Determining Net Salvage Value

The Act permits railway companies to discontinue the operation of railway lines provided certain procedures are followed. Section 143 of the Act states, in part, that a railway company must advertise the availability of the line that it intends to sell, lease or otherwise transfer for continued operations and its intention to discontinue operating the line if it is not transferred. If no persons, including VIA Rail, indicate any interest to purchase, in accordance with the advertisement, the line must then be offered in sequence to federal, municipal and district governments.

Eligibility Criteria

Federally-regulated railway companies, road authorities, a level of government or a party to a negotiation to acquire a railway line.

Summary

The net salvage value is the price at which the railway line is to be transferred. The railway line includes the track structure, land and may include sidings or station grounds.

Disputes
When there is a disagreement on a net salvage value, the Act presents the Canadian Transportation Agency (the Agency) as a possible avenue for solution. Under subsection 144(3.1), any party to a negotiation can request the Agency to determine the net salvage value. Under subsection 145(5), the railway company and the government have 90 days, after the acceptance of the offer, to agree on the net salvage value. If they cannot agree on this value, either party can ask the Agency to determine the net salvage value.

Please submit your requests to the Agency, in writing, at the following address:

        Secretary
        Canadian Transportation Agency
        Ottawa, Ontario  K1A 0N9
        Fax: 819-953-5564

In addition, you should send a copy of the request to the parties involved in the transfer or proposed transfer.

Manitoba Contact(s):
See National Contact.

National Contact(s):
Ms. Christa McClellan
Manager
Financial Analysis
Industry Determination and Analysis Directorate
Canadian Transportation Agency
Terrasses de la Chaudière
15 Eddy Street
Gatineau, Quebec  K1A 0N9
Telephone: 819-997-6105
Fax: 819-953-5564
E-mail: christa.mcclellan@cta-otc.gc.ca
Web site: http://www.cta-otc.gc.ca/rail-ferro/disco/salvage_e.html