Repost from CQ Roll Call
[Editor: Significant quote by Oregon Rep. Peter DeFazio on new tank car safety rule: “Get it done, get it done now. Start the production. Create jobs here in America.” – RS]
Members Fume Over Delayed Oil Tank Car Rule
By Tom Curry, Feb. 3, 2015
Another House hearing and another regulatory agency under bipartisan fire for its slowness in issuing an eagerly awaited rule that will have sweeping effects on several industries.
Tuesday’s hearing of the House of Representatives Transportation and Infrastructure Subcommittee on Railroads Pipelines and Hazardous Materials was a chance for members and industry spokesmen to assail the Pipeline and Hazardous Materials Safety Administration (PHMSA) not issuing a rule that would tell railroads and rail car manufacturers the standard they need to meet for new oil tank cars.
Transportation and Infrastructure Committee ranking member Peter DeFazio said that even though PHMSA has known that the older tank cars, designated as DOT-111’s, “are not adequate or safe since 1993, PHMSA has yet to promulgate a rule for new standards. In fact, the industry itself is so frustrated that they’ve proposed a new standard to the agency.”
But the agency couldn’t act quickly, he said and the rule is “lost somewhere in the bowels of the administration between the agency and the trolls over at the Office of Management and Budget who will further delay the ruling.”
PHMSA has “managed to mangle the rule by merging it together with operational issues which are much more difficult to deal with and controversial,” DeFazio said.
PHMSA should simply issue a rule on tank cars: “Get it done, get it done now. Start the production. Create jobs here in America,” he said.
What’s on people’s mind is the possibility of another Lac Megantic accident, the Quebec oil tank car derailment and explosion that killed 47 people in 2013.
Greg Saxton, senior vice president of rail car manufacturer Greenbrier, said “if we were to have additional derailments that caused more fatalities, I think we could lose our franchise, the trust that the American people put in us to do this.”
Saxton said, “You’ve got to get beyond this uncertainty” about the tank car standard.
He added that “economic forces, the market, will crush an over-packaged commodity,” meaning that market forces will lead shippers to use the older, less safe, and less costly DOT-111 cars until PHMSA requires that they upgrade to a more crash-resistant model.
Greenbrier has urged PHMSA to quickly adopt what’s called the “Option 2” design of a tank car with thicker steel tank shells and other safety features.
Subcommittee Chairman Jeff Denham, R-Calif., told Saxton that he, too, wants to see PHMSA and OMB move quickly on the rule.
But he said he wanted to make sure “that there is not a misperception” among the American people that “our current tank cars are not safe” and “that our industry does not have a safe record.”
He noted that Greenbrier, the leading car manufacturer, could only build 8,000 new cars a year, so it would take perhaps a decade for that company and others to build new cars to replace all the DOT-111 cars.
Denham also said the public shouldn’t think “that there’s some magic, quick, fast track to get all of these new tank cars” on the nation’s railroads very quickly.
(Bloomberg) — Add tank-car makers to the list of U.S. industries bracing for the effects from the plunge in crude prices.While 2014’s record orders, including an all-time high 42,900 in the third quarter, will drive deliveries this year, according to Susquehanna International Group, manufacturers from Carl Icahn’s American Railcar Industries Inc. to Warren Buffett’s Union Tank Car Co. are facing a decline. New bookings in 2015 may plunge 70 percent, Macquarie Capital USA Inc. said, putting earnings at risk when scheduled deliveries drop in 2016.
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