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Pan Am claims MBTA in default regarding implementation of Positive Train Control system

NORTH BILLERICA, MA Dec. 20, 2016 Pan Am Southern LLC (PAS) and Pan Am Railways (PAR) today served default and dispute notices concerning important operational safety agreements with the Massachusetts Bay Transit Authority (MBTA).

A 2014 agreement between the two railroads and MBTA (copy available upon request) was intended to enable a Positive Train Control (PTC) system to be in place by the federal deadline of Dec. 31, 2018. This safety system would be compliant with federal law and appropriate to the joint passenger and freight rail services conducted over the eastern Massachusetts area. In today's notices, PAS and PAR report that MBTA has disavowed the 2014 agreement, raising questions about the three railroads' ability to implement PTC on Boston-area rail lines by the federal deadline. This throws into doubt the continuation of commuter service on those lines beyond that date.

In 2008, Congress passed a law requiring freight and passenger railroads that meet certain criteria to finance, develop, install, test, and implement PTC systems across 60,000 miles of the nation's rail network by Dec. 31, 2015, which later was extended to Dec. 31, 2018. PTC uses communication-based/processor-based train control technology to prevent train-to-train collisions, over-speed derailments, incursions into established work zone limits, and train movement through a main line switch in the improper position.

In addition to providing service across its own lines, MBTA performs commuter service over properties owned by PAS. The 2014 PTC agreement governs the installation of PTC over all of the jointly-operated MBTA, PAS, and PAR lines. The agreement was the result of several years of cooperative discussions, plans, and submissions by MBTA to federal agencies (both for regulatory compliance and financial support purposes). The 2014 agreement also covers installation of locomotive equipment that would be necessary for operations for PAS and PAR freight rail service in the Commonwealth.

Since execution of the 2014 agreement, PAS and PAR have acted in reliance on the agreement to ensure safe and compliant passenger services. MBTA repeatedly has progressed and affirmed plans for PTC installation in accordance with the agreement, including in its 2016 Annual PTC Implementation Progress Report submitted to the Federal Railroad Administration. PAS and PAR are concerned that MBTA's recent disavowal could set back design and implementation of an integrated PTC system by several years, creating uncertainty about compliance with the federal mandate and the continuation of passenger services.

PAS and PAR strongly believe the best path forward lies in reaffirmation of the 2014 PTC agreement and building on the efforts PAS, PAR, and MBTA have taken since PTC was mandated. PAS and PAR pledge to work cooperatively with MBTA to implement a joint freight/passenger PTC system as soon as possible.

About Pan Am Southern

Pan Am Southern is a joint venture between Pan Am Railways and Norfolk Southern Railway Company established in 2008 to bring competitive freight rail service connecting New England to domestic and international markets. PAS consists of 161 miles of main line tracks and 277 miles of secondary lines, including trackage rights agreements, in Massachusetts, Connecticut, Vermont, and New York.

About Pan Am Railways

Pan Am Railways is the Northeast's largest regional railroad. It operates over 1,000 route miles in Maine, New Hampshire, Massachusetts, and Atlantic Canada. Pan Am Railways interchanges traffic with 15 railroads throughout its network.

 

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