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Guide to Railway Charges for Crossing Maintenance and Construction

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Effective July 1, 2005

© Minister of Public Works and Government Services Canada, 2005
ISBN 0-662-69119-9
Catalogue No.TT4-3/2005

Available in multiple formats.

Table of Contents

• INTRODUCTION
• APPLICATION
• SCHEDULED MAINTENANCE OF CROSSING WARNING SYSTEMS
• Scheduled Maintenance Labour Rates
• Scheduled Maintenance Material Rate
• Scheduled Maintenance Vehicle Costs
• Billing Periods
• GENERAL BILLING GUIDELINES
• Labour Charges
• Material Charges
• Contracting Equipment and Services
• Rental Rates of Railway Equipment
• Transportation of Equipment Charges
• Meals and Lodging
• SALVAGE VALUES
• INJURY OR DEATH
• DISCONTINUANCE OF RAIL OPERATIONS
• RENEWAL
• RAILWAY CONTACTS
• DEFINITIONS
• AGENCY ASSISTANCE
• PROCESS
• DECISIONS AND APPEALS
• CONFIDENTIALITY
• OTHER AVAILABLE DOCUMENTS
• FOR MORE INFORMATION
• SCHEDULE A: TYPE 1
• SCHEDULE A: TYPE 2
• SCHEDULE B
• SCHEDULE C
• SCHEDULE D
• SCHEDULE E

INTRODUCTION

The Canadian Transportation Agency (Agency) is a quasi-judicial administrative tribunal of the federal government created under the Canada Transportation Act (hereinafter the CTA). The Agency is responsible, among other duties, for resolving disputes arising between federal railway companies and other interested parties such as utility companies, road authorities and landowners.

Under section 101 of the CTA, railways, road authorities, utility companies and private landowners may negotiate agreements for any aspect of a crossing. These agreements usually include rates to be charged for work performed and specify which parties are responsible for paying for this work. Where agreements cannot be reached by the parties, the Agency, upon receiving an application, may resolve issues relating to the construction, maintenance and apportionment of costs of road and utility crossings.

A series of guides has been prepared to highlight provisions made available pursuant to the CTA legislation. This particular guide, which replaces the Schedule A Directives, has been developed to assist the railways and road authorities, utility companies and landowners, by providing a third party assessment of rail costs and setting a consistent, nation-wide rate structure for work performed by railway companies. This guide may be used by Canadian federally-regulated railways when charging for work performed at crossings, crossing warning systems, or for any other crossing-related work either agreed to by the parties or authorized by an order of the Agency.

The rates in the attached schedules are developed from Class I railway accounting data in accordance with the principles, methods and procedures established for the costing of Class I railway operations for regulatory purposes. They have been developed to illustrate the total costs incurred by Class I railway companies for work and services performed at road crossings.

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APPLICATION

Parties are encouraged to negotiate contracts which incorporate specifications, prices, time frames and the terms and conditions of any crossing-related work. However, should the Agency order a railway company to prepare its accounts in accordance with this guide for any construction or maintenance work, or should the parties agree to make use of this guide, the rates in the attached schedules will be the rates applied. Furthermore, these rates would apply, from the effective date of this guide, to any past orders issued by the Agency or its predecessors.

It should be noted that, as indicated above, the rates in this guide are developed from Class I railway accounting data to represent total costs and therefore:

• may not accurately reflect the costs incurred by non-Class I railways; and,
• do not take into consideration any costs related to crossing maintenance and construction that are incurred by parties other than the railways.

The rates contained in this guide fall into two categories, Scheduled Maintenance Rates which cover routine maintenance of crossing warning systems, and the General Billing Guidelines which cover construction and unscheduled maintenance projects based on the actual activities performed.

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SCHEDULED MAINTENANCE OF CROSSING WARNING SYSTEMS

Scheduled maintenance is the standard preventative maintenance which is intended to ensure the reliable and safe operation of a crossing warning system. The scheduled maintenance rates cover all labour, material, vehicle costs and overheads associated with ensuring the functional operation of a crossing warning system for reasons of public safety.

For the purposes of these guidelines and to better reflect the costs involved, scheduled maintenance rates have been divided into two categories: crossing warning systems with gates (Type 1) and crossing warning systems without gates (Type 2). A breakdown of the rates to be charged for each category is contained in Schedule A of this document.

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Scheduled Maintenance Labour Rates

The scheduled maintenance labour rates include the labour costs associated with all routine service calls and maintenance work, and scheduled testing and inspections. The labour portion of the work has been divided into two categories, work performed by signal maintainers and work performed by track and roadway crews. The work performed by signal maintainers includes regular service calls and inspections, as well as all scheduled safety tests (i.e. weekly, monthly, 6 month, 1, 2, 4, and 8 year tests). It also includes such functions as painting and parts replacement. The work performed by track and roadway crews includes: the weekly testing for certain regions of the country, where track and roadway crews are used for this test in lieu of signal maintainers; flagging during routine maintenance; and, the replacement of insulated joints and temporary bond wires.

Weekly tests are performed on all crossing warning systems across Canada where railways operate. In some regions, these tests are performed by the signal maintainers and in some regions by the track and roadway crews. The system-wide time spent on the weekly tests has been apportioned between the two labour groups.

The scheduled maintenance labour rates are comprised of two components:

1. A base labour rate is calculated for both maintainers and track and roadway crews by dividing the total dollar amount paid to employees in each labour category by the total hours worked in the same labour category. The amount paid includes straight time, vacation, statutory holidays, overtime and other pay-related benefits as well as a standby charge.

2. A labour overhead rate to cover administrative expenses related to the maintenance of way and structures including line supervision above the level of foreman. It includes costs for general administration activities incurred in the management of the railway company such as accounting, finance, human resources, legal, management services and information systems. It also includes an employee benefit allowance to cover costs relating to the company's portion of employment insurance, pensions, health plans, and other benefits. This overhead rate is applied to the base labour rate.

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Scheduled Maintenance Material Rate

The scheduled maintenance material rate covers the costs associated with the replacement of basic material items and includes paint, batteries, and light bulbs as well as any other material components replaced due to normal wear. This rate also covers any additional charges for the replacement of materials such as masts, cantilevers, gates, etc. due to normal wear.

The scheduled maintenance material rate is comprised of three components:

1. The basic material cost includes the total material items purchased for crossing maintenance.

2. The material overhead rate covers the cost of administration, supervision, purchasing, inspection, accounting, and other associated costs relating to the purchase and distribution of material items. This material overhead rate is applied to the base material cost.

3. The electricity cost includes the base cost of electricity supply and consumption required to maintain the operation of a crossing warning system. No material overhead has been added to the electricity costs.

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Scheduled Maintenance Vehicle Costs

Vehicle costs incurred for transportation to and from each crossing are also included as part of the scheduled maintenance rates. Vehicle costs are developed using a per hour rate multiplied by the number of hours the vehicle is used for maintenance purposes.

Billing Periods

The frequency and timing of billing periods for scheduled maintenance (e.g. monthly or annually, etc.) is a matter to be negotiated between the parties involved.

No scheduled maintenance rates are to be charged for crossings having only passive warning systems such as reflectorized signboards.

GENERAL BILLING GUIDELINES

The general billing guidelines apply to all work at crossings with the exception of scheduled maintenance of crossing warning systems. Charges under the general billing directives should be billed separately from any scheduled maintenance charges and should include a full detailed description of the actual work performed and the related charges. The General Billing Guidelines include three general categories: Construction Projects, Crossing Surfaces, and Unscheduled Maintenance. The charges relating to all three categories should be calculated using the appropriate rates in Schedules B through D of this guide.

Construction-related projects which may be included under the general billing guidelines are: the initial construction, reconstruction or upgrade of a grade crossing, including the crossing surface and/or the installation of the associated crossing warning system; the initial construction, reconstruction, or upgrade of a grade-separated crossing (no crossing warning system required) and the initial construction, reconstruction, or upgrade of a utility crossing (no crossing warning system required).

Maintenance performed by a railway company on the crossing surface of a grade crossing or on a grade separation is not included in the standard maintenance rates. As such, any costs incurred by the railway may be charged under the General Billing Guidelines.

Unlike scheduled maintenance, unscheduled maintenance refers to work performed on any crossing warning system components which is corrective in nature and is performed to restore the reliable, safe, and effective operation of crossing warning systems which are damaged due to accidents, incidents of vandalism, or unusual weather-related damage.

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Labour Charges

The labour charges allowed under any general billing project should be based on the actual time worked multiplied by an hourly labour rate. For construction purposes, the labour charges are applicable to the actual on-site installation of materials. This rate is comprised of the following three components:

1. a direct hourly wage as specified in each employee's collective agreement.

2. an unproductive factor to cover allowances for vacation, statutory holidays and other types of leave. This factor is applied to the direct hourly wage.

3. a labour overhead rate to cover administrative expenses related to the maintenance of way and structures including line supervision above the level of foreman. It includes costs for general administration activities incurred in the management of the railway company such as accounting, finance, human resources, legal, management services, and information systems. It also includes an employee benefit allowance to cover costs relating to the company's portion of employment insurance, pensions, health plans, and other benefits. This allowance is applied to the sum of the direct hourly wage and the unproductive factor.

Schedule B of this guide outlines the appropriate unproductive factor and labour overhead rate to be applied to direct wage rates for labour costs that fall into the General Billing Guidelines.

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Material Charges

Charges for any material items, including any pre-wired and/or pre-assembled components, used in unscheduled maintenance or construction work include two components:

1. the actual purchase price (including provincial sales tax) paid by the railway for any material item.

2. a material overhead rate which covers the charges associated with administration, supervision, purchasing, accounting, and other associated costs, such as utilities. It also includes in-house design and engineering work, legal issues, inspections and quality control, and customs clearance activities.

Schedule C of this guide outlines the appropriate material overhead rate to be applied to all material charges used in unscheduled maintenance and construction projects.

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Contracting Equipment and Services

Charges for any service contracts such as the contracting of non-railway owned equipment, services performed by any outside parties and any freight charges related to the transportation of materials, shall be based on the actual invoiced contract price. A contract overhead rate can be added to the invoice to cover basic administration costs as outlined in Schedule D, Contracting Equipment and Services.

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Rental Rates of Railway Equipment

Where railway-owned equipment is used for projects that fall under the General Billing Guidelines the Agency recommends that daily rental rates be no greater than the rates indicated in the list attached as Schedule E, Equipment Rental Rates.

The rental charges may include the actual time required for moving railway-owned equipment from home base or point of storage to the project site and back again, provided the railway equipment is not being transported directly to the site of another project. If the equipment goes directly from the site of one project to another, the latter project cannot be charged for the first movement.

The methodology to be employed is outlined in Schedule E, Equipment Rental Rates.

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Transportation of Equipment Charges

Transportation expenses incurred for the movement of railway-owned equipment to and from job sites may be charged except when the equipment moves directly from one project to another under its own power (excluding locomotives). Bills can include charges for the transportation of cars, cars loaded with roadway machines and other miscellaneous equipment to work sites either by rail or road. Charges for transporting equipment in work trains cover all operating and ownership costs associated with the train movement of the equipment to the work site. Bills can also include charges for work trains used for storage purposes.

Schedule D, Transportation Charges lists the allowable hourly charges (or fractions thereof) for locomotives, work trains, equipment transported in work trains, revenue trains and by road, as well as, trackage charges.

Transportation charges for the movement of railway employees to and from job sites are allowed for projects billed under the General Billing Guidelines.

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Meals and Lodging

The Meals and Lodging section of Schedule D also outlines the maximum allowance for meals and lodging for railway construction employees working on a project. This allowance may be charged only when employees are entitled to it by their collective agreement.

The daily allowance is based on a minimum 8 hours of eligible work related directly to the project. When less than 8 hours of work is performed, the allowance to be paid is computed on the basis of an hourly prorate of the per diem rate. When overtime is performed, no hourly prorate of the per diem rate will be allowed. Additional allowances will not be made for any accommodation for railway employees, supplies, or any other costs in connection with meals and lodging.

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SALVAGE VALUES

Proper credit is allowed for salvaged crossing warning system materials. Crossing warning system materials removed from service for re-use are to be salvaged at 60 percent of current new price, and when used again, charged out at the same percentage. Material such as relays or other apparatus which must be repaired or rebuilt shall be salvaged at 25 percent of the current new price, and when used again after being repaired, charged out at 75 percent of current new price.

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INJURY OR DEATH

Payment of compensation claims for injury or death is not allowed.

DISCONTINUANCE OF RAIL OPERATIONS

The provisions of the CTA cease to apply to any crossings on a line once the operation of that line is discontinued pursuant to Division V of the CTA. Should a railway temporarily cease operations pursuant to Transport Canada Regulations, a reduced Scheduled Maintenance Rate may apply to cover the ongoing fixed maintenance costs.

RENEWAL

The Guide to Railway Charges for the Maintenance and Construction of Road Crossings will be reviewed by the Agency on an ongoing basis but the renewal of rates in this document will be carried out no later than every two years from the date of issuance.

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RAILWAY CONTACTS

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DEFINITIONS

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AGENCY ASSISTANCE

If any party wishes to seek Agency assistance in resolving issues relating to work performed at crossings, an application must be made in writing, include all supporting information, be signed by the applicant and be sent to the Agency at the following address:

Secretary
Canadian Transportation Agency
Ottawa, Ontario K1A 0N9

If you wish to hand deliver or courier your application, please use the following address:

Secretary
Canadian Transportation Agency
15 Eddy Street
17th Floor, Mailroom
Gatineau, Quebec J8X 4B3

Fax: (819) 997-6727

In addition, a copy of the application should be sent to each other party involved.

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PROCESS

In accordance with its General Rules, after receiving an application, the Agency ensures that each interested party has the opportunity to comment on the application and any disputed issues. In general, the Agency invites the other interested parties to comment within 30 days, and then allows the applicant 10 days to comment. The Agency reviews all material submitted, makes its final decision or determination, and issues the necessary decisions or orders.

The Agency must process all applications within 120 days of receiving the originating documents, unless the parties to the application agree to an extension.

Parties are encouraged to continue any negotiations even though an application may be before the Agency.

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DECISIONS AND APPEALS

Any Agency decision is subject to the following conditions:

• it is binding upon the parties and remains in effect until it is amended or rescinded; or until the line is no longer subject to Agency jurisdiction;

• it may be reviewed by the Agency, if there are new facts or circumstances;

• it may be appealed to the Federal Court on a matter of law or jurisdiction, within 30 days of the order or decision; and

• it may be appealed to the Governor in Council at any time.

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CONFIDENTIALITY

All documents filed with the Agency become part of the public record and may be made available for public viewing. However, in accordance with the Agency's General Rules, a claim for confidentiality can be made.

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OTHER AVAILABLE DOCUMENTS

• Agency General Rules
• Determining Net Salvage Value
• Environmental Assessment Procedures
• Guide to Certificates of Fitness
• Guide to Private (Farm) Crossings of Railways
• Guide to Apportionment of Costs of Grade Separations
• Guide to Railway Crossings of Other Railways
• Guide to Railway Line Construction
• Guide to Railway Operation Compensation
• Guide to Railway Works Cost Apportionment
• Guide to Relocation of Railway Lines in Urban Areas
• Guide to Road Crossings of Railways
• Guide to Utility Crossings of Railways
• Railway Safety Management Systems Regulations
• Railway Third Party Liability Insurance Coverage Regulations
• Resolving Disputes Through Mediation
• The Canada Transportation Act and the Rail and Marine Transportation Branch
• The Rail Infrastructure Directorate: A Guide
• Transfer and Discontinuance of Railway Line Operations and Railway Track Determinations

The above are available in alternate formats.

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FOR MORE INFORMATION

For more information or copies of the above documents, please contact one of the following staff members of the Rail Infrastructure Directorate:

Director
(819) 953-0327

Manager, Approvals and Determinations
(819) 953-0365

Manager, Engineering and Environmental Services
(819) 953-2117

Fax: (819) 953-8353
Toll Free: 1-888-222-2592
TTY: 1-800-669-5575 or (819) 953-9705

For more information on the Canada Transportation Act, the Agency and its responsibilities, or Agency decisions and orders, you can access the Agency's Web site at www.cta.gc.ca.

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SCHEDULE A: TYPE 1

Note 1: A base labour rate indexed for 2005/2006 ($34.16/$26.34) is calculated by dividing the total dollar amount paid to employees in each labour category which includes straight time, vacation, statutory holidays, overtime and other paid related benefits as well as a standby charge, by the total hours worked in the same labour category. A labour overhead rate (80%) to cover administrative expenses and costs relating to the company's portion of employee benefits is applied to the base labour rate.

Note 2 : The basic material cost indexed for 2005/2006 includes the total material items purchased for crossing maintenance plus a material overhead rate (54%) which covers the cost of administration, supervision, purchasing, inspection and accounting relating to the purchase and distribution of material items.

Note 3 : No overhead has been applied to the electricity cost.

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SCHEDULE A: TYPE 2

Note 1: A base labour rate indexed for 2005/2006 ($34.16/$26.34) is calculated by dividing the total dollar amount paid to employees in each labour category which includes straight time, vacation, statutory holidays, overtime and other paid related benefits as well as a standby charge, by the total hours worked in the same labour category. A labour overhead rate (80%) to cover administrative expenses and costs relating to the company's portion of employee benefits is applied to the base labour rate.

Note 2 : The basic material cost indexed for 2005/2006 includes the total material items purchased for crossing maintenance plus a material overhead rate (54%) which covers the cost of administration, supervision, purchasing, inspection and accounting relating to the purchase and distribution of material items.

Note 3 : No overhead has been applied to the electricity cost.

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SCHEDULE B

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SCHEDULE C

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SCHEDULE D

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SCHEDULE E

Methodology to be applied to calculation of operation costs:

No overheads are to be applied to the rental rates listed below.

Rental rates do not include the costs of operating equipment. Charges for employees operating equipment, equipment supplies and fuel can be charged in addition to rental rates. These labour charges can include the appropriate statutory and other leave, and supervision and administration overheads (see above).

These rental rates apply for each day of 8 hours that the equipment actually works on a project. When more than 8 hours work is performed on any one day by the rented item, additional rental can be charged computed on the basis of an hourly prorate of the per diem rate.