HBA-ATS H.C.R. 155 76(R) BILL ANALYSIS Office of House Bill AnalysisH.C.R. 155 By: Swinford Transportation 4/23/1999 Introduced BACKGROUND AND PURPOSE In 1996, Union Pacific Corporation merged Southern Pacific Rail Corporation into a subsidiary of Union Pacific to create the nation's largest railroad. A major switching hub in a Houston switching yard was blocked when Union Pacific tried to integrate its train operations in its southern region with those recently acquired Southern Pacific properties in the summer of 1997. Consequently, gridlock ensued as one of the railroad's main lines became jammed with trains. Unable to move many railroad cars because of a lack of trains, locomotives, and railroad crews, the railroad's operations from the West Coast and the Midwest and East experienced numerous operational difficulties including slowed traffic, missed schedules, lost or delayed shipments, safety problems, and other customer service difficulties. The State of Texas was among those states hardest hit by the bottleneck. Texas businesses, especially shippers, that were dependent on Union Pacific suffered lost sales and increased expenses as these businesses had to find alternate methods of transporting their goods to customers. The Railroad Commission of Texas (commission) estimated that these lost sales and added freight expenses cost the Texas economy about $1.1 billion. As a result of what many shippers felt was Union Pacific's failure to provide adequate service as it was obligated to do so under the Staggers Rail Act of 1980, the commission appointed the Railroad Advisory Committee (committee) to study the service issue surrounding the rail crisis. The committee's recommendations suggest alternatives that can be provided to shippers who experience rail service disruptions and outline penalties for nonservice by rail carriers. For example, the committee defined "service" as providing equipment within 20 days of a request and "reasonable time" for delivery as no more than 200 percent of the normal transit time experienced for that particular movement. The committee also outlined three options for nonservice by rail carriers that would allow other rail carriers to provide service, invoice rail carriers for the difference between existing rail freight rates and the rates actually paid for trucks to move the commodity for which equipment had been ordered, and allow grain shippers to truck the product to the nearest available terminal and deduct the freight paid for this service. H.C.R. 155 urges the commission and the governor to review recommendations by the committee regarding service by rail carriers. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS H.C.R. 155 urges the commission and the governor to review recommendations by the committee regarding service by rail carriers. Provides that the secretary of state forward an official copy of this resolution to the chairman of the commission and to the governor.