(The following story by Megan Woolhouse appeared on the Boston Globe website on March 23.)
Lieutenant Governor Timothy Murray has blasted the railroad giant CSX, saying the national freight carrier is making “completely unreasonable” demands in negotiations with the state over efforts to improve commuter rail service in Boston’s western suburbs.
Murray, who expressed optimism about the tenor of the talks last October, recently complained that negotiations had reached a “logjam” because CSX has refused to bend on at least one key demand: requiring the company to face liability if a commuter-rail passenger is injured due to its negligence.
“This whole issue of indemnification is outrageous,” Murray said in an interview. “They want taxpayers to pay for their own negligence… They want to hand taxpayers the bill.”
Murray has been point man in the talks since he entered office last year. The state wants to increase the number of commuter-rail trains and end the delays that have sparked fury among some riders. On-time performance of the commuter rail line linking Worcester and Framingham with Boston was so poor that last month the MBTA created new schedules to reflect the actual travel times, adding as much as 12 minutes. State officials say they could solve the problems by buying tracks owned by CSX and controlling coordination of the freight and commuter trains that share the route.
Lisa Mancini, CSX’s vice president of strategic infrastructure initiatives, disagreed with Murray’s characterization of negotiations, saying the company and the state had “made a lot of progress” in talks. She acknowledged that passenger liability, however, is “nonnegotiable.”
“We said at the very outset that we are not willing to take on additional risk. This has been our position since the beginning of these negotiations,” Mancini said. “We are an out-of-state company with deep pockets. If the case would go to a jury, we don’t know what the outcome would be.”
The dispute could be enough to derail the deal, worth perhaps $300 million to $400 million, to buy some CSX tracks and rights of way. In addition to what it wants to purchase along the Worcester/Framingham line, the state is looking to buy rights of way on CSX tracks through Fall River and along the South Shore, as well as on lines from Allston to Chelsea (also known as Grand Junction). The state is also negotiating the purchase of CSX property in Boston, from Southampton Street to the Port of Boston, to allow for the port’s expansion. Negotiations also involve plans to move CSX’s 48-acre rail yard in Allston westward, as Harvard University expands its campus onto the site.
Mancini said the company has been looking for a property covering between 50 and 100 acres adjacent to the Worcester/Framingham rail tracks. She said CSX has a few sites under consideration, but no offers have been made.
Murray said in October that he was hopeful a deal with CSX could be finalized before January. As Worcester’s former mayor, he had campaigned for statewide office promising to double commuter rail frequency between Worcester and Boston. Many believe the economic prosperity of the Worcester area depends on the expansion of the service.
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Murray said under CSX’s current negotiating position, the railroad would have only limited liability, being responsible for the tracks and train damage in a collision, even if an employee was found to be drinking or impaired on the job, and exempt from liability for injuries to passengers. He likened it to allowing a shipping company to drive on state highways without any liability for injuries caused by the negligence of their drivers.
“It’s even more outrageous given the fact that they earned $110 billion – record revenues last year” Murray said of CSX. “These are unreasonable demands.”
A similar debate is playing out in Tampa, where CSX has asked Florida officials to assume liability for any accidents on a proposed Orlando commuter line. The state wants to purchase 61 miles of CSX track for commuter rail and shift freight traffic elsewhere. Florida’s chief financial officer, Alex Sink, has opposed complete indemnification, saying the issue could scuttle talks, according to the Tampa Tribune newspaper.
Massachusetts has a $75 million cap on liability, which means that whoever assumes all or part of the liability would pay for crash insurance, which could cost several million dollars annually.
Mancini said CSX already has partial indemnification agreements in South Florida, Virginia, Maryland, among other places. CSX demands the indemnification to avoid lawsuits, some unjustified, she said.
“We have been sued in cases where we’re not even there,” she said. “Chances are we will prevail, but we don’t want to be in the position of defending ourselves.” Such crashes, she added, are rare.
A Pulitzer Prize-winning investigation by New York Times reporter Walt Bogdanich in 2004 found that CSX benefited from indemnification agreements, and that Amtrak often paid millions in liability claims in crashes determined to be CSX’s fault.
The series highlighted examples of Amtrak passenger trains jumping tracks, killing and injuring passengers.
In cases where investigators determined that the crash had been caused by tracks poorly maintained by CSX, Amtrak paid the liability costs because of an agreement with CSX to indemnify the latter company. The agreement resulted in CSX being shielded from tens of millions of dollars in liability, according to the report.
Murray said he doesn’t want to find the financially beleaguered MBTA in a similar spot, adding, “And we wonder why Amtrak’s almost bankrupt?”