March 10, 2004

To: The Honorable Governor Arnold Schwarzenegger, California Performance Review, Legislature, Additional Responsible Officials & Media,

Subject: Saving Tax Money at the California Public Utilities Commission

To help streamline state government and make it more honest, we should end the state’s “participation” in the federal railroad safety program. Safety is one of those “good things” everyone supports. But California’s role in railroad safety is largely counter productive and mostly a waste. This is because:

1. the state merely duplicates the federal government’s rail safety program duties,
2. the state has almost no authority to adopt any rail safety regulations of its own,
3. the state “program” is undermined or subverted, anyway, as it includes at least two managers who work with or for the largest railroads in California,
4. the state “program” costs several million dollars a year, and
5. it is misleading for California to pretend it still regulates railroad safety when in fact it does not, and has not for several years.

Railroad safety is regulated by the Federal Railroad Administration, not California. California laws on this subject are anachronisms, now almost completely pre-empted by the feds [see Volume 49 of the Code of Federal Regulations and the federal court decision pre-empting California’s last, best effort to exercise some authority: the Southern Pacific vs. CPUC (Dunsmuir chemical spill) case]. Congress has given the FRA power to adopt any further necessary rail safety regulations, too. The FRA has inspectors in all railroad safety disciplines with FRA offices in both northern and southern California. The FRA can bring in more inspectors if needed, and any serious rail accidents are already investigated by the FRA and often also the National Transportation Safety Board.

The manager of the state rail office, Mr. Petrosian, does whatever the big national railroad corporations want. He routinely pre-informs (“leaks”) inspection schedules to the railroads, letting them “dress up,” or hide many safety violations. He threatens and punishes state inspectors who write up “too many” violations against the big railroads. He permits no actions resulting in any fines being paid into the state treasury, allowing only the minimum number required to satisfy the feds. The few violations that get through him are all submitted to the FRA on FRA forms for violations of FRA regulations, with all fines paid to the feds. Complaints to the CPUC’s Executive Director Mr. Franidin are routinely “covered up” (he only gives excuses or ignores them entirely). Nobody can trust the CPUC, not here in the industry nor within its own staff

This is a fraud (telling people the state regulates rail safety when it doesn’t). And, little public benefit can result from corrupted management. Let’s end this costly farce and let the Federal Railroad Administration do its (federal) job - at federal expense.

(Editor’s note: Name of sender not easily discernible)