Month: December 2010

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The 2 percentage point reduction in payroll taxes for railroad workers covered by Railroad Retirement, and bus and aviation workers covered by Social Security, will NOT have a negative impact on either the Railroad Retirement or Social Security trust funds, as has been wrongly alleged by some.

Beginning Jan. 1, all workers will see an increase in their paychecks as a result of Railroad Retirement and Social Security payroll taxes being cut from 6.2 percent to 4.2 percent. The purpose of the tax cut is to stimulate the economy through consumer spending that will snowball into increased demand for products and new hiring by employers.

For workers earning $50,000 annually, the additional take-home pay from the reduced payroll taxes will be some $1,000 in 2011. For those earning the maximum Social Security and Tier I Railroad Retirement taxable income, the additional take-home pay will top $2,000 in 2011.

The payroll tax deduction will NOT have a negative impact on the Railroad Retirement or Social Security trust funds because the legislation provides that the shortfall in the trust funds — as a result of the payroll tax cut —  will be made up by a contribution to those funds from the U.S. Treasury’s General Fund.

The legislation is absolutely clear on this point. In Section 601(e) of the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010,
it is stated:

“There are hereby appropriated to [the Social Security Trust Fund] amounts equal to the reduction in revenues to the Treasury by reason of the application of [the payroll tax cut].”

This was confirmed by the Railroad Retirement Board, which advises that the payroll tax-cut legislation “provides for the transfer of money from the general fund to the Social Security Equivalent Benefit Account, one of the trust funds from which the Railroad Retirement Board (RRB) pays benefits, in an amount equal to the revenue lost due to the reduced payroll tax rate.”

Separately, the Social Security systems chief actuary, in a Dec. 10 letter to Treasury Secretary Timothy Geithner, said, “The law specifies that Social Security will receive every dollar it would have gotten even without the payroll tax cut.”

And AARP Executive Vice President John Rother said in a press release that the payroll tax cut “has no financial impact on Social Security because the trust fund is made whole.”

Said President Obama in signing the legislation: “Social Security is a sacred compact that in return for a lifetime of hard work, America’s seniors will have a chance to retire with dignity. We have an obligation to keep that promise and safeguard and strengthen Social Security for seniors, people with disabilities and all Americans, both now and in the future.”

WASHINGTON — A former John McCain operative has been nominated by President Obama to fill a Republican seat on the Surface Transportation Board.

The nomination requires Senate confirmation.

It is not clear whether there is sufficient time for the lame-duck Congress to act on the nomination. If not, the nomination is likely to be remade after the new Congress convenes in January.

The nominee is Ann D. Begeman, currently Republican staff director for the Senate  Commerce Committee, whose ranking Republican is Kay Bailey Hutchison (R-Texas).

Begeman previously was McCain’s legislative director (2004-2009), and served as a McCain spokesperson during McCain’s unsuccessful run for the White House against Obama.

Earlier, she was a Senate Commerce Committee staffer and also a legislative aide to Sen. Larry Pressler (R-S.D.), who made an unsuccessful run in 1980 for the White House.

Begeman earned a degree in business from the University of South Dakota.

If confirmed, she would succeed Republican Chip Nottingham, whose STB term expires Dec. 31. Under provisions of the Interstate Commerce Act, Nottingham may continue serving until a successor is confirmed, or not later than Dec. 31, 2011. Nottingham’s successor would serve through Dec. 31, 2015.

The three-person STB has regulatory authority over railroad mergers and labor protection for rail employees adversely affected by mergers, line sales and leases, and line abandonments. The agency also regulates railroad freight rates.

The other two STB members are Chairman Dan Elliott and Frank Mulvey — both Democrats.

DESOTO PARISH, La. — Two KCS workers, including UTU member Timothy Council, were wounded when a gunshot came through their locomotive window here Dec. 20, according to the Shreveport Times.

The engineer, Paul Griffin, 44, was inside the cab of his locomotive when a bullet struck him in the face. The bullet then struck the hand of conductor Council, a member of Local 781 in Shreveport, La.

Police told KSLA television news that the shot was fired by a man who had just purchased a gun and was checking his aim when the gun fired.

Griffin, said KSLA, was some 400 yards away when hit. Police said the shooter would be charged with illegal use of a firearm.

The Times reported Griffin’s wound as “non-life threatening,” and that he was in stable condition at a local hospital.

Council was treated and released.

Rails know them as Pandrol clips — the bent three-quarter-inch steel clips that fasten rail to concrete ties along Amtrak’s Northeast Corridor and some other locations.

In North Kingstown, R.I., reports the Providence Journal, some of the clips — each weighing about two pounds — have been breaking off, as Amtrak’s Acela passes over the tracks at 100 mph, and flying through the air.

One clip recently flew through the kitchen window of a North Kingstown home, and another hit the side of a home, and bounced back to the street, reports the Providence Journal. Another flying clip broke a picket fence. And at a North Kingstown factory, employees say the clips “boom off the building” on occasion. No injuries have been reported.

Amtrak told the Providence Journal that such incidents are rare, but acknowledged they been occurring since 2008. The problem also has been reported at Chicago’s Union Station.

Amtrak also told the Providence Journal it is removing loose clips and installing heavier clips in some locations.

Pandrol Track Systems, the manufacturer of the clips, told the Providence Journal that millions of its clips are used by railroads worldwide. Pandrol says the problem is not one of design or installation.

WASHINGTON — A national ban on cell-phone use by bus drivers has been proposed by the U.S. DOT. It is expected to be put in place before March.

Bus drivers already are banned by federal regulation from texting while working.

“Every time a commercial truck or bus driver takes his or her eyes off the road to use a cellphone, even for a few seconds, the driver places everyone around them at risk,” said the DOT, noting that fatal bus crashes jumped from 20 to 38 in 2009.

Almost 10,000 train and engine workers returned to work on Class I railroads through the first 11 months of 2010, with T&E jobs up almost 10 percent compared with November 2009, says the Surface Transportation Board, which tracks the data.

The STB says 61,819 train & engine workers are now on the job with Class I railroads.

The increase in train and engine workers during 2010 was more than double the increase in other crafts, said the STB.

By Transportation Secretary Ray LaHood

It is difficult to imagine what America would be like without its Interstate highway system. For decades, our state-of-the-art roadways have been the world’s envy — and rightfully so. They deliver products of agriculture and industry to market. They link people with schools, jobs, family and health care.

America’s highways will remain a crucial component of our national transportation network well into the future. But we can no longer rely exclusively on roads as a strategy for economic growth over the long term. That is why the Obama administration has begun the heavy lifting of building a national high-speed-rail system that will spur economic development and job creation along its corridors.

For years, we have watched other countries pass us by as they build faster trains.

The benefits of high-speed rail are tough to ignore.

It will seamlessly integrate large metropolitan communities and economies through a safe, convenient and reliable transportation alternative. It will ease congestion on our roads and at our airports. It will reduce our reliance on oil as well as our carbon emissions. And it will provide a much-needed boost to America’s hard-hit manufacturing sector during a time of economic struggle.

Since the president proposed his vision for high-speed rail last year, enthusiasm around the country has been overwhelming. To date, states have submitted applications for $64 billion — more than six times the amount of money available.

Interest in the program has come from the public and private sectors — from state governments, rail advocates, workers, environmentalists and a broad spectrum of businesses eager to help get America’s high-speed-rail industry moving.

In fact, last fall, 30 foreign and domestic rail manufacturers committed to employing American workers and locating or expanding their base of operations in the U.S. if selected for high-speed-rail contracts. And the administration’s 100 percent Buy America requirement is sure to generate a powerful ripple effect as manufacturers buy supplies and as workers earn and spend their paychecks.

Recently, some naysayers have argued that we are moving too slowly. Others contend that states are laying track in the wrong places. Two governors-elect declined to move forward on projects that their predecessors initiated.

The fact is this kind of monumental endeavor must take place in a deliberate, thoughtful manner.

As with Interstates highways during the 1950s, we have neither drawn every single route on the map nor reached final agreements on every single financing arrangement. Few states are in a position to quickly spend billions of dollars without detailed planning. Building a nationwide network of high-speed rail lines is not as simple as repaving a road. This is hard work.

Nevertheless, signs of progress are clear. In Vermont and Maine, workers are installing track that was manufactured in Columbia City, Ind.

Other states, such as North Carolina and Illinois, are laying groundwork for major construction in 2011. Florida is poised to become one of the first states with a true high-speed-rail line. And President Obama has committed to creating or improving 4,000 miles of track as part of his plan for America’s next major six-year transportation legislation.

The reality is that we cannot build our high-speed-rail network overnight. This sort of undertaking requires leaders of all parties and persuasions to come together. It requires states to work in concert. And it requires Congress and the administration to maintain focus and commitment.

By staying on track with President Obama’s vision, modern, high-speed passenger service could connect 80 percent of Americans and restore the United States’ economic competitiveness.

When we look to America’s past, it can be easy to forget that America was never predestined to have the world’s best highways. Progress only became possible because generations before us dreamed big and built big — because they imagined, invested and sacrificed for the infrastructure on which we rely to this day.

Like our parents and grandparents, we, too, must exercise the foresight and courage to invest in the most important infrastructure projects of our time.

If we work together, a national high-speed-rail network can and will be our generation’s legacy.

When Union Pacific took possession of six freight cars interchanged from a Mexican railroad at Eagle Pass, Texas, the manifest showed titanium ore as the contents, and a Chicago warehouse as the destination.

Customs agents were suspicious, and discovered, instead, almost 22,000 pounds of marijuana, reports the Chicago Tribune.

The agents resealed the pot and sent the cars on their way — under seal and under tight surveillance. When the pot was unloaded at the Chicago warehouse, agents arrested seven individuals, where the marijuana was formally seized, reports the Chicago Tribune.

With an estimated $22 million street value, the seizure, according to the Chicago Tribune, may be the largest marijuana seizure in Chicago history.

A UTU member will be collecting more than $95,000 in penalties assessed against BNSF by the Occupational Safety & Health Administration (OSHA) for the railroad’s violation of the Federal Rail Safety Act.

OSHA found BNSF guilty of intimidating and harassing an injured UTU member who reported his workplace injury to the Federal Railroad Administration. The monetary award covers back wages, compensatory damages, attorney’s fees and punitive damages.

This is the first major award by OSHA after UTU International President Mike Futhey requested UTU designated legal counsel ramp up efforts to assist members whose whistle-blower rights under the Federal Rail Safety Act have been violated.

BNSF employee Ronald Helm (Local 1532, Kansas City), targeted for discipline after being injured on the job, didn’t feel so helpless against his powerful employer after his local chairperson, Joe Lopez, attended a seminar on whistle-blower rights given by a designated legal counsel. Helm is a 33-year veteran of the former Santa Fe and BNSF.

With assistance from General Chairperson Jim Huston (BNSF, GO 009), and committee Secretary Rex Pence, a case was developed and presented to OSHA, which administers the law as it applies to whistleblower protection.

Helm had been assessed a 30-day record suspension with no time lost, given one-year probation, and assessed 40 points against his personal performance index after reporting his personal injury to the FRA. Had the injury not been FRA reportable, he would have been assessed only five points.

BNSF said the penalty against Helm was for using a pin lifter, instead of a hickory stick, to adjust mismatched couplers in BNSF’s Argentine, Kan., yard. Evidence showed BNSF had not made the hickory stick available until after Helm’s injury.

Moreover, according to OSHA, BNSF’s discipline was arbitrary because BNSF typically does not discipline workers for using different tools if work is performed in a timely manner.

“An employer does not have the right to retaliate against employees who report work-related injuries,” said OSHA. And BNSF’s points system serves to discourage the proper reporting of workplace injuries, said OSHA.

In addition to the monetary penalty, BNSF was ordered to inform each of its employees in its Kansas Division — and in writing — of their whistle-blower rights under the Federal Rail Safety Act of 2007.

“This case and the work of our designated legal counsel shows that the federal law protecting whistle-blowers has teeth and that it can and will be used to stop the intimidation and harassment faced by our members,” Futhey said.

“UTU members who think they have been retaliated against for reporting workplace injuries should discuss the matter with a UTU designated legal counsel, their general chairperson or state legislative director,” said Futhey.

Complaints must be filed with OSHA within 180 days of the alleged employer retaliation.

Click on the following link for a listing of UTU designated legal counsel:

https://www.smart-union.org/td/designated-legal-counsel//

Click on the following link for a detailed OSHA fact sheet:

www.osha.gov/Publications/OSHA-factsheet-whistleblower-railroad.pdf

Now that Congress has approved, and sent to President Obama for signing, the compromise tax cut and jobless benefits legislation, the question UTU members have, is, “What does it mean for me?”

  • For the jobless — and there are currently some five applicants for every available job in the nation — long-term federal unemployment jobless benefits are extended through Dec. 31, 2011.

These federal-aid benefits begin after an initial 26 weeks of state-provided jobless benefits. The federal benefits extend the 26 weeks of state-provided jobless benefits to 60 weeks in states with unemployment rates of less than 6 percent; and to 99 weeks in states where unemployment rates top 8.5 percent. It is estimated that some 3 million Americans have exhausted their initial 26 weeks of unemployment benefits.

  • Social Security taxes — and Tier I Railroad Retirement taxes — will be cut by two percentage points for employees for the entirety of 2011. The reduced payroll taxes — from the current 6.2 percent to 4.2 percent — are expected to boost the economy through increased spending by workers.

For workers earning $50,000 annually, the additional take-home pay from reduced payroll taxes will be some $1,000 over the course of the year. For those earning the maximum Social Security (and Tier I Railroad Retirement) taxable income, the additional take-home pay will top $2,000.

Additionally, the legislation:

  • Prevents income taxes from rising for millions of middle-class Americans — a tax increase that could have topped $3,000 per middle-class family.
  • Provides millions of middle-class American families with relief from the alternative minimum tax, which otherwise would have hit 28 million households instead of the current 4 million households.
  • Extends the dependent child-care credit, extends an increase in the adoption tax credit, and extends education tax credits (including an additional deduction for interest on student loans).
  • Extends relief from the so-called marriage penalty by increasing the standard deduction for joint filers to twice the standard deduction available to single filers.
  • Extends tax credits for energy efficient improvements to homes.

The legislation also provides tax relief for short line railroads that invest in their properties. The tax relief encourages more investment by short lines, protecting jobs of short line rail workers as well as Class I workers that benefit from the interchange traffic flowing to and from short lines that otherwise would travel by highway.