WASHINGTON — Canadian National has asked federal regulators to confirm that the railroad has operating authority on trackage in Springfield, Ill., where its efforts to serve an agricultural shipper have been stymied by Union Pacific.
CN subsidiary Illinois Central maintained trackage rights in the Springfield area when in 1986 it sold its 631-mile line linking Joliet, Ill., with Kansas City, Mo., and East St. Louis, Ill., to Chicago, Missouri & Western, which is now part of UP.
“A live controversy exists because Union Pacific Railroad … has refused to qualify IC crews, which obstructs IC’s exercise of its right and obligation to serve customers — in particular Archer Daniels Midland Company’s Cockrell facility — on lines over which IC has long been authorized as a common carrier,” CN told the board in a regulatory filing this week. “The refusal undermines common carrier service, interferes with competition, and exposes shippers to harm.”
CN regularly operates over UP and Norfolk Southern trackage in the Springfield area to serve a customer near Hazel Dell.
“IC’s crews are already qualified to operate over the IC Connection-Hazel Dell segment. ADM’s requests for service also require IC to operate from Hazel Dell to the customer facility near MP 193.5: (1) from Hazel Dell to New KC Jct. as UP’s subtenant over NS tracks; (2) from New KC Jct. to MP 192.4 as trackage rights tenant of UP; and (3) from MP 192.4 to MP 193.5 as trackage rights tenant of CPKC,” CN told the board. “IC has operated over this segment before, including as UP’s subtenant over the NS tracks from Hazel Dell to New KC Jct., but not since 2016 — hence IC’s repeated requests to UP, for nearly a year, to admit IC by qualifying its crews.”
UP argues that an expired agreement with NS prevents CN from operating over the trackage, CN said. NS has confirmed, CN said, that CN has the right to operate as UP’s subtenant. CN argues that its trackage rights don’t stem from the UP-NS contract. Rather, they were obtained as part of the 1986 line sale, and CN said it remains a common carrier on the trackage.
“By refusing to qualify IC crews notwithstanding IC’s continuing common carrier authority over the segment, UP is denying ADM access to IC’s service at Cockrell and, with it, the associated price, service, and resiliency benefits that can flow from head-to-head railroad competition at a customer facility,” CN told the board.
Of note: The ADM facility can be served by UP, NS, and CN, according to CN.
“By obstructing IC’s common carrier access to a facility that NS can serve, UP ensures that IC cannot compete against NS for the shipper’s traffic today and, in doing so, shields its proposed merger partner from near-term competition at a location where the shipper has sought an IC option,” CN said. “UP’s conduct thus functions as a targeted foreclosure strategy: it reduces the competitive field at ADM’s facility by denying an additional service option, while preserving and potentially enhancing the traffic base of the carrier UP proposes to control.”
Union Pacific expects the STB will back its position on the trackage rights.
“Union Pacific and CN have been negotiating these trackage rights for nearly a year. Union Pacific has been committed to a reasonable outcome throughout and anticipate the Surface Transportation Board will affirm our position,” spokeswoman Kristen South says.
— To report news or errors, contact trainsnewswire@firecrown.com.
ICG sold the trackage to CM&W in 1987, not 1986.
David, the CN regulatory filing says the deal was done in 1986.