Rails Ask Shippers to Share Risk

Calling the safety of the American public of paramount importance, the Association of American Railroads (AAR) asked the Surface Transportation Board (STB) to adopt a policy statement that would allow railroads to require shippers of toxic inhalation hazard (TIH) cargos to indemnify the carrier for any liability of exposure resulting from the release of TIH materials.

National Industrial Transportation League (NITL) President Bruce Carlton rejected the proposal pointing out the STB lacks the authority to issue such a policy statement and that the US Congress recently expanded railroad liability for negligence by clarifying that state tort laws were not preempted by the Federal Rail Safety Act.

The AAR position states, “The nation's freight railroads today [July 22, 2008] urged the country's shippers of highly hazardous materials or toxic inhalation hazards (TIH) to become full partners with the railroads in safely transporting those dangerous commodities.”

"Nothing is more important than the safety of our employees and the communities through which we operate," said Edward R. Hamberger, president and CEO of the Association of American Railroads. He was speaking during a hearing at the Surface Transportation Board (STB) on the railroad industry's common carrier obligation as it relates to hazardous materials. “It’s only reasonable that those who make extremely hazardous materials demonstrate that they also have the same public safety commitment.”

The railroad industry, Hamberger emphasized, is not seeking to eliminate its common carrier obligation with respect to TIH at this time. "Rail is the safest and most secure mode of transporting TIH, many of which play an important role in the national economy. However, if there is a public interest need for the railroads to be compelled to carry TIH materials, there is a corresponding public interest imperative for the industry to do what is necessary to best ensure the public’s safety.”

Hamberger said freight railroads are doing their part to ensure that highly hazardous chemicals are delivered safely, but asked the STB to recognize that given the unique risks involved in transporting these dangerous chemicals, that shippers share those risks with the railroads and share the effort to find ways to eliminate those risks entirely.

AAR testified before the STB that freight railroads remain willing to assume the risks that are normally associated with railroad transport of any commodity. For the Class I railroads, the AAR suggested that amount would be at least $500 million. However, AAR said the STB should find it reasonable for shippers of highly toxic materials to share the risk, and indemnify the railroads beyond that level, due to the unique risks associated with those commodities.

"Railroads spend billions of dollars every year to ensure the safety of our rail network," Hamberger noted, including what is necessary for the transport of TIH materials, which account for 100,000 carloads out of 32 million, or just three-tenths of one percent of total rail volume. "We train thousands of local emergency responders and have implemented special operating procedures on trains carrying TIH. It’s only right that those who make and ship these dangerous chemicals both share in the risks we face to transport their hazardous materials and have the same incentive to eliminate those risks.”

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