Decision No. 593-R-1998

December 3, 1998

File No. R 8050/708-179.49

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APPLICATION

The Canadian National Railway Company (hereinafter CN) has applied to the Canadian Transportation Agency (hereinafter the Agency) for a determination on the apportionment of the costs remaining after the application of the ministerial grant for the installation of an automatic warning system, and for a determination on the apportionment of costs of the future maintenance of the road crossing warning system at the subject location. The application was received on June 22, 1998.

BACKGROUND

On July 28, 1997, CN filed an application with the Minister of Transport (hereinafter the Minister) pursuant to paragraph 12(1)(a) of the Railway Safety Act, for a grant of 80 percent in respect of the cost of the installation of an automatic warning system consisting of flashing lights and bell, short arm gates and constant warning devices. The estimated cost of these improvements was $202,200. CN agreed to carry out the recommended railway work provided that the Minister authorize a grant of 80 percent towards the work and the Rural Municipality of Corman Park No. 344 (hereinafter the Municipality) agree to contribute 12.5 percent towards the cost of the work and also agree to accept 50 percent of the cost of future maintenance of this road crossing warning system.

By letter dated May 1, 1997, CN requested the Municipality to provide confirmation of its acceptance to pay 12.5 percent towards the cost of the installation and 50 percent towards the cost of future maintenance of the automatic warning system.

By letter dated April 16, 1998, the Municipality advised that although it may be desirable to have an automatic warning device at this location, reduced funding from the Province of Saskatchewan makes the cost to the Municipality too great to incorporate in the current budget and declined to contribute towards the project.

ISSUE

The issue is to determine what percentage of costs is to be borne by CN and the Municipality with respect to the installation of an automatic warning system, as well as those related to the future maintenance of the automatic warning system.

FACTS

There is one main line track at this location with speeds of 60 miles per hour for freight trains and 80 miles per hour for passenger trains. Furthermore, there is an average of 23.9 train movements per day or 168 trains per week. The traffic count for the two-lane road at the crossing is 180 vehicles per day and the speed limit is 80 kilometres per hour.

Transport Canada concluded in its letter of February 17, 1997, that as a result of high cross product as well as vehicle and train speeds, the installation of automatic warning devices would be an improvement to safety at the crossing. Transport Canada also stated that "Canadian National Railway and the R.M. of Corman Park are requested to review this proposal jointly and advise this office as to what action if any will be taken at this time."

On March 24, 1998, CN received the Minister's approval for funding of 80 percent of the cost of the work.

POSITIONS OF THE PARTIES

CN submits that the proposed railway work will improve the safety of the crossing which was acknowledged at a site meeting with Transport Canada. This was also affirmed in Transport Canada's letter dated February 17, 1997, and the subsequent confirmation of funding under section 12 of the Railway Safety Act.

The Municipality maintains that this crossing has not presented a problem for the motoring public as the site distance is adequate and stop signs are in place.

The Municipality submits that the greatest safety concern is and was the elevation of the track at the crossing. During reconstruction, the track was elevated above the municipal road to the extent that if stop signs had not been erected, vehicles crossing at normal speeds "would become airborne". The Municipality maintains that construction of a gated crossing at this location will not diminish this safety hazard and that it will continue to be necessary to have stop signs.

CN advises that it was unaware of the safety hazard presented by the elevated track above the municipal road and assumes that the erection of stop signs at the crossing was due to safety concerns of sightlines. CN is now aware of the problem which has been created and steps will be taken to remedy the situation.

CN is of the opinion that both parties have a responsibility for safety at the crossing and that both parties should share in the cost according to the benefits received. CN considers that the installation of an automatic warning system consisting of two gates and bell with constant warning devices is primarily for the benefit of the road authority, its citizens and the travelling public. Although CN is willing to assume a share in the responsibility for safety, it maintains that it is the road authority and its citizens who will be the primary beneficiaries of the proposed work.

CN states that cost sharing between the railway company and the road authority for crossing protection upgrades has traditionally been set at 7.5 percent for the railway company, 12.5 percent for the road authority, of the total cost in cases where federal funding is 80 percent. CN refers to the recommendations of the Board of Transport Commissioners for Canada in its report entitled Railway - Highway Crossing Problem in Canada dated May 10, 1954, and submits that the current standard of 12.5 versus 7.5, given federal funding of 80 percent, is an equivalent ratio to that set out in that report.

The Municipality also advises that due to reduced provincial funding, the cost is too great to incorporate into its current budget.

CN indicates that due to the circumstances of this crossing improvement, the Municipality must assume the additional financial burden created by the absence of provincial funding. It would not be equitable or reasonable, having regard to the history of benefits derived by motorists at crossings, to require CN to make up for the absence of provincial funding.

CN also submits that the ability to pay is not a relevant factor to be considered in determining cost apportionment and, even if it were, the Municipality has received financial assistance from the Province but has chosen to utilize it elsewhere.

ANALYSIS AND FINDINGS

In making its findings, the Agency has considered all of the evidence submitted by the parties.

Pursuant to section 16 of the Railway Safety Act, in cases where the parties involved cannot agree on the apportionment of the liability between them to meet the costs for the project and have no other recourse under other legislation to resolve the dispute, either party may refer the matter to the Agency for a determination.

With respect to CN's reference to the report on Railway - Highway Crossing Problem in Canada dated May 10, 1954, the Agency assesses each case on its own merits and based upon the circumstances of a particular road crossing project in the context of the Railway Safety Act which was promulgated in 1989.

The Agency notes that CN states in its letter to Transport Canada dated July 28, 1997, that it agrees to carry out the recommended railway work provided:

1. The Minister authorizes a grant of 80 percent towards the work; and
2. The Rural Municipality of Corman Park No. 344 agrees to contribute 12.5 percent towards the cost of the work and also agrees to accept 50 percent of the cost of future maintenance of this road crossing warning system.

The Agency also notes that the Municipality has not agreed to contribute as set out above and has, in fact, questioned the need for the installation of the automatic warning system.

After consideration of the evidence, the Agency finds that although Transport Canada indicated that the installation of the automatic warning system would be an improvement to safety at the crossing, there is no indication that the present situation is such that it poses a threat to safe railway operations.

Therefore, the Agency is of the opinion that there is insufficient specific information on file to support the necessity of the railway work at this location. Should the subject railway work be installed, the Agency deems it reasonable that the construction, after the application of any federal grant, and maintenance costs be borne by CN.

CONCLUSION

Based on the above findings, the Agency has determined that the actual costs of the installation of an automatic warning system, consisting of flashing lights and bell, short arm gates and constant warning devices, remaining after the application of the federal grant, and maintenance costs shall be paid entirely by CN.