NDP’s complaint basis of Omnitrax railway probe

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This article was published 24/11/2017 (2870 days ago), so information in it may no longer be current.

OTTAWA — The federal transport regulator is investigating the Manitoba NDP’s complaint about Omnitrax abandoning its railway to Churchill, while the party says the agency should extend its probe to investigate cutbacks to service along undamaged parts of the line.

On Oct. 27, the Canadian Transportation Agency (CTA) sent Omnitrax’s Canadian head, Merv Tweed, a formal letter, kicking off a probe into whether the Denver-based company violated federal law by ending service along the Hudson Bay Railway without following the formal discontinuance process.

The probe could proceed to hearings, binding instructions or dismissal, and the agency aims to resolve the case by Feb. 27. The investigation came months after the Free Press reported the company was likely breaking federal law by not repairing its flood-damaged rail link to Churchill, a northern Manitoba town of 900 on the shore of Hudson Bay.

This week, the CTA provided the Free Press with the complaint it chose, amid a dozen submitted to the agency. The agency selected a detailed complaint written by an NDP researcher, whom the party would only provide for an interview on the condition he not be named, as he is not a spokesman.

The party’s complaint cites previous regulatory rulings, and a 1959 Supreme Court case that spelled out service obligations for companies that own rail lines. “If they let them off the hook, it is a precedent,” the NDP researcher said.

The NDP have asked the CTA to force Omnitrax to pay compensate people in Churchill and surrounding communities for their increased living costs, as well as the dozens laid off since July 2016. It also seeks $3 million in compensation for cuts to jobs in northern Manitoba.

“Omnitrax has abandoned their obligations under federal, Canadian laws to maintain and operate that railroad,” said MLA Tom Lindsey, the party’s caucus chairman, who has been following the crisis in Churchill. “Now they’re trying to walk away from all their obligations.”

Meanwhile, the mayors of Thompson and The Pas say Transport Canada still hasn’t reached out to them since late October, as safety and economic concerns surround Omnitrax pulling out its assets along the line.

Exactly a week after Ottawa threatened to sue Omnitrax on Oct. 13, the company phoned Thompson fuel suppliers to inform them twice-weekly freight service along the Hudson Bay Railway would be cut to once a week.

Since then, fuel suppliers have opted for deliver by truck, and suspect Omnitrax will cut back all rail service, which would require up to 250 fuel trucks per month. MP Niki Ashton has warned that will imperil safety on Highway 6 amid snow squalls.

In The Pas, Omnitrax has laid off dozens of staff, and companies have been worried about transporting goods east — though the town is still served by the CN Rail line to Winnipeg.

Energy Minister Jim Carr, a Winnipeg MP, spoke with Thompson Mayor Dennis Fenske on Oct. 31, and Transport Canada reached out to him within days.

But Fenske said Thursday he’s heard nothing since then. “I’m not surprised. We continue to trudge on.”

Jim Scott, mayor of The Pas, said he’s never heard anything from the federal government.

Last week, Carr announced Fairfax, a multibillion-dollar Toronto firm, had expressed interest in helping local groups run the line and Churchill port.

“It’s very encouraging that there is a corporation with experience and commitment to the north, that has indicated an interest publicly to sit down with the consortium,” Carr said Thursday. He referred questions about it to Transport Canada.

TC spokeswoman Mélany Gauvin said that a senior Industry Canada official spoke with Fenske on Nov. 15. But the mayor said that was about economic grants to deal with the rail situation — not concerns around safety or fuel costs.

Scott said he hasn’t heard anything about the takeover talks, or from Transport Canada.

“I should have had a bunch of information by now,” said Scott.

Both mayors believe Omnitrax targeted their communities in retaliation for Ottawa’s Oct. 13 legal threat. On Nov. 14, the feds have since filed a lawsuit seeking $18.8 million.

That same day, Omnitrax issued a notice it will seek arbitration under the North American Free Trade Agreement, claiming policies by Ottawa and the province intentionally sabotaged the rail line’s profitability, in order to expropriate it.

Meanwhile, the NDP staffer said even though the regulator has a three-month target to resolve his complaint, it might be settled before the lawsuit and NAFTA filing.

“Once these lawyers come in, these things get bogged down and there’s not any solution coming anytime soon,” he said.

The CTA says it received a response from Omnitrax on Nov. 20, meaning it’s now the NDP’s turn to respond.

Lindsey said the party will consider raising the issues in Thompson and The Pas.

“This railroad clearly is the lifeline, not just for Churchill, but for people along the line. Their costs have gone up exponentially when Omnitrax abandoned their legal, and moral, obligations.”

dylan.robertson@freepress.mb.ca

NDP complaint to Canadian Transportation Agency