COMPETITIVENESS INITIATIVE

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COMPETITIVENESS INITIATIVE TRANSPORTATION
ISSUES AND RECOMMENDATIONS October 2007
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Topic Outline

• 1. Rail Canada Transportation Act
• 2. Truck Weights
• 3. Intermodal Terminals
• 4. Road Infrastructure
• 5. Rail Costing

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Canada Transportation Act Amendments

• substantial commercial harm provision removed
• group FOA on common issues
• new Agency powers over incidental services
• more notice of rate increases
• list of producer car sidings, notice of
  abandonment
• abandonment provisions for shortlines returned to
  federal jurisdiction

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Not in Bill C-58

• running rights
• Service Review but promised after bill passed

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Status of CTA Amendments

• -Recommended by Coalition of Shippers
• Includes WCWGA, WGEA, Pulse Canada, CWB, ITAC
• Introduced into Parliament in May, died on order
  paper

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Proposed Recommendation

• -Alberta should encourage the federal government
  to re-introduce this Bill done
• -Alberta should support the Bill
• -Alberta should press to start service review
  now T of R, appointments to panel etc.

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Truck Weights

• -request to operate King B combination units
• -allows two forty foot containers per unit
• increase road limits from 63,500 to 78,500 kg
• -only by permit on routes and hours
• -allowed in SK with conditions

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Benefits of King B

• -Improve industry viability
• -Less trips and drivers shortage
• -Offset impact of CDN, higher freight costs
• -What roads, what times, limits?

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Potential Recommendation

• Alberta study the benefits of King B units with
  a view to implementing these units on a permit
  basis

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Intermodal Service

• -Railways allow intermodal terminals only in
  Calgary and Edmonton
• -Smaller cities cannot attract value added export
  industry

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Status of Intermodal Service

• -Joint federal provincial study of economics,
  volumes underway
• -Unlike bulk shipments railways not required to
  serve all I/M locations
• -What can be done for small cities?

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Proposed Recommendation

• -Alberta review in detail the draft joint study
• -Alberta consider what, if any, role the
  government can play to make rural service
  attractive to the railways
• -Alberta should consider what if any obligations
  are appropriate for railways and shipping lines.

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Infrastructure Deficit

• To stay current Alberta need to rehab. 1500 km of
  road a year but does 300
• Currently about 6000 km of road are functionally
  inadequate
• AIT has identified 8.6 billion need from 2000-15
  for rehab and capital but so far only 4.8 is
  funded.

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Proposed Recommendation

• Alberta increase its road budget by X a year
  for Y years.

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Rail Costing

• Last grain costing review in 1992
• Rail contribution mark-up 20
• Costs estimated with indices since
• Cost estimates require indexing rail volume,
  inflation and productivity
• Current rules omit productivity index

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Rail Costing

• Result is increased railway markup
• Kroeger 1998 productivity adjustment one time
  5.92 a tonne
• Current rail markup gt60
• Bill C-11 adjustment for rail car maintenance in
  Jan. est. 2.00 a tonne

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Rail Costing

• WGEA wants costing review for other factors-
  track, locos crews etc.
• Indexing for 15 years not recommended
  theoretically
• Agency has written to Cannon noting this
• Prairie Ag. Ministers have written Stahl

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Proposed Recommendation

• The Committee recommends/does not recommend a
  full costing review

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