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[CNJRoss]

Railway Age, 11/22/22

 

STB to UP: Explain Embargo Escalation

 

The Surface Transportation Board (STB) is ordering Union Pacific (UP) President and CEO Lance Fritz and other top UP executives to appear at a Dec. 13-14 public hearing on what it’s calling a “substantial increase” in the Class I railroad’s use of embargoes as a method of reducing rail traffic congestion. UP responds.

 

STB on Nov. 22 reported that UP embargoes have increased from a total of 27 in 2017 to more than 1,000 to date (as of Nov. 17, 2002). See chart below (through October 2022).

 

“In recent years, there has been a significant increase in UP’s use of embargoes, and congestion is the stated cause for almost of all of the embargoes,” as shown in the above chart, according to STB. “This pattern shows no signs of abating.” (Chart and Comments from Nov. 22 STB Decision)

 

 

An embargo suspends a shipper’s right to common carriage by restricting freight movements. Issued by a railroad when weather, congestion, labor strife, natural disasters or track conditions prevent fluid operations, embargoes may not be used as an alternative to seeking regulatory approval for line abandonments, to avoid handling unprofitable or undesired traffic, or to influence routing. Shippers may ask the STB to cancel an embargo.

 

STB said it has “received numerous reports that shippers are suffering supply chain problems as a result of the embargoes that are hampering their operations.” 

 

SNIP  

 

In related developments, STB on Oct. 28 ordered all Class I railroads to submit weekly performance and monthly employment data for six additional months, until May 5, 2023. BNSF, CSX, Norfolk Southern (NS) and UP must also submit biweekly service progress reports for another six months as well as an interim update, due Dec. 2, 2022, that covers performance and labor force targets and any service recovery plan modifications.

 

 

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[CNJRoss]

Trains News Wire

 

Union Pacific says congestion-related embargoes are a tool of last resort

 

By Bill Stephens | November 30, 2022

 

No customer has been fully shut off due to metering of traffic, chief financial officer tells conference

 

MANALAPAN, Fla. – Union Pacific, which has come under fire for its increased use of embargoes, has not fully shut down service to any customers as it grapples with congestion related to ongoing train crew shortages.

“It really is a tool of last resort for us. As a common carrier, we don’t have other mechanisms to fully suppress volumes coming on to our network,” Jennifer Hamann, UP’s chief financial officer, told an investor conference on Wednesday.

 

Federal regulators have ordered UP executives to appear at two days of hearings next month regarding the railroad’s increased use of embargoes, which have skyrocketed from 27 in 2017 to more than 1,000 so far this year.

 

Railroads commonly use embargoes to limit traffic in the aftermath of a derailment, washouts, or severe weather. But UP has become increasingly reliant on embargoes to limit congestion and twice this year has asked customers to reduce the number of cars on the railroad or face embargoes.

 

 

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[CNJRoss]

Trains News Wire

 

STB scolds Union Pacific for response to request for information about embargoes

 

By Bill Stephens | December 8, 2022

 

Railroad’s filing fell short of what board was expecting prior to next week’s hearing on increased use of congestion-related embargoes

 

WASHINGTON — Union Pacific is in the Surface Transportation Board’s doghouse.

 

In a letter to UP CEO Lance Fritz today (Thursday, Dec. 8), STB Chairman Martin J. Oberman said the railroad’s response to the board’s request for information about how and when it issues embargoes fell well short of what regulators were expecting.

 

SNIP

 

“UP filed with the Board one PowerPoint file containing seven slides,” Oberman wrote. “While the PowerPoint addressed in general terms some of the topics listed in the Board’s notice, it failed to provide any detail on those topics, and it failed to provide any information or discussion of other topics.”

 

“The PowerPoint presentation is silent on most of the topics listed in the November 22 order,” Oberman wrote, adding that the railroad has “hindered the Board in its efforts to understand this increase of embargoes, their causes and impacts.”

 

 

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[CNJRoss]

CNBC, 1213/22

 

Unions, rails clash over hiring data as Union Pacific faces regulatory heat in Washington

 

KEY POINTS

 

• Union Pacific and its CEO Lance Fritz are the subject of a Surface Transportation Board hearing this week, and the Board said that so far the railroad has “failed” to provide details on its use of 1,000 embargoes in 2022.

• STB is scrutinizing railroad staffing and service levels as part of its freight rail regulation.

• Union membership data reviewed by CNBC tells a different story than hiring information provided by railroads to the STB.

 

The strike was averted, but tensions between unions and class I freight railroads continue to run high.

 

Union Pacific’s use of embargoes, a freight railroad practice in which trade is stopped in order to clear up congestion, is at the center of a two-day hearing at the Surface Transportation Board in Washington, D.C., that started Tuesday.

 

Also under scrutiny: the railroad’s staffing data, including new hiring and retention of existing employees, which union officials at the hearing say doesn’t present the full picture of declining employment in the sector.

 

 

 

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[CNJRoss]

CNBC 12/16/22

 

Union Pacific pauses use of controversial freight rail embargoes

 

KEY POINTS

• Union Pacific is pausing its use of embargoes, a method to control freight rail traffic which has been scrutinized by federal regulators and rail labor unions.

• The Surface Transportation Board has questioned a ‘disturbing upward trend’ in embargo use by the railroad as part of its federal oversight of transportation service levels.

• Unions have tied the used of embargoes and service delays back to ongoing concerns about labor policy.

Union Pacific is pausing the use of embargoes on its freight network, a practice that had increased significantly this year and led the Surface Transportation Board to call Union Pacific CEO Lance Fritz and other of the rail’s top executives to a hearing in Washington, D.C., earlier this week.

 

In a letter addressed to STB chairman Martin Oberman and sent to the STB on Friday by Fritz, the Union Pacific CEO stated, “We are taking a hard look at our use of congestion-related embargoes. To facilitate that hard look, we are immediately pausing any additional embargoes under the pipel

 

 

 

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[CNJRoss]

Associated Press, 12/18/22

 

Union Pacific railroad puts its shipping limits on hold

 

OMAHA, Neb. (AP) — Union Pacific says it will stop imposing temporary limits on certain businesses’ shipments while it reviews the policy that federal regulators and shippers criticized at a hearing last week.

 

Union Pacific has put more than 1,000 of these embargoes in place this year — significantly more than all the other major freight railroads combined — as part of its effort to clear up congestion along the railroad. CEO Lance Fritz said a brief letter to the U.S. Surface Transportation Board Friday that UP will put all new embargoes on hold.

 

 

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[CNJRoss]

Progressive Railroading, 5/17/23

 

STB allows UP to keep some service reporting info confidential

 

In its ongoing monitoring of Union Pacific Railroad's service issues, the Surface Transportation Board on Monday granted the company's request to keep certain documents and/or data confidential.

 

UP's request to keep some information from public view arose last year around the time board held a two-day hearing in December on the railroad's use of embargoes to reduce rail traffic congestion on its network. That hearing was called after shippers complained about supply-chain problems as a result of railroad embargoes hampering their operations.

 

 

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[CNJRoss]

Trains News Wire

 

Regulators end probe of Union Pacific’s use of embargoes, but slam railroad’s ‘delay and obfuscation’

 

By Bill Stephens | April 17, 2024

 

The Surface Transportation Board applauded an 80% reduction in UP’s use of embargoes to manage congestion, but warned the railroad that it will still monitor its progress

 

WASHINGTON — The Surface Transportation Board today closed the book on its investigation of Union Pacific’s record use of congestion-related embargoes in 2022 – but not before scolding the railroad for failing to comply with board orders and requests for information.

 

“UP’s conduct in this regard bordered on the contumacious and cannot be viewed as acceptable conduct by a railroad subject to the Board’s statutory authority,” the STB said in its decision. “Contumacious” is defined as “stubbornly disobedient,” according to Merriam Webster.

 

SNIP

 

But the STB also warned UP that it will continue to monitor UP’s use of congestion-related embargoes.

 

“We do note, however, that even after the significant reduction in UP’s congestion embargoes from 2022 to 2023, the 181 congestion embargoes issued by UP in 2023 still exceeded the number issued by all the other Class I railroads combined,” the board said.  . . .

 

 

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