August 2015 Railway Age by Railway Age

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On the Cover BNSF double-tracking project in Vaughn, N.Mex. Photo: BNSF

Railway Age, USPS 449-130, is published monthly by the Simmons-Boardman Publishing Corporation, 55 Broad St., 26th Fl., New York, NY 10004. Tel. (212) 620-7200; FAX (212) 633-1863. Vol. 216, No. 8. Subscriptions: Railway Age is sent without obligation to professionals working in the railroad industry in the United States, Canada, and Mexico. However, the publisher reserves the right to limit the number copies. Subscriptions should be requested on company letterhead. Subscription pricing to others for Print and/or Digital versions: $100.00 per year/$151.00 for two years in the U.S., Canada, and Mexico; $139.00 per year/$197.00 for two years, foreign. Single Copies: $36.00 per copy in the U.S., Canada, and Mexico/$128.00 foreign All subscriptions payable in advance. COPYRIGHT© 2015 Simmons-Boardman Publishing Corporation. All rights reserved. Contents may not be reproduced without permission. For reprint information contact PARS International Corp., 102 W. 38th Street, 6th floor, New York, N.Y. 10018, Tel.: 212-221-9595; Fax: 212-221-9195. Periodicals postage paid at New York, NY, and additional mailing offices. Canada Post Cust.#7204564; Agreement #41094515. Bleuchip Int’l, PO Box 25542, London, ON N6C 6B2. Address all subscriptions, change of address forms and correspondence concerning subscriptions to Subscription Dept., Railway Age, P.O. Box 1172, Skokie, IL 60076-8172, Or call toll free (800) 895-4389, or (402) 346-4740. Printed at Cummings Printing, Hooksett, N.H. ISSN 00338826. August 2015 Railway Age 1

From the Editor William C. Vantuono

Editorial and Executive Offices Simmons-Boardman Publishing Corp. 55 Broad Street, 26th Fl. New York, NY 10004 212-620-7200; Fax: 212-633-1863 Website: www.railwayage.com

Welcome to commuting hell

have been commuting by rail to Railway Age’s Manhattan offices for more than 23 years. Door to door, on a “normal” day, it takes me about two hours, 90 minutes of which is spent on New Jersey Transit’s North Jersey Coast Line, riding between Long Branch, N.J., and Penn Station New York. About half the journey takes place on Amtrak’s Northeast Corridor, where commuter trains dominate, but are also tenants. Lately, to my discomfort and displeasure, I, along with tens of thousands of other NJ Transit passengers, have been forced to get used to a new normal. I used to enjoy the ride. Now, I never know what to expect. Welcome to rail commuting hell: Power failures. Switch problems. Catenary problems. Disabled trains stuck in the tunnels under the Hudson River. Stations with barely functioning air conditioning, packed with frustrated people standing around, looking at train information displays that alltoo-frequently say “STAND BY,” “DELAYED,” or “CANCELLED.” People trying to get into or escape from New York by other means (PATH, ferries, buses, with the now all-too-familiar practice of “crosshonoring” tickets). This is the new normal: an unreliable rail system plagued with technical problems. The prime culprit is an NEC infrastructure that’s showing its age, in dire need of major investment, and an infusion of capital. But instead of trying to do something constructive about the problems, all I see, at least on the surface, is unproductive, yet politically expedient, finger-pointing. The biggest finger-pointer has been New Jersey’s bull-in-china-shop, take-no-prisoners Governor Chris Christie, who after Hell Week (July 20-24, where every day except one was a commuting nightmare), aimed his “I run NJ Transit and don’t you forget it” rhetoric at Amtrak, everyone’s favorite whipping boy: “NJ Transit commuters were victimized by nearly an entire week of extreme delays and cancellations for one reason only: Amtrak’s 2

Railway Age

August 2015

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indifference to New Jersey commuters and its abject neglect of the infrastructure that New Jersey and our entire region relies upon.” He added that he was going to contact the state Attorney General’s office to see “what recourse New Jersey has to ensure the $100 million we pay Amtrak every year is being used properly.” The governor was campaigning for president in Iowa when he released his glorious pronouncements. Like his presidential aspirations, they have no basis in reality. NJ Transit Executive Director Ronnie Hakim’s response to the mayhem was much more reasoned: “Once again this week, Amtrak power disruptions along the Northeast Corridor have wreaked havoc with the commutes of [our] customers. We want to assure [them] that we are taking all steps necessary to hold Amtrak accountable for these service disruptions and infrastructure failures. Amtrak must take every available action to resolve its continuing problems that are creating chaos for our customers.” Amtrak President Joe Boardman’s response: Our power system infrastructure is aging and falling apart, and Congress hasn’t provided the funds to maintain a state of good repair and make improvements. “I’m very frustrated as well,” he said. “We want to get it fixed. This community deserves a reliable railroad. The problem is finding the funding to fix the problem.” Truth, or excuses? I’ll go with the former, and I don’t think there’s a railroader or civil engineer or signal engineer who wouldn’t agree that running and maintaining a reliable railroad, passenger or freight, requires lots of cold, hard capital investment. The Class I railroads aren’t pouring nearly $30 billion into their plant and equipment this year for nothing. My message to all the bloviating, fingerpointing politicans: Zip your flapping lips, and put your money where your mouth is.

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Industry Indicators TRAFFIC ORIGINATED CARLOADS

SHORT LINE AND REGIONAL TRAFFIC INDEX FOUR WEEKS ENDING JUNE 27, 2015

MAJOR U.S. RAILROADS BY COMMODITY Grain Farm Products ex. Grain Grain Mill Products Food products Chemicals Petroleum & Petroleum Products Coal Primary Forest Products Lumber and Wood Products Pulp and Paper Products Metallic Ores Coke Primary Metal Products Iron and Steel Scrap Motor Vehicles and Parts Crushed Stone, Sand, and Gravel Nonmetallic Minerals Stone, Clay & Glass Products Waste & Nonferrous Scrap All Other Carloads TOTAL U.S. CARLOADS

JUNE ’15 75,539 3,190 39,333 23,620 119,380 55,702 363,909 6,196 14,250 24,009 30,715 16,357 38,054 16,138 75,746 95,809 19,993 32,884 14,519 21,723 1,087,066

JUNE ’14 73,331 3,709 38,266 24,523 119,830 60,075 440,661 6,693 14,912 25,225 33,360 15,268 44,214 17,667 72,367 99,095 21,547 34,331 14,302 18,706 1,178,082

% CHANGE 3.0% -14.0% 2.8% -3.7% -0.4% -7.3% -17.4% -7.4% -4.4% -4.8% -7.9% 7.1% -13.9% -8.7% 4.7% -3.3% -7.2% -4.2% 1.5% 16.1% -7.7%

440,671

415,886

6.0%

1,948,588

1,859,922

4.8%

CARLOADS

Chemicals Coal Crushed Stone / Sand / Gravel Food & Kindred Products Grain Grain Mill Products Lumber & Wood Products Metallic Ores Metals & Products Motor Vehicles & Equipment Nonmetallic Minerals Petroleum Products Pulp, Paper & Allied Products Stone, Clay & Glass Products Trailers / Containers Waste & Nonferrous Scrap All Other Carloads

COMBINED U.S./CANADA RR INTERMODAL

FIVE WEEKS ENDING NOV. 1, 2014

MAJOR U.S. RAILROADS BY COMMODITY TRAILERS CONTAINERS TOTAL UNITS

jUNE ’15 118,347 998,802 1,117,149

JUNE ’14 118,509 958,843 1,077,352

% CHANGE -0.1% 4.2% 3.7%

5,829 243,821 249,650

7,141 230,210 237,351

-18.4% 5.9% 5.2%

124,176 1,242,623 1,366,799

125,650 1,189,053 1,314,703

-1.2% 4.5% 4.0%

COMBINED U.S./CANADA RR TRAILERS CONTAINERS TOTAL COMBINED UNITS

Source: Monthly Railroad Traffic, Association of American Railroads

AVERAGE WEEKLY U.S. RAIL CARLOADS: ALL COMMODITIES (not seasonally adjusted)

% CHANGE 8.0% 11.0% -1.0% 5.0% 10.0% 18.0% 2.0% -3.0% -15.0% -2.0% 22.0% 0.2% 7.0% 6.0% 42.0% 0.9% 7.0%

RAILROAD EMPLOYMENT, CLASS I LINEHAUL CARRIERS, JUNE 2015 (% CHANGE FROM JUNE 2014 )

CANADIAN RAILROADS TRAILERS CONTAINERS TOTAL UNITS

ORIGINATED JUNE ’14 42,427 23,188 28,613 10,307 19,803 5,674 9,228 5,548 20,141 8,474 2,256 1,999 17,672 11,962 34,700 9,742 83,817

TOTAL CARLOADS, MONTH 2015 VS. 2014

CANADIAN RAILROADS ALL COMMODITIES

ORIGINATED jUNE ’15 45,777 25,704 28,341 10,792 21,762 6,699 9,438 5,392 17,125 8,305 2,759 2,003 18,920 12,724 49,351 9,832 89,938

BY COMMODITY

Transportation (train and engine) 71,098 4.66%

Executives, Officials, and Staff Assistants 9,923 0.17%

Professional and Administrative 14,652 1.49%

TOTAL EMPLOYEES: 172,327 % CHANGE FROM JUNE 2014: 3.72% Transportation (other than train & engine) 6,729 (-0.10%)

Maintenance of Equipment and Stores 31,307 4.57%

Maintenanceof-Way and Structures 38,618 3.84%

Source: Surface Transportation Board

GROWTH IN ALL BUT ONE SECTOR Figures released by the Surface Transportation Board show Class I total railroad employment rose 3.72% in June 2015, measured against June 2014. Year-over-year gains were reported in all but the Transportation (other than train & engine) sector, which dropped 0.10%. Transportation (train and engine) continues to lead the pack with a growh of 4.66%, followed by Maintenane of Equipment and Stores, which rose 4.57% from June 2014. 4

RAILWAY AGE

August 2015

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Industry Outlook

NJT sets ’16 budget; hikes fares 9% Facing a $56 million budget gap for its 2016 fiscal year, NJ Transit last month adopted a FY2016 operating budget and capital program totaling $4.27 billion, and a fare and service plan that includes an average 9% fare increase. The $2.099 billion capital program includes upgrades to the Northeast Corridor (NEC, shared with Amtrak), which has allocated $61 million as part of NJT’s ten-year, $1 billion NEC investment program; $87 million for rolling stock improvements; $82 million in rail station improvements; and $913 million in major capital projects for improvements to facilities and equipment heavily damaged by Superstorm Sandy in 2012. Approximately 42% of the capital budget comes from FTA Sandy Resiliency funds, with the balance coming from federal and other sources, including 22% from New Jersey’s state Transportation Trust Fund (TTF). The $2.116 billion operating budget reflects an expected 8.3% growth in passenger revenue. Nearly half of the revenue in the operating budget comes from fares ($1.005 billion), supported by state and federal program reimbursements ($961.8 million), with the balance from a combination of commercial revenues ($115.2 million) and state operating assistance ($33.2 million).

Survey says: Complex hazmat transport regs would even “challenge Einstein” Is complying with the multitude of regulations for the transport of hazardous materials—also known as dangerous goods (DG)—truly a challenge? According to 136 shipping executives surveyed online in April 2015 by Labelmaster, a provider of solutions for hazardous material transport compliance, even Albert Einstein would have had problems figuring out some of the rules. More than half of the 136 executives polled—56%—said Einstein would have difficulties figuring out 49 CFR, one of the government’s primary reference books that covers regulations, requirements and standards for U.S. hazmat transportation. The survey also revealed a majority—59%—find it a challenge to keep with changing regulations. “Between the Department of Transportation, the Federal Aviation Administration and the Department of Defense, there are literally thousands of regulations governing the shipment of dangerous goods,” said Robert Finn, Vice President of Marketing with Labelmaster. “And, these complex regulations constantly change. Just two examples are the proliferation of new rules for the shipment of lithium cells and batteries, and new regulations for the burgeoning crude oil rail carriage industry.” 6

Railway Age

August 2015

Google has agreed to partner with the Federal Railroad Administration on grade crossing safety. Google will use the FRA’s GIS data that pinpoints nearly every rail crossing in the country (approximately 250,000) so the tech giant can add audio-visual alerts of an upcoming rail crossing when a driver uses the turnby-turn navigation feature. FRA Acting Administrator Sarah Feinberg has also asked four other major companies that develop map applications—Apple, MapQuest, Garmin and Tom Tom—to partner with the agency. When Feinberg came on board in January, a spate of rail crossing deaths and accidents occurred, “so she decided to take a fresh look at the problem and followed up swiftly with action,” FRA said. “Working with these tech companies is part of the effort to help educate drivers. Feinberg is also leveraging her experience as a former Facebook executive and her relationships in Silicon Valley to bring one of the nation’s newest industries together with government to solve one of the nation’s oldest problems.” The AAR applauded the partnership. “The grade crossing collision rate has fallen nearly every year since 1980 and about 35% since 2000, but too many collisions still occur and virtually all of them are preventable,” said AAR President and CEO Ed Hamberger. “The FRA’s work with Google will provide a technological tool for motorists to build further safety awareness at crossings. The freight rail industry supports any and all efforts designed to focus people’s attention on the inherent dangers around grade crossings. As FRA statistics show, freight rail safety has been improving dramatically over the past several decades and together with Operation Lifesaver and other key stakeholders, the push for improved safety and general awareness about the dangers at railroad tracks and grade crossings will continue 24/7.”

William C. Vantuono

FRA and Google team up on grade crossing safety

Market

MTS awarded $31.9 million for new LRVs and rail station The San Diego Metropolitan Transit System (MTS) has been awarded $31.9 million from the State of California’s Transit and Intercity Rail Capital Program (TIRCP) to purchase eight new light rail vehicles (LRVs) to increase capacity on the MTS Trolley System, and for a new trolley station serving the 22-story San Diego Central Courthouse.

North America

Worldwide

DART: Exercised an option with Brookville Equipment Corp. for two additional off-wire-capable Liberty Modern Streetcars, extending a March 2013 contract for two identical vehicles delivered earlier this year.

Berlin Transport (BVG): Has placed a €60 million order with Stadler Pankow for eleven four-car type IK narrow profile U-Bahn trains.

R.J. Corman Railway Co.: Has signed an agreement to purchase the Carolina Southern Railroad, an 80-mile short line railroad in eastern North and South Carolina, for $13.9 million.

CRRC subsidiary Nanjing Puzhen SR Rail Transport (China): Has secured three contracts for the supply of metro and light rail rolling stock in China worth a combined Yuan 2.1 billion ($338.2 million).

Southwest Ohio Regional Transportation Authority: Has awarded Transdev Services a five-year contract to operate and maintain the initial 3.6-mile phase of the Cincinnati Streetcar network, which is due to open in September 2016.

European Investment Bank: Has agreed to provide the German state of North Rhine-Westphalia with a €340 million long-term loan to finance the fleet of regional EMUs ordered for the Rhine Ruhr Express (RRX) network, which will be launched in December 2018.

Virginia Railway Express (VRE): Exercised an option to extend its contract with Keolis for an additional five years to operate VRE commuter rail trains, which serve Washington D.C.’s Northern Virginia suburbs.

Rhine-Ruhr Transport Authority: Published a tender notice in the Official Journal of the European Union for a contract to supply and maintain at least 36 EMUs for the region’s S-Bahn network.

Railway Age

August 2015

Mid-Saxony (Germany): Has awarded Vossloh Kiepe and Vossloh Rail Vehicles a contract to supply four additional City Link tram-trains for use in the Chemnitz area, after the state of Saxony agreed to fund 75% of the €23.7 million order. Mass Rapid Transit Corp. (Kuala Lumpur): Has appointed Arup as reference design consultant for the underground section of Klang Valley MRT Line 2. SJ (Sweden): Has awarded EuroMaint a contract to maintain its fleet of X2000 tilting trains and locomotivehauled coaches from March 2016. PHU Locomotive (Poland): Has signed an agreement to acquire three Gama locomotives from Pesa on behalf of Polish open-access operator Ecco Rail. GVB (Amsterdam): Has issued an international tender for a contract to supply 63 low-floor LRVs, replacing the oldest vehicles in service on the city’s 100-mile tram network.

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Update Supply Briefs Rocla acquires KSA Limited Partnership Rocla Concrete Tie, Inc. (Rocla), a North American manufacturer of prestressed concrete railroad ties, has acquired KSA Limited Partnership (KSA), a joint venture of Pittsburgh-based Koppers Inc., a wholly-owned subsidiary of Koppers Holdings Inc., and Dallasbased Lehigh Hanson, Inc. KSA, founded in 1992, manufactures concrete ties, concrete turnout ties, concrete grade crossing ties, as well as other concrete products for the railroad industry. Its customer base extends to Class I railroads as well as to commuter and transit customers primarily in the eastern U.S. It is headquartered and has its manufacturing operation in Portsmouth, Ohio. “The acquisition will allow for Rocla to expand its customer base and product range,” said Rocla President and CEO Peter Urquhart. “KSA is a recognized market leader in the concrete turnout market and a major supplier to the concrete grade crossing market.”

Wasatch Railroad Contractors acquires Dimec Rail Services RR Mergers & Acquisitions, a specialist in the sale of rail service and supplier companies, has announced the sale of the Shoshoni, Wyo.-based Dimec Railcar Repair Operations to Cheyenne, Wyo.-based Wasatch Railroad Contractors. Dimec Rail Services, a division of A. Stucki Company, continues all of its mobile rail car repair, fabrication and welding services from their existing locations across the U.S. Wasatch specializes in railcar repair and restoration, with locations in Stearns, Ky., and Cheyenne, Wyo. Wasatch plans to expand railcar repair services offered from the Shoshoni, Wyo., facility. 10

Railway Age August 2015

For Class I’s, a second-quarter earnings roller coaster

he second quarter of 2015 proved to be a difficult one for the Class I railroads compared to the prior-year period, as a majority posted negative or flat financial results, offsetting the few that posted record-setting ones. CSX set a record second-quarter with operating income of more than $1 billion, an operating ratio of 66.8%, and net earnings of $553 million. Though revenue declined 6% as pricing gains were more than offset by the impact of lower fuel recovery, a 1% volume decline and a changing business mix, continued low fuel prices and savings from “efficiency initiatives” reduced CSX’s expenses by 9%. Record net earnings of $553 million (a record $0.56 per share) increased from $529 million, or $0.53 per share, in the second quarter of 2014. NORFOLK SOUTHERN absorbed significant declines in net income, operating revenues and earnings per share, and an operating ratio that rose 350 basis points. Net income for the quarter was $433 million, 23% lower compared with the $562 million record results from the same period of 2014. Diluted EPS was $1.41, 21% lower than the $1.79 per diluted share earned last year. Railway operating revenues were $2.7 billion, 11% lower compared with second-quarter 2014, a

result of lower fuel surcharges and coal volumes. Total volume decreased 2%, or about 46,000 units. Railway operating income was $814 million, 20% lower than second-quarter 2014. Railway operating expenses declined 6% to $1.9 billion, “primarily due to lower fuel costs.” The operating ratio was 70.0%, compared with 66.5% in the prior-year period. NS said nosediving coal traffic appears to be the prime culprit in its second-quarter performance. Coal revenues were $453 million, 33% lower compared with the second quarter of 2014. Volume was down 21%, driven by declines of 23% in domestic utility and 38% in export. CANADIAN PACIFIC posted its highest-ever net income and lowestever operating ratio for a second quarter. Despite revenues of $1.65 billion that were little-changed compared to the prior-year period, CP’s net income rose to a record quarterly high of $390 million, or $2.36 per diluted share, a 12% improvement. Adjusted earnings per share soared 16% to $2.45. Operating income climbed 10% to $646 million, and the operating ratio fell to a record 60.9%, a 420-basis-point improvement. For 2015, CP said it now expects revenue growth of 2-3%, an operating ratio below 62%, and annual adjusted diluted EPS of $10.00 to $10.40, based

on a Canadian to U.S. dollar average exchange rate of $1.25; an effective income tax rate expense of approximately $35 million, compared with 2014 pension income of $52 million; capital expenditures of approximately $1.5 billion; and average OHD (On Highway Diesel) price of U.S. $2.80-$2.90. UNION PACIFIC’s net income of $1.2 billion, compared with 2014 net income of $1.3 billion, combined with an operating revenue decrease of 10% and an operating income down 11%, resulted in a flat second-quarter 2015. UP’s net income was $1.38 per diluted share, down 3% when compared with $1.43 in 2014. In addition, UP’s operating revenue of $5.4 billion was down 10% vs. 2014. Operating income of $1.9 billion dropped 11%, and the operating ratio of 64.1% was up 0.6 points. UP says the OR benefited just under a point from the net impact of lower fuel pricesr. Revenue carloads declined 6% compared to 2014. Volume declines in coal (down 31%), industrial products (down 14%), and agricultural products (down 7%) more than offset the growth in automotive (up 3%) and intermodal (up 5%). Chemicals volume (down 1%) was flat compared to 2014 as growth in base chemicals carloads offset a decline in crude oil shipments.

CN’s net income of C$866 million, compared with net income of C$847 million in second-quarter 2014, combined with an operating income increase of 8% and a record-low quarterly operating ratio of 56.4%, resulted in a solid second-quarter 2015 for the railroad. CN’s net income was C$1.10 per diluted share compared with C$1.03 per diluted share for

CP posted its highest-ever net income in 2Q 2015. second-quarter 2014. Second-quarter 2015 results included a deferred income tax expense of C$42 million (C$0.05 per diluted share) resulting from the enactment of a higher provincial corporate income tax, CN said. Excluding the deferred income tax expense, second-quarter 2015 adjusted diluted EPS increased 12% to C$1.15 from year-earlier diluted EPS of C$1.03. In addition, second-quarter 2015 operating income also increased by 8% to C$1.4 billion. And CN’s operating ratio for second-quarter 2015 improved by 3.2 points to 56.4% from 59.6% the year before, a Class I record low. Second-quarter 2015 revenues were flat at C$2.1 billion, carloadings

decreased 3% to 1.4 million, and revenue ton-miles declined by 7%. Revenues increased for automotive (17%), forest products (8%), petroleum and chemicals (4%), and intermodal (2%). Revenues declined for metals and minerals (5%), grain and fertilizers (7%), and coal (26%). KANSAS CITY SOUTHERN experienced a revenue decline in all but one commodity group, including a precipitous drop in energy. Revenue of $586 million was a decrease of 10% compared to 2014. Adjusted operating income was $187 million, which, excluding lease termination costs in 2014, was 13% lower than a year ago. The operating ratio was 68.1%, compared with 68.3% in secondquarter 2014, but excluding lease termination costs in 2014, the adjusted operating ratio was 69.4%. Adjusted diluted earnings per share were $1.035, a 15% decrease. Net income in second-quarter 2015 totaled $112 million, or $1.01 per diluted share, compared with $130 million, or $1.18 per diluted share, in 2014, a 14% drop, but still slightly ahead of Wall Street estimates. Excluding the impacts of foreign exchange rate fluctuations and lease termination costs, adjusted diluted EPS for second-quarter 2015 was $1.03, compared to $1.21 in 2014, a 15% decline.

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Update SENER wins California HSR engineering contract

The California High-Speed Rail Authority (CHSRA) has awarded the Spanish company SENER a $56 million contract to develop the engineering and environmental services for the Palmdale to Burbank section of the California high-speed rail system. The environmental documentation for this section is due to be completed by the end of 2017. The contract calls for SENER to perform preliminary design for the 45-mile high-speed section from Palmdale station in the north to the Burbank Airport station in the south. Engineering services will include conceptual design and analyzing various alternatives before selecting the preferred one. SENER will also prepare the tender bid documents for designbuild (DB) contracts. SENER is the prime consultant; subcontracting major U.S. companies including HDR and Kleinfelder for engineering, Circlepoint

Railway Age August 2015

for environment, MBI for outreach, and PlaceWorks for urban planning. The Palmdale-Burbank line will pass through urban, rural and natural areas. SENER will define the footprint for environmental impact analysis and the right-of-way to be acquired for the track alignment, stations and ancillary elements. Among the alternatives, a log-bored tunnel will be analyzed, and the station areas will include an extensive urban planning exercise together with the Palmdale and Burbank City planners. Following award of the contract, SENER USA CEO Francisco Fernandez said, “As experts in high-speed rail lines that run through major city centers, we’re going to apply all of our knowhow to plan and design an efficient solution that will be respectful of the environment while being accessible and convenient for passengers. Given SENER’s expertise, we hope this

contract will open a fruitful collaboration with the CHSRA.” SENER has been present in California since 2008 with offices in San Francisco, and has been involved in other projects in the state, such as the master plan for Los Angeles Union Station, which includes a HSR station and redeveloping the area around the historic building. In awarding both contracts, SENER says, the CHSRA recognizes its experience in high-speed rail and in urban integration of new rail lines. In addition to its participation in numerous AVE (Spanish High-Speed Rail) lines, SENER has developed the renewal of the railway hubs of Wrocław, Poznań and Łódź in Poland, as future HSR nodes. Based on SENER’s experience in highspeed, the company was called on to prepare a “High Speed Railway System Implementation Handbook” for the International Union of Railways (UIC), which was presented in Philadelphia at the UIC’s HighSpeed 2012 Congress, as well as the UIC “Passenger Railway Systems Upgrading Handbook,” published by the UIC in 2014. California’s high-speed line will be the first operating high-speed rail in the U.S., connecting the state’s major cities for a total distance of 800 miles with up to 24 stations. By 2029, San Francisco will be connected with the Los Angeles basin in less than three hours at speeds up to 250 mph.

Bruce Kelly

FRA to railroads: CBR Emergency Order still stands The Federal Railroad Administration last month sent a reminder to railroads transporting crude oil that the Emergency Order (EO) issued May 7, 2014 requiring them to notify State Emergency Response Commissions (SERCs) and Tribal Emergency Response Commissions (TERCs) of the expected movement of Bakken crude oil trains through individual states and tribal regions remains in effect and “will be made permanent.” The EO stipulates that trains hauling one million gallons or more of Bakken crude oil (approximately 35 tank cars) are subject to the SERC/TERC notification requirements. The EO also directs railroads to include estimated volumes of crude oil, the frequency of anticipated train traffic, and the route the crude oil will be transported. Contact information for at least one individual at the host railroad must be

provided as well. In May, the USDOT announced that it would make the notification requirements of the EO permanent. FRA stated, in part: “As you will remember, on May 7, 2014, DOT issued an Emergency Order requiring railroads to notify State Emergency Response Commissions and Tribal

Emergency Response Commissions of the expected movement of one million gallons or more of Bakken crude oil in a single train through the state. The emergency order required that railroads update SERCs and TERCs when a significant increase or decrease—25% or more trains per week—in an estimate occurs.

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August 2015 Railway Age 13

Update NYAB partners with Predikto on LEADER improvements Predikto, Inc. announced last month a new collaborative effort, where New York Air Brake, Inc. (NYAB) will incorporate the company’s auto-dynamic predictive analytics platform, MAX, into its LEADER (Locomotive Engineer Assist/Display & Event Recorder) advanced train control technology solutions via its internet of things (IoT) initiative. NYAB will integrate a new predictive analytics component into its advanced train control technology solution, LEADER. The mutually developed solution will now leverage a suite of predictive analytics software applications engineered by Predikto, Inc. Predikto’s patent pending solution, called MAX, is an auto-dynamic machine-learning engine that draws upon LEADER train data, in addition to capturing data external to the train itself, such as weather and line of road

conditions. MAX is a self-learning artificial-intelligence solution that adapts itself to rapid changes in context in near real-time in order to provide the most accurate forecasts possible across an array of use-cases. “Integrating predictive analytics with the rich train information from LEADER will allow the railroads to utilize their data to proactively identify opportunities to improve operating efficiency and rail safety,” said Mario Montag, CEO of Predikto. “Partnering with a premier technology company in the rail industry such as New York Brake will allow Predikto’s awardwinning platform to make a defining impact on the rail industry.” “MAX will enable new and existing users to incorporate advanced data analytics to enhance the capabilities currently available through LEADER,” Predikto said. “The MAX platform has

already proven successful within the rail industry through forecasting failures and health in rail equipment ranging from bullet trains in Europe to wayside detection equipment in North America. This partnership will allow for the deployment of dynamic predictive capabilities that include a locomotive energy efficiency forecaster, a braking efficiency forecaster and track health.” “You can have data without information, but you cannot have information without data. MAX allows us to extract every bit of information and turn it into actionable insights that will improve visibility into operations, provide innovative solutions to improve safety, and provide clarity into the critical maintenance and performance indicators that impact the bottom line most,” stated Greg Hrebek, Director of Engineering for NYAB.

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Railway Age August 2015

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Wabtec posts record quarter; will acquire Faiveley Transport Wabtec Corp. last month reported record results for second-quarter 2015 and announced plans to acquire global railway equipment supply firm Faively Transport. Wabtec’s second-quarter sales were a record $847 million, 16% higher than the year-ago quarter, due to strong growth in the company’s Freight Group. Operating income was a record $156 million, or 18.4% of sales, compared to 18.1% in 2014. Earnings per diluted share were a record $1.04, a gain of 14%. Cash flow from operations in the quarter was $67 million. On June 30, 2015, the company had cash of $265 million and debt of $400 million. Based on Wabtec’s first-half results and outlook for the rest of the year, the company affirmed its 2015 guidance for earnings per diluted share of about

$4.10, with revenues expected to be up about 10% for the year. “We had another strong operating quarter, with record sales, earnings and margins, driven by the performance of our Freight Group,” said Wabtec President and CEO Raymond T. Betler. “We continue to execute our growth strategies and internal improvement initiatives, and we’re optimistic about our future growth prospects, thanks to the diversity of our business model, continued global investment in transportation projects, and the power of our Wabtec Performance System.” Separetely, Wabtec has confirmed that it plans to acquire Faiveley Transport for a total purchase price of $1.8 billion, including assumed debt. If approved, the deal will create one of the world’s largest rail equipment supply companies.

Faiveley Transport, which employs 5,700 people in 24 countries, reported annual sales of around $1.2 billion in 2014-15. The company manufactures and supplies products ranging from braking systems and couplers to passenger information systems. Faiveley Transport’s headquarters in Gennevilliers, France, will become Wabtec’s global transit headquarters under the Faiveley Transport brand name, and the transaction recombines former SAB Wabco rail divisions, creating a company with total revenues of $4.5 billion. Wabtec intends to fund the cash portion of the transaction with cash on-hand, existing credit facilities, and potentially other debt financing. “Faiveley Transport brings to Wabtec many complementary products, a strong presence in the European and Asian transit industries and solid relationships with blue-chip, global customers,” said Betler.

August 2015 Railway Age 15

Update The Georgia Ports Authority (GPA) saw the highest-ever volume of intermodal rail moves in Fiscal Year 2015 with the Port of Savannah having moved 369,347 containers by rail in FY2015, up from the previous-year record of 332,996 containers set in FY2014, the authority announced last month. The growing volumes moved by rail resulted in an increase of 10.9% or 36,351 containers for the year. In other cargo sectors, GPA moved a record 2.66 million twenty-foot-equivalent container units (TEUs) in FY2015, an increase of more than half a million TEUs. Strong performances across business sectors also led to records in total tonnage and roll-on/roll-off cargo in the year ending June 30, 2015. “Georgia’s ports have seen phenomenal growth over the past fiscal year, due to a combination of West Coast cargo diversions, U.S. economic recovery and regional gateway shifts placing more demands on Georgia’s terminals,” said GPA Executive Director Curtis Foltz. “Our people and our infrastructure rose to meet that demand flawlessly, handling record volumes while maintaining world-class customer service.” The 3.66 million TEUs crossing Savannah’s docks in FY2015 constitutes a 17% increase compared to the previous

Railway Age August 2015

fiscal year. FY2014 was the first year in which GPA moved more than 3 million TEUs, the authority said. “Part of ensuring reliability is investing in port infrastructure,” GPA Board Chairman James Walters said. “Our development plans will follow our current practice of maintaining capacity at least 20% above demand—not only in Brunswick, but in Savannah, where we are buying four new ship-to-shore cranes and 30 more gantry cranes. Investments such as these will enable GPA to handle expanding cargo volumes both now and in the future.” Total tonnage in FY2015 reached a record 31.69 million tons, up 7.8% or 2.29 million tons. Of that amount, containerized cargo accounted for 25.89 million tons, also up 7.8%, or 1.86 million tons more than in FY2014. The GPA also achieved an 8.1% improvement in bulk cargo tonnage for a total of 2.95 million tons, an increase of 221,601 tons. GPA terminals moved 7.6% (200,875 tons) more break-bulk cargo in FY2015 than in the previous year. Total break-bulk, which includes commodities such as paper, rubber and steel, reached 2.83 million tons. The GPA moved more autos and machinery than ever in the year just ended. Combined, Brunswick and Savannah moved 714,021 units of roll-on/roll-off cargo, an improvement of 13,313 units or 1.9%. Of the total, Brunswick handled 680,427 units. “The deep water ports of Savannah and Brunswick are cornerstones of Georgia’s success, and major factors in creating new jobs and prosperity across the state,” said Georgia Governor Nathan Deal. “The wave of economic impact created by our logistics network supports virtually every industry, from manufacturing and agriculture to mining, distribution, technology and transportation.”

GPA/Stephen B. Morton

Georgia Ports Authority sees record intermodal traffic

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Watching Washington Frank n. wilner

PTC: It’s the deadline, stupid

yntax-challenged George W. Bush was bang-on correct in saying, “You got to keep repeating things over and over and over again for the truth to sink in.” So it is with Positive Train Control (PTC)—a $14 billion safety overlay utilizing computers, transponders and GPS to stop or slow a train automatically before certain types of accidents occur. But despite a congressionally imposed PTC implementation deadline of Dec. 31, 2015, for 70,000 miles of track carrying toxic-by-inhalation (TIH) hazmat as well as all commuter and passenger trains, lawmakers have not grasped the complexity of the task. The deadline was set arbitrarily in 2008 by stunned lawmakers following a horrific commuter train collision in Chatsworth, Calif., that claimed 25 lives. While railroads already have invested some $6 billion in PTC research, development and partial implementation, their efforts have been encumbered by technological uncertainties in the design, testing and employee training process. Additionally, the Federal Communications Commission was slow in approving installation of required antennas on federally protected lands. Thus, only about 50% of freight railroad locomotives and specified track will be PTC-equipped by Dec. 31. For commuter railroads, most of which travel on freight rail right-of-way, fewer than 30% will have access to PTCequipped track by Dec. 31. While Amtrak says it will meet the PTC deadline on its Northeast Corridor between Washington, D.C. and Boston, it hasn’t encountered the difficulties of freight railroads. FCC siting authority was not required, Amtrak does not interchange through-train locomotives with other railroads where PTC hardware and software must be compatible, and

Railway Age

August 2015

Northeast Corridor track-miles are relatively few. Still, there are some 50 miles of state-owned track on the NEC where PTC installation may be delayed. Elsewhere, Amtrak mostly leases access from freight railroads. PTC delay is traceable primarily to technological hurdles, not railroad indifference; yet the Federal Railroad Administration says it will impose steep fines against railroads if the Dec. 31 implementation deadline is not met. Imagine if Congress imposed on pharmaceutical companies an arbitrary deadline to produce a cancer-curing drug, and the Food and Drug Administration threatened to fine Big Pharma if it failed to meet the deadline? Indeed, PTC technology is “not something you go to Radio Shack and say, ‘Well, I’ll take a PTC system,’” said former National Transportation Safety Board Managing Director Peter Goelz. “It’s not a plug-and-go system.” Over and over and over again, railroads have stressed—fervently hoping the truth would sink in—that any deadline should respect the confines of engineering science and acknowledge the adverse impact of the FCC’s antenna-pole-siting delay. Railroads beseeched Congress for remedial legislation to extend the Dec. 31 deadline, or grant the FRA authority to authorize alternative existing safety technologies. Imposing a maximum $25,000 perday fine per railroad for noncompliance with an arbitrary deadline wrongly diverts scarce dollars from infrastructure maintenance, renewal and expansion. More likely, railroads would embargo all shipments of TIH hazmat and refuse track access to Amtrak and commuter railroads. Allowing such operations over noncompliant track would expose all parties to unimaginable jury awards were the unthinkable to occur. Congress was warned by

shippers that such embargoes would kindle severe national economic harm. Actually, railroads once advocated an early version of PTC, known as Advanced Train Control Systems (ATCS); and Burlington Northern (BN), prior to its merger with the Santa Fe, was field testing its Advanced Railroad Electronics System (ARES). Although railroads envisioned significant business benefits from ATCS and ARES—BN calculated the benefit-cost ratio of ARES as a positive 3-to-1 by including extensive business benefits— the projects were scrapped as railroads instead pursued a chain of mergers. Railroads say the cost of the morecomplex PTC exceeds safety benefits by 11-fold. A changed architecture, requiring replacement of wayside signals and retention of fixed-block train spacing—rather than the less expensive moving-block technology used by ARES—eradicated business benefits for PTC. Compounding the technological hurdles fueling delay is the $14 billion price tag—an unfunded federal mandate occurring as the Surface Transportation Board, encouraged by many in Congress, entertains shipper petitions to place new caps on railroad freight rates. The villain in this illogical collision of fact and ignorance is a dysfunctional Congress and its reprehensible failure to come together with focus, resolve and deed. The House showed no initiative to act on PTC, while the Senate slid PTC extension legislation into a notoriously controversial highway funding bill to which the House said, “no thanks.” Fans of comedians Abbott and Costello might wonder how their “Who’s on First?” baseball team’s shortstop, “I Don’t Give a Damn,” was traded to Congress. Hey, Congress: “It’s the deadline, stupid.”

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Perspective: Short Line & Regional Linda Darr

Legislative, safety initiatives make progress

he short line industry began 2015 with an ambitious list of legislative goals. Two of the top goals on that list are the extension of the short line rehabilitation tax credit (45G) and securing funding for the Short Line Railroad Safety Institute. As we pass the halfway mark, we can look with some satisfaction on our progress with both. But we know there is much to be done during the second six months of the year to turn progress into success. The short line tax credit maximizes private capital investment in railroad infrastructure and it works best when railroads have certainty it will be available. We communicate that message as strongly as possible to Congress, and although all agree that early passage is the most desirable goal, the wheels of congressional progress grind slowly. We canâ&#x20AC;&#x2122;t control the pace, but we can play a big role in the final outcome and will continue to do so. The 45G tax credit expired at the end of 2014 and short lines across the country have worked hard to secure support in Congress for an extension. That support is expressed largely through the co-sponsorship of House and Senate legislation, and we are doing very well. Our House bill, H.R. 721, now has 221 co-sponsors, which represents a majority of the House of Representatives. We have worked to extend the tax credit five times in the past eleven years and we have always secured a majority of House co-sponsors. However, this year we have reached this milestone earlier in the year than in any previous effort. To help put our progress in context, there have been 677 tax bills introduced in the House of Representatives in 2015, and our legislation has the fifth

Railway Age

August 2015

highest number of co-sponsors of all those bills. We need only 18 more to jump into second place. Equally important, the legislation enjoys broad bi-partisan support, which is important in a Congress where partisan gridlock slows and often halts the process. Our lead sponsors, Representatives Lynn Jenkins (R-Kan.) and Earl Blumenauer (D-Ore.) have worked hard on our behalf and we are grateful. But short lines across the country have also played a major role building this support. This yearâ&#x20AC;&#x2122;s Railroad Day on

Extending the 45G infrastructure tax credit and funding the Short Line Safety Institute are top priorities. the Hill was one of our best attended and most productive ever, and we secured the final co-sponsors needed to reach a majority as a result of congressional meetings held that day. In addition to the many short line representatives that participated, we were pleased to have short line customers join us to let Congressmen know that they are the ultimate beneficiaries of the track rehabilitation made possible by the tax credit. Our Senate bill, H.R. 637, currently has 31 co-sponsors and we are making a final push to secure the additional 20 senators we need to reach a majority of

the Senate. As in the House, our lead Senate sponsors, Senators Mike Crapo (R-Idaho) and Ron Wyden (D-Ore.) have been strong partners in this effort. A second goal has been to secure continued federal funding for the Short Line Safety Institute. Both the House and Senate Appropriations Committees have approved bills that include $2 million for the Institute. Both bills must still be voted on by the full Congress. If the bills pass, it will be the second round of funding for this important initiative. ASLRRA has partnered with the Congress and the Federal Railroad Administration to establish the Institute. It will engage a group of fulltime safety experts who will assess the safety practices and safety culture of individual short lines and make recommendations for changes. Our safety assessors will dig deep into short line operations and survey employees to make a realistic and unbiased determination of what needs to be changed or improved. We expect to hear candid and constructive criticism, even on those properties that believe they have good safety plans in place. And that is our intention. This is not an effort to simply show we are committed to safety. It is an effort to make us better tomorrow than we were the day before. The 45G tax credit and the Safety Institute are not the only items on our legislative list. We are engaged on a number of fronts including opposing truck size and weight increases, extending the PTC mandate, and arguing for a more realistic approach to an ever growing and increasingly expensive set of federal regulatory requirements. Much needs to be done on all fronts, but I am pleased to report that on two of those our first six months have been productive ones.

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SEPTEMBER 17-18, 2015 KEY BRIDGE MARRIOTT ARLINGTON, VA

RAILWAY AGE CONFERENCE & EXPO

Supporting Organizations

KEYNOTE ADDRESS Sarah Feinberg Federal Railroad Administrator

Michael Rush Senior Vice President, Safety and Operations, Association of American Railroads

Tom Simpson President, Railway Supply Institute

PROGRAM HIGHLIGHTS • Domestic Crude Oil Production & Rail Traffic Trends • Bakken Crude: Boom or Bust? • Tank Cars: DOT-117s & Legacy Car Retrofits • New Regulatory & Safety Requirements • Effect of “Sloshing” on Track/Train Dynamics • ECP Brake Mandate Controversy • Tank Car Financing & Leasing

Sponsorships & exhibits available. Contact Jon Chalon at jchalon@sbpub.com, 212.620.7224

David Nahass Senior Vice President, Railroad Financial Corporation

NS will present on the construction and expansion of its Moorman Yard.

Engineering excellence AREMA Conference General Sessions at Railway Interchange 2015 are designed to educate and inform industry professionals.

he American Railway Engineering and Maintenance-ofWay Association (AREMA) will hold its 2015 Annual Conference as part of Railway Interchange 2015, Oct. 4-7, in Minneapolis, Minn. AREMA and the Coordinated Mechanical Association will join for a combined general session on Monday, Oct. 5, which will feature a keynote address by Robert J. O’Neill, team leader, U.S. Navy Special Warfare Development Group. O’Neill’s speech is titled “Never Quit,” which is his personal mantra and the single-most important factor in what he believes determines success. Additional highlights of the combined general session will be the presentation of the 2015 Dr. William W. Hay Award 24 Railway Age August 2015

By MISCHA WANEK-LIBMAN, Engineering Editor

for Excellence, AREMA Scholarship announcements and a State of the Association update from AREMA President Randy Bowman. Engineering Feats

Six technical presentations that detail recent projects featuring significant feats of railway engineering follow Monday’s general session. Norfolk Southern’s Mark Dewberry will kick things off with an Engineering Services presentation on the construction and expansion of Moorman Yard, formerly Bellevue Yard. This presentation will build upon NS’s 2013 AREMA Technical Conference presentation that focused on the design and permitting challenges of this major $150 million project and will provide a detailed

overview of the construction phase. Dewberry says the presentation will also provide the next generation of railway design professionals a clear understanding of the general purpose and need for this type of rail facility, as well as an understanding of how the key elements of a hump classification yard function. SEPTA’s Anthony Fazio and Amtrak’s Lester DeLago will then present a review of safety control and indication systems for railway movable bridges for the Communications & Signals presentation. Fazio and DeLago will evaluate an advanced control and indicating system for moveable bridges. Specifically, the pair will detail the systems that have been installed and maintained during the past 30 years at Amtrak’s Portal Bridge. Portal Bridge is a swing type bridge over

the Hackensack River that was commissioned for revenue service in 1910 by the Pennsylvania Railroad and accommodates more than 450 trains per day. The bridge structure underwent a complete track, signal and bridge rehabilitation by Amtrak in 1983. Various upgrades have been made since that time, but maintenance is still described as extensive. Fazio and DeLago will discuss the bridge control system and the train control system, as well as integration of the two. BNSF and Union Pacific will outline their joint effort on the Tower 55 Multimodal Improvement Project for the Track presentation. Tower 55, located in downtown Fort Worth, Tex., is one of the busiest and most heavily congested rail intersections in the country, with more than 100 UP, BNSF and Amtrak movements operating through the intersection on a daily basis. At-grade crossings between east/west and north/south main lines constrained train movement and resulted in substantial train delays. The two railroads partnered with the Texas Department of Transportation on a multi-phase project that closed a trio of at-grade crossings, added capacity and improved emergency vehicle access for the surrounding neighborhoods. The project added a third north-south main line through the interlocking. Switches and sidings were installed and signaling and control systems were modernized. The project was completed in August 2014, resulting in motorist and pedestrian delays being reduced by an estimated 100,000 hours annually, and the railroads experiencing increased fluidity and throughput capacity. The Structures presentation will cover the Robinson Creek Tunnel Fire Emergency Response. Randall Zeiger with AMEC Foster Wheeler and Angela Johnson with CSX Transportation will detail the response and recovery following the April 26, 2014 fire of the timber-lined tunnel near Robinson Creek, Ky., that cut off service to two active coal mines. AMEC was asked by CSX to respond to this emergency, focusing on safely extinguishing the fire and possibly restoring rail service to the mines. This task was wrought with various technical, environmental and health and safety challenges. The scope

included leading the firefighting team, managing air quality, managing water quality, and reducing personal risks while working in a hazardous work environment. Once the fire was extinguished, the project team developed a phased approach toward opening and rehabilitating the tunnel. Dr. John Gregory Green of Hatch Mott MacDonald, Francis Miller of Jacobs Engineering and Dr. Hualiang Teng of the University of Nevada-Las Vegas will present their paper, “Comparative Research on the Engineering & Economics of U.S. and International High Speed Rail (HSR) Standards” for the Passenger & Transit presentation. The authors say that “as high speed passenger rail systems develop around the world, standardization of vehicle technologies and infrastructure could bring about cost efficiencies for system operators.” This presentation is aimed at building on the work of a 2013 Federal Railroad Administration (FRA) report comparing FRA regulations to international high speed rail standards regarding operational safety. The presentation will compare and contrast international design standards and guidance with various U.S. HSR systems, including the Amtrak Northeast Corridor experi-

Jr., of HDR Engineering, Inc., will outline the management of safety and security training challenges. He will discuss the dilemma of satisfying what he calls “disparate safety and security training requirements” and will offer recommendations to simplify the process by providing proven techniques to navigate sometimes confusing training options. He will address three principal forms of training mandated by multiple agencies—e-RailSafe security, roadway worker protection or on-track safety, and railroad safety orientation. Each has idiosyncrasies to consider. Frazier says, “Railroad contractors in multiple subject matter tracks will benefit from the information and techniques in this paper as they satisfy safety and security training requirements for multiple railroads.” EnglewooD Flyover and More

AREMA will hold its closing general session on Wednesday, Oct. 7, with the installation of its 2015-2016 officers, an industry update from Wall Street analyst Tony Hatch and six technical presentations. Joseph Ott of Metra, David Irving of TranSystem Corp. and Marc Beisler of Alfred Benesch & Company will begin with a Structures presentation

BNSF and UP will outline efforts on the Tower 55 Multimodal Improvement Project.

ence and proposed networks, such as California High Speed Rail. As part of the comparing and contrasting process, the forces and stresses involved in the interaction between a system’s vehicles and standard track infrastructure will be studied. The paper will review information from various U.S. agencies, the European Union, Japan and China. The final presentation for Monday will be on maintenance. Edwin Frazier,

detailing the $140 million Englewood Flyover, the first major project to be constructed for the Chicago Region Environmental and Transportation Efficiency (CREATE) Program. The presenters say the flyover is already increasing system capacity, and gradeseparated Englewood Interlocking has improved safety by eliminating conflicts between 80 Metra trains, 60 Norfolk Southern trains and several August 2015 Railway Age 25

railway interchange 2015

“This project balanced numerous engineering challenges and opportunities for unique design solutions in an urban environment while managing the funding requirements of several public agencies and differing needs of individual stakeholders,” say the presenters. “The focus of this flyover is to carry Metra trains over NS, but also includes bridges over five city streets, 14 lanes of the Dan Ryan Expressway (I-90/94) and CTA Red Line. The 1.2-mile project included design and construction challenges in an industrial and residential neighborhood, and it was accomplished without requiring the acquisition of any permanent right-ofway and while keeping all tracks in service.” Attendees will then hear a Track presentation from David D. Davis of Transportation Technology Center, Inc., titled “Evaluation of the Potential Benefits of Superelevation for Main Line Turnouts in Heavy-Axle-Load Service.” Davis will describe a project where

the alignment of a typical AREMA-style turnout was modified to reduce lateral loads at switch points by reducing the entry angle. In the first modification, the entry angle was reduced by incorporating several circular curve segments of different radii. In addition, in the second modification, superelevation was incorporated in the diverging route by lowering the low rail. Dynamic vehicle simulations were conducted using NUCARS®, and the results were compared with standard AREMA turnouts. Davis will detail the results, which show that various types of vehicles can run through the diverging route of the turnouts at or very close to the design speed of rest of the tangent track. Lateral to vertical (L/V) ratios were reduced significantly, and both modifications stay within the dimensions of the current standard AREMA No. 24 turnout. The Communications & Signals presentation will look at concepts

concerning automation and technological integration in the aviation industry during the past three decades and how they may be applied to the rail industry with the implementation of Positive Train Control. Dr. Greg Placencia of the University of Southern California will outline several of these lessons and will establish the potential for harvesting others for the rail industry. He will touch on potential dangers for train operators, such as diminished situational awareness and automation overreliance, and how to adapt lessons learned from catastrophes in other industries in order to establish high reliability and safety within an increasingly automated rail industry. Next-generation recruiting

The Engineering Services Presentation will take on the issue of recruiting the next generation of railroad professionals. Dr. Pasi Lautala, Michigan Technological University, and Dr.

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Dimitris Rizos, University of South Carolina, will detail the National University Rail (NURail) Center activities. The NURail Center is a rail-focused university transportation center that provides education, workforce development and outreach activities. The presentation will also discuss potential pathways to effectively align the NURail Center’s efforts to steer students toward rail careers with industry efforts in recruiting them. The Maintenance presentation will detail CSX’s efforts to fight rail seat abrasion in concrete crossties. CSX’s Mark Austin will discuss what situations lead to rail seat abrasion, as well as the railroad’s various repair methods, beginning with the use of “sunshine gangs” that used an epoxy applied only during dry weather that has since evolved. The AREMA Conference’s final presentation will be Passenger & Transit. Alex Lawrason and John Parola of HNTB Corp. will present their paper, “Rehabilitation of the PATCO Commuter Tracks Across The Ben Franklin Bridge.” The $103 million reconstruction of the tracks is still in progress, but most train and automobile traffic has returned to normal as the most disruptive work has finished. The majority of the civil track work is complete, but replacement of new traction power, signal and communication equipment will continue until late 2015. In an effort to bring the track structure to a state of good repair during a four-month period, schedules and work windows were established to allow continuous work on one track at a time. The contractor worked 24/7 for four months to replace both tracks, including 9,000 timber crossties, 6 miles of rail, 120 steel beams, 1,000 feet of concrete plinth direct-fixation track and lead paint abatement/coating. In addition to the 12 general session technical presentations, AREMA will hold Function Group Sessions on Tuesday, Oct. 6 in six different tracks: Communications & Signals, Engineering Services, Maintenance, Passenger & Transit, Structures, and Track. RA

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August 2015 Railway Age 27

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SEPTA: Reinvesting and rebuilding

With funding in place, the Southeastern Pennsylvania Transportation Authority is delivering on its promise to restore essential infrastructure. By carolina Worrell, Managing Editor

Courtesy of SEPTA

s a result of the passage of Pennsylvania Act 89 (House Bill 1060) in November 2013— Pennsylvania’s most comprehensive piece of state transportation legislation in decades, providing capital funds to advance transportation improvements throughout the state—the Southeastern Pennsylvania Transportation Authority (SEPTA) is now in the position to restore essential infrastructure that supports safe and efficient service to its more than 1.1 million daily riders. The agency’s Rebuilding for the Future program (funded through Act 89, launched in October 2014 and initiated by SEPTA Deputy General Manager and former Chief Engineer Jeffrey Knueppel) design and construction is under way on projects in Philadelphia and suburbs Delaware, Montgomery, Bucks and Chester counties. In Fiscal Year 2015, SEPTA will invest more than $570 million in infrastructure and vehicle rehabilitation projects. Over the next five years, SEPTA says it anticipates dedicating approximately $3.4 billion to system restoration.

switchgear and protective relaying. The program will focus on many substations originally built more than 80 years ago. These projects will take place over the program’s first five years, with budgets ranging from $3.4 million to $50 million. Projects under this portion of the program include upgrading the Doylestown, Lenni, Woodbourne, Morton, Jenkinstown, Ambler, Lansdale, Bethayres, Chestnut Hill East, Hatboro, Neshaminy,Yardley, Clifton, and City Transit substations; the purchase of 16 railroad transformers; and upgrading Center City Commuter Connection indoor switching stations. Power Infrastructure Program

SEPTA’s Power Program will complete seven catenary replacement projects, including 17 miles of 80-plus-year-old catenary on the Media/Elwyn Regional Rail Line. The $10.7 million project, which began in spring 2014 and is slated for completion in winter 2017, also includes construction of new catenary support poles.

Substation Program

Bridge Replacement and Rehabilitation

Rebuilding for the Future’s substation program will replace major power components of SEPTA’s regional rail and transit traction power substations such as transformers, transformer breakers, trolley breakers, feeder switches, substation

SEPTA’s Bridge Program involves replacement of Regional Rail and Norristown High Speed Line steel bridges and viaducts and rehabilitation of nine stone arch Regional Rail bridges. August 2015 Railway Age 29

southeastern pennsylvania Transportation Authority

Ranging in size from 339 to 3,165 feet, the majority of SEPTA’s bridges were constructed in the early 1900s, with the oldest—the Crum Creek Viaduct—built in 1895. Individual projects will focus on improvements to bridge timbers, paint, catenary, signals, superstructure steel, and substructural steel repairs, with budgets ranging from $7.6 million to $77.5 million. Projects include the $1.5 million complete superstructure replacement and substructure repairs to Bridge 6.48 over Whiskey Run, located near Papermill Station on the Route 101 line. Work began this past spring and is expected to be completed this summer. SEPTA, in partnership with the City of Philadelphia and the Pennsylvania Department of Transportation (PennDOT), is also managing design and construction of the replacement for the Woodland Avenue Bridge over the Media/Elwyn Regional Rail Line in southwest Philadelphia. The bridge also carries SEPTA Routes 11 and 36 light rail lines. The singlespan bridge will be replaced beginning in the spring of 2017 and will be completed by early 2018. The project is valued at $5.07 million. Station Improvements

This program focuses on renewal and reconstruction at customer facilities as well as travel amenity enhancements at

Protecting

Your Assets

regional rail and transit stations, and bus and trolley loops. Station and loop improvement work will include building renovations, constructing new high-level platforms, pedestrian tunnel and stairway repairs, new security and safety systems, escalators, customer waiting shelters, new boarding platforms, signage, lighting, painting, sidewalk repaving, landscaping, ADA improvements, and improving bus intermodal connections. Project budgets range from $5 million to $122 million. Roof Replacement

The Roof Program involves replacement and upgrading at numerous facilities and will include new mechanical equipment, electrical connections, brick repairs, roof-mounted HVAC equipment, and replacement of old roofing systems. Project budgets range from $1.5 million to $15.8 million. Maintenance and Transportation

SEPTA’s Maintenance and Transportation Facilities Program focuses primarily on the replacement and upgrade of equipment and systems that will enhance safety and operational efficiency, including upgrades to existing fire sprinkler systems, boiler replacement, addition of emergency generators, upgrades to vehicle washers, and surface paving. One project—the $2.7 million Frankford Transportation Building—is included as part of this effort. Construction

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August 2015

began in spring 2015 with completion scheduled for summer 2016. Project budgets in this program range from $1 million to $7.5 million. Right-of-Way

The Right-of-Way & Track Program will focus on stabilization of soil and rock slopes, storm water control, erosion control, soil compaction, earth-bridge construction, sink holes in the right-of-way and track areas for regional rail and transit as well as continuous welded rail, street track, and yard track work. Budgets will range from $3.9 million to $26 million. Projects in this program include the $26 million Norristown High Speed Line tie replacement and continuous welded rail (CWR). Work on the project began in September 2014 and is scheduled to be completed by winter 2021. Other projects include the $5.5 million Route 102 Sharon Hill Line Street Track project. Work includes renewal of embedded track on Woodlawn Avenue and Springfield Road, between North Street and West Madison Avenue in Delaware County. Work began this summer and is expected to be completed by spring 2016. Communications and Signals

The Communication & Signals Program involves modernization and installation of emergency signals and systems,

upgrades to computer aided radio dispatch systems and train control systems, as well as advancing upgrades to the systems used to enhance operational and customer communications including real-time arrival information and AVPA (audiovisual public address). Project budgets range from $3.4 million to $33 million. New Fleet

In May 2015, the SEPTA Board of Directors approved spending up to $154 million for new ACS-64 electric locomotives to replace the agencyâ&#x20AC;&#x2122;s existing AEM-7 and ALP-44 locomotives, all of which have exceeded their useful life. The locomotives will be manufactured by Siemens Industry, Inc. and will be virtually identical to the ACS-64 electrics that Siemens is currently delivering to Amtrak. The first units are due to be delivered in early 2018. In conjunction with the planned purchase of new multi-level passenger cars, the agency says it will be able to provide additional capacity to accommodate growing ridership. Thirteen locomotives will initially be purchased, with an option for five more. Trolley Tunnel Blitzes

Beginning July 31, 2015, SEPTA forces worked around the clock during a 16-day Trolley Tunnel outage, performing maintenance and construction work. Crews replaced nearly

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7,500 feet of track between 22nd and 30th street stations; installed new railings and stairs at eight stations including 13th and 22d; made general station improvements and repairs with a focus on 19th Street Station; replaced 2,880 feet of wire support assemblies; and performed graffiti removal, painting and general maintenance at every station along the Trolley Tunnel loop. Part of SEPTAâ&#x20AC;&#x2122;s Rebuilding for the Future program, this is the second year the agency has taken a blitz approach to its Trolley Tunnel maintenance. In July 2014, SEPTA replaced 14,000 feet of rail, two switches, 24,000 feet of overhead contact wire and other track components. SEPTA says this blitz is a continuation of the worked performed in 2014. Trolley Modernization Project

On June 15, 2015, SEPTA began a modernization project on its Route 101/102 (Media/Sharon Hill) trolley lines.Work includes grade crossing renewals, track replacement and surfacing and replacement of wood bridge ties/timbers and walkway; general bridge structure repairs and maintenance; replacement of overhead trolley wire; vegetation clearing and tree trimming; installation of new trolley wire support structures in select locations; repairing or replacement of retaining walls at Drexeline and Springfield Mall Stations; replacement of drainage pipe and repairing drainage

Railway Age

August 2015

trenching at Springfield Mall Station; and grade crossing warning device improvements at seven locationsâ&#x20AC;&#x201D;MacDade Boulevard, Andrews Avenue, Bartram Avenue, Chestnut Street, Walnut Street, Broad Street and Spruce Street. On Route 101, superstructure replacement and substructure repairs will be made to the Whiskey Run Bridge. In Collingdale, Clifton Heights and Aldan, SEPTA will replace Route 102 rails and concrete roadway and repave the parking lanes on both sides of the street along Woodlawn Avenue and Springfield Road between North Street and West Madison Avenue. SEPTA will also install rubber rail boots around the new rails to lessen vibration and noise. The trolley track and roadway was last replaced in this area in 1983. The work will be completed in 10 phases over a 12-week period, with rolling street closures along the construction zones. SEPTA will use the shutdown to begin the early action phase of installing a new Communications-Based Train Control (CBTC) system that utilizes radio communications between vehicles and the signal system to automatically prevent collisions between trolleys by enforcing safe stopping distances. The system also prevents trolleys from exceeding civil speed limits. The CBTC system is scheduled to be completed by summer 2018 and will also include upgraded interlockings for improved reliability and operational flexibility. RA

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Drought relief, by rail

It may be possible to repurpose older DOT-111 tank cars to haul water to drought-stricken areas.

Could emergency service that’s been used worldwide be applied on a massive scale for California? By Bruce E. Kelly, Contributing Editor

ait long enough at the roadside pull-off in southeastern Washington’s Wallula Gap, overlooking the nearly mile-wide Columbia River, and you’ll see one: A unit train of Bakken crude heading west. The string of 100-plus tank cars stretches more than a mile, yet it looks like a mere millipede in a landscape dominated by water and wide open spaces. Knowing that some of these oil trains turn left near Wishram, Wash., and head south through Oregon to reach terminals in California makes you wonder. Could such trains be filled with water that could be delivered to some of the severely drought-stricken areas along the West Coast? WBR has reached the mainstream. In a May 2015 story, “California Drought: Can Railroads Come to the Rescue?,” MSNBC and NBC interviewed a BNSF spokesman who said, “We certainly have that capability today.” The story made a couple of questionable points, including the idea of shipping water from the rain-soaked East Coast (a tremendous distance from California compared to other water sources), but it helped bring the concept of WBR to a wider audience. In August 2014, BNSF Chairman Matt Rose told Railway Age, “We actually have a WBR initiative. We have looked at it seriously several times and haven’t quite seen the economics work but it might in the future.” In September 2014, Union Pacific Senior Vice President-Corporate Relations Bob Turner 36 Railway Age August 2015

said, “There are multiple variables to be considered regarding shipping water by rail. As with any new shipment option, a thorough assessment is required prior to providing general comment on the logistical feasibility.” At first glance, WBR seems as economically feasible as CBR. The going rate for moving crude from North Dakota to California sits near $14 per barrel, which translates to roughly 32 cents per gallon. (In U.S. measures, one barrel equals 31.5 gallons. One petroleum barrel, however, equals 44 gallons. This article applies petroleum barrels to translate CBR shipping rates into theoretical WBR rates.) Now, consider that WBR from the Columbia River to California would travel roughly half the distance of that North Dakota crude—hence, roughly half the transport cost, one might expect. But then factor in the costs to procure, load, unload, and possibly treat water. Could the net cost be kept on par with the $1.20 (or more) per gallon that Californians pay for water off the store shelf, or the half-penny to one-cent-pergallon they pay through their utility? If WBR ends up costing more than that, is it a price some customers will be willing to pay? Can federal or state funding help offset the overage? Those questions and many others need to be considered. Where will the water come from? How much WBR traffic (empties as well as loads) can railroads take on? Can enough tank cars be bought or built? How much water

can each car carry, and how does water behave in transit? Would sub-freezing temperatures present challenges during loading or shipment? Not As Outlandish As You Think

The use of railways to transport water holds historic precedence both in the U.S. and abroad. Beginning in May 2000, Indian Railways provided emergency WBR service to several drought-stricken regions, with a reported 262 trips totaling 4,535 tank cars (an average 17 cars per trip) delivering water to nine towns and 200 villages. Between September 2002 and April 2003, India’s water shipments increased to 1,277 trips, handling 65,512 tank cars (an average 51 cars per trip). News of such operations has gone virtually unnoticed in the Western world. In 2008, Queensland Rail Freight delivered water to the town of Cloncurry (population 2,400) in north-central Queensland, Australia. A regularly scheduled train picked up as many as six carloads of water each day from a reservoir outside the town of Mt. Isa and forwarded them 75 miles to Cloncurry. WBR has also been implemented in Israel, Africa, South America, and elsewhere around the world. As for the U.S., tank cars were used until 1960 for the routine delivery of water from Arrowhead Springs in the foothills of the San Bernardino Mountains to bottling plants in or around Los Angeles. On a more critical and widespread basis, railroads in some parts of the American West shipped water to not only re-stock their trackside supply tanks (most notably during the era of steam locomotives) but also to support isolated communities where railway employees and other residents lived close to the track but far from any consistent, naturallyoccurring water sources. Among the more famous was Grand Canyon Village, Ariz., whose growing tourist population relied almost entirely on water delivered by Santa Fe Railway until the site’s first pipeline was completed in 1932. Assembling the Water Car Fleet

With most of North America’s 371,000 tank cars already dedicated to crude, chemicals, and other commodities, and orders for new cars running a year or more behind schedule, is it even possible to field an effective number of unit trains for water? Right after Railway Age posted “If Crude by Rail, Why Not Water?” in early 2014, Editor-in-Chief William C. Vantuono suggested this: “The 165,00-plus DOT-111 tank cars that do not meet the latest voluntary AAR safety standards (CPC-1232) for hazmat and that could be forced out of service by a pending PHMSA rulemaking could be purchased by the feds and re-purposed into water cars. That would help solve the rail industry problem of what to do with all these suddenly obsolete but serviceable tank cars that the feds say we can’t use for their orginal purpose.” Vantuono ran the idea past Robert Pickel, Senior Vice President-Marketing and Sales at National Steel Car. “Blasting a car can cost $1,500 to $2,000 per car,” Pickel said. “Lining, depending on the material, would likely cost around $5,000 to $6,000 per car.” That’s compared to the $20,000 to $40,000 cost of refitting a DOT-111 tank car for CBR.”

On May 1, 2015, the same day that Canada and the U.S. announced new design requirements for crude-carrying tank cars, Pickel told Railway Age, “We may have 100,000 plus cars available for such service [water],” his number reflecting the DOT-111s, jacketed or non-jacketed, that will drop out of crude service if they’re not retrofitted. Among those DOT-111s currently moving hazmat, Pickel says there are 80,000 “legacy” cars built before 2011 that will be obsolete for crude service by 2017.

There may eventually be as many as 100,000 legacy tank cars available for water service. DOT-111s and other tank cars used in CBR service are mostly in the 30,000- to 32,000-gallon capacity range. But with water being heavier than crude, tank cars used in WBR service could only be filled to around 20,000 to 22,000 gallons so as not to exceed gross axle load limits. Ideally, this would mean using tank cars in that medium-size range for WBR. But if thousands of DOT-111s became more readily available, could they be used, safely, if filled to only twothirds of their capacity with water? Pickel says, “Yes, sloshing could be problematic. Baffles might work as they are used in other transport modes. Partitions are another possibility. However, train handling and operating dynamics would need to be modeled to determine feasibility of unit train service.” WBR Sourcing and Routing

TV and movie star William Shatner re-ignited the war over Western water with his recent suggestion for a multi-billiondollar pipeline that would move water from the Pacific Northwest to California. The media mocked the idea, but Shatner’s overland pipeline, which the actor envisioned as similar to the 800-mile Alaskan Pipeline, seems no more audacious than other projects that have been proposed or even built. With regard to Western U.S. water policy and WBR, several key points deserve mention. The Pacific Northwest currently holds the most abundant supply of free-flowing surface water in proximity to California. Using rudimentary pumps and hoses, unit trains could be loaded at any number of sidings adjacent to major rivers as far inland as Montana. But to shorten the haul and minimize the impact on oftencongested terminals such as Hauser, Idaho; Yardley (Spokane) and Pasco, Wash.; and Hinkle, Ore., loading sites would be best confined westward and downstream, where the Columbia River lies between south central Washington and north central Oregon. BNSF and UP have main lines on opposite sides of the river here, and while both are working to alleviate existing congestion in the Columbia River Gorge, there are sidings and bulk commodity loop tracks along the river capable of holding unit trains. From the Columbia River southward, BNSF and UP have routes that already handle unit crude into California, so there should be nothing to August 2015 Railway Age 37

Water by rail

prevent WBR train from traveling the same direction. Despite the federal government’s role in managing dams, hydroelectric power, navigation, and salmon migration on the Columbia River, Northwest states have some say in the use of water. The governors of Washington and Oregon have so far turned down every attempt to export Columbia water beyond their collective borders. But in 2007, Oregon Senator David Nelson submitted an alternative view. In a paper titled “Columbia River Diversion as a Public Revenue Source,” Nelson cited studies showing that seasonally timed extraction of Columbia River water would pose no risk to salmon migration, and he argued how water could, and should, be exported like any other natural resource in order to help fund Oregon’s public services. The enormous quantity of unused water that the Columbia releases into the ocean is 3.7 billion gallons an hour, 61 million gallons per minute, and 1 million gallons a second. The Washington Department of Ecology says the Columbia’s average annual discharge into the Pacific can actually be as much as 116 million GPM during high-water years. A unit train of 100 cars filled with 20,000 gallons of water per car, and WBR would draw roughly two million gallons from the Columbia each trip. Multiply that to the tune of eight trains per day (four on BNSF, four on UP), and it still means WBR would extract only a tiny fraction of the river’s total outflow.

Who Pays for It? Can It Pay for Itself?

Water-by-rail could never move enough trains on enough tracks to supply all of California’s needs. Crude-by-rail currently delivers only 10% or less of the oil that’s processed in California, yet those rail shipments are considered vital and cost-effective to the refining industry. What makes WBR different is that it can reach parts of California where there are currently no other comparable means for delivering substantial volumes of water at all. One way to make WBR work as efficiently as CBR would be to send water trains to the same places crude trains are headed. From Bakersfield to Long Beach to the Bay Area, terminals that receive unit crude could also receive unit water.With a bit of ingenuity and investment, those water trains could be off-loaded into municipal systems or holding tanks. Valero, Shell, Tesoro and other refiners that have faced public opposition in their efforts to expand CBR in California might win some favors if they accommodated the delivery of one unit water train to their terminals for every one or two crude trains that arrive there. Agriculture accounts for 80% of California’s water consumption. According to the U.S. EPA, “Of the ten most productive agricultural counties in the U.S., nine are in California, and the San Joaquin Valley is the single richest agricultural region in the world.” Farms could utilize WBR in

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Water by rail

places where branch lines or sidings provide acceptable parking space for tank cars that could feed directly into irrigation systems. Would the federal government subsidize the cost of WBR for farming in order to maintain inventory and affordability at the grocery store, or will that food production instead be shifted to states possessing adequate water? WBR’s start-up cost would be comparatively minimal. As with CBR, most of the components necessary for WBR (track, cars, motive power) already exist. Meanwhile, the new billion-dollar Poseidon Water desalination plant in Carlsbad, Calif., is scheduled to begin operating in November. It will provide the San Diego County Water Authority with about 54 million gallons of water per day, which covers less than 10% of that county’s average water consumption. Desalinated water delivered to San Diego County will reportedly work out to just over one cent per gallon to residential users. WBR, if priced anything like CBR, could cost anywhere from 10 to 32 cents per gallon. To match the Poseidon plant’s output would require 2,700 tank cars (if loaded 20,000 gallons each) rolling into San Diego County every day. That’s at least 27 loaded trains arriving, plus empties departing daily, on a corridor that handles two-dozen intercity passenger trains, every day, plus another 50 or more commuter trains MondayFriday. The delivery cost alone for WBR would still be

higher than the wholesale cost of desalinated water, based on today’s CBR rates. It could come down to WBR being delivered to communities or businesses for whom price is not an issue, or government agencies stepping in to fund water shipments to those who otherwise can’t pay for it themselves. Where lies the tipping point that separates profit from humanitarian relief? FEMA and the Red Cross don’t typically charge citizens for water, food and other aid being handed out following a natural disaster. The extent of California’s drought is, of course, much broader than that. If California is indeed entering a long-term megadrought, similar to those that struck the region several times over the past thousand years or more, new sources of imported water could be the only way of preventing a mass migration, as well as a major loss to America’s food supply. Pipelines and aqueducts would ultimately be the movers of greatest volume. Until those conveyances are built, railways could be delivering appreciable amounts of water to at least a few of California’s hardest-hit areas. Conventional metrics suggest that WBR may simply cost too much. But the western drought has thrown convention out the window. The millions who live in California, and the millions more who eat or earn income from its productivity, might soon be asking whether we can afford not to put WBR into action. RA

The difference between a 20-ton paperweight and a highly efficient diesel engine starts with fuel injectors. 16 Ways to improve your bottom line. In fact, replacing a full set of 16 injectors with Interstate’s patented EcoTip injectors has proven to reduce fuel costs up to 10% along with reduced maintenance costs. That’s a savings that will keep you – and your bottom line – right on track. Don’t let your engine become a 20-ton paperweight. Find out how we can help – visit interstate-mcbee.com or call 800-321-4234.

August 2015 Railway Age 39

People

Meetings

High profile Keolis Commuter Services has named United Airlines aircraft maintenance veteran Kenneth Trahan as Chief Mechanical Officer for its Massachusetts Bay Transportation Authority (MBTA) commuter rail system operations and maintenance contract. Trahan will manage Keolis’ fleet maintenance operations, ensuring the safety, performance and regulatory compliance of the locomotives and cars that transport more than 125,000 people across Greater Boston each day. Described by Keolis as “an Trahan experienced manager and leader,” Trahan comes to his new Keolis position with nearly 40 years in the transportation industry, including 29 years with United Airlines, where he most recently served as Director of Maintenance, overseeing operations in Boston and Cleveland.

Sept. 17-18

KANSAS CITY SOUTHERN— Brian D. Hancock, a veteran supply chain executive with experience in home appliances, trucking, fast food and discount consumer products, appointed Executive Vice President and Chief Marketing Officer. CANADIAN PACIFIC—Stephen C. Tobias resigned from the Board of Directors of Canadian Pacific Railway Limited and Canadian Pacific Railway Company for personal reasons on June 29, 2015. DALLAS AREA RAPID TRANSIT— Maureen McCole named as Vice President, Commuter Rail/Railroad Management. DART has also named Garrome “Jerry” Franklin as Vice President and Chief Safety Officer; and David Schulze as Vice President, Policy and Strategy.

SUPPLIERS PARSONS BRINCKERHOFF—Nancy Lyon-Stadler appointed a senior principal engineer in the company’s Cleveland office, as part of PB’s transit and rail technical excellence center. PB also appointed Philip Stephens as a senior principal technical specialist in the Chicago office. MINER ENTERPRISES—Andrew Kries, 24-year engineering department employee, promoted to Director of Engineering. He replaces Bob Pokorski, who is taking on a new position at Trinity Rail. 40

Railway Age

August 2015

PARSONS—David Nichols, former Director of the Missouri Department of Transportation (MoDOT), appointed Vice President, Transportation Program Director. GANNETT FLEMING—Alireza Edraki, PEng, PMP, named Vice President of Canadian Operations for the Gannett Fleming Transit & Rail Systems. He is based in the firm’s Toronto, Ontario office.

100 YEARS AGO in

Railway Age Crude by Rail Conference Key Bridge Marriott, Arlington, Va. Email: conferences@sbpub. com; Website: railwayage.com/ conferences

Oct. 4-7 Railway Interchange 2015 Minneapolis Convention Center. Combined exhibits hosted by RSI, REMSA, and RSSI. Technical and educational sessions presented by AREMA and the Coordinated Mechanical Associations (CMA). railwayinterchange.org

Oct. 13 Western Railway Club Dinner Union League of Chicago Email: wrclub13@comcast.com

Oct. 20 2nd Annual Michigan Tech Rail Day and Railroad Night XI Michigan Technological University, Houghton, Mich. Website: rail.mtu.edu/ event/2nd-annual-rail-day-andrailroad-night-xi

Oct. 27-28

(AUGUST 1915) NEW PITTSBURGH NORTH SIDE FREIGHT STATION OF THE P.R.R. The Pennsylvania Railroad has recently completed a new freight station with inbound, outbound and transfer facilities near the center of the manufacturing district on the north side of the city of Pittsburgh. This station will replace the old Anderson Street house, and the transfer station at Ross, 7.8 miles east on the Conemaugh division, and eventually the business now handled at the North Avenue house, a few blocks distant from the new station, may be transferred at this point. The Anderson Street house, which was erected more than forty years ago, had become inadequate for the business which it handled, making the provision of better facilities imperative.

Railroad Environmental Conference Illni Union, Urbana, Ill. Website: railtec.illinois.edu/RREC/ overview/php

Oct. 28-29 Railway Age Passenger Trains on Freight Railroads Conference Grand Hyatt, Washington, D.C., Email: conferences@sbpub.com; Website: railwayage.com/ conferences

Nov. 9 American Association of Railroad Superintendents Annual Derailment Investigation Seminar Sheraton Philadelphia University City Hotel Website: railsuperintendent.org

Products Metalized collector strip extends pantograph life Morgan Advanced Materials offers a new lighter weight, metalized pantograph current collector strip, produced by its Electrical Carbon business, that enhances rail system reliability and extends service life by about 35%. The new collector strips feature an arc protection system that maximizes collector strip life, reducing maintenance and running costs for rail contractors. The system also provides improved service for passengers, since the collector strips require less frequent replacement, dramatically reducing downtime. The new lighter metallized collector strips are the latest addition to Morgan’s line of performance carbon and metalized carbon current collector strips for pantograph and third rail applications. The comprehensive range of collectors includes products suitable for overhead, third rail and trolley bus

shoes in transportation applications including metro systems, high-speed trains, trams and trolley buses. The new collector strips are based on proprietary material technology, which enables the strip’s width to be increased by 40%, from 30 millimeters to 42 millimeters. The arc protection system, an engineered coating applied to the metal, draws any arcing to the carbon strip. This makes the strips ideal for running in wet weather or icy conditions, when a buildup of ice on overhead rail lines creates a barrier to power transfer and may cause localized overheating of the metal support carrier. Without arc protection, collector strips must often be replaced before the carbon has fully worn. The new collectors join a line of Morgan products designed, engineered and manufactured for main line railway systems, including self-

Miner high-performance side bearing

Miner Enterprises has introduced a long-travel CCSB (constant-contact side bearing) with a wide range of applications. The bolt-on bearing, designated TCC-45 LTLP-C, features a low profile and simple design, allowing for easy installation and maintenance, Miner says. Ideally suited for use on tank cars, the LTLP-C side bearing can also be used to reduce wheel and truck wear on a variety of other railcars. The threepiece bearing provides 4,500 pounds of preload and 5/8-inch of travel above its low-profile 2-inch housing. At the bearing’s core is Miner’s heavy-duty TecsPak®, an advanced pad that helps control truck hunting under a wide

range of operating conditions and speeds. Like all of Miner’s bearings, the company says the LTLP-C features tight tolerances that extend the bearing’s service life and helps reduce maintenance costs. “We take pride in developing products that improve railcar performance and reduce our customers’ operating costs,” said Miner Executive Director of Global Sales Bill O’Donnell. “The LTLP-C represents the latest technology in side bearings that deliver superior stability combined with excellent performance on curves.” Miner Enterprises developed the industry’s first long-travel CCSBs in 1991. Long-travel bearings help improve railcar stability at high speeds and reduce wear on wheels and trucks, and also help lower the risk of derailments due to carbody roll. These improvements in safety and stability led the AAR to mandate the use of longtravel CCSBs on all tank cars in 2005. For more information visit www. minerent.com.

The new collector strips feature an arc protection system.

supporting carbon collector strips that feature epoxy bonding of carbon to aluminum. These self-supporting carbon collector strips reduce pan head mass, improve dynamic response, and reduce maintenance and service costs. For more information visit www. morganelectricmaterials.com/products/ electric-carbon/collectors-railway.

AAR approves Strato knuckle The AAR Coupling System and Truck Casting Committee has approved the Strato E50BE Knuckle to the AAR M-216 Knuckle Fatigue Test specification, which requires an average fatigue life of at least 600,000 cycles. The Strato E Knuckle is one of only a few on the market to meet this specification. Additionally, it has received approval to all AAR requirements for material, foundry technical, quality assurance and component standards. Strato’s optimum manufacturing processes ensure consistent fit and function, longer life, and smooth operation. For more information visit www. stratoinc.com.

August 2015 Railway Age 41

Products Crash Hardened Memory Module Central Railway Manufacturing’s Crash Hardened Memory Module (CHMM) is a DOT-certified crashworthy memory module for PTC and LDARS event recording applications. Standalone or used in conjunction with the CRM LEAM, the CHMM is part of a flexible event recording strategy ranging from simple FRA-mandated data acquisition to hardened video storage. The CHMM employs a modular yet scalable architecture that permits capacity configurations to range from 2 to 128 gigabytes, allowing the end-user to cost-optimize memory requirements to their specific application. For event or video storage applications, the CHMM can be configured to support the following upload interfaces— 10/100/1000Mbps Ethernet, RS232 Asynchronous,RS-422/485 Synchronous/Asynchronous, USB 2.0 device/host, and USB 3.0 device.

For data downloads that can be initiated both locally and remotely via one of the network connections, the CHMM supports up to 1000Mbps Ethernet. The CHMM also provides a unique automated walk-up USB interface with optional secure authentication. With this interface, when a properly authenticated thumb drive is inserted into the CHMM, the CHMM will automatically download a user-configurable portion of the hardened memory directly to the drive. Offloaded data files are easily converted to viewable text tables with the CRM Desktop Application (CDA), or can be viewed graphically with the CRM Desktop Player (CDP). In the case of automated downloads, data can be decoded on-the-fly by a user application with CRM’s published data-file format, useful for data flow integration with a real-time database

of locomotive operation. For legacy serial port applications, most existing locomotive asynchronous and synchronous RS-232 and RS-422 protocols are supported. The CHMM offers a highly configurable operating system that can support many high-end data upload and download features, such as multiple and simultaneous operating instances of FTP servers or lean versions of Secure Copy (SCP). With these types of interfaces, the CHMM can accommodate the information technology requirements of various type of locomotive data management infrastructures.

Are you a railroad or supplier searching for job candidates? visit http://bit.ly/railjobs THE RAILWAY AGE JOB BOARD connects candidates and opportunities in the rail industry. To place a job posting, contact: Jeanine Acquart • 212 620-7211 • jacquart@sbpub.com 42

Railway Age

August 2015

RAWrkSiteTrn1_2pg2014AllClass_Layout 1 1/22/14 2:53 PM Page 1

Locomotive Event Acquisition Module Central Railway Manufacturing’s equipment portfolio includes LEAM, a locomotive event aggregation device capable of interfacing discrete electric and pneumatic systems. The LEAM supports up-to-date FRAcompliant data collection and PTC-messaging support with LDARS-compatible on-board network connectivity. In conjunction with CRM’s Crash Hardened Memory Module, the LEAM is part of a flexible event recording strategy. The advancement of FRA recording requirements due to the evolution of safety standards in the freight rail industry presents unique locomotive maintenance issues. The LEAM was specifically designed to allow CRM customers to update their current fleets of Quantum® recorders with minimal impact to existing wiring while providing the latest FRA compliance recording points and advanced network connectivity features. The LEAM is available in common Quantum® recorder form factors, offering form-fit-function compliance with regard to existing electrical connections, air connections, and mounting features. Incremental FRA discrete recording connections are supported on additional ports that are physically positioned for ease of retrofit installation. The LEAM also integrates Quantum® Alerter functionality. Equipped with two industry-standard M12 Ethernet network connections, the LEAM integrates advanced switch features such as VLAN support for maximum on-board network integration flexibility. The LEAM acts as a concentrator, combining discrete locomotive events into industry-standard AAR Class D EMP messages that conform to open AAR standard data-dictionary elements. Flexibility of data collection by an external DOT-crashworthy memory module or any network-based utility for non-hardened (e.g. database) applications is ensured by utilizing this nonproprietary format. In addition to supporting external memory, the LEAM also integrates up to 2 gigabytes of internal non-hardened storage to accommodate a wide range of custom user applications such as locomotive configuration management. Custom user communications configurations are available on the LEAM. For legacy serial port applications, most existing locomotive asynchronous and synchronous RS-232 and RS-422 protocols are supported. The LEAM also offers fault and status monitoring message generation, where network messages can be forwarded to user-defined locations given user-specified locomotive telemetry sequences or logic trees.

My Employees don’t have time for training.

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Work Site Training Courses: Locomotive: • GE 7FDL Diesel Engine Maintenance • Testing and Troubleshooting 26-Type Locomotive Air Brake Systems • Locomotive Periodic Inspection and FRA Rules Compliance • Locomotive Electrical Maintenance and Troubleshooting • Locomotive Air Brake Maintenance and Troubleshooting • Distributed Power Maintenance and Troubleshooting • Distributed Power Operations, Training, and Operating Rules

Freight Car: • Freight Car Inspection and Repair • Single Car Air Brake Test • FRA Part 232 Brake System Safety Standards for freight and other non-passenger trains • Train Yard Safety

Track: • Track Safety Standards

CORRESPONDENCE TRAINING • WORK SITE TRAINING • CONSULTING

The Railway Educational Bureau 1809 Capitol Ave., Omaha NE, 68102 Toll Free (800) 228-9670 • (402) 346-4300 www.RailwayEducationalBureau.com

August 2015 Railway Age 43

The Railway Educational Bureau BOOKS - Railroad Resources -

Canadian Rail Atlas

Rights of Trains In this Edition, it is the aim of the author to set forth clearly the basic principles underlying the rules, and to show how the rules of various railroads differ from the Standard Code and from each other. This popular book has been highly sought after throughout the years. The information is not new but still highly respected in the industry. Softcover, 459 pages.

BKRT

Rights of Trains

$36.25

You can order online at www.transalert.com

Coming Soon!

Elements of Planning, Engineering, & Operating Light Rail With Applications in NJ

This edition of the Canadian Railway Atlas illustrates Canada’s world class rail network, the third largest rail system in the world, the backbone of the transportation system and a major economic driver. Produced in association with the 50 goods, tourist, commuter and intercity Rail businesses represented by the Railway Association of Canada, as well as non-member railways, the Atlas reflects changes and developments in the rail sector up to December 2011. It features 68 pages of detailed information, 16 large-format regional maps, connections to the North American rail network and an index of the more than 5,000 railway stations across Canada. 68 pages.

MPCANAT

Canadian Rail Atlas

$76.95

Unlike modern rapid transit, which is highly standardized in design and operating practices, light rail employs a full range of technologies including railcar configuration and capabilities. This book’s main purpose is to review some of the specialized technical and operational issues associated with light and interurban railways. This book also closely examines the relationship between transportation and economic development, in a modern urban environment. Softcover. 136 pages.

BKEPEO

Elements of Planning, Eng., & Op.Light Rail

FRA Regulations

Freight Car

Dictionaries

Track Safety Standards, Subparts A-F • BKTSSAF • $9.95

The Double Stack Container Car Manual • BKDOUBLE • $17.50

Dictionary of Railway Track Terms • by Chris Schulte • BKRTT • $32.50

Rules & Regulations Governing Railroad Signal and Train Control Systems • BKSTC • $19.50

Doorway to Safety With Boxcar Doors • BKBD • $20.95

Mechanical Department Regulations • (Parts 210, 215, 216, 217, 218, 221, 223, 225, 229, 231, & 232) • BKMFR • $27.95

The Basics of Railroad Wheels - 3rd Edition • BKWHEEL • $23.50

General The Railroad: What It Is, What It Does - 5th Edition • BKRRNN • $44.95 All About Railroading - Second Edition • by William C. Vantuono • BKAARR • $33.95 Train Wreck: The Forensics of Rail Disasters • by George Bibel • BKTW • $29.95 Emergency Responder’s Guide to Railroad Incidents • BKERGRAIL • $33.00 Introduction to North American Railway Signaling • BKINARS • $52.95

The Art and Science of Rail Grinding by Dr. Allan M. Zarembski) • BKGRIND • $130.00 Operations

Elements of Train Dispatching, Vol. I • by Thomas White • BKETD1 • $44.95

Elements of Train Dispatching, Vol. II • by Thomas White • BKETD2 • $41.95 Railroad Operations and Railway Signaling • BKRORS • $25.00

Guide to Freight Car Trucks • BKFCT • $84.50

The Carman's Dictionary • BKCD • $15.25 Transit Urban Transit: Systems & Technology • BKUTST • $150.00

Locomotive

Urban Transit: Operations, Planning & Economics • BKUTOPE • $150.00

Guide to Locomotive Electrical Maintenance • BKGLEM • $43.50

The Historical Guide to North American Railroads, Third Edition • BKHIST• $24.99

Diesel Theory - Principles Explained • BKDT • $24.95 Guide to Locomotive Mechanical Maintenance • BKGLMM • $34.50 Maps & Atlases

Professional Railroad Atlas of North America • BKATLAS • $77.95 2014 Railroads of Continental United States Wall Map (laminated) • MPWML14 • $44.95

Railroads of Canada Wall Map (laminated) • MPRRCAN • $99.00 Training Videos (DVD)

Daily Locomotive Inspection (DVD format) • DVLOCO • $249.00

Blue Signal Protection (DVD format) • DVBLUE • $210.00

Shipping Rates:

Add the following shipping and handling if your merchandise subtotal is: UP TO $10.00 10.01 - 25.00 25.01 - 50.00 50.01 - 75.00 75.01 -100.00 100.01 - 150.00 150.01 - 200.00 200.01 - 300.00

U.S.A. $4.10 7.20 9.80 10.90 13.00 14.80 17.30 21.00

CAN $8.55 11.80 15.70 19.80 26.10 34.20 45.90 57.20

U.S.A. CAN 300.01 - 400.00 24.70 68.90 400.01 - 500.00 28.50 80.40 500.01 - 600.00 32.50 91.70 600.01 - 700.00 36.50 105.60 700.01 & up (Appropriate charges applied)

To order, call

1-800-228-9670 or visit

www.transalert.com

Railroad Hearing Conservation Training (DVD format) • DVHEAR • $165.00

The Railway Educational Bureau 1809 Capitol Ave., Omaha NE, 68102 I (800) 228-9670 I (402) 346-4300 www.RailwayEducationalBureau.com

Ad Index Company

Phone #

Fax URL/Email address

Page #

Aldon Company

847-623-8800

847-623-6139

e-rail@aldonco.com

ALLU Group, Inc.

800-939-2558

201-288-4479

usa@allu.net

DALKO Enterprises

866-707-4286

724-962-3658

cboughner@driworldwide.com

Ellwood Crankshaft & Machine

724-347-0250

724-347-0254

ecgsales@elwd.com

FreightCar America

312-928-0850

312-928-0890

tbaun@freightcar.net

Georgetown Rail Equipment Co.

512-869-1542 ext. 5292 512-863-0405

bachman@georgetownrail.com

Interstate Diesel Service, Inc.

800-321-4234

216-706-5010

proach@interstate-mcbee.com

LTK Engineering Services

215-641-8826

215-542-7676

tfurmaniak@ltk.com

MAC Products

973-344-0700

973-344-5891

edward.gollob@macproducts.net

Miner Enterprises

630-232-3000

630-232-3055

sales@minerent.com

New York Air Brake

315-786-5431

315-786-5676

janice.pheile@nyab.com

NRE

618-241-9270

618-242-8519 sales@nre.com

ORX

814-684-8484

glenn@orxrail.com

Progress Rail Services - EMD

256-505-6402

256-505-6051

info@progressrail.com

Progress Rail Services - Signal

256-505-6402

256-505-6051

info@progressrail.com

Railquip Inc

770-458-4157

770-458-5365

sales@railquip.com

Rails Co.

973-763-4320

973-763-2585

rails@railsco.com

Railway Educational Bureau, The

402-346-4300

402-346-1783

bbrundige@sb-reb.com

Railway Equipment Co.

763-972-2200

763-972-2900

sales@rwy.com

RailWorks

866-905-7245

952-469-1926 jrhansen@railworks.com

Rio Grande Chemical, Ltd.

956-686-2221

956-686-8290

33, 43, 44 9

david.bertram@rgcx.com

Samyoung Machinery

Van Air Inc.

219-879-5100 x217

219-879-5800

sales@vanair.com

Western-Cullen Hayes

773-254-9600

773-254-1110

co@wch.com

Zhuzhou CSR Times Electric Co.

The Advertisers Index is an editorial feature maintained for the convenience of readers. It is not part of the advertiser contract and Railway Age assumes no responsibility for the correctness.

Advertising Sales MAIN OFFICE Jonathan Chalon, Publisher 55 Broad St., 26th Floor New York, NY 10004 (212) 620-7224 Fax: (212) 633-1863 jchalon@sbpub.com AL, AR, IN, KY, LA, MI, MS, OH, OK, TN, TX Emily Guill 20 South Clark Street, Suite 1910 Chicago, IL 60603 (312) 683-5021 eguill@sbpub.com CT, DE, DC, FL, GA, ME, MD, MA, NH, NJ, NY, NC, PA, RI, SC, VT, VA, WV, Canada – Quebec and East, Ontario Jerry Marullo 55 Broad St., 26th Floor New York, NY 10004 (212) 620-7260 Fax: (212) 633-1863 jmarullo@sbpub.com

AK, AZ, CA, CO, IA, ID, IL, KS, MN, MO, MT, NE, NM, ND, NV, OR, SD, UT, WA, WI, WY, Canada – AB, BC, MB, SK Heather Disabato 20 South Clark Street, Suite 1910 Chicago, IL 60603 (312) 683-5026 Fax: (312) 683-0131 hdisabato@sbpub.com The Netherlands, Britain, France, Belgium, Portugal, Switzerland, North Germany, Middle East, South America, Africa (not South), Far East (Excluding Korea /China/India), All Others, Tenders Louise Cooper International Area Sales Manager The Priory, Syresham Gardens Haywards Heath, RH16 3LB United Kingdom +44-1444-416368 Fax: +44-(0)-1444-458185 lc@railjournal.co.uk

Scandinavia, Spain, Southern Germany, Austria, Korea, China, India, Australia, New Zealand, South Africa, Russia, Eastern Europe Baltic States, Recruitment Advertising Julie Richardson International Area Sales Manager The Priory, Syresham Gardens Haywards Heath, RH16 3LB United Kingdom +44-1444-416368 Fax: +44-(0)-1444-458185 jr@railjournal.co.uk Italy, Italian-speaking Switzerland Dr. Fabio Potesta Media Point & Communications SRL Corte Lambruschini Corso Buenos Aires 8 V Piano, Genoa, Italy 16129 +39-10-570-4948 Fax: +39-10-553-0088 info@mediapointsrl.it

Japan Katsuhiro Ishii Ace Media Service, Inc. 12-6 4-Chome, Nishiiko, Adachi-Ku Tokyo 121-0824 Japan +81-3-5691-3335 Fax: +81-3-5691-3336 amkatsu@dream.com CLASSIFIED, PROFESSIONAL & EMPLOYMENT Jeanine Acquart 55 Broad St., 26th Floor New York, NY 10004 (212) 620-7211 Fax: (212) 633-1325 jacquart@sbpub.com

August 2015 Railway Age 45

equipment Sale/Leasing

LOCOMOTIVE BATTERY Available for Lease

“AMERICAN INGENUITY FOR A MODERN WORLD”

4650 cu ft Covered Hopper Cars 3600 cu ft Open Top Hopper Cars 100 ton Automated/Manual Ballast Cars 4480 cu ft Aluminum Rotary Open Top Gons 50’, 70 ton mechanical refrigerated boxcars Contact: Tom Monroe: 415-616-3472 Email: tmonroe@atel.com

products & services

OR TOLL FREE 888.901.9987

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◆ 3,600 cu. ft. Open Top Hoppers. 45 degree slopes for aggregate, coke, coal, etc. ◆ Covered Hopper Cars – 4,650 & 4,750 cu. ft. cars with trough hatches & gravity gates. 268K Gross Rail Load. ◆ Covered Hopper Cars – 3,000 cu. ft. cars with circular hatches & gravity gates. ◆ Flat Bottom Gondolas – 4,000 cu. ft. cars, 268K Gross Rail Load and no interior bracing. For additional information and pricing, please contact John Goodwin phone (605) 582-8318 e-mail jgoodwin@mwrail.com www.carmathinc.com

MARKETPLACE SALES Contact: Jeanine Acquart Ph: 212/620-7211 Fax: 212/633-1165 Email: jacquart@sbpub.com

RailwayAge.com

The News Destination for the Rail Industry 46

Railway Age

August 2015

ALL MAJOR CREDIT CARDS ACCEPTED

PROFESSIONAL DIRECTORY

strAteGic PLANNiNG: • Commuter rail tranSitionS • fra ComplianCe programS • operationS auditing

Kansas City Office (913) 661-2424 oPerAtioNs trAiNiNG & coNsULtiNG: www.tcsrailservices.com • engineer training & CertifiCation other services: • exCellent HiStory witH fra, ntSB • Staffing • interim management • meCHaniCal & part 238(Qmp)

TRAINING

Part 243 Training & Certification Part 242 Conductor Training Part 240 Engineer Training and re-certification -------------------------------------------------------Modoc Railroad Academy 916-965-5515 info@modocrail.com

RECRUITMENT

EDNA A. RICE, EXECUTIVE RECRUITER, INC EDNA A. RICE, President

RFP

LOS ANGELES COUNTY METROPOLITAN TRANSPORTATION AUTHORITY (METRO)

(713) 667-0406 FAX (713) 667-1651 Web address: www.ednarice.com Email: resume@ednarice.com

6750 West Loop South Suite 735 Bellaire, Texas 77401-4111

EMPLOYMENT

ATTENTION: REVISED PRE-PROPOSAL CONFERENCE DATE Metro will receive proposals for RFP No. P2000-2015 for Light Rail Vehicle Overhaul Program per specifications on file at the Office of Vendor/Contract Management, One Gateway Plaza, Los Angeles, CA 90012 (9th Floor). All proposals must be submitted to Metro, and be filed at the reception desk of the Office of Vendor/Contract Management on or before November 6, 2015, 2:00p.m., Pacific Standard Time. Proposals received after the above date and time may be rejected and returned unopened. Each proposal must be sealed and marked RFP No. P2000-2015. A Pre-Proposal Conference will be held on WEDNESDAY, AUGUST 5, 2015, 10:00 a.m. at the Metro Green Line Yard located at 14724 Aviation Blvd, Lawndale, CA 90260. As part of the Pre-Proposal Conference, a vehicle walk-through will be conducted. Individual detailed Green Line vehicle inspections can be reserved in advance by contacting the Contract Administrator. These inspections may be scheduled in one-hour increments, scheduled immediately following the Pre-Proposal Conference on August 5, 2015 through August 6, 2015 (if needed). A detailed inspection of the ATC System on the Blue Line LRVs can be reserved in advance by contacting the Contract Administrator. These appointments will be arranged for August 7, 2015. The ATC System inspection will be held at the Metro Blue Line Yard located at 4350 East 208th Street, Long Beach, CA 90810. You may obtain Request for Proposals, or further information, by emailing Nicole Dang, Senior Contract Administrator at dangn@metro.net or via phone at (213) 922-7438. 7/27/15 CNS-2776100# RAILWAY AGE

Chief Mechanical Officer: FT The Chief Mechanical Officer is responsible for overseeing the safe maintenance and upkeep of Grand Canyon Railway locomotive, passenger car fleet and company vehicle maintenance. In addition is responsible for the timely completion of all capital projects in Train Mechanical Shop ensuring minimum downtime and within budget. Qualified candidate will be a Certified Train Engineer, and possess knowledge of job usually acquired through at least 5 years previous work related experience or formal education and training, in addition must have a minimum of 3 year’s verifiable work experience in the railroad industry in a Train Mechanical Shop lead or supervisor position responsible for locomotives (steam and diesel) and train passenger cars. Candidate must be able to read and interpret documents such as safety rules, schematics, operating and maintenance instructions and procedure manuals, and be able to diagnose electrical problems using various meters and related equipment. Strong analytical, organizational and time management skills and working knowledge of Word and Excel MS Office programs is a must. Employment is contingent upon successful completion of General Code of Operating Rules Class, and negative DOT drug screen results. Requires a clear and valid Arizona Driver’s license to operate company motor vehicles. HOW TO APPLY: To APPLY and to read more about this job and other career opportunities with Grand Canyon Railway visit our website at WWW.THETRAIN.COM/ CAREERS. OR Stop by our Williams office to speak in person with our recruiting and hiring managers. Follow us on Facebook & Twitter. Xanterra Parks & Resorts® Grand Canyon Railway (GCR). EOE/AA/M/F/DISABLED/VETERAN

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August 2015 Railway Age 47

Financial edge DAVID NAHASS

Growth vs. value: An investor’s dilemma

ast month, Railway Age’s Rail Insights conference in Chicago covered a broad range of rail related topics, such as congestion in Chicago and the significant efforts being put forth by Class I railroads to improve customer service. No conference seeking to discuss the current state of the railroad industry is complete without a discussion of the market for equipment and leasing. Barbara Wilson, President of First Union Rail, and Jason Kuehn, Vice President at Oliver Wyman, tackled all things equipment related during a robust conversation. One point discussed was the current state of equipment values and the “indecisiveness” of railcar demand today. Succinctly, both speakers observed that the market for many equipment types and the commodities they carry has softened from even as recently as firstquarter 2015 (a point also noted by NRE President and Rail Insights speaker Steven Beal). Coal, scrap steel and steel products, crude, sand, lumber—almost every product moved by railcar, other than intermodal containers, has seen year over year decreases in loadings. This has had an impact on railcar leasing and railcar values. However, there is still evidence that the pricing on used equipment remains overly optimistic about the prospects for the market today and the market of the future. There is plenty of evidence that car owners, seeing the successes of secondary market equipment sellers, are examining all options for monetizing assets today, especially for markets that might be viewed as being oversold, such as small-cube hoppers for sand and all kinds of general-purpose tank cars that do not meet the DOT and TC 117 requirements. For buyers of rail equipment it’s a classic growth vs. value investing

Railway Age

August 2015

dilemma. Growth investors look for an asset’s income production to grow faster than the average asset (perhaps a fifteen-year-old jumbo (5,150 cubicfoot covered grain hopper on a lower than current FMV lease at the time of sale), while value investors look for overlooked assets that can be bought with a view toward increasing upside through modification (such as a 1970s-built 4,750 cubic-foot grain hopper repurposed for hauling frac sand), or near-term undervalued assets that can be bought for rehabilitation

Investing in a car hoping for value and receiving none can be a portfolio killer. and redeployment (such as 1980s-built 5,800 cubic-foot plastic pellet hoppers that move into compressed wood pellet service). Both styles of investors can struggle to find opportunities when the market is overheated or over sold as many would suggest it is today. Pat Mazzanti, president of the rail appraisal firm, Railroad Appraisal Associates, when asked for an update on the state of the secondary equipment market, noted the following, “I am beginning to see some discipline in the market, especially from long term, experienced players. They are passing on deals that are being won at excessive premiums.” That’s good news for investors who have struggled to put sidelined capital to work in a frothy market. Score one for the growth investors. One market that might not be the immediate beneficiary of a new found

wave of investor prudence is the tank railcar market. Still reeling from the DOT and TC 117 new design specifications, the general-purpose tank railcar market remains unsettled with pricing and its future undetermined. Many industry observers expect the legacy car market for non-flammable commodities to be long cars for years while car owners scramble to determine the future of existing equipment. What’s causing indecisiveness in tanks? Two main issues: Car owners have not been able to get a read on the actual costs for retrofitting cars and are still not certain which tank railcars may or may not be able to be retrofit. Here Mazzanti notes, “Manufacturers have not yet told the market which (tank railcars) can and can’t be retrofit. Therefore the co st of retrofitting and its impact on valuation remains uncertain.” Never mind the uncertainty of litigation associated with the regulations. Two months after the DOT and TC issued their original guidance, the future for tank railcars used in CBR, transporting ethanol and other flammable commodities is holding up a potential market shift in value on these assets. Especially impacted is the market for legacy cars. As Mazzanti notes, “Guidance on retrofit is going to be case by case for each different car. Car owners will need to know what kind of engineering may or may not need to be completed.” These are the hallmarks of a value play. The risks to investors are legion until outstanding issues get settled. As any savvy railcar investor will tell you, investing in a car hoping for value and receiving none can be a portfolio killer. Tank railcar investors need to manage the draw of value versus the reality of the landscape that lies ahead. Got questions? Set them free at dnahass@railfin.com.

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