Madam Speaker, by streamlining and shortening the current process for rail line rationalization the Canadian Transportation Act will encourage the conversion of underutilized rail lines to short line railroads as opposed to their abandonment.
The main line railways are required to make available a three-year plan showing which lines they intend to keep and which they intend to sell, lease or discontinue.
Once the railways have advertised their intention to divest themselves of a particular line, parties interested in setting up short line railroads on that line would then have at least 60 days to indicate their interest to the railway. The elevator companies cannot prevent the creation of short lines.
Within the legislation there is a provision that states the railroads must negotiate with the interested parties in good faith. It is a business decision of the elevator companies whether they continue to operate an elevator or close the elevator to consolidate their operations.
It is anticipated that there will be line abandonments due to elevator closures. However it is also anticipated that opportunities for short line operators will arise on branch lines that have operational elevators and sufficient volumes.
Short line operators have to take into consideration the consolidation of an investment plan of grain companies when they make decisions on potential purchases of lines. If no interest is expressed by short line operators, the CTA allows provincial or municipal governments to acquire the lines at net salvage value.
In summary, new provisions of the CTA encourage the transfer of lines where it makes economic sense and provides opportunity for governments to acquire lines if it is in the public interest to do so.