With railway safety becoming a hot topic following the Lac Mégantic disaster, it's only natural that Humboldt examine the potential risks of the trains passing through the city.
Mary-Jane Bennett is a transportation consultant and research fellow with the Frontier Centre. In a report entitled Lessons From Lac-Mégantic, Risk in the Transportation of Dangerous Goods, Bennett wrote about the uneven risk distribution between the rails, shippers, manufacturers, and taxpayers.
"Beyond the responsibility placed on the taxpaying public to step in and cover these expenses, other costs associated with the transportation risk are borne by the government," states Bennett in the report.
In other words, because transporting dangerous goods falls to the rilways, they are considered responsible for any accidents. As in the case of the Lac-Megantic disaster, however, those risks are often too much for the rails to bear alone, leaving the government and taxpayers to help pay for the cleanup.
These risks are aggravated further by two circumstances: the $1 billion insurance limit for rails and the common carrier doctrine. According to Bennett, the common carrier doctrine mandates that "rail is required to transport all goods presented to it for delivery and not to decline a request for transportation."
The insurance limit, moreover, was reduced from the $1.5 billion limit it was at five years ago.
"Since 9/11, the insurance companies have cut back on the cap in terms of accidents and how much they will pay per accident," said Bennett. "Union Pacific (UP) has said there could be accidents in the tens of billions if you're talking about derailment in downtown Chicago, for example."
Of course, because Canada and the United States share a border, there is frequent trading of dangerous goods across the border via rail. This means that the risks that affect rails south of the border would have the same effect here in Canada.
Bennett's report also states that in July 2008, the railway argued that they should receive financial assistance in case of accident when transporting Toxic Inhalation Hazards (TIH). Alternatively, the common carrier doctrine should be modified or dissolved to relieve them of such a risk-laden obligation.
In her report, she uses various examples of other industries that have built in policies to protect against financial liability in case of accidents. She suggests that although the analogies aren't perfect, they can be used as a starting point.
"There would be primary insurance coverage of a certain amount by the rails," she suggests for one example, "and then a secondary coverage between various shippers and manufacturers to cover a nightmare scenario."
Simply put, the rails would cover the primary costs, but if the costs were higher than that, the secondary insurance would cover it.
For towns and cities such as Humboldt that are built around the tracks, the most common risk will come from the transportation of oil. For the foreseeable future, transportation of oil through the towns will be necessary due to pipeline over-capacity. Last year, Canada's railways transported 140,000 carloads of oil alone.
The federal government has already started discussions on how to improve the situation. The first step has been to implement a policy that requires railways to share information about the dangerous goods they are carrying to municipal first responders and emergency planners.
"There is still a long way to go if we are going to avoid tragedies like the one in Lac-Mégantic," said Mayor Debra Button, president of the Saskatchewan Urban Municipalities Association (SUMA) is a news release. "I look forward to working with FCM (Federation of Canadian Municipalities) and the federal government to develop improved regulations for railway operations."
