No. H029/05 For release March 9, 2005 TRANSPORT CANADA AND FARMER RAIL CAR COALITION TO BEGIN NEGOTIATIONS ON HOPPER CAR TRANSFER OTTAWA – Transport Minister Jean-C. Lapierre and Finance Minister Ralph Goodale today announced that the Government of Canada will open negotiations with the Farmer Rail Car Coalition concerning the possible transfer of the federal railway hopper car fleet to the coalition. "Over the past year, the Government of Canada has been working with the Farmer Rail Car Coalition on its innovative proposal to take over management of the federal railway hopper car fleet," said Mr. Lapierre. "It's time to focus attention on this proposal with a view to negotiating a commercial transfer agreement." "I hope these negotiations can be concluded successfully, so farmers can have the opportunity to demonstrate their capacity to be full-fledged partners in the grain handling and transportation system," said Minister Goodale. "This is an important step towards ensuring that western grain producers will have a long-term and affordable system for shipping their grain," said Andy Mitchell, Agriculture and Agri-Food Minister. "The coalition should be commended for its diligent work on behalf of grain producers." Currently, there are approximately 12,400 railway hopper cars in the government-owned fleet and they form the core of the rolling stock used by Canadian National Railway and Canadian Pacific Railway to move grain. These cars are provided at no cost to the railways for the transportation of grain from the Prairies for export through the ports of Vancouver, Prince Rupert, Thunder Bay, and Churchill. The Government of Canada has conducted a significant amount of due diligence during the review of the proposal to ensure that the business model the Farmer Rail Car Coalition has put forward is both financially viable and workable. The government has carefully examined the coalition's business case to ensure that it is consistent with both parties' shared interest in moving towards a more commercial, efficient and competitive grain transportation system that meets the needs of producers, railways and other stakeholders. These objectives are consistent with the input received in February 2005 from the Standing Committee on Transport, and from the stakeholder roundtable session held in Winnipeg in November 2004. As part of these negotiations, the government will ensure that the coalition's roles and responsibilities are clear, that its operations are accountable and transparent, and that the interests of the taxpayers are respected. "Today's announcement fulfils the commitment we made to farmers in the last federal election to work with the Farmer Rail Car Coalition to secure a viable future for the government's grain hopper car fleet," said Mr. Lapierre. "When I took office last year, I committed to making this issue a top priority, and thanks to the collaboration of stakeholders, industry and my cabinet colleagues, we finally have a solution in sight." The government expects to make a final decision on the transfer and all related terms and conditions in the spring of 2005. A backgrounder on the principles for disposal of the hopper cars is attached. - 30 - Contacts: Irène Marcheterre Director of Communications Office of the Minister of Transport, Ottawa (613) 991-0700 Patrice Breton Press Secretary Office of the Minister of Finance, Ottawa (613) 996-7861 Elizabeth Whiting Press Secretary Office of the Minister of Agriculture and Agri-Food, Ottawa (613) 759-1059 Transport Canada is online at www.tc.gc.ca. Subscribe to news releases and speeches at apps.tc.gc.ca/listserv/ and keep up-to-date on the latest from Transport Canada. This news release may be made available in alternative formats for persons with visual disabilities. BACKGROUNDER PRINCIPLES FOR THE DISPOSAL OF HOPPER CARS The following principles would guide the disposal of the government-owned hopper cars: Encouraging system efficiency, competition, commercial discipline and accountability. Fostering good relations within the industry, including meeting the needs of producers and other stakeholders without impeding overall efficiency of the grain handling and transportation system. Minimizing risk of trade challenges, especially by the United States. Ensuring adequate car supply for western grain movements. Optimizing value for taxpayers. Minimizing the financial impact on western producers. Ensuring an orderly transition. March 2005
