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New Rules for Hazardous Shipments

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Posted by Murphy Siding on Sunday, March 16, 2008 8:41 PM
 Railway Man wrote:

The AAR is asking the Federal Government for authority to revise the common-carrier law to allow railroads to separate shippers into 2 classes: one that ships especially dangerous hazardous commodities, and a much larger class that ships nonhazardous or moderately hazardous commodities.  In particular, the AAR is focusing on Toxic Inhalation Hazards, gases such as ammonia, chlorine, and phosgene, which account for 0.3% of all rail carloads but most of the liability risk. 

RWM 

That makes sense to me.  If I were a smoker, my life insurance would cost more money.  After all, insurance is a matter of statistics and risk.  I'm surprised that the other 99.7% of railroad shippers aren't kicking and screaming about subsidizing the .3%.

     What is specifically stopping the railroads from raising rates on TIH's?  Regulations?

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Posted by Railway Man on Sunday, March 16, 2008 7:54 PM
 Murphy Siding wrote:
 Railway Man wrote:

A more important topic is insurance.  The railway industry would like shippers of hazardous commodities to bear the full costs of their shipments, particularly the full costs of the insurance, instead of being forced by law to spread those insurance costs onto all of its shippers, whether they ship harmless lumber or toxic ammonia. 

RWM

Having shippers of hazardous commodities  bear the full cost of insurance on their products would not change the liability of the railroads.  If I were shipping marshmallows by rail, I'd be a little unenthusiastic about underwriting the true insurance cost of someone shipping something highly toxic.

Murph:

The AAR is asking the Federal Government for authority to revise the common-carrier law to allow railroads to separate shippers into 2 classes: one that ships especially dangerous hazardous commodities, and a much larger class that ships nonhazardous or moderately hazardous commodities.  In particular, the AAR is focusing on Toxic Inhalation Hazards, gases such as ammonia, chlorine, and phosgene, which account for 0.3% of all rail carloads but most of the liability risk.  The Graniteville, S.C., wreck of Norfolk Southern train 192 of January 6, 2005, which resulted in the puncture and release of a single tankcar of chlorine, killed nine, and had direct costs to NS of $30-40 million to date, probably would have bankrupted the corporation had it occurred in a more populated area or during a weekday at this location.  The separation of shippers into classes would result in railroads charging a rate to hazardous shippers that reflected the cost of insuring their shipments.

It will be interesting to see how the National Industrial Transportation League (NITL) responds to this request.  From one point of view, a marshmallow shipper would probably appreciate his freight cost not including a de facto subsidy to the methyl-ethyl-death shipper.  From another point of view, shippers as a whole may look with dismay on any abrogation of this very old aspect of the common-carrier law, as it could be a slippery slope.  If it occurs, shippers of things like molten sulfur might want to gain a lower included insurance rate than shippers of things like gasoline, gasoline lower than liquified petroleum gas, and so forth.

RWM 

 

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Posted by MichaelSol on Sunday, March 16, 2008 7:39 PM
 Murphy Siding wrote:
 Railway Man wrote:

A more important topic is insurance.  The railway industry would like shippers of hazardous commodities to bear the full costs of their shipments, particularly the full costs of the insurance, instead of being forced by law to spread those insurance costs onto all of its shippers, whether they ship harmless lumber or toxic ammonia. 

RWM

Having shippers of hazardous commodities  bear the full cost of insurance on their products would not change the liability of the railroads. 

It changes who bears the cost of the risk for that liability. Public policy has long held that you cannot make someone else accept the cost of the risk of your negligence.  There is a large grey area in there, but ultimately, there is a public good involved in discouraging negligent behavior. The reasons should be pretty obvious why. If you could require someone else to accept the entire cost of the financial risk of your actions, that breaks down the preventative goals of negligence laws. Negligence and liability laws are ultimately statutory and contracts made to circumvent the law invite scrutiny. Kind of like Governor Spitzer's recent contractual embarrassments: the fact that two people agreed to the contract doesn't make it legal in the first place.

If I were shipping marshmallows by rail, I'd be a little unenthusiastic about underwriting the true insurance cost of someone shipping something highly toxic.

I would too if the Chemical Company was paying the same rate that I was for my marshmallows.

Do you think they are?

 

 

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Posted by Murphy Siding on Sunday, March 16, 2008 7:27 PM
 Railway Man wrote:

A more important topic is insurance.  The railway industry would like shippers of hazardous commodities to bear the full costs of their shipments, particularly the full costs of the insurance, instead of being forced by law to spread those insurance costs onto all of its shippers, whether they ship harmless lumber or toxic ammonia. 

RWM
Having shippers of hazardous commodities  bear the full cost of insurance on their products would not change the liability of the railroads.  If I were shipping marshmallows by rail, I'd be a little unenthusiastic about underwriting the true insurance cost of someone shipping something highly toxic.

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Posted by MichaelSol on Saturday, March 15, 2008 9:43 PM
 Murphy Siding wrote:
 Railway Man wrote:

A more important topic is insurance.  The railway industry would like shippers of hazardous commodities to bear the full costs of their shipments, particularly the full costs of the insurance, instead of being forced by law to spread those insurance costs onto all of its shippers, whether they ship harmless lumber or toxic ammonia. 

RWM

Why is it, that something that, on the surface, looks so logical-shippers bearing the insurance costs-should be so hard to convince lawmakers to change?

Because it shifts the burden of direct negligence to the party that cannot control the negligence, and absolves the potentially negligent party of bearing any risk for their negligence. That is bad public policy up, down, and sideways.

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Posted by RRKen on Saturday, March 15, 2008 9:37 PM

 Just to be sure, I checks all current and NPRM's at the DOT. There is an Notice out dated 12/21/2006.   Yep, 2006.   This is still only a proposed rule,  TSA/DOT will have to sort it out, and that can take some time depending on the comments.  

 You have to remember, to force carriers in what is considered an unfunded mandate, will cost the common consumer a great deal of money.   In the end, I rather doubt these rules will be draconian.  

 And being governed by those rules, we would know well in advance of these changes as it would effect waybilling of shipments.   And that is the last thing shippers want.  And if you think shippers don't have a voice?  Keep dreaming.

 We (railroad carriers) don't monitor routing's of electronically submitted waybills right now.  To do that, would require a lot more manpower for both the carriers and shippers.

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Posted by RRKen on Saturday, March 15, 2008 9:02 PM
 Ham Radio wrote:

A lot of the newer hazmat tank cars I have handled the past year in the course of my job have GPS tracking devices installed on the railcar.  You can tell by the small UHF antenna on one end of the car.

There is an active interest in the whereabouts of a lot of these cars.

 

We ship hundreds of hazmat tanks every week.  None of them have antennas or devices for tracking.   Since 2002, there have been 11,000 new tank cars put into Ethanol service.  None with tracking abilities aside from the AEI transponders.   

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Posted by Nagrom1 on Saturday, March 15, 2008 7:03 PM

 

"A lot of the newer hazmat tank cars I have handled the past year in the course of my job have GPS tracking devices installed on the railcar.  You can tell by the small UHF antenna on one end of the car."

Great, another way for people with bad intentions to get info they don't need...

j/k by the way. I think some things meant to protect have gone too far. I am pretty sure the statistics say that automobiles(trucks) are more likely to be involved in incidents than rail traffic. Wouldn't that be shooting yourself in the foot?

 

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Posted by Ham Radio on Saturday, March 15, 2008 6:30 PM

A lot of the newer hazmat tank cars I have handled the past year in the course of my job have GPS tracking devices installed on the railcar.  You can tell by the small UHF antenna on one end of the car.

There is an active interest in the whereabouts of a lot of these cars.

 

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Posted by Railway Man on Saturday, March 15, 2008 5:09 PM
 Dakguy201 wrote:

If the CSX would just take dangerous shipments off that line through Washington DC, it might be enough to avoid any need for new rules.  Nothing concentrates legal attention to a matter like a danger to a Congresscritter's person!  The hearings that were held on this matter were full of phrases such as "less than a mile from the Capitol..."

That would be conceding something in return for nothing.  The interest of the railroad industry is to make chemical shippers pay for the hazards.  Giving in on this one would make it that much more difficult.

RWM 

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Posted by bobwilcox on Saturday, March 15, 2008 4:52 PM

 Murphy Siding wrote:
Why is it, that something that, on the surface, looks so logical-shippers bearing the insurance costs-should be so hard to convince lawmakers to change?

In Washington at the STB it comes down to politics and whose lawyer has the best argument. This isn't a closed topic since the railroads have apealed the ruling. 

 

Bob
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Posted by Murphy Siding on Saturday, March 15, 2008 4:05 PM
 Railway Man wrote:

A more important topic is insurance.  The railway industry would like shippers of hazardous commodities to bear the full costs of their shipments, particularly the full costs of the insurance, instead of being forced by law to spread those insurance costs onto all of its shippers, whether they ship harmless lumber or toxic ammonia. 

RWM
Why is it, that something that, on the surface, looks so logical-shippers bearing the insurance costs-should be so hard to convince lawmakers to change?

Thanks to Chris / CopCarSS for my avatar.

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Posted by Dakguy201 on Saturday, March 15, 2008 3:09 PM

If the CSX would just take dangerous shipments off that line through Washington DC, it might be enough to avoid any need for new rules.  Nothing concentrates legal attention to a matter like a danger to a Congresscritter's person!  The hearings that were held on this matter were full of phrases such as "less than a mile from the Capitol..."

Railway Man is right that the more important issue is who bears the cost of insuring these shipments.  The AAR has been trying to shift the burden from all shippers to those whose inputs or outputs are hazards.  Predictably, the chemical companies don't think that is a good idea.   The trial lawyers don't care which side bears the cost so long as total liability is not capped.

 

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Posted by blue streak 1 on Saturday, March 15, 2008 12:00 PM
agreeded: shippers should bear the full insurance costs. Bet tank cars would be built like sherman tanks.
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Posted by Railway Man on Saturday, March 15, 2008 12:27 AM

I haven't yet read the text of the law so I am not sure if it is practical or reasonable.  It is possible the net result will be almost nil except to create jobs at railways for some compliance people to file paperwork with the government showing that the law was adhered to, and some jobs in the government to audit and file the paperwork.

A more important topic is insurance.  The railway industry would like shippers of hazardous commodities to bear the full costs of their shipments, particularly the full costs of the insurance, instead of being forced by law to spread those insurance costs onto all of its shippers, whether they ship harmless lumber or toxic ammonia. 

RWM
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Posted by vlmuke on Friday, March 14, 2008 10:23 PM
I don't see them stopping the rail carriers from shipping stuff as we already haul stuff that can't be shipped via the highway but then again you just never know what those political idiots will do
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Posted by inch53 on Friday, March 14, 2008 1:17 PM

After reading this, it got me to wondering, since most the companies that produce or use HAZMAT are within generally close to large cities. If they ship or receive by rail now, it will leave little choice but to go by trucks, or move both operations, perhaps overseas.

  I don't know but wouldn't rail be safer setting 10 minutes to an hour for a crew or engine change with some security. Than in a truck stop for a lunch or potty stop or 8 hour driver down time, with very little or no security.

If something were to happen, it would take some one with a whole lot of information they shouldn't have had to begin with.

inch

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Posted by diningcar on Friday, March 14, 2008 12:40 PM

A few Thoughts:

If they are not moved by rail then how?

Those who say there are no alternative routes should cite specifics rather than make general statements.

When there are alternative routes will the smaller cities, 100,000 and less for example, also choose to impose restrictions?

Any alternative will cost more. Whether by truck, barge or rail the shipping costs will increase and the end result will be higher costs to the customer or consumer.

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Posted by Murphy Siding on Friday, March 14, 2008 12:32 PM
 StillGrande wrote:

My question is is it even possible to ship anything by rail that does not go through one of the 60 cities?

How do they ship *to* those cities?  If a railroad is prohibited from shipping hazmat through a certain city, can they refuse to ship it to that city?

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Posted by cacole on Friday, March 14, 2008 10:58 AM

What next?  Going back to an archaic law when railroads were in their infancy that required all trains to have a person walking in front with a red lantern and ringing a bell?  I think that law is still on the books in some parts of the country.

 

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Posted by StillGrande on Friday, March 14, 2008 9:15 AM

One of the pictures they use is from the tunnel derailment in Baltimore, which, other than being somewhat of a disruption had no casualties if I remember correctly, even though it was in the middle of the city. 

Do most railroads even have an alternate route which would work?  In New England?  I'm not sure dragging this stuff around the countryside for twice as long is "safer".

And they wonder why manufacturing jobs are moving overseas.  You can't even get the materials to the factory without someone freaking out.

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Posted by tree68 on Friday, March 14, 2008 8:32 AM

Without seeing the list of cities involved, I'd have to say 'fat chance.' 

At one time, cities grew up around the railroad station, therefore placing the railroad line in the middle of town.  The lines are still there.  Since the railroads got rid of redundant lines some years ago (Eek! Lack of foresight!  They should have known that this would happen!), there are precious few alternatives for moving this cargo. 

The comments that accompanied the story generally referred to fearmongering....

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New Rules for Hazardous Shipments
Posted by StillGrande on Friday, March 14, 2008 8:08 AM

There is an article in USA Today about the new shipping rules for hazardous materials through cities.  Sorry, my current location will not let me have an active hyperlink.  http://www.usatoday.com/news/nation/2008-03-13-toxictrains_N.htm

The long and the short of it is that railroads will have to evaluate each shipment and make a determination as to whether the shipment should be sent on a more circuitous route.  If the initial route is through one of 60 cities, then they have to check on an alternate. 

Of course everyone is complaining that the railroads will just say the new route is more expensive and puts more people at risk than a direct route. 

My question is is it even possible to ship anything by rail that does not go through one of the 60 cities?

 

Dewey "Facts are meaningless; you can use facts to prove anything that is even remotely true! Facts, schmacks!" - Homer Simpson "The problem is there are so many stupid people and nothing eats them."

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