Evidence of meeting #31 for Agriculture and Agri-Food in the 40th Parliament, 2nd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was cars.
A recording is available from Parliament.
President, Saskatchewan Association of Rural Municipalities
We sure can, and the costs are quite extreme. And somebody has to look at the environmental impact on this too.
Conservative
The Chair Conservative Larry Miller
Thank you. Your time has expired, Mr. Valeriote.
Mr. Bellavance.
Bloc
André Bellavance Bloc Richmond—Arthabaska, QC
What I understand from what Mr. Lemieux said earlier is that the issue is far from settled. CN put off its decision just until the end of the year. The threat still looms over communities and producers. We are talking about 52 sites that could be closed, and that is nothing to sneeze at. For my own benefit and probably for the benefit of those who will be reading the evidence of the agriculture committee, I would like to know whether the people at CN have done the same thing in the recent past, that is, closing sites almost arbitrarily.
I want to know whether they do this a lot, closing a number of sites. I also want to know if the company had a plan to determine whether all these sites were profitable or if the people affected were caught off guard. At some point, was a decision made to close 3 sites and then 52? Or, on the contrary, had there not been any closures for many years, and then, all of a sudden, CN announced that it was closing 52 sites? I would like a little background on the situation. I want to hear how CN went about choosing the sites and whether it consulted anyone.
My questions are for everyone.
President, Saskatchewan Association of Rural Municipalities
I'll try on this one.
The rules as we understand them are that they just have to advertise that they're going to close the sites and give 60 days' notice. There is no recourse, as we take it, to change that. You can make your complaint, but we don't even know where that would get you, and that's our concern. You can file a complaint with the CTA, and that's all we really know about that.
The rationale to do it is probably--and this is only my opinion, take it for that--that these are an inconvenience to the rail line and probably to other industries. I guess it's a competition, it's a competitive aspect of the industry, that somebody is trying to eliminate.
Bloc
André Bellavance Bloc Richmond—Arthabaska, QC
I will ask one of my questions again.
Had a number of sites been closed in the recent past, or had there not been any closures for a long time, when suddenly, CN announced that it had to close 52 sites?
President, Saskatchewan Association of Rural Municipalities
I have to honestly say this is the first that I am aware of.
Bloc
André Bellavance Bloc Richmond—Arthabaska, QC
As I was saying earlier, the closure of 52 sites is a serious blow to those who have been using these sites for many years, sites that were no doubt reasonably close by. From now on, costs will go up, only for transport. I want to come back to what Frank was saying. By law, CN has to ask for Transport Canada's permission, but it does not have to give the slightest reason. As I said, when they want to close a site, things are done arbitrarily. I want to know if Transport Canada asks for valid reasons before it gives its authorization. I am not sure. We are not really familiar with what Transport Canada has to do in these cases. The idea that Transport Canada would just give its authorization at CN's request seems rather shocking.
Executive Director, Grain Growers of Canada
Maybe I'll just back up a little. When we looked at the numbers, we saw that a lot of these sites had not been used in a number of years. The farmers aren't using them. The issue is that what they're suggesting is that the timeline is too tight. So the community says, well, if we'd known you were going to close it, maybe more farmers would have been using it. Sometimes we have to be woken up a little bit, and I think that's some of the case here. We've woken up, and it really got our attention too.
So what I think we need now is some time for the communities to look at the rail sidings and say, let's put together a package, let's buy it, and let's encourage farmers to deliver grain here. In some cases, the communities may say, it's not worth it, so let it go; there's another town close by. Perhaps there's another siding not that far away.
So what we're asking from you is some time. But I think in terms of process, if they go through the process, they can just abandon them.
Bloc
André Bellavance Bloc Richmond—Arthabaska, QC
I have a simple suggestion. It might be useful for these people to appear before the transport committee, as well.
Conservative
The Chair Conservative Larry Miller
And at your directive, we can certainly do that here--or suggest it, I should say.
Mr. Atamanenko, five minutes, please.
NDP
Alex Atamanenko NDP British Columbia Southern Interior, BC
Thank you.
I just want to get this clear in my mind. Let us a take a community like Blaine Lake in Saskatchewan, which years ago used to have an elevator. When I'd help my uncle, we used to deliver grain there. There are no more elevators now. Blaine Lake doesn't accept grain. It's not one of these sites, but if the farmers in that area wanted to have it, could there be other sites opened? I don't quite understand the process. Is that possible?
I have another question. There are 52 sites that are closed, and yet according to this only six of them have operated in this last year, so the danger here is that if we allow this to happen, the idea we're looking at is the potential of reactivating these sites. There's a potential for that. That's why we're on this, if I'm not mistaken. Also, is it possible to open up other sites? Physically, what's necessary? Is it just a side railway line beside the main line?
Maybe you could explain that to me, please.
Executive Director, Grain Growers of Canada
Once they go through this process, what we anticipate would happen is that they would simply pull out all the steel and all the ties and these would be decommissioned. I don't think you would ever see anybody go back in and build a siding again. The cost of doing that and negotiating.... Once they're gone, they're gone for good. That's why we need this time.
You know, maybe some of these will be gone for good, no matter what. Maybe they're not needed because there's an alternative close by. What we need is that time, because once they're gone, they're gone. Is anybody going to build brand new sidings? I don't think there are going to be many built. It's very, very expensive. That's why we want to just buy some time to see what we can do with these.
President, Saskatchewan Association of Rural Municipalities
Mr. Chair, if I could add to that, we have to be very clear on this. A producer car siding is an allocation of that siding. It is not the siding itself. It's an allocation of it. Once you remove that allocation, you will never get it back, and then you've removed the competition on that siding. That's our whole defence here: that there should be a more transparent process to remove that allocation.
NDP
Alex Atamanenko NDP British Columbia Southern Interior, BC
I have another question in regard to CP. We haven't heard CP mentioned. What's happening with CP?
President, Saskatchewan Association of Rural Municipalities
As far as we know, CP has not put any sidings or producer car allocation sites on the list for delisting.
NDP
Alex Atamanenko NDP British Columbia Southern Interior, BC
So CN has done this because they're saying it's too costly. Is that correct? What's the cost to them?
President, Saskatchewan Association of Rural Municipalities
The only costs I can see that CN or the railway could defend on a producer car allocation is if that siding was not used for anything else--if no other industry player or grain company was using that siding. If a siding is a half a mile or a mile long and there's a grain terminal on it, then the grain terminal is using that siding.
There's no more cost for the allocation portion of that siding for a producer car loading site. They don't pay an extra tax on it. If the siding is not being used by any other industry player and there's a producer car allocation, in defence of CN the cost would be the tax of the siding and the maintenance of the switches.
NDP
Alex Atamanenko NDP British Columbia Southern Interior, BC
But they're making money transporting the grain.
President, Saskatchewan Association of Rural Municipalities
That's right. But they would say the siding was not being used for any purpose whatsoever, and they'd have to maintain the switches and pay tax on the siding.
NDP
Alex Atamanenko NDP British Columbia Southern Interior, BC
Thank you. I don't have any more questions.
Conservative
Conservative
Randy Hoback Conservative Prince Albert, SK
Thank you, gentlemen, for coming. I know it's short notice.
When we first heard about this, to say I was concerned would be saying it lightly. We contacted both Minister Ritz and Rob Merrifield, who handles transport. They both got behind this right away to say it was something that needed to be looked at. I'm glad that commitment created this result that has bought us a little bit of time.
Mr. Smolik, in your report here, this is just loading of railcars, not non-grain products.