Misc R.R. Revenue

[Anonymous]

I thought rairoads only got paid for moving cars from piont A to point B. Are there other ways that railroads earn revenue?
TIM A

[Anonymous]

You bet, stay tuned. gdc

[Anonymous]

As a way of introducing this subject, I'll try to answer your question. Miscellaneous charges, that is billing to customers by the railroads, are for services ancillary to but not necessarily involved with direct moving of a car. For instance, the various types of demurrage. Demurrage is a charge to a customer for excessive detaining of a freight car for loading or unloading. The purpose of demurrage is to encourage the prompt release of an empty or forwarding of a load, so as to provide the railroad a reasonable return on the investment of its equipment. A box car not moving is not producing revenue.
There are other miscellaneous charges as well. As these posts go on I'll talk about them as is appropriate and as long as interest is there. Other miscellaneous charges may be the various types of switching, weighing, transit charges and other services indiginous to a particular location. On the former N&W, there was even a miscellaneous charge for koshering. There was a Jewish owned customer who received perishable goods by the carload. Since this customer was an orthadox Jew, he desired to have the load koshered before it was unloaded. The railroad had an agreement with a local rabbi to do just that. When a car arrived, the rabbi was called, he came and the load was koshered. The miscellaneous charge to the customer was $25 per car, if I remember correctly, which is what the rabbi charged.
Since Ed, from Houston, expressed an interest in discussing chargeable switching, let's go there first. Right off the top of my head, I can think of 5 types of chargeable switching.
1. Intra plant. This is switching of cars from spot to spot within a customer's facility. Since nothing in railroad billing is simple, there are instances where intraplant switching is not billable to the customer. We can discuss this more in a future post.
2. Inter plant. This is switching between two customers, maybe even the same the customer with two facilities.
3. Intra terminal. This is switching within a railroad's yard limits. This could also apply to a switching carrier such as the one Ed works for. Such as two locations within one yard limit.
4. Inter terminal. This is switching between two terminals while still not a line-haul move. It may or may not be between two carriers.
5. Junction switching. This is switching done within designated geographic limits at the beginning or terminating point of a line-haul movement. To clarify, imagine a customer located in Chicago on NS who wants to ship a car to Florida to a location on CSXT. The customer prefers to have the car shipped from Chicago on CSXT. The customer contacts CSXT with a bill of lading. CSXT then notifies NS that box car CSXT 123456 is ready for switching to them. NS then gets the car and moves it to the interchange point with CSXT at Chicago. Since NS is not going to do this free, a junction switching charge is assessed against CSXT and settled with other similar switching moves monthly.
This post has become long quickly so let's stop here and give everyone a chance to comment. If I've overlooked a type of switching or you wi***o add something or wi***o ask a question, I invite you to do so. More next post...gdc

[edblysard]

Really good opener,, and yes, better as a seperate topic. Wonder if anyone will bite on AAR billing/bad order & car repairs?
Good start.
Ed

[Anonymous]

I wonder too. However AAR repair billing is a mechanical function as opposed to rail operations. If this discourse continues, I will get into that down the road. There are also money sources in land leases and sales, building and property rents, coal, gas and timber royalties as well as profits from investments and industrial development projects. Ed, thanks for your input. I am trying to keep this as an overview. gdc

[Anonymous]

As further response, there are areas of other interline settlements as well. Revenue, car hire and freight claims come to mind. These are other facets and, for clarities sake, should be discussed seperately methinks. Have a safe day! gdc

[oltmannd]

On the intermodal side of the house, there are some others. Most notably storage fees for empty steamship containers and chassis. Sometimes storage is worked out as part of the rate, given certain traffic volume and amt of equipment.

[Anonymous]

Thank you for your comments and I apologize. It was not my intent to exclude intermodal ops and the areas of trailer/container/chassis storage is a revenue source. We had begun to focus on switching which is indiginous to rail operations. If we go that long, we can also discuss intermodal revenue sources. After all, it's one of the few volume growing areas of the industry. gdc

[Anonymous]

The railroads charge for switching cars at line customer industrial sights? I thought that spotting cars was added into the shipping costs.
I thought the railroads dropped off the cars at a customers sight for free. Is that not correct?
TIM A

[Anonymous]

Tim,
Line-haul rates include the pulling of a car from original loading spot and the placing of a car at its final destination. Sometimes customers want additional switching. This more than likely occurs in large facilities with multiple tracks but isn't limited to that. The first type of chargeable switching I will talk about is intraplant. Hopefully it will explain some of your questions. Stay tuned! gdc

[edblysard]

Hi Tim,
You bet we charge to move cars within a plant. It is one of the most common moves we do on a terminal RR. Example.
I am going to pull and spot a plants loading track #6A.
I have work orders showing 4 pulls, 1 move and 4 spot cars.
Their track #6A has five spots, specific locations where cars are placed, usually under a loading/unloading pipe rack or at a warehouse door.
Spot 1 is nearest the main, spot five at the back of the track. I am going to describe the moves required, so you can see why we would charge someone to move a car already in their plant. My work order shows the customer wants the cars from spot 1, 3,4&5 pulled and sent to the carrier of their choice.
However, the car on spot 2 is a "setback/move", the customer now wants it moved to the 5 spot to unload it.
Remember, I also have four "new" cars to spot in the plant.
We would cut off from our train, leaving it on the main, reach in and pull all five cars from the plant. Set three cars to the main on top of our train, (spots 3 ,4 &5) and set the car from the 2 spot back in the plant. We would then get back against our train, which now consist of a locomotive followed by four pulls, (#s 1, 3 4 & 5) and four "new" spot cars. The customer dosnt care what order the new spots are in, but the car from #2 must go to the #5 spot. We drag up, come back against the car we put back in the plant, (old #2 spot) and shove back to the #5 spot, cut off, and then spot #s 4, 3, 2, and 1, with the "new" spot cars,cut away and leave the plant with the old cars from #s 1, 3, 4 &5, our "pulls". Now remember, there is a lot more work involved, this is very simplified. We have to couple up the cars in the plant, as they are usually seperated, lace up the air hoses, cut in the air, check with a air guage the brake pipe pressure at the rear car, and do a walk set, (visual check to make sure all the car brakes work)
So you see, it isnt just a matter of "grab and go", it can require a lot of complicated moves, what I described is a very simple example, imagine if 1 went to 4, 4 to 2, and 2,3& 5 were pulls?
If all we had to do was pull and spot the plant, with no additional moves, a single flat fee or charge is billed. Any aditional or special moves are billed as a seperate switch move.
At this plant, we often have to "turn" a car, literaly turn it around. This is because some cars have unloading nozzels facing to one side only, and often arrive from the point of orgin facing the wrong way for the customers unloading/loading rack, which is only on one side of the track.. So the customer wants us to pull the car, turn it around, and re-spot it so the rack and nozzles line up. This means we pull it from the plant, and take it a few miles to a wye, wye the car, run around it, and shove it all the way back to the plant and re-spot it. Think about it, why would we do all of that for free? The customers are happy to pay the "small fee" we charge, as investing in newer permant plant structures is very expensive, compared to the cost of a switch move.
Clearer, or did I just stir up the mud more?
Ed

[Anonymous]

I think that a new can of worm has just been opened Ed for people who do not work for the railroad`s do not realy understand on how we generate revenue to keep it running 1. being the cost of diesel fuel to run the locomotives 2. the cost of labor for the switch crew i.e. the engineer, foreman & helper it takes time to do the air break tests when car are pulled from the industry i.e. air flow or break pipe leakage in the absents of an air flow meter the AFM test is easy as long as the train is 60 cfm or below the break pipe leakage takes 3 minutes to do before doing any of these tests the train air system has to be fully charged to operating pressure as per the GCOR 80 psi for yard and 90 psi for road walk the set up of the breaks and take the walk it can take some times over an hour to a simple move of 8 cars out and 8 cars in there is no such thing as a fast move when ever the crew gets in a hurry things can go wrong. Rodney Beck Switchman/Foreman BNSF Chicago Division Galesburg Terminal

[Anonymous]

Property leases, track Leases, car hire revenue, demmurage, special train moves, asset sales, switching charges, car repairs, any shop work for others, just a few other ways

[Anonymous]

Property leases, track Leases, car hire revenue, demmurage, special train moves, asset sales, switching charges, car repairs, any shop work for others, just a few other ways

[Anonymous]

Ed had explained what one type of chargeable intraplant switch would be. In essence, if you change the remaining lineup of the track, then a switch charge is applicable. You could even move remaining cars from one door to the next as long as you didn't exchange spotting locations. For instance, consider a single track with 8 spotting locations, 1 thru 8 beginning at the closest to the switch. There are cars in spots 2, 3, 4, 6 and 7. The carrier arrives with a car that the customer wants at spot 4. At the same time, the customer wishes to pull the car presently in spot 4. Additionally, the customer would like the cars all coupled together in spots 8, 7, 6, 5 and 4. Since this did not change the lineup of the track other than to spot and pull, there is no chargeable switch. If the remaining cars had been moved around each other and respotted, then there would be a chargeable switch. This has complexity been a point of contention between the carriers and customers for years. Some undertand it and accomodate the charges and some never do. Other customers try to take advantage, especially if the encounter an inexperienced train crew.
Other types of chargeable intraploant switching would be from track to track in a larger facility. This would be done to complete loading or unloading. Line-haul rates include the spotting at one loading location and/or one spotting at the destination. A strict interpretation of this would be switching an extended load to an idler. Let me describe this to those who may not be familiar. An extended load is one that is too long for one car, such a bridge girder. In order for the car to be handled in the train, a flat car is provided to accomodate the extended end of the girder. If the loading spot can not accomodate the idler, the load has to be switched to it from the end that can be reached to complete loading---a strict definition of completing a load. Whether that is a chargeable switch has been the subject of heated conversations between carriers and customers. (As an aside to Ed, have you ever encountered that move and how was it handled?) At NS we ultimately created a rate that permitted that. It was indiginous to that customer at that location only.
Other chargeable intraplant switches could be at larger customer facilities, The customer may want something moved from one place in his plant to another. Since there would be no line-haul involved, there would be a chargeable switch. This has probably given you an idea of how complex switching can be, and believe me, we've only scratched the surface.
Once again, this post has become long. Next time as an adjunct to intraplant switching, let's talk about customers who perform some or all of their own moves. This activity is usually found in large operations such as steel mills, auto assembly plants, paper mills, etc. It's not limited to those, though. Have a safe day...gdc

[Anonymous]

Right you are. Check outg the posts of 12/5 at 9:41 pm and the one from Donald on 12/6.

[Anonymous]

Ed, at NS we never charged for a car facing in the wrong direction. In the case of an opposite nozzle or a placard directing unload from the other side from the spot, we would turn the car without charge. The logic is that it is the carrier's responsiblity through line haul rates to spot the car for the customer. As I think about it, it probably is different for a terminal carrier, since they usually do not participate in line-haul revenue. I don't remember that ever coming up with the switching carriers I've been involved with. gdc

[Anonymous]

WOW, I did not think that switching cars could be so complicated. You mention air brake testing, if your moving a car a short distance why do you need brakes isn't the engine powerful enough to stop the car on its own? Moving these cars sounds like alot of reversing. Do they use two engines facing away from each other? If your useing one of those new big engines, how do you see out of them when in reverse?
TIM A

[Anonymous]

If you derail a train while doing this work who pay's to get everything fixed?

[edblysard]

Yes, for a line haul not charging for a turn woald make sense. But on a terminal road, when the carrier delivers the car ro us, their responsibility ends. Based on whatever agreement the carrier and the customer have, turning the car may be included in the carriers charge. If not, then we charge to do it for the customer. Most of the time the switch crew dosnt know one way or the other, it may be a seperate charge or not. On this paticular plant, it is a seperate charge between them and the port, as it is a "once in a while move" involving one or two special phospherous salt cars. At another plant with powdered kaolin clay, its a everday move, and the "cost" is billed to the delivering carrier. Based on the number of responses, this topic seems to be generating some intrest, thanks for the information, your are educating a lot of folks.
Ed

[Anonymous]

Whomever is responsible pays! If it's caused by track conditions on the customer owned property, then the customer pays. If the cause is train handling, the carrier pays, if it is caused by defective equipment (car) then it's the car owner's responsibility. In that case, settlement can be a long and tedious process...but then what's new with that? gdc

[Anonymous]

Tim,
I wasn't the one who mentioned brake tests. If you're just moving a small number pf cars a short distance and there are no gradients with which to worry, brake tests would not be necessary. The conditions change from place to place.

[Anonymous]

Glad to do it! Wait 'till we get to demurrage!

[Anonymous]

Hello everyone I am the who mentioned air break tests on the BNSF in the GCOR any time cars are picked up either from a storage track or industry an air break test is required as the crew is picking up cars not pretested i.e. they have not had air in the break system for 4 hous as per a special instructions they require an inital terminal air test i.e. air flow methode or brake pipe leakage test in the absents of the AFM also a set and release of the cars must be done if a cars breaks do not set it is left at the storage track or industry and placed in a bad order status the crew has to have 100% of the breaks working on the cars that gets picked up. would you want to handle loaded 100 ton hoppers with out air if it is within the yard moving at slow speed no problem it can be done but if the switch crew leaves the yard to work air must be aligned. As for the locomotive yes they are powerful enough even using an old SD9 which has 1750 horse power they can do just about anything thrown at it. Rodney Beck Switchman/Foreman BNSF Chicago Division Galesburg Terminal

[Anonymous]

Rodney,
Thank you for clarifying the difference. However, If I were making an industry switch from the line of road, why not just draw the brakes down tight, set 3 handbrakes, cutoff and do what you have to do. When you returned with your pickup, couple up, cut the air in carefully so as not to initiate an emergency application and release the 3 handbrakes. If you are using an EOT, that will tell you when the brake line has charged back to within 15 psi of the valve setting and you can leave. If you didn't have an EOT, one of the helpers would have to be at the rear to see the brakes releasing. By the way, what is GCOR?

[wabash1]

rodney if you would reread your book that refers to initial terminal brake test. at a point other than initial terminal you only need 80% brakes. at a terminal such as ed works all he needs is a set on rear car. he does not even haft to walk the release. no leakage on the cars either. dont get the line haul and terminal moves mixed up.

[Anonymous]

Could you please answer one more question? If they use those big engines how do they see what there doing when backing up? Ed, you seem to do alot of switching what kind of engine do you use?
TIM A

[Anonymous]

It is much more difficult to see with a long end leading. Usually, if you're switching with one of these, you would have help from other members of your crew. They would advise you of obstacles, etc. and tell you how close you are to the cars you're going to get. It's the same if you were shoving a cut of cars to a coupling. The standard is to advise the engineer in 50' car lengths. The radio conversation would go something like this. "ten cars to a coupling.....7 cars.....5 cars, ease 'em up.....2 cars.....1 car.....half a car". Just before the coupling is ".....that'll do." Some of the older locomotives' controls were set up for long end lead and others for short end lead depending on the preference of the railroad. The controls are arranged in the locomotive so that the engineer is on the right side. This has been traditional going all the way back to the first locomotives right up through the steam age until now. Trackside signals, signs, mileposts, order boards, etc. are also so constructed. Being on the right side enables the engineer to see these things more easily. Those roads who preferred long end lead believed that permitted bidirectional operations. Some roads opted for dual controls, i.e. on both sides. Nowadays, everyone designates short end lead.
There is a lot more that can be said about this. Switching carriers, as a rule, use smaller power, sometimes locomotives designated for switching. In these cases even the long end is shorter and there is no short end. The vernacular term for these locomotives on NS is "buttheads". Very few, if any switch locomotives are produced anymore. Everyone prefers the versitility of multiple service power.

[Anonymous]

Thank you for the Education. I'm trying not to annoy you guy's to much. I have very little knowledge when it comes to trains.
TIM A

[edblysard]

The only way to get the info is to ask, none of us were born with it. Some learned thru research, some of us learn it at work. I am still learning new things every day at work, and from this forum. I dont think you could ever learn all there is to know and railroading, there is just to many facets for one person to absorb. So ask any question you would like to , I will try to answer, if not me, someone out there has the info you need and will answer.