May 2017 Railway Age by Railway Age

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COMMODITY FOCUS: HAZMAT THE RIGHT CABLES FOR THE JOB C&S FOCUS: CROSSING PROTECTION

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On the Cover A BNSF unit grain train crests the summit of Marias Pass, Montana. Photo: Sean Kelly Railway Age Magazine (Print ISSN 0033-8826; Digital ISSN 2161-511X), (USPS 449-130), (Canada Post Cust. #7204564; Agreement #40612608; IMEX PO Box 25542, London, ON N6C 6B2, Canada) is published monthly by Simmons-Boardman Publishing Corp., 55 Broad St., 26th Floor, New York, NY 10004. Tel. (212) 620-7200; FAX (212) 633-1863. Vol. 218, No. 5. Printed in the U.S.A. Periodicals postage-paid at New York, NY and additional mailing offices. SUBSCRIPTIONS: Qualified individuals in the railroad industry may request a free subscription. Pricing for non-qualified subscriptions, printed and/or digital version: $100.00 per year/$151.00 for two years in the U.S./Canada/Mexico; $139.00 per year/$197.00 for two years, foreign. Single copies are $36.00 each. Subscriptions must be paid for in U.S. funds only. COPYRIGHT Â© Simmons-Boardman Publishing Corporation 2017. All rights reserved. Contents may not be reproduced without permission. For reprint information, contact PARS International Corp., 102 W 38th St., 6th Floor, New York, NY 10018. Phone (212) 221-9595. Fax (212) 221-9195. For subscriptions and address changes, please call (800) 895-4389 or (402) 346-4740; Fax (402) 346-3670; e-mail railwayage@omeda.com; or write to: Railway Age Magazine, SimmonsBoardman Publishing Corp., PO Box 3135, Northbrook, IL 60062-3135. POSTMASTER: Send address changes to Railway Age Magazine, PO Box 3135, Northbrook, IL 60062-3135. May 2017 Railway Age 1

From the Editor William C. Vantuono

Out with the old Penn Station?

s there a better way to operate Penn Station New York, whose infrastructure is severely taxed, to the point that two derailments occured within the space of 10 days in late March and early April? D.C. Agrawal and Martin E. Robins, the former a retired NJ Transit executive, the latter Director Emeritus of the Alan M. Voorhees Transportation Center at Rutgers University (and both members of New Jersey’s “Transit Mafia,” and I say that in a positive way), have floated a concept they’re calling “One Penn Station,” a pseudo terminal company that would in essence replace Amtrak as owner/maintainer/operator of Penn Station. It’s an idea worth exploring. First, some historical context. Agrawal was one of NJ Transit’s founding fathers, in 1983 spearheading purchase of the ex-PRR/Penn Central, Jersey Central, Lehigh Valley, Erie-Lackawanna lines that a disinterested Conrail had practically run into the ground, operating commuter trains under contract for NJ DOT. Years later, in 2001, he represented NJT on the New York Penn Station Partnering Steering Committee, which “got sidelined,” he tells me, due to a reasons like post-9/11 response, NJT pursuing Access to the Region’s Core (which morphed into the infamous “Tunnel to Macy’s Basement” project that New Jersey Governor Chris Christie eventually killed), Amtrak leadership changes, yada, yada, yada. So, what are we talking about? Here’s the problem, as Agrawal and Robins see it— and it’s a big one, an aging elephant that’s been in the room way, way too long: “In 1910, the Pennsylvania Railroad built Penn Station to meet its then-passenger rail service requirements. It was designed, constructed, owned, managed and operated by the railroad to conduct its long distance, regional and short-haul train operations. “Much has changed since then in Northeast railroading. Today’s NYPS is owned, managed and operated by 2

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May 2017

Amtrak—decidedly the minority user of the station. MTA Long Island Rail Road and NJT are tenants of Amtrak but dominate the facility’s usage. Of the 1,084 daily trains, only 134, or less than 13%, serve Amtrak passengers, with 584 serving LIRR and 366 serving NJT. “Recent events highlight the need to re-examine PSNY governance and management issues. Perhaps we need to go ‘back to the future’ to retrieve some simple and straightforward options. PSNY’s divided usage and split management responsibilities have led to poor accountability and inefficiency. This institutional dysfunction has been recognized for years. It can and ought to be corrected. “Under a One Penn Station concept, all train dispatching in the region could be managed under accepted and agreed-to railroad protocols.This is more than just a terminal company. The concept is to include the railroad infrastructure of a terminal company but also customer services, passenger security and real estate revenues. Given Moynihan Station coming on line soon, we must re-examine the governance/management issues at PSNY. “One limitation under Amtrak’s current management is its labor contracts, which allow its employees to work anywhere on the Northeast Corridor based on their seniority. This results in significant employee turnover and limits staffing of critical functions. One Penn Station would create a cohesive workforce dedicated to the facility, supervised by a management responsible for all PSNY functions.” I wonder if Amtrak would buy into this reconstituted structure. But it’s going to take more than Amtrak, NJT and the New York MTA cooperating. It’s going to require a ton of political support, perhaps even from the White House. I’m not holding my breath.

RailwayAge Subscriptions: 800-895-4389 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 ARTHUR J. McGINNIS, Jr., President and Chairman JONATHAN CHALON, Publisher jchalon@sbpub.com WILLIAM C. VANTUONO, Editor-in-Chief wvantuono@sbpub.com STUART CHIRLS, Senior Editor schirls@sbpub.com Contributing Editors: Roy H. Blanchard, Jim Blaze, Alfred E. Fazio, Bruce E. Kelly, Ron Lindsey, Ryan McWilliams, David Nahass, Jason H. Seidl, David Thomas, John Thompson, Frank N. Wilner Creative Director: Wendy Williams Art Director: Nicole Cassano Graphic Designer: Aleza Leinwand Corporate Production Director: Mary Conyers Digital Ad Operations Associate: Kevin Fuhrmann Production Director: Eduardo Castaner Marketing Director: Erica Hayes Conference Director: Michelle Zolkos Circulation Director: Maureen Cooney Western Offices 20 South Clark Street, Suite 1910, Chicago, IL 60603 312-683-0130; Fax: 312-683-0131 Engineering Editor: Mischa Wanek-Libman mischa@sbpub.com Assistant Editor: Maggie Lancaster mlancaster@sbpub.com International Offices 46 Killigrew Street, Falmouth, Cornwall TR11 3PP, United Kingdom Telephone: 011-44-1326-313945 Fax: 011-44-1326-211576 International Editors: David Briginshaw, db@railjournal.co.uk Keith Barrow, kb@railjournal.co.uk Kevin Smith, ks@railjournal.co.uk Dan Templeton, dt@railjournal.co.uk Customer Service: 800-895-4389 REPRINTS PARS International Corp. 253 West 35th Street 7th Floor New York, NY 10001 212-221-9595; fax 212-221-9195 curt.ciesinski@parsintl.com Railway Age, descended from the American Rail-Road Journal (1832) and the Western Railroad Gazette (1856) and published under its present name since 1876, is indexed by the Business Periodicals Index and the Engineering Index Service. Name registered in U.S. Patent Office and Trade Mark Office in Canada. Now indexed in ABI/Inform. Change of address should reach us six weeks in advance of next issue date. Send both old and new addresses with address label to Subscription Department, Railway Age, PO Box 3135, Northbrook, IL 60062-2620, or call toll free (800) 895-4389, or (402) 346-4740. Post Office will not forward copies unless you provide extra postage. Photocopy rights: Where necessary, permission is granted by the copyright owner for the libraries and others registered with the Copyright Clearance Center (CCC) to photocopy articles herein for the flat fee of $2.00 per copy of each article. Payment should be sent directly to CCC. Copying for other than personal or internal reference use without the express permission of Simmons-Boardman Publishing Corp. is prohibited. Address requests for permission on bulk orders to the Circulation Director. Railway Age welcomes the submission of unsolicited manuscripts and photographs. However, the publishers will not be responsible for safekeeping or return of such material.

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Industry Indicators TRAFFIC ORIGINATED CARLOADS

SHORT LINE AND REGIONAL TRAFFIC INDEX FOUR WEEKS ENDING APRIL 1, 2017

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

MAR. ’17 117,988 4,637 45,473 31,961 158,444 49,504 400,039 6,265 17,042 27,588 19,181 21,237 46,799 20,165 89,286 118,389 22,305 37,533 18,337 31,316 1,283,489

MAR. ’16 106,652 4,265 46,685 31,337 160,557 53,886 336,193 6,762 17,128 27,435 19,619 20,237 43,606 16,422 94,285 105,235 21,746 36,169 18,307 29,780 1,196,306

% CHANGE 10.6% 8.7% -2.6% 2.0% -1.3% -8.1% 19.0% -7.3% -0.5% 0.6% -2.2% 4.9% 7.3% 22.8% -5.3% 12.5% 2.6% 3.8% 0.2% 5.2% 7.3%

400,552

358,500

11.7%

1,684,041

1,554,806

8.3%

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

FOUR WEEKS ENDING APRIL1, 2017

MAJOR U.S. RAILROADS by Commodity TRAILERS CONTAINERS TOTAL UNITS

MAR. ’17 116,759 1,181,414 1,298,173

MAR. ’16 110,840 1,140,153 1,250,993

% CHANGE 5.3% 3.6% 3.8%

5,217 299,733 304,950

4,751 270,703 275,454

9.8% 10.7% 10.7%

121,976 1,481,147 1,603,123

115,591 1,410,856 1,526,447

5.5% 5.0% 5.0%

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 1.2% 22.5% 1.2% 6.0% 18.4% 11.0% 4.4% -4.2% -4.4% -5.9% 19.4% 27.6% -4.3% 15.2% 29.6% 8.4% 1.2%

Railroad employment, Class I linehaul carriers, MARCH 2017 (% change from MARCH 2016)

CANADIAN RAILROADS TRAILERS CONTAINERS TOTAL UNITS

ORIGINATED MAR. ’16 48,871 21,067 23,032 11,522 22,963 6,421 9,900 3,712 18,292 10,807 1,716 1,885 17,777 11,711 43,483 9,195 81,310

TOTAL CARLOADS, March 2017 vs. 2016

CANADIAN RAILROADS ALL Commodities

ORIGINATED MAR. ’17 47,157 25,803 23,459 12,217 27,189 7,130 10,333 3,555 17,481 10,170 2,049 2,406 17,011 13,491 56,366 9,964 82,299

BY Commodity

Transportation (train and engine) 59,191 0.62%

Executives, Officials, and Staff Assistants 9,058 (-3.36%)

Professional and Administrative 13,204 (-5.17%)

Total employees: 149,323 % change from MAR. 2016: (-2.86%) Transportation (other than train & engine) 5,844 (-5.82%)

Maintenance of Equipment and Stores 27,927 (-4.99%)

Maintenanceof-Way and Structures 34,099 (-5.28%)

Source: Surface Transportation Board

class I employment shows no signS of growth Figures released by the STB show Class I total railroad employment dropped 2.86% in March 2017 measured against the same month in 2016. Only Train & Engine numbers avoided a decline, and by less than 1%. But railroad employment for the year was more stable as March levels dropped by less than 1% across-the-board from February. Union Pacific topped all U.S. railroads with 139,400 employees while Norfolk Southern capped the low end of the ranks, with 117,100. 4

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Industry Outlook MBTA looks to speed system upgrades

BNSF greenlights second Idaho bridge BNSF Railway has given the go-ahead for preliminary work on a long-anticipated second bridge across Lake Pend Oreille at Sandpoint, Idaho. Stretching roughly 3/4-mile in length, the new bridge will stand parallel to an existing single-track bridge built in 1904. By double-tracking its crossing of the lake, BNSF will alleviate a chokepoint where BNSF and Montana Rail Link main lines converge at the east end of what’s often referred to as the Spokane-Sandpoint “Funnel.” It’s a vital component in BNSF’s Northern Corridor connecting Chicago, Texas and the Midwest with the Pacific Northwest. The current single-track bridge handles 50 to 60 trains per day. That figure can swell to nearly 70 trains per day during peak traffic season. West of the existing bridge, BNSF’s route toward Spokane largely comprises two main tracks. East of the bridge, BNSF’s Kootenai River Subdivision into northern Montana and MRL’s 4th Sub into southern Montana are mostly single track with intermittent sidings or short segments of doubletrack main. When trains from two or more of these lines approach the bridge simultaneously, the higher-priority train gets to cross first. Grain, coal and manifest trains off MRL are often delayed at Sandpoint Junction because the higher percentage of the area’s traffic, including the vast 6

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May 2017

majority of time-sensitive intermodals, travel via BNSF’s Kootenai River Sub. Adding a second bridge over Lake Pend Oreille should help resolve that. And with BNSF installing approximately one mile of second main track between the east end of the new bridge and Sandpoint Junction (requiring an additional bridge over the mouth of Sand Creek), BNSF and MRL trains will move to and from their respective routes more freely. A second bridge over Lake Pend Oreille would also allow BNSF to perform periodic maintenance on its existing bridge with minimal impact to traffic flow. Predecessor Northern Pacific Railway initially crossed the lake on a mile-long wooden trestle built in the 1880s. Two decades later, NP replaced it with the steel-on-concrete bridge in service today. Those concrete piers have stood on timber pilings driven roughly 50 feet into the lakebed. NP later refitted several of the piers to have longer steel piles beneath them. The new piers, which BNSF installed during 2008-09, are supported by steel piles driven more than 100 feet below the lakebed. BNSF plans to drive two test piles at the site and perform load testing in May and June. Beyond that, BNSF said the project must still go through the appropriate permitting and review process before moving forward. No construction is scheduled for this year. —BRUCE KELLY

The Massachusetts Bay Transportation Authority has a new master plan that aims to accelerate the timeframe to bring its equipment, infrastructure and operations into a State of Good Repair (SGR) to 15 years from the previously projected 25 years. The agency’s Fiscal and Management Control Board (FMCB) has approved a comprehensive MBTA Strategic Plan to serve as a blueprint for the objectives and strategies needed to ensure continuous improvement across all areas of the transit operator. The Board added it aims to accomplish these initiatives through internal improvements, as well as collaboration with cities and towns with a focus on fast, reliable, accessible and consistent service for MBTA ridership. “This Plan reflects a year’s worth of effort by the FMCB and managers across the MBTA to build consensus and make progress on the actions that must be taken by the MBTA and its stakeholders to ensure the MBTA becomes a bestin-class transit system that exceeds the expectations of its customers,” said FMCB Chairman Joseph Aiello. The Board said the revised deadline for bringing all MBTA assets into SGR reflects the fact that as of 2015, nearly one-third of the MBTA’s physical assets failed to meet that level, with a backlog estimated at $7.3 billion. The Strategic Plan will boost capital delivery capacity to achieve a minimum of $1 billion in annual SGR spending within four years and eliminate the backlog in 15 years. It also will create and effectively manage capital delivery capacity, implement asset management and lifecycle maintenance for all current and future MBTA assets, and address the SGR needs of business processes and information management. Operating cost reductions are also targeted with an eye toward generating $100 million in annual non-fare revenue by fiscal 2012.

Market OptiFuel Systems delivers IHB CNG loco systems OptiFuel Systems, LLC of Beaufort, S.C., announced last month that it has shipped all-U.S. designed and manufactured dual-fuel locomotive engine systems utilizing diesel fuel and compressed natural gas (CNG) to the Indiana Harbor Belt Railroad. The systems will be integrated into the first two of a planned 31 CNG Tier 4 switcher locomotives for IHB’s CNG Repower Program. The dual-fuel natural gas system includes OptiFuel-designed on-board CNG storage units and a trackside CNG refueling station. The IHB is the first railroad in the U.S. to convert its entire fleet to clean-burning natural gas as its primary fuel source. The system design, assembly and integration of the natural gas system was contracted by IHB to OptiFuel; locomotive design, assembly, and integration is being handled by R.J. Corman Railpower Locomotives of Erie, Pa. “The CNG Repower Program represents a substantial investment to change our locomotive fleet to CNG and eliminate harmful emissions,” said Michael Nicoletti, Director of Mechanical Operations for Indiana Harbor Belt Railroad. “The locomotives are a

North America Metra is seeking requests for proposals for the design and production of new railcars and locomotives to replace its aging fleet. The agency said it plans to order a minimum of 25 new passenger railcars “plus as many more railcars above that amount as possible.” The exact total depends on the responses to the RFP, available funding, and “financing alternatives,” such as leasing, to stretch its available dollars. The locomotive RFP, which will be published during the third quarter of 2017, specifies a base order of 10 units “plus as

part of a greater effort by IHB to convert up to 31 of its locomotives to be powered primarily by CNG. At the conclusion of the program in 2020, 70% of the railroad’s fleet will be converted to utilizing CNG as its primary fuel source. Introducing CNG as a viable fuel into the freight rail industry is a role that the IHB embraces in both

many more as possible.” Metra has approximately $200 million budgeted for rolling stock purchases over the next five years, but those funds could be channeled to Positive Train Control or other capital needs. Metra’s Board of Directors said it has asked staff to consider financing alternatives such as leasing to maximize the efficient use of available capital resources. The agency was banking on $1.3 billion in new funding, mostly from a new state bond program, to pay for its 2014 modernization plan calling for the purchase of 367 railcars and 52 locomotives.

its unique challenges and operational and environmental rewards.” The California Air Resources Board in April petitioned the Environmental Protection Agency for even stricter regulation of diesel locomotive emissions, stating that yard switcher operations pose a significant health threat to nearby residents.

Worldwide China Railway Corporation (CRC) has awarded a Yuan 543 million ($79 million) contract to Bombardier Sifang Transportation (BST) to supply five eight-car CRH1A-A high-speed trains for the Nanning Railway Bureau, following its order of 18 trains at the beginning of March. The 155-mph trains will support the ongoing integration of Guangxi’s regional high-speed lines into the national high-speed network, which now totals more than 14,000 miles and is the world’s longest, reaching 29 of 33 Chinese provinces. May 2017 Railway Age 7

Update Harrison changes “yet to come” at CSX

SX’s favorable first-quarter financials appear to be based, at least in part, upon the massive operational and organizational changes that new President and CEO E. Hunter Harrison (above) began implementing when he took the throttle from Michael Ward. However, according to Cowen and Company Managing Director and Railway Age Wall Street Contributing Editor Jason Seidl, “It is important to note that the strong 1Q17 results had very little to do with Hunter Harrison. The impact from the impending changes he is likely to make are yet to come.” CSX’s non-adjusted $362 million net earnings and $712 million adjusted operating income yielded net EPS of $0.39, up from $356 million, or $0.37 per share, in the same 2016 period. Excluding a $173 million restructuring charge, adjusted EPS was $0.51. The adjusted OR, based on adjusted operating income of $885 million and adjusted net earnings of $472 million, was 69.2%. Including the restructuring charge, the OR was 75.2%. Revenue for the quarter increased 10%, reflecting volume growth across most markets, overall core pricing gains, increased fuel recovery, and what CSX termed “favorable mix.” The $173 million restructuring charge drove a

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May 2017

13% year-over-year increase in expenses for the first quarter, but based on such factors as headcount reduction and hump yard closures, the railroad “delivered strong efficiency savings of $123 million. Looking forward, CSX is making adjustments throughout the company to improve asset utilization, achieve greater operations efficiency and reduce its cost structure.” At the same time, CSX announced an 11% increase in its quarterly dividend, a new $1 billion share repurchase program and “strong financial guidance” as it applies Harrison’s Precision Scheduled Railroading model to its operations, which the CEO said are “just in the beginning phase.” “By focusing on these principles, CSX expects to realize record efficiency gains and a step-function improvement in key financial measures for the year given continued economic growth and stable coal markets,” CSX said. “Adjusting for restructuring charges in 2017, these actions are expected to drive a full-year OR in the mid-60s, EPS growth of around 25% off the 2016 reported base of $1.81, and free cash flow before dividends of around $1.5 billion.” In addition, CSX’s Board also approved a new $1 billion share repurchase program, which management expects to complete by the end of first-quarter 2018. “This follows the successful completion of CSX’s previous repurchase plan, during which the company bought back $2 billion worth of shares since April 2015,” CSX said. “In line with the company’s balanced approach in deploying capital, CSX now expects to invest $2.1 billion in 2017, including approximately $270 million for Positive Train Control. Of the 2017 investment, more than half will be used to sustain core infrastructure with the balance allocated to projects supporting profitable growth, efficiency initiatives and service improvements.” Jason Seidl comments: “CSX’s 1Q17 adjusted EPS of $0.51 beat our and

consensus expectations of $0.43. All-in same-store sales (SSS) pricing was up 3.9% y/y, it’s strongest growth since 4Q15, but intermodal and merchandise SSS pricing continues to moderate. Headcount reductions and operational changes are under way, but we think Harrison and management will likely need some more time to analyze the business. “765 people were laid off in March, or about 3% of the total workforce, and a number of hump yards were shut down. We expect to hear of further cost reduction efforts in the coming months. All-in SSS pricing grew solidly in 1Q17, at 3.9%. That’s the fastest rate of growth since 4Q15, and was largely due to better pricing conditions in CSX’s export coal business, which is about 40% of the company’s total coal tonnage. “Merchandise and intermodal pricing continues to be under pressure, given recently negotiated contract renewals, which are driven by an oversupplied truckload market. Merchandise and intermodal (69% of revenue) pricing moderated to +2.5% from 3.2% in 4Q16, 3.6% in 3Q16, 4.0% in 2Q16 and 4.0% in 1Q16. The $173 million restructuring charge, or $0.12 per share, was taken during the quarter, resulting in adjusted EPS of $0.51, better than our and consensus’ $0.43 estimate. The company’s 69.2% adjusted OR was more than 200bps better than our 71.4% forecast and consensus’ 71.9% expectation. CSX noted $123 million worth of efficiency savings during the quarter. Previously, the company had said it would achieve more than $150 million of efficiency gains for the year, so the 1Q17 result suggests upside. “Newly raised 2017 guidance of a mid-60s operating ratio and around 25% EPS growth implies about $2.25 to $2.30. That’s roughly 9% above current consensus expectations. There are no structural issues at CSX that will keep the company from achieving industry-leading margins, which

implies a CN-type operating ratio in the mid-50s range. We think that implies around $4.00 in EPS over the next 4-5 years, but we are not forecasting that yet. CSX does a good job in the intermodal area (15% of revenue), but significant improvements can be made in the merchandise segment (53% of total company revenue). Focus will be on a more balanced network over 7 days a week, a reduced number of locomotives and railcars with significantly less average terminal dwell time from ~26 hours to the high-teens range. The ultimate result should be improved service levels for customers. “CSX’s nine divisions are likely to be cut to a couple. Some of the most recent terminals that CSX has built were in the 1980s, which suggests Harrison thinks the company has been slow to evolve the network as times have changed. Like most railroads, CSX has too many facilities due to all of the mergers in its history.”

Eastern ports OK’d for container co-op The Federal Maritime Commission has approved the East Coast Gateway Terminal Agreement, allowing the Georgia Ports Authority and the Virginia Port Authority to cooperate as a containerized cargo gateway. The agreement encourages the exchange of information and best practices in operational and supply chain efficiencies, safety, communications, and customer service. The five specific areas approved include cargo handling practices and terms, gate operations and access, turn times, staffing and infrastructure; joint or independent acquisition, utilization and best practices relating to operating systems and equipment including metrics relating to the repair and use of chassis and containers; joint or independent acquisition and use of marketing materials for ocean carriers, alliances, shippers, beneficial cargo

owners (BCOs) and ocean transport intermediaries; and commercial opportunities regarding carriers. The GPA and VPA can meet and exchange operational information and performance criteria with carriers, shippers and other marine terminal operators. The agreement does not cover discussions regarding purchase or lease prices for containers or chassis. It also prohibits the ports from entering into agreements on rates, charges, terms or conditions on containers or chassis without filing an agreement with the FMC. Any joint discussions that lead to an agreement under the Shipping Act must be filed with the Federal Maritime Commission. Rail service to both states’ port facilities is provided by CSX and Norfolk Southern. Commonwealth Railway and Norfolk & Portsmouth Belt Line Railroad also serve in Virginia.

Keeping Technology in Motion

May 2017 Railway Age 9

Update

The government of Canada will provide C$1.8 billion to the GO Transit Regional Express rail (GO RER) project in the Greater Golden Horseshoe Area. The funds are being provided through the New Building Canada Fund; more than 300 additional projects in Ontario have been approved

Railway Age

May 2017

under the Public Transit Infrastructure Fund. The federal government noted that the investment is being provided as “the benefits of public transit ... are well understood. So too is the cost of inaction.” Along with the province of Ontario’s contribution to the GO RER, this

commitment will be the single largest transit project in which the federal government has ever invested. The project is building new track, stations and facilities in order to provide two-way, all-day electrified regional transportation service to the Greater Toronto and Hamilton Area (GTHA). GO RER is expected to provide service as frequent as 15 minutes in both directions, serving communities in the GTHA and beyond, including the Waterloo Region and Barrie. Over the past few years, Ontario has made significant progress towards modernizing the entire GO network, allocating C$13.5 billion toward GO RER and another C$7.8 billion to upgrade and extend the GO network to include regular service to Niagara and Bowmanville. At C$21.3 billion, the GO capital program is the largest commuter rail program in Canada.

GO Transit

Canada commits to funding GO RER

Jonathan Chalon

Greenbrier, Sumitomo launch West Coast axle plant The Greenbrier Companies on April 28 announced the opening of GBSummit, an 80,000-square foot railcar axle machining facility in San Bernardino, Calif. Jointly owned by Greenbrier and Sumitomo Corp. of Americas, the U.S. unit of Japan’s Sumitomo, the facility features advanced automation and performs railcar axle machining, in addition to comprehensive axle services including inspection and cleaning, finishing, machining and downsizing (for example, machining 100-ton-spec axles down to 70-ton spec for articulated intermodal platforms.) The new operation is adjacent to a Greenbrier Rail Services-owned railcar wheel/axle maintenance facility. GBSummit can produce up to 12,000 axles per year and deliver them to freight car owners across North America. The company expects

production to grow to 50,000 axles per year over the next 36 months. “Our new state-of-the art facility is the first axle machining location on the West Coast” said Rick Turner, senior vice president and leader of Greenbrier’s Wheels & Parts unit. “It supports the growth we see in inter-

modal rail activity, the largest of all rail loading categories, where loadings have increased steadily in 2017, up 2.4% year-to-date. GBSummit is in a prime location near major intermodal rail operations that serve the Port of Long Beach and the Port of Los Angeles (San Pedro).”

May 2017 Railway Age 11

Update Miner Double Groove III a popular pick

Miner’s Double Groove III pneumatic gate for plastics features watertight construction, obstruction-free product flow and simple operation.

Miner Enterprises says that industry adoption of the company’s Double Groove III pneumatic outlet gate for plastics continues to accelerate, and has been specified on more than 2,400 new railcars in recent months. Among recent orders are hopper cars for CIT Rail, Greenbrier, and Wells Fargo Rail. The Double Groove III design protects hopper car contents from the elements while preventing product leakage during storage or transit. The gate’s obstruction-free valve and singlehandle operation eliminate confusion during operation, making it easy to sample or unload product. “We are proud to see that industry demand for our pneumatic outlet gate for plastics continues to grow,” says Bill O’Donnell, Miner Executive Director of Global Sales. “I believe these orders are evidence that the Double Groove III has become the pneumatic outlet gate of choice for plastics customers in North America.”

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Fall 2017 Registration Now Open Sue Lonier • 517.353.5667 railway.broad.msu.edu/info

Watching Washington Frank n. wilner

Trump beware: Banquo’s ghost lurks

“F

ire burn and caldron bubble … something wicked this way comes”—and it’s neither Shakespeare’s Macbeth nor his lady. Enter, stage right, Presidential adviser Stephen K. Bannon, desiring to “deconstruct the administrative state,” and President Trump’s son-in-law, Jared Kushner, toting a White House assignment to make government more efficient. This is not newly-ripened extremist populism. In 1921, Commerce Secretary (later Republican President) Herbert Hoover proposed, for efficiency, merging the Interstate Commerce Commission (ICC, now Surface Transportation Board, or STB) with other transportation regulatory agencies. Republican President Ronald Reagan said in 1981 that “government is not the solution to our problems; government is the problem.” In 1993, Democratic President Bill Clinton, in creating the National Partnership for Reinventing Government, said, “Our goal is to make the entire federal government less expensive and more efficient.” The result was some 400,000 federal jobs eliminated, and the ICC reconstructed as a lesser STB. In fact, every modern President has sought to improve the efficiency of the bureaucracy. Here we go again, but with a doublecaffeine jolt. Since taking office Jan. 20, Trump’s Executive Orders, budget recommendations, nominations of Cabinet secretaries and his more than 13,000 Tweets (most followed by between two and 15 exclamation points) convey an unambiguous message that federal agencies will be shrunk, administrative regulations will be chopped and the ranks of bureaucrats will be purged. Among some 430 federal agencies employing almost 1.5 million workers are the STB and Federal Railroad

Administration (FRA). While their regulatory authority may not be explicitly diminished absent congressional edict, their fitness, willingness and ability to perform may be weakened. Consider the FRA. Aside from the Republican-majority Congress imposing agency-weakening budget cuts, the FRA Administrator, who reports directly to Trump’s cabinet-level Transportation Secretary, may command reduced regulatory involvement, rescind previous rulemakings, and be less aggressive in issuing new directives. Moreover, FRA’s controlling statute

Beware of the great political irony: the law of unintended consequences. allows the Transportation Secretary to outsource FRA’s safety regulation mandate to states or even the private sector. The Transportation Secretary also holds authority to delegate safety and other duties of the Federal Transit Administration (FTA), and a merging of FRA and FTA may be in the works. Additionally, FRA organizational changes could shift FRA purse-strings oversight of Amtrak and high-speed rail projects elsewhere in DOT. As for the STB, its chairman, designated by the President, sets the agenda on matters without statutory deadlines, such as whether to grant or revoke exemptions from regulation; initiate investigations; redefine rail revenue adequacy; revise, replace or supplement a complex test for determining

maximum allowable freight rates for shippers lacking effective transportation alternatives to rail; or permit competitive switching at certain sole-served facilities to afford a second railroad choice for so-called captive shippers. Then there is the matter of the 2015 Surface Transportation Board Reauthorization Act, which created two new, but yet unfilled, seats on the current three-member Board. Should Trump, with Senate consent, fill them, the STB will have a 3-2 Republican majority that could rescind or loosen, for example, restrictions on rail mergers imposed by a Democratic Board majority almost two decades ago. The power of quasi-legislative and quasi-judicial federal regulatory agencies is broad, with the 1946 Administrative Procedure Act favoring their orders with a presumption of validity unless shown to be arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law. Newly confirmed Supreme Court Justice Neil Gorsuch views them negatively as an unaccountable-to-voters fourth branch of government exercising excessive powers. So it is that many congressional Republicans and their supporters advocate limiting federal agency powers through the Regulatory Accountability Act of 2017. It would defeat a 1984 Supreme Court doctrine—Chevron USA v. Natural Resources Defense Council—that awards great deference to regulatory agency decisions. Perhaps the ghost of Banquo will appear to reveal to Trump a great political irony known to economists as the law of unintended consequences—that diluting or disabling federal agency power may deliver more and even less desirable regulation at the state and local levels, or via the courts. Oh my, double, double toil and trouble; fire burn and caldron bubble. May 2017 Railway Age 13

2017 Guide to Equipment Leasing

Quagmire or Oasis?

Sean Kelly

By DAVID NAHASS, Financial Editor

he railcar leasing market remains as dynamic and unpredictable as it always has been, even as the market moves through another stage in a lengthy cyclical downturn. In the fourth quarter of 2016, the number of small-cube covered hoppers in storage totaled somewhere between 25,000 and 40,000 cars. Fast forward to the beginning of April 2017, and the market for small-cube covered hoppers has done a 180-degree turn in a timeframe that is atypical of the market and the railcar leasing industry in general. While not all stored cars are on lease, the lessor blocks of modern capacity, 286,000 pounds gross rail load (GRL) cars

have moved into service. Not enough “wow” for you? Lease rates on small-cube hopper cars, which were in mid-year 2016 languishing between $175 and $225 per car per month, have reached up into the $475 per car per month range. Who says there are no second acts? What’s to account for this dramatic reversal of fortune? While the price of crude jumped to $57 per barrel in January, for most of 2017, the price has mostly been lower than $55 per barrel, drifting as low as $47. OPEC continues to try to restrict production, but mixed with the availability of crude from the U.S., that has not done much to elevate the price. The U.S. Energy Information Administration (EIA) May 2017 Railway Age 15

EQUIPMENT LEASING GUIDE

the right relationship can help you make the most of the miles ahead.

PNC EQUIPMENT FINANCE When it comes to financing your rail assets, we know you value industry expertise and financial strength. No wonder thousands of rail equipment clients across the U.S. and Canada choose PNC Equipment Finance to keep their businesses on track. Deep experience allows our team to offer leading asset-specific financing solutions, including loans, leases and lines of credit, to help you drive maximum ROI. If you’re looking for a better way to manage your asset base, know that we can prepare you for the miles ahead. To learn more, visit pnc.com/ef

PNC is a registered mark of The PNC Financial Services Group, Inc. (“PNC”). Equipment financing and leasing products are provided by PNC Equipment Finance, LLC, a wholly-owned subsidiary of PNC Bank. In Canada, PNC Bank Canada Branch, the Canadian branch of PNC Bank, provides bank deposit, treasury management, lending (including asset-based lending through its Business Credit division) and leasing and lending products and services (through its Equipment Finance division). Deposits with PNC Bank Canada Branch are not insured by the Canada Deposit Insurance Corporation. Deposits with PNC Bank Canada Branch are not insured by the Federal Deposit Insurance Corporation, nor are they guaranteed by the United States Government or any agency thereof. In the event of the failure of PNC Bank, deposits with PNC Bank Canada Branch would be treated as unsecured general liabilities, and creditors would be considered general creditors of PNC Bank. The PNC Financial 16 ©2017 Railway Age MayServices 2017 Group, Inc. All rights reserved.

MarchCIB 2017 Age 16 EF PDF Railway 0816-064-348803

Bruce Kelly

EQUIPMENT LEASING GUIDE

predicts the average 2017 per-barrel price for WTI (West Texas Intermediate) to stay around $54 per barrel. What about the production side of the house? U.S. production of crude is approaching 9.1 million B/D (barrels/day). U.S. production peaked in July 2015 at 9.7 million B/D, but production troughed at 8.6 million B/D in July 2016, so simple production increases of roughly 10% in daily capacity do not scream large increases in sand tons moved. What about natural gas pricing and production? Natural gas has been hovering in the low $3 per million BTUs range for some time. Here, the EIA is not expecting any great shakes, with pricing expected to be $3.10 per million BTUs for the remainder of 2017. Production is expected to increase by almost 3% in 2017 vs. 2016. Pipeline growth for moving natural gas, expected to explode in the coming years, hasn’t made an impact on the market just yet. Similar to crude, natural gas production is not screaming out the results that seem to be driving the current demand for sand. Nonetheless, the price of frac sand has been on the rise, and in dramatic fashion. According to The Wall Street Journal, sand has approached, and possibly even breached, the $40 per ton mark, more than doubling from lows in mid-2016. The price of sand eats into the margins on extracted crude and natural gas, consuming profits as underlying prices rise. One concern on the near-term horizon is the potential for a capacity crunch as demand for frac sand (proppant) outstrips production capacity. The sand production industry went bust in 2015, taking with it many smaller, undercapitalized

producers who shut down unfavorable and inefficient sand mines that were not cost effective as prices began to retreat. As shale drilling has expanded and matured, two trends have remained fairly constant: One, the price of extraction for crude and natural gas has been dropping as technology improves and production methods get more efficient, and two, the quantity of sand going into each frac well is going to continue to increase. The stories of the increases in sand usage are extraordinary. The Wall Street Journal reported a tripling of the quantity of frac sand being used in wells in Delaware. The WSJ also reports that in Louisiana, a frac well 1.8-miles in length was pumped with 50.2 million pounds of sand. For those of you keeping score, 50 million pounds of sand is roughly equal to 210-225 railcars, depending on railcar capacity, or two unit trains (plus a few spare railcars), and that is for just one well. Last, it is expected that producers will experiment with pushing to increase the tons of sand in each well up to 3,000 pounds of sand per foot of well. That would be a dramatic step up from the current rough industry average of 1,700 pounds per foot of well today—another reason why the high price of sand remains an impactful factor in analyzing where this market is really headed. Need more positive news? Rig counts, up to 847 rigs in mid April 2017, are pacing a steady increase, up 20% from January 2017 (700 rigs) and more than double a year ago (406 rigs), quickly moving close to the 2015 peak of 884 rigs but still a ways off the 2014 peak of 1,931 rigs. This mix of changes in frac drilling—lower drill costs, higher extraction rates, more rigs and increased quantities of frac sand being pumped into wells—has combined with decreases in railroad velocity that began in the fall of 2016 and continued into the beginning of 2017. This group of factors together has pointed demand for proppant and cars to haul it upward at a rapid pace. Even with all the positive news, the road ahead is treacherous: The backlog of small-cube hopper cars not yet built stands at roughly 16,000 cars, but three months into this resurgent market, rumors already abound of increases in demand driving the possibility of new orders. The small-cube

May 2017 Railway Age 17

EQUIPMENT LEASING GUIDE

hopper fleet has doubled in size since 2008, and many industry watchers would tell anyone that would listen that no new cars are necessary. Add to that the trend of potentially sourcing frac sand closer to the well head (such as in West Texas) or the potential to begin moving proppant as containerized freight rather than in railcars, and you have a market looking strong that still remains vulnerable to changing market fundamentals. Where are all the cars that are coming out of storage heading? Depending on the source for the information, this represents another unusual anomaly in this market. Industry sources have indicated that some cars finding their way into leases are acting as surrogates for end-user-controlled cars that remain in storage. Why? Getting cars in and out of storage can be an expensive proposition. Without confidence in the long-term demand for cars or commodity, a short-term “rental” of lessor-owned cars might actually save a company money over moving cars out of storage. So what’s the real story? At the 2017 Rail Equipment Finance Conference, Todd Kahn, Vice President Portfolio Management and Marketing at Chicago Freight Car Leasing Co., provided data that is key to understanding how all these factors mix together (chart, opposite page). Kahn indicates that there are approximately 75,000 smallcube hopper cars for sand service. To tie this all together, the

move from 1,700 pounds to 3,000 pounds of frac sand per foot per well is roughly the equivalent of moving from 60 carloads of sand per well to 100 carloads. This data suggest that a burst in the number of rigs, a system slowdown, and an increase in sand per well may push demand higher. The railcar investment market is hungry for opportunities for growth. In spite of the current cyclical downturn, investors continue to throw billions of dollars into railcar investment. Even through this cyclical downturn, railcar investors remain a hopeful bunch. (Really!) A consumer purchasing a home builds equity and hopes to sell with enough profit to buy a replacement home and to offset realtor fees 20 years later. Railcar investors hope for a mix of asset and rental appreciation, even for railcars manufactured at the peak of a cyclical run-up in pricing greater than any seen in the past 30 years. And they want this all within an asset’s regulatory life of 50 years. Although year-over-year carloadings growth has improved, the market continues to search for something to offset a loss of significant coal loadings. Frac sand clearly will be a part of that offset (more than crude without a doubt). If 100% of today’s 800-plus rigs require rail-delivered sand, 75,000 small-cube hoppers cars could barely service that demand. Small-cube hoppers remain a cautionary tale. One lesson of the crude boom and bust is that when necessary, the crude

Wells Fargo Rail

The largest and most diverse rail equipment operating lessor in North America, with more than 175,000 railcars and 1,800 locomotives. Wells Fargo Rail — getting stronger to support your business. Contact us at 1-844-459-9664 • railaccountservices@wellsfargo.com © 2016 Wells Fargo Bank, N.A. All rights reserved. Wells Fargo Rail Corporation is not regulated in Canada as a financial institution. WCS-3208920

Railway Age

May 2017

EQUIPMENT LEASING GUIDE Carloads of Sand per Well

Number of small-cube hopers needed to serve 600 rigs (25 wells/rig) 12 trips per year

14 trips per year

16 trips per year

75,000

64,286

56,250

100

125,000

107,143

93,750

Carloads of Sand per Well

Number of small-cube hopers needed to serve 800 rigs (25 wells/rig) 12 trips per year

14 trips per year

16 trips per year

100,000

85,714

75,000

100

166,667

142,857

125,000

Carloads of Sand per Well

Number of small-cube hopers needed to serve 1000 rigs (25 wells/rig) 12 trips per year

14 trips per year

16 trips per year

125,000

107,143

93,750

100

208,333

178,571

156,250

USE OUR CAPITAL – NOT YOURS Enjoy the benefits of leasing new MOW equipment for a fraction of the cost of owning. Progress Rail’s Equipment Leasing team offers several programs tailored to meet your financial needs. We offer: • Diverse, well-maintained inventory • Competitive options for any budget • No hidden fees

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Progress_Rail

May 2017 Railway Age 19

EQUIPMENT LEASING GUIDE

extraction and production market has the capacity to pay premium rental amounts for useable assets. Current market dynamics provide some optimism about a cyclical increase in demand for small-cube hoppers that is atypical for the railcar market generally. There is the smell of opportunity— increased demand, more rigs, more tons of frac sand per well. There is money to deploy in chasing transactions when additional capacity is ready to be added. There is also a bust that left more than 25,000 cars parked in 2016 and per-car rentals less than $200 per car per month. While caution remains key in the current environment, don’t be surprised if small-cube hoppers lead railcar production numbers in 2017. Around The Market

Following is the annual Guide to Equipment Leasing update on the lease market for a variety of car types: Small-Cube Covered Hoppers: For those readers who blew through the sand market analysis, demand for small-cube hoppers has increased rapidly in the past quarter, driving full-service rates to the high $400s per car per month. Those lessors who placed cars early and low might be kicking themselves, as this market seems to have some steam. Drillers demonstrating an ability to make money when crude is in the low $50s per barrel and natural gas above $3.00 per million BTUs will keep driving this market. Investors should

be cautious, but patience may be rewarded. Bigger question: Should new investment capital flow to this car type? Grain Hoppers: The railroads moved prodigious amounts of grain in 2016 with little impact to the car market as rents languished in the low $400s (and high $300s) on jumbo cars and high $200s and low $300s on small-cube cars. Scrap has hit $300 per ton, a level at which many hope will lead to some organized scrapping of older 4,750 cubic-foot covered hopper cars. The dollar is still strong, and South America, Russia and Australia are expected to have strong or even bumper-sized harvests. Those hoping for carbuilding in the segment and improving lease rates might have to wait another year. Plastic Pellet Hoppers: Expectations for overbuilding in this segment continue to cast a shadow even as expansion plans continue domestically, with new facilities or expansion projects announced with amazing regularity. Lease rates continue in the low $500s (or high $400s), and car prices are well off 2015 highs—another wait-and-see market. Those holding 5,800 cubic-foot cars could see price erosion as carbuilders try to source every opportunity for replacement. Coal Cars: Well, the news isn’t all bad, and that’s an improvement of sorts! Lease rates on rapid-discharge hoppers may have moved into the low to mid $200s as coal loadings have been running at an increase of 10% year-overyear. Gondola cars remain under stress, as there just are not

CIT Knows

Rail Leasing Optimized rail equipment solutions based on industry-leading leasing and financing expertise. CIT Rail keeps your operations on-track with innovative leasing solutions for your railcar and locomotive transportation needs. Our full suite of leasing and management services is designed to free up capital for your growth and operating priorities. With one of the most diversified and high-capacity fleets, we are committed to serving a wide range of industries in North America and Europe. CIT knows rail leasing and we are eager to power your growth. Visit citrail.com, call 312-906-5701, or follow  @CITgroup. ATTRACTIVE ASSETS • FLEET MANAGEMENT CAPABILITIES CAPITAL PRESERVATION ©2017 CIT Group Inc. All rights reserved. CIT and the CIT logo are registered trademarks of CIT Group Inc.

Railway Age

May 2017

EQUIPMENT LEASING GUIDE

enough loads to fill the overhang of cars in this segment. Rents for gondolas languish in the low $100s when opportunities show up. Owners of these cars will need to remain optimistic and opportunistic and hope that policy will slow the move away from coal for a few more years. Centerbeam Flat Cars: Existing home sales seem to have peaked (what, already?!). That creates another drag on any potential bounce-back for this fleet. Thatâ&#x20AC;&#x2122;s old news, but investors might learn a lesson on their coal car investments from their experiences in this car type. Tank Cars (Non-Crude): As production moves back to more historical norms, owners can take some heart in that many car types remain only modestly overbuilt. Competition between builders and lessors is fierce, with lease rates being offered at rate levels not seen since before the pre-crude run-up in price. Full-service lease rates on new 25,000-gallon cars in the mid $500s per car per month, full-service, punish investors that paid more than $125,000 for cars in 2014 or 2015. Pressure cars continue to remain oversupplied, in the mid $400s. Tank Cars (Crude): We hear of the potential for the existence of some demand for cars hauling crude oil. Fleets of cars that are parked remain large. The market dynamic for this fleet will continue to evolve as leased cars find their way back to the lessors that made investments in this market and future lease

opportunities remain infrequent. There really is no lease market for these cars, but cars are offered for lease in the low $400s. Mill gondolas: $300 per-ton scrap has not really moved the needle on this car type. Scrap needs an export market. With Turkey and China on the sidelines, scrap is not going to find the loadings demand necessary to move car rents materially higher. Modern (286,000 pounds GRL) 52-foot cars (Eastern use) are trending in the low $300s, while similar capacity 66-foot cars (Western use) are in the low $400s. Boxcars: The ongoing supply and demand balance in this car segment makes for treacherous investment and lease rates that do not seem to want to improve. The standard 60-foot Plate F car (with a variety of door configurations) is fetching a barely passable mid $500s per car per month. Like many other car types, that is not enough to generate investment, but enough to keep those invested from leaping from tall buildings. This is likely the story for 2017. Aggregate Cars: Demand is stronger here, as this fleet was (is) old and growing. Unfortunately, demand is limited by the size of the market. Rents are all over the place in keeping with the age of the assets, but investors in new cars can expect to see plenty of suitors and lease rates in the low $400s, long term. Good quality used cars are generating similar rates with shorter terms. RA Company profiles follow on p. 22.

CONNECT The right car when you need it. Access one of the largest growing fleets in North America. We welcome the opportunity to speak with you about all your rail needs.

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May 2017 Railway Age 21

equipment leasing Guide

Leasing Resource Directory The 2017 Guide to Equipment Leasing (pages 15 through 21) is supported by companies that provide equipment leasing and financial services and products to the rail industry. All of these firms have advertisements elsewhere in this section or have used paid profile space to present their background and capabilities.

Wells Fargo Rail operates one of the largest, most diverse railcar and locomotive fleets of any rail equipment operating lessor in North America with over 175,000 railcars and 1,800 locomotives. Our team of over 200 experienced rail industry professionals is ready to listen to your needs and design and deliver creative and competitive equipment solutions. wellsfargo.com/rail © 2017 Wells Fargo Bank, N.A. All rights reserved. All transactions are subject to credit approval. Some restrictions apply. Wells Fargo Rail Corporation is not regulated in Canada as a financial institution.

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May 2017

Trinity Industries Leasing Company (TILC), with an owned and managed fleet of over 105,000 railcars, provides comprehensive railcar leasing options, fleet management, administrative services, as well as railcar maintenance and on-site field service support. TILC also provides access to the manufacturing resources as well as parts and components provided by Trinity Industries’ rail manufacturing companies. Sales and marketing activities for Trinity’s leasing and manufacturing businesses are coordinated under the trade name TrinityRail®, providing a single point of contact for our customers. Additional information on TrinityRail’s products and services may be found at www. trinityrail.com. Brian Madison, President, Trinity Industries Leasing Company Mark VanCleave, Executive V.P., Industrial Sales & Leasing 2525 Stemmons Freeway, Dallas, TX 75207 Phone: 800.631.4420; Fax: 214.589.8623.

www.trinityrail.com

RailSolutions provides a broad variety of railroad equipment-related consulting, technical and advisory services to financial institutions, railroads, shippers and fleet operators with a primary focus on equipment valuation and appraisal services. Additional areas of expertise include railcar and locomotive inspections, equipment repair and overhaul cost analysis, and portfolio valuations. RailSolutions draws on over 40 years of railroad industry experience in developing multiple quantitative valuation models supported by both a sound base of market data and advanced analytical techniques. James D. Husband, President 1307 Jamestown Road, Suite 101 Williamsburg, VA 23185 757-903-4606 • Fax: 757-903-4705

www.railsolutionsinc.com

equipment leasing Guide

HZRX

LOCOMOTIVE LEASING,,LLC

CIT Rail is an industry leader in providing customized leasing and financing solutions for our customers throughout North America and Europe through our subsidiary, Nacco, A CIT Company. We leverage a highly diversified fleet of efficient railcars and locomotives to supply railcar transportation solutions to shippers and carriers across a wide range of industries. Our solutions free up capital for your growth priorities, increase efficiencies and reduce out-of-service time. CIT Rail owns over 130,000 railcars and 400 locomotives leased to approximately 670 customers. CIT Rail brings unparalleled asset management expertise and commitment to the transportation sector. Visit citrail.com, call 312-906-5701 or @CITgroup follow

citrail.com

With over 100 years experience in the rail and finance industries, Progress Rail Equipment Leasing is a full-service professional leasing firm specializing in leasing railroad maintenance equipment. We finance and refinance MOW equipment, intermodal equipment, locomotives, railcars, and other rail-oriented equipment. Our experts’ dedication and uncompromising focus on quality sets us apart from the competition. Progress Rail Equipment Leasing develops leasing programs to cut equipment costs and provides leasing structures that are tailored to meet the rail industry’s specific and everchanging needs. In addition, we offer finance and operating leases, sales/leaseback programs, and short and long-term rentals. Progress Rail Equipment Leasing 15173 North Road, Fenton, MI 48430 (810) 714-4626 Voice • (810) 714-4680 Fax

www.progressrail.com/mowfinancing

HZRX-Locomotive Leasing, LLC offers turn-key locomotive leasing solutions. Armed with parts, materials and a vast array of resources permit the highest levels of asset heath, reliability and maintainability. All of our locomotives are rigorously renewed by the same people who answer the phone and go into the field. This allows for quick responses backed with first-hand knowledge of the actual asset. Consistent reinvestment, cloud-based recordkeeping with diligent maintenance allow us to provide some of the cleanest, reliable and presentable locomotives! JON JAROS President & CEO 440-478-8009 | Jon@horizonrail.com 25018 LAKELAND BLVD EUCLID, OH 44132

www.horizonrail.com

The David J. Joseph Company

When evaluating your railcar needs, you need a partner with industry experience, deep asset knowledge, and the strength to offer competitive and flexible terms. From flat cars to covered hoppers and beyond, the Rail Finance team at PNC Equipment Finance offers the inventory of assets to meet your needs combined with the industry-leading financial expertise to maximize ROI. Whether you need Full Service Lease options, including maintenance or a simple net lease, short term or long term, we bring comprehensive railcar solutions for the miles ahead. PNC Equipment Finance – Rail Finance Team  Ken Roseberry, SVP 513 455 9617, ken.roseberry@pnc.com  Christopher Bell, Sales & Marketing 513-455-9620, christopher.bell@pnc.com   Robert Hogan, Sales & Marketing 513-455-9056, robert.hogan@pnc.com

www.pnc.com

The David J. Joseph Company’s Rail Group provides a broad range of transportation services throughout North America: single investor, leverage leases, freight cars, portfolio evaluation, remarketing fleet management, purchases and sales of portfolios, and private fleet management. Other services include freight car inspections and engineering services from design of new cars to complete ISL extended life, modifications and analysis; in addition to railcar dismantling for scrapping and parts reclamation. The David J. Joseph Company Rail Equipment Group 300 Pike Street • Cincinnati, OH 45202 Tel.: 513-419-6200 • Fax: 513-419-6221 Contact: info@djj.com

SMBC Rail Services LLC is committed to providing innovative rail car leasing products and services to North America’s vital rail industry. Let one of our experienced professionals show you how. Visit us at our website: www.SMBCrail.com, or call us at 1-866-4-RAILCARS. Gene Henneberry, President and CEO SMBC Rail Services LLC 300 S. Riverside Plaza, Suite 1925 Chicago, IL 60606

www.djj.com

May 2017 Railway Age 23

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Hazmat HOLDUP Demand for new equipment is still in the tank.

Bruce Kelly

By Stuart Chirls, Senior Editor

ith shipments of crude-by-rail at a veritable standstill, investment in hazmat equipment is flowing like so much spillage out of a damaged tank car to, well, downstream chemical products. To be sure, CBR hasn’t completely disappeared, as the recent increase in frac sand shipments attest. But, tens of thousands of tank cars remain in storage, while others locked up in long-term leases or too expensive to upgrade or convert to other uses roll off the miles while their operators wait for the scrap market to revive. Meanwhile, carbuilders and component suppliers are diversifying into the derivative chemicals market to ensure steady business in the near-term. “There have been three rounds in the recent car business,” says Tom Jackson, Vice President of Marketing for The Greenbrier Companies. “First, cars for frac sand. Second, tank cars for crude-by-rail. And third—now—tank cars for downstream products.” Those products are categorized as TIH, for Toxic Inhalation Hazard, and include anhydrous ammonia, caustic soda, chlorine, ethanol, and many others. They are among the most hazardous and heavily-regulated commodities hauled by rail, and, unlike general purpose commodities, require highly specialized cars and equipment to ensure safety during transport. Liquefied petroleum gas comprises the largest of the specialty chemical tank car fleets, which tend to be smaller than either crude or ethanol. “Where we will build 1,000 of one type car we are now building tank cars in smaller lots, 100 of this, 50 of that, cars with specialty valves and linings, for example,” says Jackson. “In the chemical business you have companies out there who have never owned or operated a railcar, never had to

worry about certification or maintenance; it’s a new world for them. They are small and jump in and out of markets.” So while the North American market in Bakken and Canadian tar sand crude boomed, Greenbrier looked ahead to diversifying its product offerings. As of September 2015, it catalogued 12 different tank car designs. Jackson also expects good replacement demand for older car types in the coming years. The AAR is phasing out some chlorine and ethanol cars; the U.S. DOT previously ordered the DOT-111 cars used to carry ethanol and other flammables be retrofitted or phased out by May 2023. “Historically, operators scrap 2.5-2.7% of their tank car fleets each year,” Jackson says. “But it is a decision specific to each company, and depends on market conditions, leases, scrap metal prices. If the price of scrap shoots up, they’ll start to scrap cars.” In the Railway Age 2017 Guide to Equipment Leasing (p. 15), Financial Editor David Nahass reports that scrap is currently pricing around $300 per ton—not enough to jump-start the market. “I think we have reached the bottom of the order cycle and will keep moving up throughout the year,” Jackson says. “There is a lot of replacement demand coming.” At Canadian carbuilder National Steel Car, the present contrasts sharply with the future. “We are not building tank cars,” says Bob Pickel, Senior Vice President of Marketing and Sales. “The market has retracted back to levels seen before CBR.” Pickel said National Steel Car, based in Hamilton, Ont., was seeing orders for as many as 12,000 cars a year during the oil boom. He forecast orders of 8,000-9,000 per year through 2019, absent a crude comeback. Currently, most May 2017 Railway Age 25

HAZMAT equipment

of what NSC plans to build are the DOT-117 cars specified in the U.S. and Canada to replace the DOT-111 in hazmat service. While rules permit the 111 cars to be upgraded, for operators it makes little economic sense. “There’s a surplus of the 111 flammable tank cars used to haul ethanol, biodiesel and LPG,” Pickel says. The market for pressure cars [cars used to haul materials under pressure] “is long right now. And, it’s not easy to convert a hazmat car to non-hazmat, which is considered controversial because the physical structure, the thickness of the tank wall, can be affected, among other things. Tank cars are permitted to operate for 50 years like most other freight cars, but a hazmat car must be recertified safe every 10 years” by the FRA and its counterpart, Transport Canada. Pickel said that with the recent increases in drilling and fracking, a corresponding uptick in shipments of derivative chemicals by rail would follow. “Most carbuilders have cut back capacity. We’ll wait until there is some critical mass to restart our production lines.” For parts suppliers, the ability to supply a broad array of commodity shippers means business remains brisk. For cars carrying flammable crude oil and ethanol, the Fixing America’s Surface Transportation (FAST) Act set out requirements for phase-outs and upgrades that is good news for aftermarket companies. page landscape: 7 The x 4deadlines 15/16 for cars to meet new safety rules:

Crude Oil

Car type • Non Jacketed DOT-111 • Jacketed DOT-111 • Non Jacketed CPC-1232 • Jacketed CPC-1232

Deadline 1/1/18 3/1/18 4/1/20 5/1/25

Ethanol

• Jacketed and Non Jacketed DOT-111 • Non Jacketed CPC-1232 • Jacketed CPC-1232

5/1/23 7/1/23 5/1/25

“Business is good for us,” says Griffin Schiele, sales engineer for Salco Products, a manufacturer and marketer of freight car parts based in Lemont, Ill. Schiele said that after the collapse of CBR, the rail market turned 180 degrees. Plastic pellets are now the hot commodity for Salco, which specializes in diversified offerings such as fittings for loading or off-loading cars that carry enclosed products. Schiele also observes that the spectacular growth of the CBR market was a prime opportunity for Salco to be more than just a supplier. Salco sells to leasing companies, shippers, repair networks and carbuilders, “and there is an educational process for small customers to understand our products. So, we do quite a bit of consulting; that’s our

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HAZMAT equipment

competitive advantage. It’s geared to a high level—procedural maintenance, FRA compliance, like that. It helps us build deeper relationships with our customers, and get to solutions quite a bit quicker.” After a soft 2016, Schiele says the hazmat market is picking up, and that Salco is seeing more hazmat movements from its shipper customers. “There’s been an uptick in hydrochloric acid,” he notes. After a 2004 acquisition, Salco opened its Hazarsolve division, which specializes in designing, constructing and supplying products and services to the chlor-alkali chemical industries. Among its new products are a patented lined fittings plate, manufactured to extend the lining and eliminate premature failure of the tank car manway and fittings for corrosive rail and tank truck manway systems. Also offered are corrosion-resistant dip tubes, primarily for use with hydrogen chloride, ferric chloride, ferrous chloride and bleach, but also appropriate for non-corrosive environments. Made from ultra-high molecular weight polyethylene and Teflon, the tubes are significantly more resistant to abrasions than steel. They are available in a variety of sizes, and the tube can be cut for specific applications. Flanges can be customized for inlet-outlet fit. An expected change in federal hazmat tank car regulations is helping drive new product development. Among these is

a new bottom outlet and valve that can extended the life of a car by 30%, says General Manager Kevin Cook of Midland Manufacturing, Skokie, Ill. “New regulations are positive for us, typically,” Cook says. “We have a next-generation fittings package in development. The last time we came out with one was six years ago. This is an opportunity to improve. This package is easier to install and maintain, and easier for first responders to cap the valves, if needed. It’s a TIH value package with angle valves and check valves that work together.” Midland is currently conducting a revenue service trial, a two-year process of inspections and approvals. RA Salco specializes in diversified offerings such as fittings for loading or off-loading cars that carry enclosed products.

AEI RF Identification Tags are on over 1,000,000 Railcars

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Grade crossing collision challenge How new tech aims to solve an old problem. By Stuart Chirls, Senior Editor

of commuter and light rail across the country, and transitoriented residential developments located closer to active tracks.” Drivers misguided by in-car Global Positioning Systems, and outdated grade crossings with vehicular traffic far above design limits, also put trains and motorists on a potential collision course. In an age where so much information is collected and analyzed, CTC is exploring big data as a means to prevent a grade crossing collision before it occurs. CTC offers the X-Link™ system, moving beyond “what happened” to real-time analytics. The X-Link R is a grade crossing event recorder/analyzer that integrates data and video to monitor crossings, for root-cause analysis by uncovering operational anomalies that are difficult to detect through standard diagnostics. To improve response time, the X-Link can send a user-defined notification during an event that can be accessed on-site or remotely. Campbell says CTC has installed more than 100 X-Link systems, which can be networked with the X-Link H traffic signal monitor, for compliance with certain FRA and Federal Highway Administration recommendations for interconnected crossings. Campbell says CTC is testing the X-Link with several Class I railroads. “We have captured amazing video of different incidents. We’re seeing what drivers do at crossings. That tells us the rest of the story—and how to mitigate those issues.” To help warn distracted motorists and pedestrians, CTC

Railway Equipment Company

esides gravity and friction, there’s something else railroads have been fighting since there have been railroads and automobiles—grade crossing hazards. Unless you grew up where the railroad was rich enough to raise the right-of-way (think Delaware, Lackawanna & Western commuter service westward from Newark, N.J.), or smart enough to put it in a trench (Alameda Corridor), then you well know the danger inherent in mixing trains and traffic. (Editor’s note: While the DL&W raised much of its electric commuter line through Essex County, N.J., once in Newark the main line actually dove below grade to pass under the existing Newark City Subway, which crossed Orange Street at grade, today’s NJ Transit Newark Light Rail. But that’s another story…) “If you look at the recent crossing statistics from the Federal Railroad Administration, you’ll see that with programs such as Operation Lifesaver and increased enforcement, there are about 2,000 collisions and a couple of hundred fatalities each year,” says Rick Campbell, president of CTC Inc., a provider of crossing warning devices based in Fort Worth, Tex. “But there hasn’t been recent improvement on that number. We’re not driving that number down anymore.” It’s not hard to see why, Campbell says. “Driver distraction is a national issue, whether they are texting or just using a cellphone, with earphones in listening to music. And that extends to pedestrians, too. There has also been the growth

May 2017 Railway Age 33

Bungalow view of CTC Inc.’s X-Link™ R event recorder/analyzer.

offers two products. The Wayside Horn System is installed at crossings and produces a digitized train horn sound in a standard crossing warning pattern as a train approaches, at volumes up to 100 decibels. Since it is directed at approaching traffic, it can eliminate the need for a train’s horn—a key feature for crossings in quiet zones. A confirmation beacon provides visual operational status

to train crews. CTC began marketing the system this year. CTC also offers Another Train Coming, a pedestrian active warning sign that determines multiple train approaches at busy or complex grade crossings with pedestrian traffic where approaching trains may be hidden by a stopped train or are otherwise unseen. The LED sign is approximately 30 inches square and 11 inches deep, and a single train activates an illuminated crossbuck while red lights flash alternately. A second train activates an audible message while alternately flashing “ANOTHER TRAIN COMING” and “DANGER.” It supports crossings up to six tracks, has a programmable audio message, and interconnects to railroad bungalow circuitry. Campbell says CTC is also testing a system to address the issue of stopped vehicles, warning drivers to get off the tracks. The company also is working on a long-term research project with the Texas A&M Transportation Institute that involves crossing protection and autonomous cars. But not all grade crossing warning devices are complex, large systems, or even cutting-edge technology. At Railway Equipment Co., a manufacturer of crossing gate arms headquartered in Plymouth, Minn., outside Minneapolis, the most significant change in its product line might also be the most subtle. “The biggest factor we have seen,” says Joe Ashley, vice

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CTC Inc.

Grade crossing warning devices

CTC Inc.

Grade crossing warning devices

president and general manager, “is the change on crossing arms from diagonal safety striping to vertical striping.” Ashley says he began to see a change in striping several years ago from diagonal to vertical. “I’m not sure the FRA specified it, but from what I’ve heard there was some concern that the diagonal striping was directing people around the gates.” A cursory check found an illustration in Delaware state regulations showing a crossing gate with vertical stripes, and REC has been selling predominantly vertical striping. A modern update on crossing tech has been the replacement of incandescent gate lights with light-emitting diodes. REC offers a traditional round LED or a new low-profile model that’s more rectangular. Ashley said the low-profile style is preferred by transit operators and Class I’s, all of which are REC customers. The company also is offering a new power cord for powering the gate arm lamps, with a flat, thin profile that looks better and is less attractive to vandals. All are backwardcompatible with older technology, and the LEDs use less power than bulbs. “It took the Class I railroads quite a while to evaluate LEDs,” said Ashley. “We showed them how to save money on new products, save them a few bucks, and now we sell to all of them.” RA

CTC Inc. equipment at a Metrolink crossing in Southern California.

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May 2017 Railway Age 35

SOLID CONNECTIONS

or almost as long as there have been railroads, there have been cables, which are among the most critical pieces of equipment in virtually all wayside, onboard or back office equipment and systems. The applications are virtually endless: interlocking controllers, grade crossing warning devices, traction power (catenary and third rail, substations), fault detection, rail lubrication, signaling and traffic control, PTC, telecommunications, microprocessor-based engine controls, AESS, HEP, video surveillance (CCTV), passenger information, emergency intercoms, onboard internet, train control. Ruggedness, reliability and resiliency are paramount. There are several dozen standard engineering terms used in cabling. These range from the familiar AWG (American Wire Gauge), based on the circular mil system where 1 mil equals 0.001 inch, to XLPO (Cross Linked Polyolefin), a thermoset jacketing material with low smoke characteristics and free of halogens. As well, there are seven conductor identification designations, all of which fall under ICEA (Insulated Cable Engineers Association) Standard S-73-532: E-1 (color 36 Railway Age May 2017

sequences for utility conductor identification, includes green and white); E-2 (color sequence for industrial conductor identification, excludes green and white); METHOD-1 (colored compounds with tracers); METHOD-2 (neutral compounds with tracers); METHOD-3 (neutral or single colored compounds with surface printing of numbers and color designations); METHOD-4 (neutral or single colored compounds with surface printing of numbers); and METHOD-5 (individual color coding with braids). Among the industry’s principal suppliers are the Okonite Company, Electro-Wire and Huber + Suhner. Okonite has been in business since 1878 and manufactures cables that range from 300- to 345,000-volt insulated products under no fewer than 21 registered trade names. Applications include instrumentation, power and control (including vital circuit signal cables), medium- and highvoltage cables, all manufactured exclusively in the U.S. with a variety of insulating and jacketing materials, among them OKOGUARD® EPR (ethylene-propylene rubber), laminated polypropylene paper (LPP) and other thermosetting and thermoplastic compounds. OKOGUARD® is

Okonite Company

Thanks to state-of-the-art technology, cables By WILLIAM C. VANTUONO, Editor-in-Chief are no longer the weakest link.

Okonite’s exclusive EPR-based thermosetting insulation, “with an optimum balance of electrical and physical properties unequaled in other solid dielectrics,” the company says. Used on power cables rated 600 volts and above, it has been manufactured since 1968. Okonite serves many industry markets in addition to rail: electric utility, oil and gas, chemical, military, pulp and paper, health care, education, water treatment, data centers, wind and solar farms, and biofuel generation. Electro Wire specializes in providing well-known brands like Exane® and TelcoFlex® wire and cable and a full range of electronic wire and cable, shrink tubing, fiber optics, connectors and terminals. Switzerland-based Huber + Suhner in the past few years has established a strong presence in the North American rail transit vehicle market, counting Bombardier, Alstom, Kinkisharyo, Siemens, and Kawasaki among its principal domestic customers. The company develops and manufactures components and systems for electrical and optical transportation of data and energy for the communication, transportation and industrial markets with cables, connectors, cable systems, antennas and other passive components for radio frequency, fiber optics and low frequency technologies. Huber + Suhner’s pre-assembled cables consisting of RADOX® RAILCAT CAT7 cable and M12 connectors are EN45545 (European Union railway standards for rolling stock fire safety)-compliant. Designed specifically for rail

transit rolling stock where space is at a premium, they offer 50% more conductive material, “more wire in less space,” says Railway Market Manager North America Mark Anderson. They also meet NFPA (National Fire Protection Association)-130 standards for fire protection and life safety requirements. (For vehicles, NFPA-130 addresses emergency procedures, communications, control systems, and storage areas subject to extreme heat and vibration.) RADOX® RAILCAT/M12 cables “offer low-loss data transmission, high signal reserves, easy installation without special tools, and lossless extensions,” according to Anderson. “During testing, they have survived 5.8 million continuous bending cycles, equivalent to more than 30 years of service in a high-vibration environment at temperatures exceeding 120 degrees C (248 degrees F).” Huber + Suhner’s SPUMA flexible, low-loss, halogen-free, high-performance RF cables are designed for CCTV systems, for applications up to 6 GHz. With a screening effectiveness of >90 dB over the entire operating frequency range and a tight bending radius, they are also approved under EN45545 and NFPA-130 standards, as well as DIN 5510 and NF F 16-101 standards. As well, they also feature excellent return loss (VSWR, for Voltage Standing Wave Ratio, a measure of how efficiently RF power is transmitted from a power source through a transmission line into a load—for example, from a power amplifier through a transmission line to an antenna), according to the company. RA

Connected Mobility – Everything from one source Why risk long-term performance of your Connected Mobility solution on components from multiple suppliers? With HUBER+SUHNER’s connectivity solutions you can reliably link all systems and devices on railway vehicles and train-to-ground with our low frequency wires and databus cables, antennas and NFPA 130 compliant radio frequency cables, and fiber optic cables and fiber management systems.

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May 2017 Railway Age 37

Power

Player 38 Railway Age May 2017

The Tier 4-compliant Dual Railserve LEAF® Gen-Set locomotive debuted in 2016. There are two models: a single-engine unit, powered by a Cummins QSX15 Tier 4-complaint 600-hp genset, and Dual LEAF®, with two Cummins gensets.

Railinc’s 2017 North American Locomotive Review shows a fleet gradually expanding in size and power.

ailinc’s annual analysis of the North American locomotive fleet reveals that the size of the total fleet increased in 2016, driven by growth in high-horsepower, six-axle, AC diesel locomotives. Trends in 2016 were: • Locomotives continue to join the fleet at a steady rate. This was the seventh consecutive year of growth for the fleet. At the end of 2016, the locomotive fleet totaled 39,200. That was up about 700 units—or about 2%—from 2015. • The age of the locomotive fleet increased in 2016. Locomotives have long service lives, and their average and median ages both increased 0.7 years in 2016, compared to 0.6 years in 2015. This was the seventh consecutive year the average and median ages increased. • Most new additions to the fleet since the mid-1990s have been six-axle locomotives with a horsepower rating of 4,000 or higher. Locomotives with alternating current traction motors (AC units)—which perform well at hauling heavy loads—accounted for the majority of new additions in the past decade. And, locomotives with the highest fuel capacity—more than 4,500 gallons—make up the largest percentage of the fleet.

Fleet Size Increase Continues

By DAVID HUMPHREY, Ph.D., Senior Analyst, Railinc Corp., for Railway Age

Since Railinc began reporting on locomotives, the size of the fleet has increased each year. Although the locomotive fleet increased by 700 units in 2016, the growth rate was 2%—one percentage point lower than the previous year (see Figure 1, p. 40). May 2017 Railway Age 39

RAILINC north american locomotive review

Figure 1

Approximately 620 new locomotives joined the North American fleet in 2016, down from about 950 the previous year (see Figure 2). Historically, the average age of the fleet and the number of locomotives added to the fleet mirror the economic environment. When the economy is strong, as in the mid-1990s and mid2000s—and there are more railcars in service—the fleet tends to grow. During periods of recession, fewer new locomotives join the fleet. As new locomotives join the fleet each year, large railroads move older units to less demanding roles, sell them to regional and short line railroads, or make them available to be rebuilt or refurbished. A locomotive has a long service life and can be used in a variety of ways during its lifespan. In its first decades of service, it most often is used for long hauls. Middle age can be spent working on regional and short line railroads. Then comes performing lighter duty service, such as moving 40 Railway Age May 2017

railcars in a hump yard, at 60 or 70 years old. DC diesel locomotives make up 66% of the North American fleet, down two percentage points from the previous year. The share of AC diesel

The fleet does continue to add lower-horsepower locomotives, though at generally decreasing rates.

locomotives continues to increase as more AC units join the fleet (see Figure 3). Although DC diesel locomotives still make up two-thirds of the North American fleet, AC diesel locomotives have dominated among new additions

in the past 10 years. In the past four years, 93% of all new locomotives were AC units. Locomotives with a horsepower rating of 4,000 or higher continue to make up the majority of the North American locomotive fleet—55% in 2016, unchanged from 2015. As a percentage of the fleet, locomotives between 2,000 and 3,999 horsepower fell from 35% in 2015 to 34% in 2016, while the smallest locomotives—those with up to 1,999 horsepower—rose one percentage point. This reflects the trend of highhorsepower locomotives dominating among new additions to the fleet. The fleet does continue to add lower-horsepower locomotives, though at generally decreasing rates. These lower-horsepower additions to the fleet consist of rebuilt locomotives and new units used as switchers. Shift to Higher Horsepower Continues

Locomotives with a horsepower rating

RAILINC north american locomotive review

of 4,000 or higher dominate among AC diesel locomotives, which tend to be newer. There are twice as many DC diesel locomotives in the North American fleet as AC units. However, DC units are more evenly distributed by horsepower rating, with locomotives with horsepower ratings of less than 4,000 making up the largest share. Six-axle locomotives make up 69% of the fleet, holding steady from the previous year. Six-axle locomotives distribute the weight of a locomotive to the rails across more wheels and deliver tractive effort through more wheels and traction motors. The majority of six-axle locomotives were built in the past 30 years. Locomotives with fuel capacity of more than 4,500 gallons make up 55% of the fleet, holding steady from the previous year. This share has grown in recent years, while the share of locomotives with fuel capacity between 3,500 and 4,500 gallons has decreased. This is consistent with the recent trend of the fleet adding new high-horsepower, six-axle locomotives, which have larger fuel tanks.

Figure 2

Figure 3

Road Units, Switchers Account for 90% of North American Fleet

To distinguish locomotives used in road service from those used in switching service, Railinc has applied the following definitions: â&#x20AC;˘ Road units are locomotives with six axles and a horsepower rating of 2,500 or higher. â&#x20AC;˘ Switchers are locomotives with four axles and up to 2,500 horsepower. Road units make up 68% of the North American locomotive fleet, while switchers account for about 22% of the population (see Figure 4). Locomotives with four axles and a horsepower rating of 2,500 or higher make up 8% of the fleet. However, the industry shifted away from making this type of locomotive in the mid-1990s. Railinc is a wholly-owned subsidiary of the Association of American Railroads. For more information or to download this report, visit www.railinc.com. RA

Figure 4

May 2017 Railway Age 41

Is 39 tons too much? TTCI examines the performance of tie and fastener systems under extreme heavy axle loads.

By MIKE McHENRY, Senior Engineer; and Joseph LoPRESTI, Scientist,Transportation Technology Center, Inc., for Railway Age

s North American railroads continue to seek safer and more efficient operations, improved track components, including tie and fastener systems, will be necessary. The tie and fastener system plays a key role in overall track quality, particularly in areas of higher speed and higher tonnage. Transportation Technology Center, Inc. (TTCI) continues to evaluate the performance of various tie and fastener systems at the Facility for Accelerated Service Testing (FAST) under heavy axle loads of 39 tons. The objective of this testing, funded by the Association of American Railroads Strategic Research Initiatives program, is to assess the relative performance of these tie and fastener systems throughout their life cycle, and to determine how certain failure modes affect track performance. TTCI worked with North American railroads and suppliers to select the tie and fastener designs for testing. Various test zones were evaluated between 2008 and 2016, accumulating more than 1,000 MGTs (million gross tons). The test section included zones of hardwood and softwood ties with and without elastic fasteners, polymer composite ties with cut spike fastening systems, and a variety of concrete ties and fastening systems. A number of elastic fastening systems were tested on concrete and wood ties. All test sections were located in the 6-degree curve of Section 25 at FAST’s High Tonnage Loop. Observed failure modes were documented throughout testing. Additionally, gage strength was evaluated using gage restraint measurement system (GRMS) testing, lateral track loading fixture (LTLF) testing, and track geometry measurement. The GRMS and LTLF testing are two techniques used to apply a gage widening load to the track to assess the tie and fastening system’s ability to resist gage widening. Key conclusions from this testing indicate: • Conventional concrete tie insulators are prone to breakage, which may contribute to wider gage. • Softwood ties showed significantly higher magnitudes of plate cutting than similarly configured mixed hardwood ties, thereby increasing track gage and reducing gage strength. • Cleated tie plates, designed to increase plate/tie friction, had no apparent effect on gage strength, and appeared to increase rates of plate breakage. • Two zones of polymer composite ties saw increased rates of plate breakage compared to wood ties, but remained serviceable for more than 1,700 MGT and 2,100 MGT, respectively. • Hardwood ties with premium 18-inch plates and elastic fastening systems appear to perform similarly to concrete ties; both in terms of track geometry and gage strength. 42

Railway Age

May 2017

• Driven spikes and screw spikes, used as plate hold-down fasteners for elastic rail clips, both showed failures throughout the test—screw spikes primarily through breaking below the head, and driven spikes primarily through rising/loosening out of their spike hole. • Fastening system designs with spikes located closer to the rail base had higher rates of spike failure. Failure modes, along with the performance data collected throughout the test, are being used to guide improved system designs. The arid climate at FAST generally negates any effects of wood tie rot/decay on fastener performance. Increased wood deterioration in more humid climates negatively affects plate cutting and spike retention. New polymer composite ties that resist rot and decay are currently being evaluated as alternatives to wood ties. Additionally, new test zones are being designed to more directly compare the effects of plate size, plate hold-down spikes, and spike locations on the plate. RA Mixed hardwood ties with conventional 14-inch tie plates and cut spikes were used as a control zone for evaluation of a variety of tie and fastener systems.

Wired in, not wired up By WILLIAM C. VANTUONO, Editor-in-Chief

Real-time asset condition monitoring is changing the way railroads maintain critical equipment.

n an increasingly data-driven industry, a continuous flow of detailed, accurate information on assets, both fixed and mobile, is fast becoming an indispensable tool. Realtime monitoring tied in to SaaS (software as a service) has been around for quite some time. Following are two more-recent developments.

Progress Rail Services

Battery Cell Monitoring

Railway Equipment Company (REC) has developed a remote battery cell monitor that can eliminate errors that sometimes occur during the inspection process, where each battery cell must be individually tested with a meter by a signal maintainer. This technology collects data from individual battery cells or battery strings. The monitors communicate via wireless 900 MHz to the battery monitor, DTC, or SMC battery

chargers. Additionally, they are compatible with RECâ&#x20AC;&#x2122;s RailNETÂŽ central data collection technology, allowing access to the status of equipment and data 24/7. The battery cell monitor offers data collection, analysis and distribution functions. It monitors live data points for the temperature and voltage of up to 60 individual cells, and is capable of identifying a deteriorating cell before it damages the entire cell bank. It is customizable with a web-based user interface for viewing historical data to identify bad or deteriorating cells. It estimates the remaining battery capacity based on amp-hours consumed, discharge-current temperature and battery age, as well as remaining runtime based on capacity and average load. Canadian Pacific has been conducting proof-of-concept testing on RECâ&#x20AC;&#x2122;s battery cell monitor at two Canadian May 2017 Railway Age 43

SOFTWARE AS A SERVICE

REC’s battery monitoring technology is compact, designed to fit into existing signal and switch control cases, even those with traditional relay-based vital logic that requires a lot of space.

ARGUS and OSCAR

Through its recent acquisition of Inspired Systems Pty Ltd., Progress Rail Services now offers ARGUS data accumulation 44

Railway Age May 2017

and real-time asset condition monitoring, and OSCAR, a condition monitoring data repository. ARGUS is web-based and modular in design, and can incorporate input from such equipment as hot wheel, hot bearing and dragging equipment detectors; battery condition and grade crossing monitors (current draw, proximity, I/O); and pumps (pressure, current draw). Using high-throughput, low-latency internal communications, ARGUS monitors communications connectivity from end to end as well as the

Railroads have been petitioning the FRA and Transport Canada to allow remotely collected data to be used to meet inspection requirements.

health of the asset protection system; raises alarms/alerts in real time; combines data from disparate field devices/ systems; and can host an unlimited number of telemetry devices. Because it can communicate with any interface, ARGUS is “brand-agnostic.” OSCAR, also web-based, collects information from such disparate systems as wayside fault detectors (traditional and acoustic bearing detectors, onboard locomotive health monitors, AEI tags, etc.). OSCAR also raises alerts on individual or combined data sources, and has a powerful search function to retrieve data for such functions as predictive maintenance, wear and utilization trending, lifespan performance reporting, and comparisons against fleet averages. Like ARGUS, OSCAR is brand-agnostic. RA

Railway Equipment Company

signal/switch installations equipped with older, relay-based vital logic. REC equipment monitors two battery banks at each location: one 12-volt, for signals and related electronics; and one 24-volt, for switch machine power. The results, according to CP Senior Manager, Signal Standards Matt Perkin, “have been impressive. The interface works very well, and we receive detailed information as well as useful historical data. The REC units are compact, which is important since many existing housings are very limited on space.” Like U.S. railroads, which have been petitioning the FRA to allow remotely collected test data to be used to meet inspection requirements, Canadian carriers are petitioning Transport Canada. “This is a safer, more reliable method than manual inspection,” says REC CEO Dave Fox. “It can free signal inspectors to concentrate on other critical tasks required to operate a safe railroad.” Remote monitoring has many other applications. One is a winter resiliency plan in which the Massachusetts Bay Transportation Authority has partnered with REC and Keolis Commuter Services to install gas hot air track switch heater systems and fiberglass covers at critical locations on the MBTA commuter rail network. All these installations include REC’s Sno-NET®, which is capable of remotely monitoring individual switch heaters and local weather conditions. Data is sent directly to management and maintenance personnel via a web portal and email notifications. Authorized individuals are able to control switch heaters remotely, reducing the need for field visits during adverse winter weather. Remote monitoring also allows MBTA management to perform predictive and preventive maintenance along with root cause analysis on individual units.

People

Meetings

High profile Former NJ Transit Interim Executive Director Dennis Martin has been named a vice president in the Lawrenceville, N.J. office of WSP | Parsons Brinckerhoff, the global engineering and professional services organization. Martin serves as director of multimodal planning for the firm’s Northeast region, responsible for intermodal facilities, bus rapid transit, light rail and rail operations. He had served as leader of Parsons Brinckerhoff’s planning work for the replacement of the Port Authority Bus Terminal in New York City. Martin joined the Martin company in March after a 33-year career with NJ Transit, where WSP | PB he was Interim Executive Director from 2015-16. In that role he led negotiations for the agency’s expired bus and rail labor contracts, and directed the development of the $3 billion fiscal 2017 capital and operating budgets. He later served as Vice President and General Manager, Light Rail & Contract Services, overseeing operations and contract management of the agency’s light rail systems.

May 23-25, 2017 North American Rail Shippers Association (NARS) Annual Meeting. Parc 55 Hilton, San Francisco, CA. Information: (331) 643-3369; www.railshippers.com June 7-8, 2017 Railway Age Third Annual Rail Insights Conference Union League Club of Chicago Information: http://www.railwayage.com.

Carlos Rojas has been named Chief of Police for Bay Area Rapid Transit (BART). Rojas comes to BART from the Santa Ana Police Department, where he served the past five years as chief. He holds a Master of Science in Criminal Justice from Chapman University, and a Bachelor of Science in Criminal Justice from California State University, Long Beach, with additional training at the FBI National Academy. WAGO of Germantown, Wisc., has added Patrick Butler as Regional Sales Manager in Southwestern, Ontario. Butler previously worked for Phoenix Contact as a District Application Specialist, a Regional Sales Manager, and Regional Channel Manager. WSP | Parsons Brinckerhoff has appointed Greg Johnson as Michigan Area Manager. Johnson, a vice president, is responsible for managing operations, establishing strong client relationships and maintaining a focus on business development and marketing for new and existing clients in the Detroit area and statewide. Previously, Johnson was administrator of the Maryland State Highway Administration. Thomas Gibson has been appointed Vice President and Western Regional Manager of WSP | PB’s Transit and Rail practice, based in Sacramento. Gibson is responsible for technical and operational management, project delivery, staff acquisition and business growth.

Fred Tallarico has been appointed Regional Director of Design-Build for the company’s Northeast and Central regions. Tallarico will manage the firm’s pursuit and execution of transit, highway and infrastructure projects using alternative delivery methods such as design-build and P3s (public-private partnerships). He is based in New York City. Kathy Simons has been elected President of the Los Angeles chapter of WTS International. Simons is owner and president of LKG-CMC, Inc., a consulting company providing transit configuration management/document control and project control services.

100 YEARS AGO in

conferences@sbpub.com. June 11-14, 2017 APTA Rail Conference Baltimore Information: http://www.apta.com. Sept. 17-20 Railway Interchange 2017 Indiana Convention Center, Indianapolis http://railwayinterchange.org Sept. 25-27, 2017 Institution of Railway Signal Engineers (IRSE) 2017 Annual Convention.

May 1917 Passenger Service and the War Our passenger train service is the most luxurious in the world, and it is the most uneconomically conducted part of our railway transportation. We have fewer passengers per train than any other country. Very large economies can be effected and the efficiency with which railway facilities are used can be greatly increased by reducing the speeds of passenger trains, curtailing the number of them and eliminating many of the luxurious features of passenger service.

Dallas, Texas Contact : ray@globalsignals.net http://irsecon17.wixsite. com/dallas. Oct. 19-20, 2017 Railway Age/Parsons International Conference on Next-Generation Train Control Courtyard Philadelphia Downtown Information: http://www.railwayage.com. conferences@sbpub.com. May 2017 Railway Age 45

Products Siemens creating “Internet of Trains” Siemens’ U.S. unit has launched Digital Rail Services, a new business that will use intelligent sensors and advanced software platforms to put intelligence behind billions of data points created on the country’s rail systems. The company said this insight will help railroad operators improve their operations and create an “Internet of Trains” to bring infrastructure and vehicles into the digital era. Powered by software tools, Siemens claims the Digital Service business will help reduce unplanned downtime, improve operational efficiency, enable improved business planning and performance, and generate energy and cost savings. The new portfolio applies Siemens global digital analytics experience with its extensive rail industry knowledge via an existing rail footprint that spans manufacturing, automation technologies, power infrastructure equipment and service. and will locate its Digital Services hub in Atlanta, which will be home to the Data Analytics and Applications Center on the campus of Georgia Tech. Siemens will also support the rollout by opening a new East Coast Locomotive Service Headquarters in New Castle, Del., this summer. Siemens Digital Rail Services is part of Siemens Mobility Division, the American division of Berlin-based Siemens AG, which works with more than 25 transit agencies in the U.S. It has transportation manufacturing hubs in Sacramento, Louisville and Marion, Ky., and Pittsburgh. The Digital Services offered for the rail industry are based on Railigent™, a cloud-based industrial data analytics platform connected to Mindsphere, Siemens’ IoT operating system. The platform features Smart Monitoring for real-time insight on vehicle state and location; Smart Data Analytics that provide root cause analysis and remote vehicle and infrastructure diagnostics, and Smart Prediction that conducts prescriptive maintenance. It will also feature advanced cyber security and guidance services. 46

Railway Age

May 2017

“Today, rail vehicles send between one and four billion data points per year and rail infrastructure can send billions of messages just inside a specific system,” said Simon Davidoff, head of Siemens Mobility Digital Services in North America. “With our Digital Services business, we’re taking not only experience from our global rail footprint but also our extensive company-wide digital expertise to turn billions of data points into action, including the ability to detect malfunctions well before they can cause problems and information that helps improve arrival times and punctuality for riders.” In Atlanta, one of two initial launch sites, the Siemens Digital Services team will collect information captured via on-board systems from the Siemensbuilt Atlanta Streetcar and analyze data points to make the best use of

their fleet, including slow vehicle movements to identify traffic bottlenecks in order to reduce delays; identifying track segments and time periods with high energy consumption to reduce power usage; length of door opening durations to improve passenger comfort; and horn usage from car or pedestrian traffic warnings to determine possible related infrastructure improvements that would increase safety. In Charlotte, the Charlotte Area Transit System is currently working with Siemens on a pilot program for near-real-time diagnostics and analysis of its light rail system data to help make prescriptive maintenance recommendations. By making preemptive adjustments to service strategies and planning, Siemens said, operators can better avoid light rail service interruptions and delays and increase the availability of their overall fleet.

Ad Index Company

Phone #

Fax

URL/Email address

CIT

212-461-5781

212-461-5632 James.Spencer@cit.com

Danella Rental Systems, Inc.

610-828-6200

610-828-2260

pbarents@danella.com

David J Joseph Company

513-419-6200

513-419-6221

txs@djj.com

Greenbrier Companies The

800-343-7188

503-684-7553

gbrx.info@gbrx.com

Huber + Suhner

802-764-4332

802-878-9880

jnee@hubersuhner.com

J-Track LLC

718-554-2760

contactus@jtrackny.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

Michigan Sate University

517-353-5663

517-353-0796

littlen@broad.msu.edu

Miller Ingenuity

877-843-0767

sales@milleringenuity.com

Okonite Co.

201-825-0300

info@okonite.com

PNC Equipment Finance

513-455-9056

robert.hogan@pnc.com

Progress Rail Services

256-505-6402

256-505-6051

info@progressrail.com

RailSolutions, Inc.

757-903-4606

757-903-4705

jhusband@railsolutionsinc.com

Railquip Inc

770-458-4157

770-458-5365

sales@railquip.com

Railway Equipment Co

763-972-2200

763-972-2900

sales@rwy.com

Railway Educational Bureau, The

402-346-4300

402-346-1783

bbrundige@sb-reb.com

Salco Products Inc

630-685-461

630-783-2590

sales@salcoproducts.com

SMBC Rail Services LLC

312-559-4800

888-4RAILCAR

sales@smbcrail.com

SoftRail Inc

888-872-4612

sales@signalcc.com

Trans Environmental Systems Inc

800-220-2466

www.transenvsys.com

Trinity Rail

800-631-4420

www.trinityrail.com

Vertex Railcar Corp

508-556-5500

info@vertexrail.com

Wells Fargo Wholesale Marketing

844-459-9664

railaccountservices@wellsfargo.

201-825-3524

214-589-8623

Page #

9 12,35

29,C3

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, KY, Jon Chalon 55 Broad St., 26th Floor New York, NY 10004 (212) 620-7224 Fax: (212) 633-1863 jchalon@sbpub.com CT, DE, DC, FL, GA, ME, MD, MA, NH, NJ, NY, NC, OH, PA, RI, SC, VT, VA, WV, Canada – Quebec and East, Ontario Jerome Marullo 55 Broad St., 26th Floor New York, NY 10004 (212) 620-7260 Fax: (212) 633-1863 jmarullo@sbpub.com

AR, AK, AZ, CA, CO, IA, ID, IL, In, KS, LA, MI, MN, MO, MS, MT, NE, NM, ND, NV, OK, OR, SD, TN, TX, 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

May 2017 Railway Age 47

equipment Sale/Leasing Available for Lease

Available For Lease • Pressure Differential (PD) Covered Hopper Cars – 5,125 & 5,230 cu. ft., 286K GRL, operate at 14.7 psi. • Pressure Differential (PD) Covered Hopper Cars – 5,150 cu. ft., 263K GRL, operate at 14.7 psi. • Mill Gondolas – 52’6” inside length with 4’6” sides • Open Top Hopper Cars – 4,000 cu. ft., three pocket with manual gates and rotary couplers.

3000 cu ft Covered Hopper Cars 4650 cu ft Covered Hopper Cars 3600 cu ft Open Top Hopper Cars 4480 cu ft Aluminum Rotary Open Top Gons 65 ft, 100-ton log spine cars equipped with six (6) log bunks 60 ft, 100 ton Plate F box cars, cushioned underframe and 10 ft plug doors 50 ft, 100 ton Plate C box cars, cushioned underframe and 10 ft plug doors Contact: Tom Monroe: 415-616-3472 Email: tmonroe@atel.com

• Box Cars – 60’ cars equipped with interior load dividers, plug doors & cushioned underframes.

RECRUITMENT

• Covered Hopper Cars – 3,250 cu. ft., 286K GRL

For additional information and pricing, please contact John Goodwin phone (605) 582-8318 e-mail jgoodwin@mwrail.com www.carmathinc.com

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

LOCOMOTIVE BATTERY

(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

PROFESSIONAL DIRECTORY

AGM64RR

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) • MAINTENANCE FREE SEALED LEAD ACID BATTERY • • 214 AMP HOUR BATTERY CAPACITY • 750 LBS • • 3800 AMPS PEAK CURRENT • 1600 CCA @ 80˚ F • • 1450 CCA @ 32˚ F • 1300 CCA @ 0˚ F • • CYCLIC CHARGE VOLTAGE 76.8V - 78.9V • • FLOAT CHARGE 72.0V - 73.6V • 64V BATTERY • • BUILT-IN FORKLIFT POCKETS FOR EASY INSTALL •

TRAINING

www.STARTPAC.com

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

OR TOLL FREE 844.901.9987

RailwayAge.com

AGM64RR (3.4in x 5in).indd 1

18/02/2016 15:46

The News Destination for the Rail Industry

48 Railway Age May 2017

Weâ&#x20AC;&#x2122;re current, are you? FRA Regulations FRA News:

Mechanical Department Regulations A combined reprint of the Federal Regulations that apply specifically to the Mechanical Department. Spiral bound. Part Title 210 Railroad Noise Emission Compliance Regulations 215 Freight Car Safety Standards 216 Emergency Order Procedures: Railroad Track, Locomotive and Equipment 217 Railroad Operating Rules 218 Railroad Operating Practices - Blue Flag Rule 221 Rear End Marking Device-passenger, commuter/freight trains 223 Safety Glazing Standards 225 Railroad Accidents/Incidents Updated 4-3-17. 229 Locomotive Safety Standards 231 Safety Appliance Standards 232 Brake System Safety Standards

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BKMFR

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Current FRA Regulations Item Code

FRA Part #

209 211 BKTSSAF 213 BKTSSG 213 BKWRK 214 BKFSS 215 BKROR 217 218 BKRRC 220 BKEND 221 BKSEP

Update effective

4-3-17 7-20-09 4-3-17 4-3-17 4-3-17 4-3-17 4-3-17 4-3-17 4-3-17 4-3-17

BKHORN 222 4-3-17 BKRFRS 224 4-3-17 BKHS BKLSS BKSLI BKSAS BKBRIDGE BKLER

228 229 230 231 237 240

4-3-17 4-3-17 4-3-17 4-3-17 4-3-17 4-3-17

BKCONDC 242 4-3-17

BKBSS

BKCAD BKSTC

BKPSS

232 4-3-17

FRA Part #

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233 234 235 236 238 239

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28.50 10.50 9.50 9.95 7.65 9.95

9.45 8.55 8.95 6.90 8.95

RR Communications Rear End Marking Device, Passenger, Commuter & Freight Trains Use of Locomotive Horns Reflectorization of Rail Freight Rolling Stock Hours of Service Locomotive Safety Standards Steam Locomotive Inspection RR Safety Appliance Standards Bridge Safety Standards Qualification and Certification of Locomotive Conductor Certification

5.95 5.50

5.35 4.95

13.75

12.40

6.95 11.00 11.50 23.95 9.95 6.95 13.25

6.25

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11.50

10.35

Each

25 or more

15.25

13.70

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Combined FRA Regulations Each

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Drug and Alcohol Regulations in the Workplace

37.00

4-3-17 4-3-17 4-3-17 4-3-17 4-3-17 4-3-17

Signal and Train Control Systems

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Track and Rail and Infrastructure Integrity Compliance Manual - Volume II, Track Safety Standards - Part 213 Technical Manual for Signal and Train Control Rules. - Includes Part 233, 234, 235, 236

Part 215: Freight Car Safety Standards 49 CFR 215. Prescribes the minimum safety standards for freight cars allowed by the FRA. Includes safety standards for freight car components, car bodies, draft system, restricted equipment and stenciling. Softcover, spiral.

Freight Car Safety Standards

BKFSS

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49 CFR Part 209, 213, 214, 215, 216, 217, 218, 219, 220, 221, 222, 223, 224, 225, 227, 228, 229, 230, 231, 232, 233, 234, 235, 236, 237, 238, 239, 240, 241, 242, 243, 244, 270, and 272: Implementation of the Federal Civil Penalties Inflation Adjustment Act Improvements Act for a Violation of a Federal Railroad Safety Law, Federal Railroad Administration Safety Regulation or Order, or the Hazardous Material Transportation Laws or Regulations, Orders, Special Permits, and Approvals Issued Under Those Laws. To comply with the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, FRA is adjusting the minimum, maximum, and aggravated maximum penalties it will apply when assessing a civil penalty for a violation of a railroad safety statute, regulation, or order under its authority. FRA is also adjusting the minimum penalty, ordinary maximum penalty, and aggravated maximum penalty that it will apply when assessing a civil monetary penalty for a knowing violation of the Federal hazardous material transportation laws or a regulation, special permit, order, or approval issued under those laws. The aggravated maximum penalty under the hazardous material transportation laws is available only for a violation that results in death, serious illness, or severe injury to any person or substantial destruction of property. DATES: Final rule was effective April 3, 2017.

33.00 47.00

Updates from the Federal Register may be supplied in supplement form.

30.00 42.30

Part 231: Railroad Safety Appliance Standards 49 CFR 231. General requirements for safety appliances including:â&#x20AC;&#x2C6;handbrakes, brake step, running boards, sill steps, ladders, end ladder clearance, roof handholds, side handholds, horizontal end handholds, vertical end handholds, and uncoupling levers. 106 pages. Softcover.

BKSAS

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

Add Shipping & Handling if your merchandise subtotal is: U.S.A. CAN U.S.A. CAN UP TO $10.00 $4.50 $8.75 25.01 - 50.00 10.78 16.80 10.01 - 25.00 7.92 12.65 50.01 - 75.00 11.99 21.20

Orders over $75, call for shipping

*Prices subject to change. Revision dates subject to change in accordance with laws published by the FRA. 5/17

OKONITE The Premier Manufacturer of Vital Circuit Signal Cables For nearly 140 years Okonite had been the leader in the design and production of vital circuit signal cables. Signal cables are an essential component of the uncompromising safety, security and integrity of a railroad’s signal system. Okonite, along with its Okoguard EPR insulation for power cables, was also the first to innovate EPR vital circuit EPR signal cables. With its 50 years of outstanding service record, Okonite's signal cables ensure unmatched characteristics, excellence in quality and reliability and an assurance of railroad security and safety operations.

Over the years others have tried to match Okonite’s trusted reliability, but only Okonite signal cables can meet the most discriminating and essential test requirements — the tests of long-term and trouble-free time and service in railroad cable installations of all types. Okonite’s dedicated commitment is to re-invest in our business, provide the highest and most advanced facilities, keeping us at the forefront in cable product and manufacturing superiority. Only Okonite has demonstrated the expertise to provide concurrently the necessary response and capacity to effectively process high levels of cable requirements associated with other important railroad programs such as Positive Train Control. Only Okonite — Proven Experience, Proven Reliability and Proven Quality and Service.

THE OKONITE COMPANY

Okonite Cables...A higher Standard!

102 Hilltop Road, Ramsey, NJ 07446 201.825.0300 Fax: 201.825.9026 www.okonite.com