The Interstate Commerce Commission is expected to vote today on a plan to direct the Kansas City Terminal Railroad to operate freight services on the lines of the financially troubled Rock Island Railroad.
The proposed action is intended to get farm shipments moving again on the Rock Island, shut down by a strike since Aug. 28, before the fall grain harvest hits full swing and causes even more serious disruptions. Grain elevators throughout the Midwest are reported full already, and farmers, harvesting the expected record corn and soybean crops, will be big losers without a resumption of rail service.
The Rock Island -- the official name is the Chicago, Rock Island & Pacific Railroad -- carries 10 percent of all Midwest grain and serves 1,650 grain elevators along its 7,200 miles of track in 13 states.
President Carter issued an order last Thursday directing the Rock Island's striking employes to return to work for a 60-day cooling-off period, but workers haven't yet appeared back on the job. Even if they did, the ICC staff and administration officials contend that the railroad -- in bankruptcy proceedings since 1975 -- lacks the money to resume operations, making an ICC "directed service" order to another railroad a necessity if freight services are to be resumed.
The ICC was urged to act in a strongly worded letter from Transportation Secretary Neil Goldschmidt, who said he was "shocked" at the handling of the troubled line by its courtappointed trustee, William M. Gibbons. Goldschmidt charged that Gibbons had failed to pay wages when due, had jeopardized the safety of the public and railroad employes, and had driven service to shippers steadily downhill.
"The Rock Island has maintained its corporate identity by running its physical plant and services into the ground and, more recently, by failing to pay its bills," the DOT secretary complained to the ICC. "Even as it is operating today, the Rock Island cannot continue."
Under the law, the ICC can direct another railroad to operate the services of a railroad that ceases its operations because of a cash shortage or a court order.
Although a federal judge in Chicago last week ruled that he couldn't declare the railroad cashless because it appears to have some money on hand, the ICC is expected to find that the railroad's cash position is so poor that it can't resume services. That paves the way for an order to another railroad to step in and begin operations on the Rock Island's lines, using its equipment and employes.
Members of the ICC discussed the proposed plan at an open meeting yesterday but delayed final vote pending the resolution of questions raised by several members.
The Kansas City Terminal Railroad, which is expected to get the go-ahead, is a switching company owned by 12 railroads, including the Rock Island and the financially ailing Milwaukee Road.