Donald W. Johnson, president of the Alberta Association of Municipal Districts and Counties, explains the importance of rail service to rural economies.
In 2007, Transport Canada announced its intention to conduct a review of rail transport country-wide, the Rail Freight Service Review. For Canadian rural municipalities, this review raises issues about the impact of rail closures and declining service levels upon their futures as viable, sustainable communities.
First, a bit of information about the process for rail companies to formally transfer or discontinue a rail line, as per the Canada Transportation Act. It begins with a three-year plan, advertisement and an expression of interest and negotiation.
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Next, an offer is made to governments and then there is a notice of discontinuance and compensation.
During this process, another rail operator may acquire the line or it may be sold to any interested party. Railway companies must offer to transfer interest in a scheduled discontinued rail line simultaneously to all three levels of government through whose territory the line passes, for no more than its net salvage value.
Thus, municipalities and provincial governments have the opportunity to purchase and put these lines to use. But to what purpose or use may they be put?
Most Canadian rail lines were constructed decades ago to reach scattered, rural and remote communities. Given modern population growth and development, it would be nearly impossible to reconstruct such corridors today. Losing these corridors could be detrimental to future generations who might use or repurpose them.
Retained corridors from discontinued lines can convey regional services such as utilities or act as alternative transportation corridors. Most discontinued rail lines cross several municipalities, so it is crucial that all involved municipalities and their provincial government work together to explore regional use options.
Another concern regarding rail freight is the level of service on current lines. This is of particular concern to prairie municipalities, because the Rail Freight Service Review found that among commodity types with the lowest level of satisfaction were grain products. These products make up significant portions of rural Alberta and Saskatchewan rail freight.
In November 2009, the Rail Freight Service Review Secretariat invited comments on the status of rail freight in rural Canada. Because of the municipal stake in rail closures, the Alberta Association of Municipal Districts and Counties and Saskatchewan Association of Rural Municipalities each submitted reports.
SARM’s submission expressed a desire for defining and establishing minimum standards of service for rail freight. The association recommended a performance-based system centering on penalties/rewards for service providers.
One of its major concerns was an amendment to include railway sidings in the definition of railway. This was intended to protect Saskatchewan’s declining railway infrastructure and ensure competition between service providers. Tearing up sidings puts producers and short-line railways at risk.
In Alberta, the AAMDC agreed with the government of Alberta, which communicated that increased competition between rail service providers would help increase accountability to rail customers like rural municipalities. The success of Alberta’s economy is contingent upon a safe, reliable and efficient transportation system, connecting producers with domestic and international consumer markets.
From an Alberta perspective, rail closures are a threat to the viability and sustainability of rural municipalities. If the province were a body, rail would be its arteries – the lifeline sustaining rural municipalities across Alberta.
More than 60 percent of Alberta’s economic output is shipped out of province – 75 percent by rail. However, outside of the Edmonton-Calgary corridor, two monopolies, one for the northern half of the province, one for the south, threaten intramodal competition that would encourage better service.
At its fall 2009 convention, AAMDC members passed a resolution urging the provincial and federal governments to “reassess policies and procedures regarding discontinued rail lines.”
This resolution wanted the association and governments to explore and pursue acquiring rail lines for potential use as future regional transportation and utility corridors.
Municipalities want service levels maintained, particularly after the removal of lines in the Peace region impacted the delivery of agricultural products to destination markets.
They should also be offered the chance to bid on the closed lines, which could be used as transportation or utility corridors.
AAMDC members would like to see expanded loading and unloading capacity. Municipalities would like a moratorium placed on pending rail closures until longer notification and appeal timelines can be established.
They’d like a more equitable system, where freight rates are reviewed and balanced so that rural shippers are not unfairly treated.
