Nevada small businesses exempted from new railroad safety rules

Wednesday, Aug. 2, 2000 | 11:10 a.m.

CARSON CITY -- The staff of the state Public Utilities Commission retreated Tuesday from a proposed regulation that could have cost some small Nevada businesses hundreds of thousands of dollars to upgrade railroad spurs on their property.

Staff Counsel Jacqueline Rombardo told a hearing on railroad safety rules that the staff never intended to include businesses with less than 150 employees with the big railroads that run through the state.

For some small businesses, she said, "the cost of upgrading would have been half-a-million or 1 million dollars. That was not the staff's intent."

Keith Lee, a Reno lawyer representing real estate developer Dermody Properties, said in a letter to the commission that Dermody has 20,000 lineal feet of railroad track. Complying with the rules "would be very expensive without the realization of any commensurate benefit," he said.

The regulations deal with such things as hauling of hazardous wastes, bridge inspections and walkway standards adjacent to tracks. They were proposed by the unions and opposed by Union Pacific and other railroads. But the parties negotiated for more than three hours Tuesday and reached a consensus on new regulations, which must be approved later by the commission.

PUC Commissioner Richard McIntire, who presided over the case, started the hearing in March. But he recessed it and ordered the staff to conduct a study on the impact of the regulations on small business.

A new law went into effect Jan. 1 designed to protect small business from burdensome government rules and the PUC may have been the first agency to do a study to see if small businesses would be harmed by proposed regulations.

If an agency finds there is a "direct and significant burden" on small business, the law says the department must work with the companies to reduce the impact, such as lowering the standards for small firms, imposing smaller fines for violations and simplifying the rules.

Rombardo said neither the railroad nor the union objected to exempting small businesses from the regulations.

After a consensus was reached between the railroads and their unions, McIntire recessed the hearing until Aug. 22, when a final hearing will be held. The proposed regulation will later be presented to the full PUC for approval.

The regulation would require railroads to "develop and implement emergency planning and response procedures for handling releases of hazardous materials in the state." There must be a telephone staffed 24 hours a day to report emergencies. The railroad must have procedures in place to notify authorities and how to respond to unexpected events.

Include in the regulation is a requirement for the railroads to report the hazardous materials being carried through the state.

Railroad bridges would have to be inspected at least once a year. And if the staff of the PUC has a concern, the railroad must inspect the structure within one working day.

The most contentious section of the regulation dealt with the areas adjacent to the tracks. Union officials said these areas are sometimes too narrow or on too steep a grade to allow a worker to do repairs. The two sides agreed to follow a regulation approved in California for rail safety in addition to some new standards for Nevada.

And the proposed Nevada regulations set standards for a minimum walkway, the surface type and the allowable slope.

Railroad officials initially said the proposed rule by the unions would have cost the company $500 million to make the necessary upgrades. After the agreement, both sides said they could live with the new compromise.