Transport Committee on May 16th, 2016

[Linda Duncan, NDP, Edmonton Strathcona, AB]

It has been widely reported over the last several years that there has been a thousandfold increase in rail traffic of dangerous cargo, including petroleum products. Have you at any time reconsidered, or are you in the process of reconsidering the insurance levels for this kind of activity by the major rail lines?

[Fred Gaspar]

No, the insurance levels are prescribed by Parliament through the Safe and Accountable Rail Act, and so what we're doing is we are preparing to be able to enforce those. We've been in discussions for a number of months with different stakeholders, both in the insurance field and with the railways themselves, to discuss how we're going to do the monitoring and the compliance. At the same time, we are also preparing to ensure that when Parliament prescribes a coming-into-effect date, Canadians can be assured that all railways will be properly insured under the provisions of SARA.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Do you also confer with municipalities in deciding what's appropriate insurance?

[Fred Gaspar]

No, the insurance levels are prescribed by the Safe and Accountable Rail Act.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

That's interesting.

In rail relocation, what factors do you consider in making a determination on whether you should be even entering into what you call negotiations?

[Fred Gaspar]

There's a pre-application stage, before the application is submitted. That's really where we expect most of the work to be done, because that's where a lot of the issues get addressed through the development of an accepted plan. The accepted plan is defined as being something that has to be supported by the province and all the municipalities within that urban area. The intention of that plan is to really identify how the transportation network of that entire region are going to properly function after the proposed relocation. A lot of the issues, frankly, that are of primary relevance are going to be dealt with through the formation of that plan.

When it comes to us in the application stage, our primary focus is taking a look at whether or not the no net loss provisions for the railway.... And we test to ensure that the accepted plan is in fact an appropriate plan and has been accepted by all parties.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

One of the things that you look at is the assessing of the shared costs of rail crossings. Is that correct?

[Fred Gaspar]

Yes.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

And in doing so and deciding how they would be portioned, do you give consideration to the amount of dangerous cargo transported by the company, and proportionately then impose a greater proportion of the costs on the company?

[Fred Gaspar]

No, the real triggers are really what's causing the relocation. For instance, if the municipality wishes to build a new road network, and if that's the primary trigger for the relocation, then the act prescribes.... I'll have to get back to you with the precise details

Oh, I do have it here. My apologies.

They're primarily due to road development. The road authority pays 85% of the cost and the railway company pays 15%. Inversely, if it's primarily due to railway redevelopment, the road authority would pay 15% and the railway company 85%.

It's really a function of looking at the operations and the underlying economics of the proposal. We don't make value judgments through the context of the rail crossing act as to the nature of the goods being carried. That's dealt with through the insurance provisions. They either have or don't have authority to carry the goods they are proposing to carry, and they either do or don't have the level of insurance required. That's a separate exercise.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Ms. Duncan.

Mr. Hardie, Mr. Sikand.

[Ken Hardie, Liberal, Fleetwood—Port Kells, BC]

Has any railroad had its certificate of fitness suspended?

[Fred Gaspar]

I'm sure they have. I have to apologize to the committee, as I'll have to get back to you on that. I've only been with the agency for five weeks, so I'm still in the process of digesting the history, but we'll definitely get back with complete numbers for you—

[Ken Hardie, Liberal, Fleetwood—Port Kells, BC]

It would be interesting to have numbers and basically the reasons cited for the withdrawal, just so that we get a sense of what's really important to your board.

In terms of fitness, fitness will obviously have some specific criteria attached to it as you assess who gets the certificate, or what they need to get it, but operating practices are changing. Trains are longer, they're heavier, and faster, in some cases. Would there be changes to what constitutes fitness according to the operating realities of the various lines?

[Fred Gaspar]

The considerations you raise are really more dealt with by Transport Canada through their railway operators' certificate, because it's mostly operational, taking a look at it from a safety perspective. Ours is more from the economic viability perspective, to assure Canadians that once a service comes into service, it's going to be able to carry on business, that it's properly financed. The certificate of fitness is primarily a financial fitness test. We do it in coordination with Transport Canada to ensure that the parties are advancing one instrument that the other is also advancing.

[Ken Hardie, Liberal, Fleetwood—Port Kells, BC]

At the risk of stating the obvious, regarding my earlier question about certificates being withdrawn, that would obviously apply to short-line railroads, wouldn't it?

[Fred Gaspar]

I'm sorry, I missed the....

[Ken Hardie, Liberal, Fleetwood—Port Kells, BC]

My earlier question of how many incidents involved withdrawal of fitness certificates would apply to short-line railroads.

[Fred Gaspar]

Okay, probably so.

[Ken Hardie, Liberal, Fleetwood—Port Kells, BC]

It mentions in our notes here that you do have some responsibility under the Railway Safety Act. Can you give us some details of what those responsibilities are?

[Fred Gaspar]

Section 23 of the Railway Safety Act , for instance, provides new authorities to the agency with respect to fire. That was a subamendment to that legislation from the Safe and Accountable Rail Act. It essentially provides for municipalities and localities to make the case that if they find that railway operations are the primary cause of a fire, any reasonable costs they can show to have been incurred in combatting that fire.... It authorizes us to make that determination and issue an order accordingly.

[Ken Hardie, Liberal, Fleetwood—Port Kells, BC]

Is that basically it?

[Fred Gaspar]

No. The dispute adjudication rules also apply with regard to the Railway Safety Act. All the requirements in the Railway Safety Act are captured by our dispute adjudication rules, so it allows parties to come to us to resolve any disputes that are addressed.

[Ken Hardie, Liberal, Fleetwood—Port Kells, BC]

Mr. Sikand would like to ask a question.

[Gagan Sikand, Liberal, Mississauga—Streetsville, ON]

You just touched upon the cost recovery of a fire.

I have a document in front of me that states that there actually haven't been any applications under the fire provisions. Could you please expand on this and maybe clarify?