MM&A carried only $25 million in insurance for an estimated loss of $200 million, including clean up at Lac Megantic. Portland Attorney for MM&A ( and whoever those 20 anonymous investors are whose names we all need to learn).there will be no piercing the corporate veil of Rail World Inc. and their global assets to make up the difference..
I have never been to Lac Megantic but in photos I could see it is like any small Maine town and those who lost everything , including the lives of loved ones, are not in a position to navigate claims and pursue recovery of lost homes without a strong on site claims management loss assistance program on the ground.and doing active outreach at the time and immediately following. the accident.
It is not even clear given the apparent gross negligence that lead to this accident, gross negligence that was a matter of official MMA;A policy that insurance will click in at all. Insurance covers events which are neither “expected or intended”. What happened at Lac Megantic was forseeable. And its unlikely the $25 million is primary. More likely it is excess over a large self insured layer..ie that ordinary working folk in Lac Megantic will have to deal with a huge corporate structure, not the claims management section of a respectable domestic insurance company for any liability claims that will really enable rebuilding. ( Does anyone in any of our state agencies even have the capacity to properly review an insurance certificate if one were presented? Certainly I have never seen a reg by any state agency that suggests any basic knowledge of how property & casualty insurance works. )
I have been waiting three weeks for MDOT to turn over the State’s lease with JD Irving of the section of track we the people purchased for $20 million from MM&A to provide relief to these still unidentified “20 anonymous investors”. (Another $10 million in public funds is being invested in upgrade of this section of track leased back to JD Irving.)
I want to see, we all need to see, the details of that lease and I am hereby asking again, MDOT that the lease be posted at your website so we can all see what standards of safety and insurance protection attend JD Irvings operation of its leased track and whether we are getting back enough to amortize quickly enough our $30 million investment in the section leased to JD Irving.
I want to know,we all need to know, who these “20 anonymous investors” and through whom they lobby our legislature. “Anonymous investors” are never white knights.
I discovered doing research on Lac Megantic that through some law passed by our legislature the existing required reporting and fee for rail conveyance of petroluem product was suspended and that repeal takes effect in 2015..This is what funds State clean up of spills. Is this wise with JD Irving and Portland Pipeline and TransCanada all so eager to transport Alberta crude product across Maine?
And how safe is the Pan Am now doing the major weekly hauls of Bakken crude through the downtowns of dozens of Maine communities? The Pan Am has had two de railments already moving Bakken to JD Irvings St John refinery.
How much risk should “we the people” assume because JD Irving is determined to have Alberta and Bakken crude at its St. John refinery .
Is MDOT taking advantage of every opportunity to represent the interests of “we the People” on issues of safety, risk management, adequate risk financing,, adequate fees and accountability on hazardous spills?
The way its supposed to work is that the generators of the risk are responsible for adequate financing of that risk. On Rolling pipeline that is putting every community those trains pass through at risk that is JD Irving, Pan Am, and the about to reorganize through bankruptcy MM&A.
What are we doing to make sure one of our towns is not the next Lac Megantic all for the sake of JD Irvings corporate preference for Alberta and U.S. fracked petroleum ?
Lindsay Newland Bowker, C.P.C.U, A.R M., Environmental Risk Manager
President, NYC Chartered Property & Casualty Underwriters ( emeritus)
Board Member, NYC Risk & Insurance Management Society (emeritus)
Science & Research In the Public Interest
15 Cove Meadow Rd
Stonington, Maine 04681
August 8th Additional Information
Here is a general background on rail insurance that among oter things indicates that a typical small incident would average $30-$50 million per occurrence. Court papers on the bankruptcy show that MM&A has effectively been bankrupt long long long before it parked that train unattended on a main track with an incline..gross negligence but company policy…just to avoid a brake check and brake check report. That means that MM&A was under insured by about $5 to $20 million per occurrence as it only carried a single policy with a $25 million per occurrence limit. What good is self insurance from a nearly bankrupt company?
Among the more than 200 unpaid unsecured debts of MMA are all of its Maine employees owed severance pay and perhaps pay checks, many small business suppliers to MMA, many government agnecies and Maine utilities and of course all the investors the lawyer Clement representing MM&A in the bankruptcy petition. Jd Irving has the largest unsecured credit to MMA at $2.3 million.
How was the value of that section of track now leased to JD Irving established ? Why did we pay $20 million for the small section now leased to Irving for $1 a year. Why are we investing another $10 million (TIGER grant) of “we the people” money in that section JD Irving leases and why are tying up $30 million in public $ for this section of track that was to be abandoned by MMA. Are the services and investments JD Irving is perfrming for $1 a year a fair return on a “we the p” investment of $30 million?
Write to me if you want a copy of the court papers. I have no place to post. They are pdf and can be relayed via email.
August 10, 2013
Common Dreams Also concerned about the lost oridinary folk in this disaster
August 12, 2013
Canada suspends license of MM&A due to inadequate insurance and lack of ability to procure insurance
August 15, 2013
Claims and Disaster Relief Prseece on the ground in the wake of the Lac Megantic Disaster but not clear whether anyone is assistaing with liability claims or whether there will be any assets to pursue
August 15 , 2013
350.0rg expressing the threat of rolling pipeline to Lewiston Auburn
August 18, 2013
MM&A shows addutional isurance in the short term and alowed to continue operations in Canada intil October 1
August 19,2013 No surprise here..Irving, owed $2.3 million by MM&A in negotiations to Acquire MM&A Actually I am all for this if Mainers don’t have to pay anything except for the part about rolling pipeline with noo safety program
August 20,2013 another Canadian story on Irvings potential acquisition of MM&A
August 20,2013 No Surprise here either..Pan Am Rolling pipeline derailment #3
August 21, 2013 Lac Megantics Legal system in a crisis of lost records, destroyed offices
August 21, 2013 Lac Megantic Timeline
August 21,2013 Daily Kos Says Lac Megantic Just More of the Same from Ed Burkhardt
August 21 2013
Safety issues and citizen petition for rulemaking on retrofitting of DT111 cars that were involved in Lac Megantic. On a per tank basis this study says amortized cost is only $500/car per year.
In a stunning move Canadian regulatory authorities order Canadian Pacific Railroad to resupply MM&A with tank cars to continue its rolling pipeline operation through Maine despite Canadian Pacific Railroads written objection that MM&A does not have the infrastructure, management capacity or financial capacity to do so.
Canadian Senate Committee on Energy & Natural resources considering minimum insurance requirements for rolling pipeline
Montreal Gazette Editorial says cities deserve to know about hazardous materials moving on rail so close to their homes, businesses, downtown centers.
350 Maine and Earth First stage second rolling pipeline protest in Lewiston Auburn to call attention to the unacceptably high level of risk JD Irving is exposing every Maine community to for the sake if its desire for lower costs Bakken and Tar Sands at its St. Johns refinery
August 31 2013
Shift to rail cools refiner support for pipeline. Bad news for Maine as that will continue to keep pressure on using Maine’s CalssII track to move JD Irvings Bakken and Tar Sands to Its refineries in St Johns.
September 2, 2013
Bakken to be more closely examined by Rail Safety Officials
September 3, 2013
Enbridge discovered flammability and corrosivity of Bakken and has refused to accept Bakken. “In June, Enbridge won an emergency order to reject oil with high hydrogen-sulfide levels from its system after telling the Federal Energy Regulatory Commission that it found dangerous levels of the compound at a rail terminal in Berthold, North Dakota. Enbridge also won FERC permission to refuse shipment of any delivery of oil with hydrogen sulfide that exceeded 5 parts per million.”
– See more at: http://www.longtailpipe.com/2013/08/toxic-flammable-crude-oil-from-bakken.html#sthash.8aSFFPyu.dpuf
Two other pipeline companies have also raised concerns with regulatory officials
September 13, 2013
Canadian officials find severe deficiencies in 19 KM of MMA track in vicinity of LacMegantic disaster
September 18, 2013
Experts say lac Megantic MMA derailment is the worst environmental disaster in Canada’s history
September 22, 2013
Canadian regulators review insurance requirements for Canadian Licensed railroads
In Canada , as the government licenses railroads this would be enforceable and through insurance certificates and cancellation notices . In the U.S railroads are essentially self regulated with nominal mainly advisory oversight through the FRA.
October 5, 2013
Lac Megantic victims now possible victims of eminent domain. This is just too sad for words.
Canadian Regulatory Officals weigh minimum insurance requirements for all railways in Canada.
Losses and clean up costs at Lac Megantic greater than first realized due to greater volume of JD irvings Bakken crude spilled