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Trackage Rights

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Trackage Rights
Posted by jeep35 on Sunday, May 9, 2010 9:44 PM
I have a very basic understanding of the term "trackage rights". One railroad (or more) has the right to use another railroads tracks to move freight or passengers, but that's about where my knowledge on the subject ends. What are the benefits for each railroad. Is there financial compensation involved? I assume that the foreign road bills its customers for mileage even if its using another railroads tracks. If you had a model railroad with staging tracks and one of those tracks contained a foreign road with trackage rights how far could they be allowed to operate. I suppose you could run it from one staging yard to the other, but would it make sense doing that. Any information would be welcome Thanks Jim
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Posted by tomikawaTT on Sunday, May 9, 2010 10:43 PM

I've broken up your post to try to give a very general overview of trackage rights.  Be aware that trackage rights are granted by mutual agreement, and no two situations are likely to be identical. 

jeep35
I have a very basic understanding of the term "trackage rights". One railroad (or more) has the right to use another railroads tracks to move freight or passengers, but that's about where my knowledge on the subject ends. What are the benefits for each railroad.

Who benefits and how is situation-specific, bst the most basic answer is improvement on the bottom line, either through cost reduction or financial improvement.

 Is there financial compensation involved? I assume that the foreign road bills its customers for mileage even if its using another railroads tracks.

There may be direct financial compensation, or there may be other benefits not measured by the amount of money changing hands.  An example of the latter is the situation where two railroads had roughly parallel single track routes, and agreed to operate each route one way for both railroads.  The benefit for both would be getting the operating advantage of double track without having to lay a single length of rail.

As for the rates charged to shippers, there is a single charge payable to a single entity for transporting X from Alpha to Omega.  The exact detail of route, interchange, trackage rights, terminal switching and such are all included in that single payment.  The entity receiving that payment then has to distribute pieces of it to every other entity entitled to a slice of the pie.

 If you had a model railroad with staging tracks and one of those tracks contained a foreign road with trackage rights how far could they be allowed to operate. I suppose you could run it from one staging yard to the other, but would it make sense doing that. Any information would be welcome Thanks Jim

A foreign road train operating under trackage rights would be routed in accordance with that specific trackage right agreement.  Your train in staging might run to your main classification yard from its junction with your main in your netherworld (aka staging) so that your railroad wouldn't have to send a loco and crew to someplace in the heart of nowhere to perform interchange service where track ownership actually changes.  Likewise, the other road then gets to tie up in a place where there are crew accommodations (even if only a motel and greasy spoon) and loco turning facilities.  Or it might be operating over your railroad because its more-or-less parallel route is temporarily (or permanently) out of service - in which case it would simply operate from staging to staging.

On my layout, when the Tomikawa Valley Railway approached the lordly Japan National Railway Company (a government-owned monopoly) about operating coal trains in captive service over the JNR's route from Tomikawa to Takada, the answer was, "We'll be happy to handle the traffic - with our locomotives and our personnel."  As a result, the TTT parks the train on an interchange track, the steamer cuts off, JNR's catenary motor couples on and, upon receiving clearance, proceeds to Takada (a staging yard deep in the heart of the netherworld where the train is once again turned over to TTT power on TTT tracks.)  The steamer couples to the empty train the cat motor dropped and proceeds back to the mine.  No trackage rights involved.

Moral of the story?  Trackage rights are negotiated between two railroads.  If one says, "No," the agreement doesn't happen.

Chuck (Modeling Central Japan in September, 1964)

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Posted by RedGrey62 on Sunday, May 9, 2010 11:16 PM

Chuck pointed out the basic reasons pretty well.  Some other info that may help.  If a road had a more or less parallel line, it may opt to negotiate trackage rights because the other RR might have better grades and curves and it just might be cheaper to pay for trackage rights than to pay for upkeep and taxes on your own right of way.

As far as length, it can be quite lengthy and running from one staging are to another is plausible.   There are numerous examples of trackage rights all across the country and eras.

Ricky

"...Mother Nature will always punish the incompetent and uninformed." Bill Barney from Thor's Legions
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Posted by jeep35 on Sunday, May 9, 2010 11:25 PM
Ok, but to further complicate the question, suppose I have a long linear (basically a small shelf that runs around the basement) layout with a hidden staging yard at each end and a small visible classification yard at one of those ends. The foreign road originates from the staging farthest away from the classification yard. Right smack dab in the middle of the layout is an industry that would receive a car that is in the foreign roads train. Do they drag the car all the way to the classification yard only to have the home road drag it back to where it belongs (which sounds silly) or would the foreign road switch the industry itself or maybe set off the car somewhere along the line and have the home road pick it up and deliver it. I don't have much information about operating agreements or union rules and how they would apply. I would like to do it as realistically as possible. Jim
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Posted by cx500 on Sunday, May 9, 2010 11:31 PM

Each trackage rights agreement is unique to the area covered.  Generally though the tenant pays the owner for the use, which might be a base fee plus so much per axle, or so much per gross ton moved.  The trackage rights might only allow overhead moves from Alpha to Omega or, less frequently, also switching of some or all on-line industries.

The owning road gets the benefit of a lot more revenue from its property with the only extra cost being a bit of additional maintenance.  The tenant is able to extend or link up portions of its system without having to spend the massive cost to build a parallel route.  Sometimes the parallel routes did exist, but neither alone carried enough traffic to cover the operating costs.  By combining the traffic onto one line the economics start to look better.

As others have noted, you can also get shared trackage agreements, which usually combine two single track lines to create the equivalent of double track.

John

 

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Posted by nbrodar on Monday, May 10, 2010 12:15 AM

 Don't forget trackage rights are also imposed by the ICC/STB as a merger condition, to preserve competition, like D&H's trackage rights over Conrail from Scranton to Allentown, Harrisburg, Philadelphia, and Washington DC. Although after being evicted from Amtrak, both Conrail and D&H used CSX rails to reach Washington.

Nick 

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Posted by dehusman on Monday, May 10, 2010 6:53 AM

jeep35
I have a very basic understanding of the term "trackage rights". One railroad (or more) has the right to use another railroads tracks to move freight or passengers, but that's about where my knowledge on the subject ends. What are the benefits for each railroad.

You have to split trackage rights into two "eras".  One is pre-Staggers, the other is post-Staggers.  Pre-Staggers most of the trackage rights were for the convienience of the two railroads.  It was purely a business decision for one railroad to let another use its right of way.  Many times trackage rights allows one railroad to eliminate a poor route or get around a damaged  or high maintenance piece of railroad. Sometimes a bridge is involved.  In exchange the host railroad gets a payment of some sort and possibily some improvements to the line.  The payment can be on a ton mile, train mile, per, per axle, per month, per year basis.  Each trackage rights route has its own contract between the railroads and they are often very different.  Plus there may be restrictions on the tenant road, only some many trains a day, only certain types of trains, set limits on tonnage, horsepower, length, etc. 

There are of course restrictions on the route itself.  The from points and two points are set.  Sometimes which track the foreign train uses is set.  Now the host railroad can for its own convienience put the tenant train outside the required track, but the tenant road cannot use track that it does not have rights over.

 Is there financial compensation involved?

Mostly yes.  Sometimes, for short moves in terminals, no or a nominal fee.

 I assume that the foreign road bills its customers for mileage even if its using another railroads tracks.

Technically no, because railroads don't bill by "mileage' per se.  If they are charging by a tariff rate then the rate is for a commodity between two stations and is independent of the route.  If railroad A and railroad B both haul widgets between Pittsburgh and Chicago, they both charge $500, regardless of how long or how far they have to go.  If railroad A's route is 500 miles and takes 3 days, they charge $500, if railroad B's route is 1000 miles and takes 8 days, they charge $500.

Post Staggers a railroad could contract with the widget company to haul widgets between Pittsburgh and Chicago, but once again, that is not normally a per mile contract, more like an origin to destination contract. 

 If you had a model railroad with staging tracks and one of those tracks contained a foreign road with trackage rights how far could they be allowed to operate. I suppose you could run it from one staging yard to the other, but would it make sense doing that.

That's entirely up to you.  Normally its from one connection with the tenant road to another connection with the tenant road.  That could be miles or hundreds of miles.  The BNSF has trackage rights over the UP Red River bridge (if you are traveling on I-35 it will be just west of the highway bridge between OK and TX) a distance of a few miles.  The BNSF was granted thousands of miles of trackage rights over the UP as a result of the UP/SP merger.  There is no standard for how far trackage rights can go.  Your choice.

Dave H.

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Posted by jeep35 on Monday, May 10, 2010 7:38 AM
Thanks for the information guys. Jim
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Posted by AltonFan on Monday, May 10, 2010 5:35 PM

dehusman

jeep35
I have a very basic understanding of the term "trackage rights". One railroad (or more) has the right to use another railroads tracks to move freight or passengers, but that's about where my knowledge on the subject ends. What are the benefits for each railroad.

You have to split trackage rights into two "eras".  One is pre-Staggers, the other is post-Staggers.  Pre-Staggers most of the trackage rights were for the convienience of the two railroads.  It was purely a business decision for one railroad to let another use its right of way. 

Dave H.

I've read about any number of pre-Staggers trackage rights that were ordered by the regulatory authorities.  And if railroads wished to voluntarily enter into a trackage rights arrangement, the agreement was subject to approval by the ICC.

Dan

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Posted by AltonFan on Monday, May 10, 2010 5:48 PM

jeep35
The foreign road originates from the staging farthest away from the classification yard. Right smack dab in the middle of the layout is an industry that would receive a car that is in the foreign roads train. Do they drag the car all the way to the classification yard only to have the home road drag it back to where it belongs (which sounds silly) or would the foreign road switch the industry itself or maybe set off the car somewhere along the line and have the home road pick it up and deliver it. I don't have much information about operating agreements or union rules and how they would apply. I would like to do it as realistically as possible. Jim

It would depend on the type of train.  Typically, trains running between terminals would not stop to drop off cars, even if they passed the industry where the car would finally end up.  It's not silly; most of the costs in railroading are incurred when a car is picked up, and when it is delivered.  Stopping a Chicago to Omaha run to switch local industries all along the way would be inefficient.  The car would be taken to the train's scheduled terminal, and a local would deliver the car to the receiving industry.

Road crews switching industries would also probably violate union agreements, and craft boundaries.  (Road crews would not handle yard switching , for instance.)

Where a foreign road has trackage rights are involved, usually, the foreign road is not allowed to solicit business from the shippers on the line on which it has trackage rights.

Dan

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Posted by dehusman on Monday, May 10, 2010 9:28 PM

jeep35
The foreign road originates from the staging farthest away from the classification yard. Right smack dab in the middle of the layout is an industry that would receive a car that is in the foreign roads train. Do they drag the car all the way to the classification yard only to have the home road drag it back to where it belongs (which sounds silly) or would the foreign road switch the industry itself or maybe set off the car somewhere along the line and have the home road pick it up and deliver it.

On many, if not most, trackage rights agreements, the tenant road does NOT have rights to serve local customers.  In that case the tenant road would have to deliver the car in normal interchange (which means it would not be in the trackage rights train in all proablility). 

If the tenant road has the rights to serve local customers per the trackage rights contract then they would serve the customer direct with their local train.  Most places I have seen a trackage rights "local" its either very small or a through freight that does a dab of local business, mostly because the trackage rights trains normally don't generate that much local business.

Dave H. Painted side goes up. My website : wnbranch.com

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Posted by wjstix on Tuesday, May 11, 2010 8:04 AM

Sometimes in the past it wasn't so much a case of a regulatory agency requiring some sort of trackage rights agreement when a merger or purchase of one railroad by another took place, as it was a railroad threatening to put up legal roadblocks to the merger if they didn't get a trackage rights agreement.

For example, in 1900 the Northern Pacific bought the St.Paul and Duluth railroad, which oddly enough actually ran between St.Paul MN and Duluth MN. This "Skally line" route gave NP a much shorter and faster route between the Twin Cities and the Twin Ports (Duluth-Superior). However, the Milwaukee Road objected because they didn't want NP to get this shorter route, as it would affect traffic on their lines between the two.

They eventually removed their objections when an agreement was made allowing the Milwaukee to have trackage rights over the NP between the Twin Cities and Duluth-Superior. Part of the agreement was that they could only run freight trains - no passenger trains - and that they could not serve any industries along the line. Oddly enough, even through several mergers, that agreement is still in effect. Canadian Pacific trains today still use trackage rights over today's BNSF between the Mpls-St.Paul and Duluth-Superior.

The old Minneapolis Northfield and Southern - a belt railway serving the south, west and northern suburbs of Minneapolis, used to have a trackage rights agreement with the Soo and NP/BN to reach Soo's Shoreham yard and NP/BN's Northtown yard north of downtown Minneapolis. A lot of the MN&S' business was moving cars from one railroad's yards to another. The MNS also got I think three stalls in the Soo roundhouse at Shoreham for their locomotives to use.

Also, you might have a situation where railroad A wants to serve an industry, but railroad B's line is closer. For example, IIRC there was a situation on the Mesabi Iron Range where a big taconite plant opened up some years back. The nearest railroad was the Duluth Winnipeg and Pacific, who wasn't an iron ore railroad and didn't really have the ability to serve the plant. So they and the DM&IR worked out a trackage rights agreement so the Missabe could use the DWP tracks for a few miles to reach the taconite plant and pick up and deliver cars, since the Missabe had a line that was already fairly close to the DWP line. Online "commercial" customers were still served by DWP, the Missabe only ran the tac trains on the line.

Stix

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