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Saturday, November 22, 1997

Railroad commission votes to seek Union Pacific track divestiture

By JUAN B. ELIZONDO Jr. / Associated Press Writer

AUSTIN (AP) -- The federal government should force Union Pacific railroad to give up some 200 miles of train track in Texas, the state's Railroad Commission said Friday.

The commission, which has no authority to force the divestiture, voted 2-0 to ask the federal Surface Transportation Board to adopt, on an emergency basis, a Texas-written plan to give lines now owned by Union Pacific to Burlington Northern and Texas-Mexican, a joint rail venture between Kansas City Southern and a Mexican rail company.

Trouble-plagued Union Pacific announced this week it won't meet a self-imposed Thanksgiving deadline to fix gridlock and service problems that have disrupted thousands of rail shippers nationwide.

Railroad Commissioner Carole Keeton Rylander said the backup is affecting shippers now but will hit consumers soon.

"We're afraid Union Pacific will become the grinch that stole Christmas," Rylander said. She described the UP congestion as a "disastrous, double-wammy on the Texas economy and Texas lives."

The jam, according to Railroad Commission staffers, is centered near the Port of Houston. The commission said allowing other railroad companies independent access to shippers in the area will reduce the backup and give shippers a choice in rail lines.

Currently, other rail companies can get to the area only through Union Pacific-owned lines.

Mark Davis, a Union Pacific spokesman, said the lines Texas wants the railroad to give up won't help relieve the congestion and will seriously hurt the company's future. Union Pacific is in the process of merging with Southern Pacific railroad.

"Every rail line that we operate in Texas is very important to merging the Union Pacific and Southern Pacific together," Davis said.

The Surface Transportation Board meets Dec. 3. It could take up the divestiture call at that time.

Railroad Commissioner Barry Williamson, who's running for the Republican nomination for state attorney general, was not present for the vote.

He said he is concerned about government forcing private business to sell assets. He said a better solution would be to allow the free market to resolve the problem.