Evidence of meeting #14 for Transport, Infrastructure and Communities in the 42nd Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was rail.
A recording is available from Parliament.
Liberal
Ken Hardie Liberal Fleetwood—Port Kells, BC
When it comes to track rerouting, you mentioned that ideally, interested parties will get together and negotiate something, and then if necessary, your agency can step in and help resolve any differences.
What could be done in a situation where one of the two parties, either say a municipality or a railway, has no interest in exploring the topic, but the other one is really interested in it?
Chief Compliance Officer, Canadian Transportation Agency
I think when such parties can't reach a formal agreement, then certainly we can step in. If they can make a case, as a quasi-judicial tribunal, that the numbers are sound, that it is of no net loss to the railway company.... And again, this is just an example; I'm not suggesting that one party or the other is most likely to be in a position of not agreeing. But if one party, in the view of the other party, is not acting in good faith, and that first party can make a case that, in fact, the numbers work, that the proposal is reasonable, that the transportation plan that's required under the RRCA is an appropriate one, then certainly we would have the authority to step in on that case.
Liberal
Ken Hardie Liberal Fleetwood—Port Kells, BC
I presume that the requirement that there be no net loss to the railway looks just at dollars in-dollars out, and not necessarily at some of the other issues that might be non-monetary but could be seen as a benefit.
Chief Compliance Officer, Canadian Transportation Agency
I hesitate to define it too much, because, quite frankly, this is art not science, and so we do want to allow for the maximum latitude of discussion with regard to someone making and building a case. To that end, certainly one of the provisions in the act, for instance, is an allowance for the cost to be recouped over time. I think it's 15 years. I might have to get back to you on that to confirm. There is methodology by which non-direct costs can be recognized.
Liberal
Ken Hardie Liberal Fleetwood—Port Kells, BC
I see. How long has this no net loss requirement been in place?
Randall Meades Chief Strategy Officer, Canadian Transportation Agency
It's been there from the outset. It's not a new provision.
Liberal
Ken Hardie Liberal Fleetwood—Port Kells, BC
It's been around for awhile.
I have one final question, and if there's time left over, I'll defer to my colleague here for a couple of quick ones. With regard to the certificate of fitness, are you noticing specific issues with short-line railroads meeting those requirements?
Chief Compliance Officer, Canadian Transportation Agency
I wonder if, perhaps, you might be referring more to the certificate of insurance, which is a feed-in to the certificate of fitness. There's no doubt that the insurance market is pretty constrained, and there are only a few in the market of underwriters internationally, and the international field that supports this kind of insurance is fairly constrained. It's intuitive that small short-line railways would be more effective, but I think that's why the Safe and Accountable Rail Act set thresholds with regard to volumes and with regard to the nature of goods being carried, such that they can make choices accordingly to ensure that they have a business proposition that is marketable and profitable.
Liberal
Ken Hardie Liberal Fleetwood—Port Kells, BC
I think, just as a flag, with the number of incidents coming up for which there will be heavy draws on insurance funds, we might see that capacity really start to dry up in a big way. That may be something that policy-makers need to keep an eye on.
At this point I will defer to my colleague Mr. Sikand.
Liberal
Liberal
Gagan Sikand Liberal Mississauga—Streetsville, ON
No problem.
In terms of the dispute resolution, can you give us some numbers to work with in terms of how many disputes actually arise?
Chief Compliance Officer, Canadian Transportation Agency
With all due respect, Madam Chair, could I come back to the committee with that? To be perfectly frank, I would be guessing at this point. I will definitely come back.
Chief Strategy Officer, Canadian Transportation Agency
Madam Chair, I would add that we have an annual report that will be published later on this year, with all that data and statistics in it. It may be worthwhile just waiting until then, if that's agreeable.
Liberal
The Chair Liberal Judy Sgro
That would be later on in the year.
I think that, from the committee's perspective, we are trying to finalize a report, albeit short, on railway safety. It would be helpful if we had that information to look at just how many disputes there actually are.
If you could get it to us in the next 48 hours, if that's the best you can do, we'd appreciate that.
Chief Strategy Officer, Canadian Transportation Agency
We'd be more than happy to accommodate.
Liberal
Linda Duncan NDP Edmonton Strathcona, AB
Thanks for appearing, gentlemen. Can you tell me whom you would see as your client?
Chief Compliance Officer, Canadian Transportation Agency
We're accountable, through the legislation we administer, the Canada Transportation Act. To that end, as a quasi-judicial economic regulator, we are accountable to Parliament, and we administer the acts as prescribed by law.
NDP
Linda Duncan NDP Edmonton Strathcona, AB
In our conversation before we convened here, I was asking you some questions about certificates of operation. I was a little surprised to discover—and maybe you can correct this on the record—that a certificate of operation is issued only once to a rail company. Is that correct?
Chief Compliance Officer, Canadian Transportation Agency
There are actually a number of certificates. I just want to clarify that there's the railway operating certificate, which is issued by Transport Canada, and that's the mechanism that gets more into questions of safety. Then, as a concurrent piece, we do the certificate of fitness, which really looks more at the economic viability, the underlying business case. We certainly coordinate with Transport Canada to ensure that they are issued, I guess, in conjunction with each other.
In terms of how often we do it, we do issue it once. However, we do review the certificate of insurance yearly. We also have provisions to monitor whether we receive a complaint or if, on inspection, we find that there are deficiencies, and we have provisions to suspend or cancel.
NDP
Linda Duncan NDP Edmonton Strathcona, AB
I reviewed the report by the Transportation Safety Board on the MMA disaster at Lac-Mégantic. In the long list of problems with MMA, despite the fact that they were given an exemption, one of them was a lack of investment in infrastructure maintenance. Is that not a factor you would look at under your certification?
Chief Compliance Officer, Canadian Transportation Agency
If that observation is related to the infrastructure of the rail line and it's a rail line they don't own, when we look at a certificate of fitness, we look at the railway's own business model. But again, these things aren't done in isolation from any other considerations. So, obviously Transport Canada, when looking at the railway operator certificate, would take any such concerns into account.