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November 2021
By Jeff Stagl, Managing Editor
The Belt Railway Co. of Chicago (BRC) has served as an integral service provider in the nation's largest rail hub since 1882. The short line also has been a major clearinghouse for rail cars there since 1902.
Now the nation's largest intermediate switching terminal railroad, the BRC employs 440 people. Its operations center on the 786-acre, 5.5-mile-long Clearing Yards near Chicago Midway International Airport that features a double hump and 92 tracks totaling more than 250 miles.
On average, about 2 million cars are separated, classified and re-blocked in the yard each year. In a 24-hour period, train consists stretching a total of 40 to 50 miles carrying thousands of cars are classified. Reassembled trains then head to 12 hump yards and 17 flat yards throughout the United States, with some of the cars ultimately destined for points in Canada or Mexico.
About 27% of all North American freight moves through Chicago by rail, and the short line handles a fourth of it, BRC President Mike Grace estimates. In 2021, the Clearing Yards' hump traffic is averaging 3,131 cars per day and the short line's interchange traffic (carrier-to-carrier moves via BRC's mainline) is averaging 20 trains per day.
Although it long has played a common, yet vital role for most Chicago hub stakeholders, the BRC is rather uncommon by U.S. short-line standards. The railroad is a not-for-profit entity that serves the needs of its owners, the six largest Class Is. It operates like a shared joint facility, says Grace.
"We earn enough revenue to cover costs and investments in our capital program," he says. "We're like a toll road, we connect one owner to another."
The BRC also dispatches more than 8,400 cars per day on trains heading to all 48 continental states and parts of Mexico, serves 49 local customers and conducts business with the South Chicago and Indiana Harbor Railway, Chicago Rail Link, Chicago South Shore and South Bend Railroad, Wisconsin & Southern Railroad and Indiana Harbor Belt Railroad Co. In addition, Amtrak and Metra use its tracks, which include 28 miles of mainlines.
Moreover, the BRC repairs many cars and replaces about 3,200 wheels for multiple customers per year, says Grace. Earlier in 2021, wheel beds at the shop were more than doubled in size to hold 11 wheel sets, enabling the railroad to retain more stock on hand and stay ahead of replacement demand.
Given its multiple and unique facets, what's perhaps the best way to describe the short line? "A small specialty railroad that has a big impact on the rail industry" is the way Chris Steinway, the BRC's general counsel and director of human resources, characterizes it.
"There are other similar railroads in the United States, but not to our scale," Steinway says, referring to the Terminal Railroad Association of St. Louis, New Orleans Public Belt Railroad and other terminal railroads.
To keep filling what are awfully big shoes in Chicago, the BRC strives to ensure every aspect of operations is a tight fit with its mission. An ongoing push by the short line's leaders to forge that better fit involves efforts to modernize the organization, upgrade infrastructure, refine work processes and develop a new workforce mindset.
One major modernization undertaking was capped off last month with a grand opening. The BRC unveiled a new state-of-the-art command center in its main building that features 75 TVs showing different camera views of operations.
The command center houses 10 key employees in one location: the terminal manager, two yardmasters, two hump conductors, two dispatchers and three car operations clerks. They previously were housed in different buildings, and some of them had never met in person, communicating solely by phone, says BRC General Manager Percy Fields.
"It cuts down on phone calls, and helps bring more collaboration and comradery to the job," he says.
Another modernization effort bore fruit a little more than a year ago. The BRC partnered with BDO USA LLP — which designs software and systems — to develop a new car inventory system. Implemented in July 2020, the web-based system took four years to develop, says Grace.
Now known as Belt Apps, the new system replaced a 30-year-old, "green-screen" system that was based on antiquated COBOL computer language, he says. Belt Apps is used to manage car inventory, electronic data interchanges and other functions, and store such information as air brake test records and train schedules.
"It's now more user-friendly with a better user interface," says Grace. "It makes car locations more transparent for car owners."
In terms of a technological evolution, Belt Apps is "like going from the Flintstones to the Jetsons," says Fields.
There's another impactful technological change looming on the horizon: By year's end, the BRC plans to implement PS Technology's CrewPro™ automated crew calling system. CrewPro software is designed provide real-time crew supply and demand matching, reduce employee qualification information upkeep and simplify travel accommodation scheduling.
The BRC will use the software to set parameters for employees, such as hours and vacations. CrewPro will enable the short line to consolidate crew-caller positions to gain cost savings, says Fields.
"And the crew person will not be spending all day making calls," he says.
BRC leaders also hope to gain workforce efficiencies and accident-prevention results from a new safety training program that was implemented on Jan. 1. The short line previously had no data to support safety training, says Fields.
"The program was quantity driven instead of quality driven," he says.
Fields analyzed 10 years' worth of injury reports and drilled down on a number of factors to better understand safety risks and make training efforts more predictive.
"For example, on a Wednesday, we could tell a mechanical department employee they likely would be at risk if they were welding because, historically, that's what the data showed," he says.
The frequency of safety testing was changed from yearly to quarterly.
"We can adjust risks on a quarter-by-quarter basis. We now base testing on data, so an employee better knows rules and testing requirements, and what to do to be safe," says Fields.
Management training also got a makeover, becoming more formalized and continuous, and experienced workers now help provide some training for craft employees rather than having it outsourced, says HR director Steinway.
"The training then is more focused to our railroad," he says.
A more focused organization was the goal three years ago, when Grace began implementing mission command. The military strategy is a way to determine what and why something needs to be done, and enable a leader to remain focused on realizing a company's vision while empowering subordinates to determine solutions.
Mission command helps better align teams and fosters autonomy and ownership among subordinates, who tend to become more passionate, creative and focused on objectives as a result.
Since forging more efficient and productive operations is another organizational goal, adopting longer trains in the yard made sense. Recent process and mindset changes enabled the BRC to build its first-ever 15,000-foot, mixed-manifest origin train in May. Now, the railroad builds two such trains each day, says Fields.
It took a fresh set of eyes and questioning historical norms to implement the change, he says. The short line was able to take a train that was once was limited to 8,000 or 9,000 feet pulling about 100 cars and built a longer train pulling 250 to 300 cars that departs from a different direction out of the BRC without adding tracks or costs, says Fields.
"It's simply about asking ourselves what we can do versus focusing on what we can't do. It's been paying dividends all around," he says. "This reduces dwell and creates capacity in one fell swoop."
Creating capacity — and gaining efficiencies — are similar objectives for the capital program. The 2021 program mostly involved replacing a century-old bridge, repairing five other bridges, installing 25,000 ties and some curve rail, and replacing a major retarder in the yard.
Crews replaced the 100-year-old Holland Road bridge on the Kenton Line earlier in fall. The project included upgrades to the 87th Street interlocking and the site's signal system, and the installation of two new cantilevers.
Another major project this year involved replacing the yard's master retarder and group 3 retarder. The railroad contracted Cranemasters Inc. to handle the project, which required an 18-hour track outage in July.
During the outage, BRC crews also performed a yard sweep of all tracks that were out of service to clear debris, replaced switch components and ties, and performed surfacing work. The Clearing Yards has 19 retarders, including 10 in the east classification bowl and nine in the west bowl.
In 2022, the BRC is anticipating a more standard capital program year, with most of the work involving tie replacements and surfacing work, says Grace.
The short line also expects to derive infrastructure-improvement benefits from the ongoing Chicago Region Environmental and Transportation Efficiency (CREATE) program. Among the more than $4 billion program's 70 projects, the BRC expects to be positively impacted by planned grade separations at Columbus Avenue, Archer Avenue and 65th Street, and the Forest Hill Flyover that's part of the large 75th Street Corridor Improvement Project.
To start next year, the Columbus Avenue grade separation calls for building an overpass or underpass to eliminate a grade crossing involving three BRC tracks, while the 65th Street separation — which also will involve an overpass or underpass to eliminate a crossing with two BRC tracks — is in final planning stages. The Archer Avenue separation is further out from the construction phase, says Grace.
Projected to start in spring 2022, the Forest Hill Flyover will help significantly reduce conflicts between BRC, CSX, Norfolk Southern Railway and Metra trains. It will be a game changer just as the CREATE program's Englewood Flyover has been for NS since it was built in 2014, says Grace.
Ultimately, the CREATE projects will help eliminate bottlenecks and speed up trains, he says.
"All the projects also will open up capacity significantly," says Grace.
What's helped the BRC significantly in terms of guidance and execution is a change in the leadership team's makeup, says Fields. Instead of continuing to be staffed only by homegrown BRC talent with short-line experience, the team now includes individuals with a mix of experiences, including Class I stints.
For example, Fields spent nearly 20 years at Union Pacific Railroad in superintendent and dispatching roles prior to joining the BRC in March 2020 to fill the newly created GM position. And Grace served NS for 38 years — including a stint as a division superintendent — before he assumed the BRC's top post in May 2018.
"We gain two perspectives instead of just having one," says Fields. "We're having more productive conversations now."
The BRC also has consolidated 29% of management headcount since May 2018 — going from 52 to 37 active managers — through attrition, a reorganization of the work chart and work flows, the adoption of technologies and increased use of contractors.
"We have a more focused management team now," says Steinway. "We have brought in best practices and made updates to procedures."
Meanwhile, the finance management team has gained four new faces over the past couple of years, transitioning from members with 100 years of total experience — all of whom retired — to those with less than 10 years of experience. Led by Chief Financial Officer and Controller Brian Dilger, who assumed the post in September 2019, the team includes an accounting manager, accounts payable manager and revenue accounting manager.
"We're learning on the job and asking a lot of questions. Before, the team didn't rely as much on innovations and new technologies, and now it's necessary to do that," says Dilger.
For example, the BRC recently employed timekeeping automation and the use of purchasing cards — account numbers issued to those responsible for making purchases or payments on behalf of the employer — for smaller purchases.
Since cost control is vital to the BRC, the short line focuses heavily on cost per car, a measure that shows if fluidity is maintained in the yard.
"We are tracking to plan on cost per car. The volume of cars drives it — we need to stay busy and fluid," says Dilger.
The finance team also is trying to rein in other expenses, such as overtime and fuel. Fuel costs have shot up 50% this year for the railroad, which operates 30 locomotives, says Dilger.
"We are focusing on consumption, trying to be as efficient as possible," he says. "At certain times of the year, locomotives can be turned off when not needed."
In terms of traffic, volume has been steady so far in 2021, says Grace. Volume fell 14% last year due to pandemic but has since bounced back, reaching a level that's consistent with pre-COVID traffic in 2019, he says.
"We don't handle intermodal, autos and auto parts, and don't handle much coal, so there's the benefit of not having to deal with that volatility," says Grace.
Going forward, "be prepared and proactive" is the mantra to ensure the organization can handle whatever comes its way. That includes major snowstorms. In February 2020, 30 inches of snow fell on the yard, which proved extremely difficult on operations, says Grace.
Now, the BRC is stockpiling salt, preparing snow brooms and prepping staff to work around the clock in case Mother Nature strikes hard again.
"We have to get ready for winter. And be ready for anything," says Grace.
Email questions or comments to jeff.stagl@tradepress.com.
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