Operational Issues for Rail Projects

APTA Legal Affairs Seminar 2008

Janie ShengK&L Gates LLPjanie.sheng@klgates.com(202) 778-9855

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Shared Use

What type of share?

Shared Corridor

Shared Track

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(cont’d)

Shared Corridor:

no major freight vs. passenger capacity issues

lower insurance cost

don’t have to use FRA-compliant equipment

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(cont’d)

Shared Track

Must use FRA-compliant equipment i.e. vehicles that meet FRA safety and crashworthiness

requirements for use on the general railroad system. See 49 CFR 238.

Otherwise, secure a waiver from FRA requirements for use of non-compliant vehicles.

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(cont’d)

FRA essentially requires temporal separation as part of the operation plan in Shared Track situations.

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Rail Line Capacity

Besides price, the most important issue for freight railroads is capacity on the line.

Capacity constraints are worse in dense urban freight corridors.

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(cont’d)

Tension between how many passenger trains public agency wants to run vs. how many trains freight railroads need to run.

Commission a capacity analysis.

Freight railroads will want to preserve the right to run additional freight.

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(cont’d)

Public agencies need to make sure freight railroads don’t have the right for future expansion and use up passenger rail capacity.

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Operations and Maintenance

Will you be purchasing the railroad right-of-way?

If NOT, then

Freight railroads may want to drive your passenger trains. On-time performance issues. Freight railroads may want to perform maintenance of way. Public agency can still perform maintenance on passenger

equipment.

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(cont’d)

If purchasing railroad right-of-way and track

More likely that public agency will be able to drive own trains and maintain own property.

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Liability and Insurance

“But for” liability protection. Freight railroads want public agencies to indemnify

them against any and all claims Arising from grant of access, or Provision of passenger rail service Regardless of negligence That would not have arisen but for the existence of

the passenger rail service.

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(cont’d)

Public agencies should expect “but for” liability even if purchasing right-of-way.

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(cont’d)

How do public agencies manage the risk?

Insurance

Usually self-insurance + policies

Huge cost item for public agencies

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(cont’d)

Amtrak Reform and Accountability Act

Federal statute limits rail passenger liability to $200 million per occurrence.

Clearly applies to Amtrak

Appears to apply to commuter rail

Unclear whether it applies to third party claims

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(cont’d)

The industry has talked about establishing a Captive Insurance Pool with other passenger rail providers for lower premiums.

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The End.