(The following story by Lindsay Peterson appeared on The Tampa Tribune website on April 22.)
TAMPA, Fla. — Local governments pay CSX Transportation millions to build, fix and maintain the company’s railroad crossings on public roads.
Some city and county officials wonder why it costs so much.
CSX doesn’t submit receipts from materials suppliers. The company dictates the price of its crossing work, giving government officials a choice – either pay the money or forgo the project and risk having to close a road.
“We don’t have the freedom or the option to question,” said Hillsborough County spokesman Steve Valdez. “If you question them, they’ll say, ‘Tell you what, we’ll just remove [your project] from our plan.’ And the crossing doesn’t get fixed.”
Since 2000, the cities and counties of the Tampa Bay area have paid CSX millions in taxpayer dollars for a range of things, including hundreds of thousands for flagging services.
The Tampa Tribune reported last month that when government agencies do road work near CSX rails, the company bills them for full-time flagmen. The CSX flagmen are paid up to $25 per hour to sit in their vehicles and watch the tracks, even when no trains are running and workers are hundreds of feet from the rails.
CSX charges to local governments since 2000 include at least $8 million for work on railroad crossings.
CSX responded in a statement that the company documents its labor and materials expenses and insists “on ethical behavior in our procurement process.” A spokesman didn’t respond to requests for more information about what was contained in those documents.
On 30 projects the Tribune has reviewed, the only descriptions of what the company provided were on the invoices it submitted for billing. The files contained no receipts from original suppliers for the rails, concrete and asphalt it used.
When government agencies build or widen roads and need new rail crossings or when crossings wear down, CSX agrees to do the work only if the agencies agree to pay the company’s price. The jobs generally include installing new rails over the roads, often with rubber or concrete pads between the rails to create a smooth surface.
If the road is a busy one, the railroad puts up warning signals and gates, then charges annual fees for their maintenance.
Public officials don’t question their responsibility to help pay for these crossings and the cost of keeping them safe. As Valdez puts it: “The railroads were here first. Our roads cross their tracks, not the other way around.”
But officials do question why the costs are so high.
‘One Word: Exorbitant’
A new crossing with gates and lights can cost taxpayers more than $400,000. The repair of a crossing can exceed $200,000.
“We have never had any business with CSX in which they did not charge us a very high rate,” said Safety Harbor City Engineer Bill Baker, who said he had the same experience as a city engineer in Clearwater.
“I would classify all that they do in one word: exorbitant.”
St. Petersburg recently added $600,000 to its budget for the next three years to pay for railroad crossing repairs.
“We have a very difficult relationship with CSX” concerning crossing repair costs, said Mike Conners, the city’s internal services administrator. “With the skill of the work involved versus the prices we’re asked to pay, we have a very difficult time seeing why it’s so high.”
On top of crossing construction and repair, CSX’s annual maintenance fees are $935 to $2,800 per crossing. The money is for inspecting the crossing and making sure the warning signals work.
That adds up for local governments with crossing signals on their roads. Bartow, for instance, pays more than $21,000 per year on 15 crossings. Hillsborough County, with 187 crossings, pays more than $224,000 annually.
In addition to local governments, the state has paid CSX millions for crossing work since 2000. And like the local governments, state officials say they have no choice. CSX is the only company that can do the work.
“They’re the sole supplier,” said state rail administrator Gary Fitzpatrick. “They set the market.”
He said state officials verify CSX charges with inspections while the project is going on and afterward to make sure the work meets state and federal standards.
CSX charges the state nearly $280,000 a year to inspect the company’s crossing surfaces and signals on state roads.
Tied To The Rails
Polk County traffic engineer Steve Logan learned soon after he took his job how costly – and questionable – the signal maintenance fees can be.
In 2003, his department received a letter from CSX saying it owed more than $600,000 for past maintenance on several crossings.
Sent out to investigate, he found that the railroad’s list was “replete with errors,” he said. Some of the crossings were on abandoned roads. A few had been dismantled years earlier. Others were misclassified and not Polk County’s responsibility, he said.
He determined that Polk owed less than half of what CSX had requested.
“We marked up their list and sent them a check for about $300,000,” he said. The company took it without challenging Logan’s findings.
Logan hasn’t been so successful with a recent battle over two crossings south of State Road 60 between Bartow and Mulberry.
He has been checking on them for about two years and seen no activity beyond the proliferation of brush on both sides of the road. Pictures he took in 2005 and last month support his observations.
“It’s ridiculous,” he said. “It’s obvious that no trains have been on these tracks for years.”
But when he asked to be released from the payments, $1,868 a year for the two, CSX said no. Company officials said CSX was responsible for maintaining the crossing signals because it planned to use the tracks.
“It’s so frustrating. We could save thousands of dollars on this,” he said. He doesn’t know what CSX does with the annual payments. “They say they’re maintaining the signals, but I don’t know what that takes. They don’t tell us.”
Polk County pays $133,000 per year in maintenance fees for 91 rail crossings on county roads.
A framed cartoon hangs on the wall of Logan’s cubicle. Below his name it says, “He has CSX wrapped around his little finger.” Below that is a drawing of a man tied to a set of railroad tracks.
“That’s me,” he said recently.
The cartoon hit home last year while he worked on the construction of a four-lane bridge in Mulberry that would cross a set of railroad tracks.
He failed to persuade the company to come down on its demand for $160,000 worth of flagging services for the 14-month project. Also, CSX wanted $427,000 to install a crossing over its tracks, with warning gates and lights.
The costs so far have included $22,000 for engineering; $136,000 for material, including freight charges; and $67,000 for 49 days of labor. The county received no receipts, just invoices.
“We pay them what they ask,” Logan said. Otherwise, CSX could stop cars from crossing its tracks.
“We’ve never been able to talk about payment details with CSX. It’s just not discussable,” Hillsborough spokesman Valdez said. “They give us a lump sum total and say, ‘Pay this.’ If we don’t pay them, we won’t get any more work done.”
Rising Costs
When Hillsborough County widened Sheldon Road from two to four lanes about 15 years ago, CSX built the crossing. The new surface, gates and signal lights cost taxpayers about $300,000.
CSX had built the rails with rubber pads on both sides. Over time, the pads sank, creating a bumpy ride. When the county asked for a repair estimate two years ago, CSX said it would cost about $154,000.
By the time the work was finished, the price to install 320 feet of rail and concrete pads across the four lanes had risen to more than $210,000.
The county had asked CSX to work overtime to speed completion of the project. CSX billed for the work of 10 to 15 workers each Saturday and Sunday for three weekends in a row, charging about $55 per hour, including a surcharge for benefits and insurance, for each employee.
In the past 15 years, the Sheldon Road crossing has cost county taxpayers more than $530,000. That includes making sure the signals work and other maintenance, which costs $1,870 per year.
The county pays the bills because it has no choice, Valdez said.
“I agree it’s outrageous,” he said, conceding the county doesn’t get receipts and detailed work reports and doesn’t know exactly what it’s paying for. But CSX isn’t the typical county contractor.
“We don’t control them. They do not work for us. They are the railroad,” he said.
“As long as we get a finished product and it’s the way we want it done, there’s no discussion.”