November 29, 2022

Lawmakers Aim to Pass Legislation to Prevent Railroad Strike

With the December 9 deadline for a railroad strike quickly approaching, President Biden yesterday called on Congress to intervene to pass legislation that would implement tentative agreements between labor unions and railroads and avoid disruptions that would likely impact many sectors, including water and wastewater utilities.

President Biden said his administration saw “no path” to resolving the dispute at the bargaining table, one in which four out of the 12 labor unions had not agreed to the proposed deals. Though eight unions have ratified the deals, a strike by one union obligates all 12 strike. As WaterISAC has previously reported on, even before a strike goes into effect industries reliant on certain shipments, including chemicals, would likely experience some effects as railroads embargo hazardous materials in a precautionary move. American Chemistry Council President and CEO Chris Jahn said, “Chemical manufacturers are less than a week away from being unable to transport chemicals critical to everyday life as railroads start to restrict service in advance of the strike deadline. Many of these chemical shipments are needed to protect public health and safety, including water treatment…” Although the President’s call seems to reduce the likelihood of a strike, it still must be negotiated and approved in Congress. Congress also has the option to extend a cooling-off period, allowing parties to continue negotiating until they reach an agreement, or force both sides to enter arbitration, where a third-party mediator gets involved. Read more at CNN, the Washington Post, and The Hill.

November 22, 2022

Possibility of Early December Rail Strike Looms

The likelihood of a railroad strike that would have significant and far-reaching implications for supply chains increased yesterday after one of the largest railroad labor unions voted against a tentative agreement. As WaterISAC reported on in mid-September when there were also concerns of a railroad strike, any disruptions that do occur could affect essential chemicals and other products water and wastewater utilities rely upon.

There are now four out of 12 railroad labor unions that have not agreed to the proposed deals, altogether comprising about half of the nation’s 115,000 rail workers. The four unions have agreed to try to hash out a contract before a December 5 strike deadline. If agreements aren’t reached and a strike does occur, Congress will likely have to settle the dispute by imposing contract terms. Even getting close to the deadline could cause problems because railroads will freeze shipments of chemicals and other hazardous materials. In September, when all of the labor unions had not reached agreements, multiple railroads started to embargo the transport of hazardous materials in a precautionary move, which included chlorine products. “[Association of American Railroads] data show that there was a drop of 1,975 carloads of chemical shipments during the week of September 10 when the railroads stopped accepting shipments due to the threat of a strike,” said Jeff Sloan, American Chemistry Council senior director of transportation policy. “We would expect a similar dramatic reduction in chemical shipments if an embargo were to take place this month.” Read more at the Associated Press and CNBC.

WaterISAC encourages its members to read the advisories below for recommendations on how to respond to and mitigate any supply chain disruptions that occur and become more resilient in the long term.

September 15, 2022

Tentative Agreement Reached to Avert Railroad Strike, Likely Preventing Significant Supply Chain Disruptions

Today the White House announced railroad companies and labor unions had reached a tentative agreement that is expected to avert a strike, keep freight trains running, and prevent significant supply chain disruptions.

The agreement must still be ratified by the unions, but those involved in the talks expressed optimism that a strike that could have resulted in nationwide supply chain disruptions has been avoided. In a statement, President Biden said, “I thank the unions and rail companies for negotiating in good faith and reaching a tentative agreement that will keep our critical rail system working and avoid disruption of our economy.” As WaterISAC reported on in an advisory sent to members yesterday, those disruptions were expected to involve chlorine and other chemicals important for water and wastewater utilities’ operations. In advance of the potential strike, rail companies started to embargo the transport of hazardous materials so that they wouldn’t be left unattended in the event of a work stoppage. These shipments are regulated by the Transportation Security Administration and are required to always be secured. In its update on the situation, Norfolk Southern reported, "We are moving immediately to resume normal operations and restore service that had been curtailed in anticipation of a potential strike."

Although significant supply chain disruptions appear to have been averted in this case, WaterISAC encourages its members engage in efforts to make themselves resilient to potential future supply chain challenges. Events over the past few years, including the COVID-19 pandemic, have revealed that supply chain issues can emerge from a variety of sources and aren’t always foreseeable far in advance. EPA’s recently published Supply Chain Resilience Guide for Water and Wastewater Utilities provides information utilities can use to mitigate the impacts of a future supply chain disruption. WaterISAC also encourages members to report supply chain disruptions they experience, to include by contacting EPA at SupplyChainSupport@epa.gov and WaterISAC at analyst@waterisac.org or (866)H2O-ISAC.

Read more at the Washington Post and the Association of American Railroads.

September 14, 2022

Potential Railroad Strike Could Cause Supply Chain Impacts for the Sector

Water and wastewater utilities may begin experiencing supply chain disruptions resulting from a potential railroad strike that could start later this week. The disruptions could include chlorine and other essential chemicals and products, some of which have already been impacted. These events necessitate utilities assess their status and that of their suppliers and consider mitigation actions.

Situation Overview
The potential railroad strike emanates from an ongoing labor dispute between major railroads and labor unions. In an effort to avoid a strike, last month a Presidential Emergency Board issued a report with recommendations for resolving the situation, which included a 30-day cooling off period (during which time work stoppages were prohibited) that ends at 12:01 am ET on Friday, September 16. Since the railroads and all of the labor unions have not reached agreements, multiple railroads started to embargo the transport of hazardous materials yesterday in a precautionary move. This includes chlorine products needed for drinking water and wastewater treatment systems. These shipments are regulated by the Transportation Security Administration and are required to always be secured. Therefore, railroads are pulling these shipments off their lines so they aren't left unattended if there is a work stoppage.

In the meantime, the railroads are prioritizing delivering essential chemicals and products that are currently en route to their destinations prior to the onset of a work stoppage. Additionally, if a stoppage occurs, they plan to prioritize shipping these products once it ends. They have also emphasized that a stoppage is not a foregone conclusion and that negotiations continue.

The following publications provide additional information on this situation:

• EPA - Railroad Transportation Limitations and Disruptions: Current Status and Potential Supply Chain Impacts
• Association of American Railroads - Railroads Prepare to Secure HAZMAT, Security-Sensitive Shipments Due to Labor Uncertainty
• The Washington Post - Freight Rail Strike Threatens Supply Chains, Prompting White House Planning

Mitigation Actions
Utilities should first assess the implications of a disruption in delivery of chlorine and other essential treatment chemicals, to include taking inventories and calculating the number of days of available supplies. Depending on their assessments, they should consider:

• Coordinating with suppliers regarding deliveries
• Conserving existing supplies
• Working with mutual aid and assistance contacts, such as the state WARN
• Consulting the state primacy agency to discuss steps that can be taken
• Communicating potential impacts to treatment operations to the public, especially if boil water advisories become necessary

For additional information on mitigation measures, WaterISAC recommends utilities review EPA's recently published Supply Chain Resilience Guide for Water and Wastewater Utilities.

Reporting Supply Chain Impacts
If your utility experiences a supply chain disruption, in addition to your state primacy agency (and any other entity required by regulations) you can report it to EPA at SupplyChainSupport@epa.gov. WaterISAC also encourages its members to report supply chain disruptions by emailing analyst@waterisac.org or calling (866)H2O-ISAC.

Please let us know if you have any questions.

- The WaterISAC Team