Promoters of prairie short-line railways take little comfort from recommendations made to the federal government by a panel reviewing rail transportation rules.
The review panel on the Canada Transportation Act told transport minister David Collenette in mid-July that regional railways can be an important part of the grain transportation puzzle.
But it failed to make recommendations strong enough to give the industry a boost, said Ron Gleim of Chaplin, Sask., president of the Western Rail Coalition.
“They talked a lot to us but I’m not entirely sure they understood what we were saying,” said Gleim.
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Regina transportation consultant Paul Beingessner has a more blunt assessment.
“They seem keen not to push the major railways too hard,” he said in a July 27 interview. “It’s inescapable to conclude that their primary goal was finding a way to keep healthy railways, and they think the railways have been doing as much as they can do.”
For their part, panel members, including former Manitoba agriculture and transport minister Glen Findlay and former Ontario premier Bob Rae, thought they were offering policy proposals helpful to short-line and regional railways.
They proposed that for the first time, running rights granted under strict conditions and with appropriate compensation should include the right for a “guest” railway to solicit business along the rail line of the “host” railway.
“The panel believes that commercially sound regional railways could provide tangible benefits to regions where they operate,” said the report. “Further, the panel’s proposals to transform running rights into a competitive access tool may provide further incentives to create commercially sound regional railways.”
The report also suggested that pro-vincially regulated railways should be eligible to apply to the Canadian Transportation Agency for running rights, an opportunity now limited to federally regulated rail companies.
Promoters of short lines argue that while the running rights proposal is helpful, the panel made several other recommendations that undermine the benefits.
The panel suggested a significant and complicated compensation package for the host railways, including payment for new business solicited along the line.
It rejected shippers’ arguments that it should be up to the host railway to prove joint running rights would not be in the public interest. Instead, it is the obligation of the applicant to prove it is in the public interest.
And the panel rejected the shipper proposal that railways be forced to offer an entire branch line for sale, and not just parts of it. That makes short lines more difficult to organize.
“The panel’s view is that such steps would interfere with the business decisions of the track owner,” said the report.
Beingessner said it was a perfect example of the panel’s pro-railway bias.
“When I read that, I thought that the whole point of regulation is to interfere with normal business decisions in the public interest.”
Gleim said it appears to be a case of “the farmers being out-lobbied by the railways.
“I would say there are a lot of details to be worked out and of course, we don’t know how the minister will react,” he said.
“It all makes us very cautious.”
