POP: Finalizing the Transfer of Hopper Cars to the FRCC

POP: Yes
Res #: POP 4-06A
Number: 4
Year: 2006
Midterm: No
Expired: Yes
Responses Received: No
Departments: Transport Canada

Point of Privilege Resolution No. 4-06A

WHEREAS, the federal government has negotiated a transfer of the federal hopper car fleet to the Farmer Rail Car Coalition (FRCC) representing 17 farm groups across the prairies; and

WHEREAS, the transfer process needs to be finalized; and

WHEREAS, the business plan for FRCC is time sensitive; and

WHEREAS, every month delay results in farmers paying the railways millions of dollars in excess freight charges; and

WHEREAS, the newly elected Conservative Party has said they will want to review most recent government transactions;

THEREFORE BE IT RESOLVED, that SARM ask the new federal transport minister and agriculture minister to expediently finalize the transfer of the federal hopper car fleet to the FRCC, representing 17 farm organizations.

Response from Honourable Lawrence Cannon, Minister of Transport, Infrastructure and Communities:

As you may be aware, on May 4, 2006, the Government of Canada announces that it will retain ownership of the federal grain hopper car fleet, and tabled Bill C-11, an Act to amend the Canada Transportation Act and the Railway Safety Act and to make consequential amendments to other Acts. This bill contains an amendment that would allow the Canadian Transportation Agency to better align the maintenance costs embedded in revenue caps with the actual costs of maintaining the hopper cars. Estimates indicate that these measures would save farmers approximately $2 per tonne of grain shipped, or $50 million a year in total savings.

Taxpayers will also benefit from the decision to retain the cars, as the government will continue to collect between $10 and $15 million each year from the railways for non-regulated shipments. The decision to retain the cars will also ensure accountability and transparency for an efficient and effective grain transportation system. The government will negotiate a new operating agreement and rail ca refurbishment program with Canadian National and Canadian Pacific Railway to ensure that cars remain in good operating condition.