Not Conrail

STB's environmental analysis of CN-IC merger shows much lighter impact than Conrail takeover

 BY JOHN GALLAGHER

Based on the Surface Transportation Board's analysis of the environmental impact of the Canadian National Railway-Illinois Central merger, complying with the government's recommendations should be a cakewalk compared to what Norfolk Southern and CSX were up against in the Conrail acquisition. 

"There's not a lot of environmental impact in this proposal," said Mike Dalton, project manager from the STB's office of environmental analysis for the CN-IC merger. "It's much more straightforward than in the Conrail acquisition. No route has more than an eight-train-a-day increase in traffic. That's dramatic change from where we were at Conrail last year. I think we had over 20 routes with more than 15-train-a-day increases. Here most of the routes are one or two, with some decreases in traffic volume." The few more significant changes were in some hazardous material routing in the northern part of Illinois and in parts of Michigan, he said. 

Dalton, who was also project manager for the Conrail acquisition, said the costs for complying with the environmental assessment also would be significantly less for CN-IC as compared to Conrail. "The whole dynamic is different because CN-IC is a much smaller system. We're talking about 4,000 miles in the United States versus 44,000 in the United States for NS and CSX." 

Conrail had a much more significant impact in areas such as grade crossing safety, operations, and hazardous material movements. In the Conrail merger, he said, "I think there were 85 or 90 line segments that had hazardous material movements that we recommended for mitigation. Here there's something like 14." 

Each of the CN-IC corridors also is carrying less traffic than those of the new NS and CSX, with roughly 10,000 to 20,000 carloads per year compared with 60,000 to 80,000 carloads per year in the Conrail merger. 

CN and IC said they would abide by the STB's recommendations "that would, among other things, require in selected rail corridors minor modifications of the carriers' existing hazardous materials transportation policies to ensure closer coordination with local emergency response organizations." 

The fact that CN-IC is an end-to-end merger has a lot to do with the relatively minor environmental impact. Dalton likened the transaction to a corporate takeover, with a continuation of the business being purchased. "(CN) will divert a little more traffic to IC, because, if the merger is approved, they'll own it. But it won't be a dramatic shift," he said. "There's not that much traffic to divert, relatively speaking." 

Because Conrail was split up between two railroads, there is a lot of shifting of routes either on or off former Conrail lines, depending on the business plans of the two acquiring railroads. With regard to hazardous materials, there was the same number of carloads going to different places, so some communities were suddenly exposed to three or four times as much traffic as they had been previously. "But you won't get that type of diversion with CN-IC," Dalton pointed out. "First of all, CN-IC is a single line system from Chicago to the Gulf of Mexico. So there's nowhere to put the traffic other than north-south. And CN is really an east-west system. So it's not a complicated spider-web system like CSX-NS." 

Dalton also noted that there were no added implications in assessing the environmental impacts of a merger involving a Canadian carrier. "The U.S. part of their system is only 4,500 miles; that's the part we're regulating. And they were fully cooperative in supplying all the data in the application and in their environmental data to us," he said.