provisions that permitted interswitching of up to 160 kilometres, along
with the disappearance of producer cars, has put short lines and their
shippers in a worse competitive position, they say
‘This does nothing for us and we have come here to Ottawa several times saying we need some help:’ short-line group head
The House of Commons transport committee is set to examine Bill C-49 clause by clause on Oct. 3.
Members were asked to submit possible amendments to the
transportation modernization act by Sept. 28, and after a week of
testimony from 85 witnesses, it’s likely there will be some.
Concerns about long-haul interswitching top the list and Perry
Pellerin, who heads the Western Canadian Short Line Railway Association,
would add something for his industry.
“As this bill is written right now, if you just look at it from a
straight short-line perspective there’s nothing in it,” he told the
committee during his testimony.
“This does nothing for us and we have come here to Ottawa several times saying we need some help. This isn’t helping us.”
He said short lines represent 24 percent of Saskatchewan’s track. The
companies employ 183 residents and move $500 million worth of
Yet, Bill C-49’s provisions don’t allow short-line customers to
access long-haul interswitching. Those rules required a rail company to
pick up shipments along its track and deliver the cars to a competing
rail company’s line.
Pellerin said ending the long-haul provisions that permitted
interswitching of up to 160 kilometres allowed under the previous
legislation, the Fair Rail for Grain Farmers Act, along with the
disappearance of producer cars, has put short lines and their shippers
in a worse competitive position.
Shipping by truck for distances less than 500 km is generally more affordable than rail, he said.
“We are cheaper than a truck,” he said. “The problem is when
we give that car over to our Class A partners, they are unable to
compete at that rate.”
For example, shipping a car on the short line for about 120 km from
Leader, Sask., to Swift Current, Sask., costs about $650, or half the
trucking cost, he said.
But handing that car over to Canadian Pacific Railway to take it to Moose Jaw, or about 175 km, costs $2,600.
Even multi-car rates differ by about $1,000 per car, he said, leading
shippers to move grain by truck to inland terminals that can load
The previous 160 km interswitching rules provided a stronger
bargaining position, Pellerin added. Returning to a 30 km zone as
existed before will make long-haul interswitching available to only two
of the association’s 14 members. Rates will be too high, he said.
“It is our understanding that the intent of the long-haul
interswitching was to increase competition by providing expanded options
to shippers,” he said.
From a short-line perspective it won’t achieve that goal.
Transport minister Marc Garneau during his appearance before the
committee said that short lines were consulted while Bill C-49 was
drafted and their input is reflected.
“They are not subject to long-haul interswitching orders or
the new data requirements as they were considered too burdensome for
them,” Garneau said.
He said short-line railway concerns generally relate to infrastructure, which is beyond the scope of this bill.
“Short lines are eligible on the other hand to apply for funding
under the national trade corridor initiative announced in July,” he
“We realize that they’re an important element of the transportation system; they’re just not covered in Bill C-49.”
Former Transport Minister Lisa Raitt noted that David Emerson, who
led the Canada Transportation Act review, told the committee that
shippers will be forced to use trucks and roads if short-line
infrastructure and investment aren’t addressed.
She asked Garneau if the government would include short lines in a national rail plan.
“We are looking at that issue at the moment,” Garneau replied. “We’ll see what comes out of that.”
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