INTRO: The last decades have seen numerous unprofitable secondary and branch lines spun off to regional and short line operators. The Indiana Rail Road demonstrates how labour flexibility, innovative technology, and close attention to service can turn once marginal routes into successful regional railways, reports William DMiddleton

ESTABLISHED IN 1986, Indiana Rail Road took over a large part of an Illinois Central Gulf branch, extending from the north-south ICG main line at Effingham, Illinois, to Indianapolis. Once embargoed by the Federal Railroad Administration for its poor track condition, the line had been upgraded between 1979 and 1981 with federal and state funds, but its infrastructure was still in a marginal condition and traffic was falling.

Headed by President & Chief Executive Officer Thomas G Hoback, the Indiana Rail Road (INRD) group saw good prospects for profitable independent operation hauling coal from southwestern Indiana and from connections with Class I railways.

The group’s initial acquisitions from ICG included 175 km between Indianapolis and Sullivan in Indiana, and a 13 km branch south from Bloomington that was quickly abandoned. Another 74 km between Sullivan and Newton, Illinois, was acquired from Illinois Central in 1990, and INRD also obtained 56 km of running powers, extending its reach north to Noblesville, and west to Lis. Although CSX Transportation acquired a majority interest in 1995, the company continues to operate independently.

By focusing on the development of new traffic, the railway has seen a steady growth in tonnage, and has been consistently profitable. By 1989, the annual total of just over 22000 carloads was almost double the 12000 handled in ICG’s last year.

Traffic has continued to grow, reaching a peak of 67779 carloads and 673741 tonne-km in 1999. This year the railway is on target for an annual total of 100000 carloads and about 1million tonne-km.

This kind of growth reflects both the new services developed by the railway and a focus on service quality and reliability to win traffic back from the roads. Innovative services include the Transload distribution facilities which receive carload shipments of materials such as timber, brick, steel, plastics and foundry sand. Storage, inventory, and reshipment services are provided for customers.

According to Hoback, ’value-added’ traffic brings in revenue from both freight and distribution. The largest transload site is the Indiana Reload Center, which occupies 20ha of the Senate Avenue Terminal in Indianapolis. It can unload up to 20 cars at a time, and store over 100 cars for later distribution. Smaller centres are located at Bloomington and Bloomfield, and taken together the centres currently account for about 1000 annual carloads.

Favourable rates and a high quality of service are combined with trunk line connections allowing the railway to capture a substantial volume of business from industries that previously sent freight by road.

At Bloomington, carload shipments of television sets from an RCA plant had been lost to road hauliers. Soon after it took over, INRD developed a favourable service to the West Coast via Conrail and Union Pacific to recapture traffic that averages about 1000 carloads annually.

At the Marathon-Ashland refinery in Robinson, ICG was handling 1800 to 2000 carloads of by-products per year. Indiana Rail Road has raised its refinery traffic to about 10000 carloads annually by coming up with a reliable tank car service for feed stocks that previously moved by pipeline, allowing the refinery to free up pipeline capacity for other products.

Important to the success in developing new traffic has been the availability of connections with CSX, Norfolk Southern, Canadian Pacific and Canadian National. ’Having four trunk line connections gives us enormous flexibility that we wouldn’t have with only one or two’, says Hoback.

Unable to work out a suitable movement for western coal to a Newton, Illinois, power plant using its Illinois Central connection, Indiana Rail Road found an alternative route via the Canadian Pacific connection at Linton, Indiana. INRD now moves 4million tonnes of coal to Newton each year.

Grain from elevators in Illinois formerly moved by rail only when it was going to traditional ICG markets in Cairo, New Orleans or Illinois. When grain shippers had better markets in the southeast, the traffic moved by road. INRD has developed new routes with its connections, and this traffic now goes by rail. Hoback explains ’we give our shippers the ability to play the markets better.’

Key to the success and profitability of the railway has been the labour flexibility of a non-union workforce that gives both improved operating efficiency and a better service. The railway is now negotiating its first labour agreement with the Brotherhood of Locomotive Engineers, but Hoback expects it to be a good agreement, noting that the union has already agreed to the key elements that give the railway its labour flexibility.

’Flexibility has been a key to our success’ says Hoback. ’We do as much cross-training as possible’. Everyone in INRD train service is qualified as conductor and engineman, and they typically work half of each shift in each category to maintain their skills.

As many employees as possible are qualified on all parts of the railway. Operating staff are empowered with a high degree of flexibility, with the authority to make immediate decisions on pick-up, delivery, and classification of wagons. Hoback cites as an example the case of the Marathon-Ashland refinery at Robinson, where train crews work closely with refinery staff to handle extra shunting and frequent special wagon movements: ’our crews are responsive, they are a key part of our marketing.’

Training and safety are emphasised. Enginemen go through an intensive training programme including classroom instruction, field training, and the use of locomotive simulators. The strong emphasis on safety is reflected by the winning of the Jake Jacobson Safety Award in 1996, 1997 and 1998.

Technology cuts crew sizes

Innovative application of technology has enhanced crew productivity, and Indiana Rail Road is among a growing number of railways using remote control of locomotives. Yard shunting at Indianapolis, Palestine and Robinson makes use of remote control. To protect employees ’remote control zones’ are used. Operators are able to lock out yard access, requiring other train crews to obtain permission from them before entering.

At Bloomington, remote control has enabled INRD to provide a switcher at General Electric’s appliance plant; this would have been uneconomic with a normal two-person crew.

Technology is an essential element of the single-manning programme. Two daily unit trains are run with one-man crews, and the goal is to operate all unit trains in this way. Locomotives in one-man service are fitted with GPS equipment so that the dispatcher always knows its exact location. All enginemen in one-man service are medically certified and re-examined annually. An alerter monitors operator control inputs, prompts for a response if no activity is detected, and initiates an emergency stop if there is none. It also notifies the dispatcher of an emergency, including the train number and location.

Upgraded radio equipment provides full coverage of the network, allowing constant contact with the dispatcher. If a trainman fails to check in at the required interval, the dispatcher initiates contact, and can activate the cab alerter or even emergency braking if necessary. To enhance the driver’s field of vision, locomotives are equipped with video. One camera is mounted on top of the loco, and another provides a view back along the train from the left-hand side.

Reflecting the gains from remote control and one-man crews, INRD’s average crew size had dropped to only 1·54 by the first quarter of 2001.

As part of a complete rebuild of its Palestine yard two years ago, the railway installed 15 solar/battery-powered hydraulic turnouts. These can be activated either from the switch or by remote control. A protection loop prevents actuation beneath a train. The turnouts both speed up operations and reduce injuries, and more will be installed wherever there is intensive shunting.

Other technology applications still on trial include the use of on-board computers linked by radio to the company’s network. These will permit train crews to do on the road work that is now carried out at the office, such as preparing shunting lists, car movement reports and payroll data.

Also in the trial stage is a level crossing protection system developed by Harmon Industries. This is monitored via computer and telephone lines. Any failure to activate or a false activation of the self-diagnosis system will initiate a signal to the dispatcher.

Infrastructure improvements

Indiana Rail Road initiated an infrastructure upgrade programme when it took over the line in 1986.

Between 1996 and 2000 the railway completed a $20m capital programme financed through internally-generated funds. This is designed to support a 50% increase in traffic over the next five years.

Much of the track in Indiana was originally laid with 45 kg/m jointed rail, and the sleepers, surfacing, and drainage were in poor condition. In its first year the railway put around $1m into track improvements, including 11 km of new 58 kg/m rail, 13000 new sleepers, and many tonnes of ballast. In 1988-89 another 27 km of 45 kg/m rail was replaced with 58 kg/m stock.

The 1996-2000 programme included replacement of another 113track-km of rail, installation of 150000 new sleepers, and the strengthening of bridges for 130 tonne cars. The yards at Palestine and Robinson were rebuilt from the subgrade up. This summer INRD expects to raise line speed to 64 km/h, giving faster times and improving productivity.

Switz City is a central point for INRD operations and the home base for most train crews. The capital programme included a new maintenance and fuelling facility, replacing older premises at Indianapolis and Palestine. Locos are now refuelled at Switz City as they pass through.

The improvement programme includes expansion and upgrading of the loco fleet. The current motive power roster is made up of 31 rebuilt Electro-Motive diesel-electric units of a variety of models, ranging from shunters to SD10, SD18, and GP16 locomotives. To meet future capacity needs the railway is moving to more powerful 3000hp SD40-2 locos, of which four are already in service.


Looking ahead, Hoback anticipates significant growth. At Bloomington, for example, INRD is almost ready to go ahead with construction of a 5·6 km spur that will give it access to a quarry shipping 2 million tonnes of aggregate annually. A similar 8 km extension for a southwest Indiana mine is under consideration, and could win the railway 1 million tonnes of coal a year now moving by lorry.

Hoback also talks of forming strategic marketing initiatives with other railways to compete for other coal traffic now moving by road.

CAPTION: INRD has developed storage, inventory and reshipment services to add value to its traditional role

CAPTION: INRD makes effective use of new technology. All locos with single-person crews have GPS equipment

CAPTION: Remote control shunting at Indianapolis, Palestine and Robinson has helped to reduce INRD crew sizes

CAPTION: Connections with trunk lines give INRD the ability to attract and develop new business