion in key corridors such as Chicago, network capacity will expand, allowing us to improve service and lower costs—which is both pro-shipper and pro-competition. A combined network will also lead to faster growth for the new entity versus what either of us would be able to achieve on our own and, importantly, would create a larger, more diversified book of business less dependent on volatile commodities such as crude oil or thermal coal.”

Harrison said the United States and Canada would benefit from “having an end-to-end shipment solution that improves safety, reduces highway congestion, improves service, lowers cost and increases overall freight capacity (which is vital to support expanded economic growth) behind an environmentally friendly form of transportation funded exclusively with private versus public expenditures.”

The letter said the offer for NS stock had received unanimous approval from the CP board of directors and listed the law firms and financial advising companies that CP had retained to review the merger and guide it through the regulatory review process.

A financial analyst told Railway Age that the letter is likely the first step in a long process by which CP intends to go directly to NS shareholders to win support for the merger.

“However, the current premium may not be attractive enough for NS management and shareholders,” said Cowen and Company Managing Director and Railway Age Wall Street Contributing Editor Jason Seidl.

“The fact that CP decided to make a public appeal to NS management likely means that private talks were not very fruitful and CP now hopes that various stakeholders could help sway NS’s leadership,” Seidle said. “If these efforts fail, we would not be shocked if CP decided to go directly to NS shareholders, who, we believe, may be willing to listen given current macroeconomic conditions.”

CP Acknowledges Proposing Merger With NS

November 18, 2015

Canadian Pacific acknowledged on Tuesday one of the worst-kept secrets in the railroad industry. It wants to merge with Norfolk Southern.

CP confirmed in a news release that it has sent a letter to NS management proposing a merger that CP said would move traffic away from Chicago, perhaps through gateways in Buffalo, New York, or via Kansas City.

The release was issued just hours after a CP executive declined to address the NS merger rumor at an investors conference being held in Canada.

CP’s chief operating officer, Keith Creel, said at the conference that any railroad merger would need to have two friendly partners.

Creel said that an end-to-end merger that promises better service and a boost in competition would likely win approval from the U.S. Surface Transportation Board.

Shippers would also need to be on board with the merger proposal, Creel added.

Noting that at age 47 he has several more years left to work, Creel said he expected to see industry consolidation during his career.

He said that CP is promoting consolidation because it’s the right thing to do in reaching the goals of providing better service at lower costs.

Creel expressed optimism that any regulatory hurdles could be overcome.

In the meantime, railroad public relations executives interviewed by Trains magazine expressed doubt and even opposition to a proposed CP-NS merger.

“We don’t think mergers make sense at this point in time, especially in this environment,” Union Pacific spokeswoman Kristen South said. “All of this would be disruptive and not in the best interest of our customers or shareholders.”

A CP-NS merger would most likely affect CSX and that company also has doubts about the proposed merger.

“Regulatory thresholds are significantly higher than in the last round of rail mergers. No merger has been completed under the current regulatory environment,” said CSX spokeswoman Melanie Cost. “North American railroads have realized major advantages of rail alliances that provide the benefits of mergers. Our focus continues on delivering excellent service for our customers and creating value for our shareholders.”

Julie Piggott, BNSF’s chief financial officer, told that railroad’s bondholders that the regulatory environment remains an obstacle to mergers.

CSX, NS Lauded for Reporting Environmental Data

November 18, 2015

Norfolk Southern and CSX have been recognized for disclosing greenhouse gas emissions and climate change information.

The railroads said they have placed that information on the CDP Global Performance Report. CDP is an independent organization that promotes sustainable business practices.

CSX said it is is one of five U.S. industrial companies and the only railroad to be included in the Climate A List for 2015 and that it is among the top 5 percent of companies that submitted disclosures for this year’s report.

In a news release, CSX said that its CDP’s annual leadership indexes highlight what corporations are doing to address carbon emissions and environmental management.

CSX achieved a perfect score of 100 for its disclosure, which also puts it on the S&P Climate Disclosure Leadership Index.

NS said that it had achieved a score of 99 out of 100 for carbon disclosure, up from 98 in 2014, to achieve a place on CDP’s 2015 S&P Climate Disclosure Leadership Index.

In a news release, NS said that it scored within the top 10 percent of Standard & Poor’s 500 Index companies that disclose information to CDP.

In addition, NS achieved its best-ever CDP score for environmental performance, company officials said.

LSL Boston Through Cars to Resume in February

November 17, 2015

The Boston section of the Lake Shore Limited will not resume operating between Chicago and Boston until Feb. 1, 2016.

Currently, Nos. 448 and 449 are operating as a connecting train between Boston and Albany-Rensselaer, New York.

Amtrak said additional time is needed to complete a track reconfiguration and new platform construction at the station in Rensselaer. That project was originally scheduled to be completed in the fall.

Nos. 448 and 449 have been operating only between Boston and Albany-Rensselaer since early 2015.

The Viewliner sleepers previously assigned to the Boston section have instead been operating between Chicago and New York on Nos. 48 and 49, the parent train of the Lake Shore Limited.

In the interim, the Boston section has operated with coaches and a café car.


Get every new post delivered to your Inbox.

Join 78 other followers