B-158733, APR. 27, 1966

B-158733, APR. 27, 1966

TO THE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO A LETTER DATED MARCH 15, 1966, WITH ENCLOSURES, FROM MR. GEORGE E. ROBINSON, DEPUTY ASSISTANT SECRETARY, CONCERNING A PROPOSED SUPPLEMENT TO BUREAU OF RECLAMATION CONTRACT NO. 14-06-700-4633 WITH THE MISSOURI PACIFIC RAILROAD COMPANY, RELATIVE TO THE RELOCATION OF THE RAILROAD'S FACILITIES IN CONNECTION WITH CONSTRUCTION OF GLEN ELDER DAM AND WACONDA LAKE, GLEN ELDER UNIT, MISSOURI RIVER BASIN PROJECT. THE PROPOSED SUPPLEMENT WOULD AUTHORIZE THE UNITED STATES TO REIMBURSE THE RAILROAD FOR ADDITIONAL CONSTRUCTION DETERMINED TO BE NECESSARY TO PROVIDE ADEQUATE SWITCHING FACILITIES AND SAFE OPERATING CONDITIONS AT CAWKER CITY, KANSAS.

UNDER THE TERMS OF THE BASIC CONSTRUCTION CONTRACT, EXECUTED ON JUNE 17, 1964, THE RAILROAD AGREED GENERALLY TO CONVEY ITS RIGHT OF WAY IN THE PROJECT AREA TO THE GOVERNMENT, AND TO PERFORM ALL WORK NECESSARY TO RELOCATE ITS FACILITIES OUTSIDE OF THE PROJECT AREA. THE GOVERNMENT AGREED GENERALLY TO REIMBURSE THE RAILROAD FOR ALL EXPENSES INCURRED IN THE RELOCATION IN ORDER TO GIVE THE RAILROAD FACILITIES IN THE NEW LOCATION AS NEARLY EQUAL AS POSSIBLE TO THE OLD FACILITIES.

PRIOR TO THE EXECUTION OF THE CONSTRUCTION CONTRACT, THE GOVERNMENT AND THE RAILROAD CONDUCTED AN ON-SITE INSPECTION AND ENTERED A PRELIMINARY CONTRACT UNDER WHICH THE RAILROAD PERFORMED PRELIMINARY ENGINEERING STUDIES AT GOVERNMENT EXPENSE. THE PLANS IN THE BASIC CONSTRUCTION CONTRACT WERE THE RESULT OF THE PRELIMINARY ENGINEERING STUDIES AND NEGOTIATIONS BETWEEN THE PARTIES TO RESOLVE VARIOUS ENGINEERING PROBLEMS. THE RAILROAD INCLUDED PROVISIONS IN THE PRELIMINARY PLANS FOR 2,100 FEET OF SETOUT TRACKS ADJACENT TO THE MAIN LINE AT GLEN ELDER AND CAWKER CITY SPURS TO FACILITATE SWITCHING OPERATIONS INTO THOSE TOWNS AS THE RELOCATED TRACK IS SOME DISTANCE TO THE NORTH OF THE TOWNS AND IT IS NECESSARY TO LEAVE SOME CARS ON THE SETOUT TRACK WHILE OTHERS ARE TAKEN INTO AND OUT OF THE TOWNS ON THE SPUR TRACK. THE PROVISIONS FOR THE SETOUT TRACKS WERE APPROVED BY THE GOVERNMENT AND INCLUDED IN THE CONSTRUCTION CONTRACT. AFTER EXECUTION OF THE CONTRACT, THE RAILROAD DETERMINED THAT, IN ADDITION TO THE 2,100 FOOT-SETOUT TRACK ADJACENT TO THE MAIN LINE AT THE CAWKER CITY SPUR, IT WOULD BE NECESSARY TO CONSTRUCT A 17-CAR SETOUT TRACK ON THE SPUR ITSELF WITHIN THE CAWKER CITY LIMITS IN ORDER TO PROVIDE SAFE AND ADEQUATE SWITCHING FACILITIES AT THAT LOCATION. WITHOUT THE ADDITION OF THE 17-CAR SETOUT TRACK, IT IS NOT POSSIBLE TO MOVE THE LOCOMOTIVE FROM ONE END OF THE TRAIN TO THE OTHER AND THE TRAIN MUST THEREFORE BE BACKED INTO OR OUT OF CAWKER CITY. THIS IS A TIME-CONSUMING PROCESS AS THE TRAIN MOVES MUCH MORE SLOWLY WHEN BACKING. ADDITIONALLY, AND MORE IMPORTANT, A SAFETY HAZARD IS CREATED AS IT IS NECESSARY TO BACK THE TRAIN ACROSS A MAJOR HIGHWAY. THIS SITUATION DID NOT EXIST BEFORE THE RELOCATION OF THE RAILROAD'S FACILITIES, AND DOES NOT EXIST AT THE GLEN ELDER SPUR BECAUSE OF DIFFERENT CONDITIONS THERE.

THE RAILROAD ADVISED THE BUREAU OF RECLAMATION OF THESE CONDITIONS IN A LETTER DATED SEPTEMBER 15, 1965, AND REQUESTED APPROVAL FOR THE CONSTRUCTION OF THE 17-CAR SETOUT TRACK AT GOVERNMENT EXPENSE. THE RAILROAD ORIGINALLY ESTIMATED THE COST OF THE ADDITIONAL CONSTRUCTION AT $22,005 AND SUBSEQUENTLY REVISED THAT ESTIMATE TO $11,465, BASED ON THE UTILIZATION OF SALVAGE MATERIAL FROM THE EXISTING LINE, AS PROVIDED IN THE CONTRACT. THE REVISED ESTIMATE WAS $8,995 LOWER THAN THE ESTIMATE MADE BY THE BUREAU OF RECLAMATION AFTER THE RAILROAD'S REQUEST FOR APPROVAL OF THE ADDITIONAL CONSTRUCTION, AND THE REVISED FIGURE IS ACCEPTABLE TO THE BUREAU.

THE BUREAU INITIALLY REFUSED TO APPROVE THE REQUEST FOR APPROVAL OF THE ADDITIONAL CONSTRUCTION ON THE GROUNDS THAT THE 17-CAR SETOUT TRACK WOULD CONSTITUTE A BETTERMENT SINCE IT WAS NOT NECESSARY BEFORE THE RELOCATION, AND THE CONTRACT REQUIRES THAT THE COST OF BETTERMENTS BE BORNE BY THE RAILROAD. UPON RECONSIDERATION, HOWEVER, THE BUREAU DETERMINED THAT THE ADDITIONAL CONSTRUCTION IS NECESSARY TO PROVIDE THE RAILROAD WITH EQUIVALENT FACILITIES AND THAT THERE WAS NO WAY FOR THE BUREAU OR THE RAILROAD TO DETERMINE THIS BEFOREHAND. IN VIEW OF THIS DETERMINATION, THE BUREAU RECOMMENDS THAT THE CONTRACT BE MODIFIED TO PROVIDE FOR GOVERNMENT PAYMENT OF THE COST OF THE ADDITIONAL CONSTRUCTION.

THE OVERALL INTENT OF THE CONTRACT WAS THAT THE GOVERNMENT WAS TO PAY ALL COSTS INCURRED IN PROVIDING THE RAILROAD WITH FACILITIES IN THE NEW LOCATION EQUAL TO THOSE IN THE OLD LOCATION. THE BUREAU OF RECLAMATION HAS DETERMINED THAT THE ADDITIONAL WORK REQUESTED IS NECESSARY TO PROVIDE THE RAILROAD WITH EQUAL FACILITIES AND IS NOT A BETTERMENT AS DEFINED BY THE CONTRACT. THE CONTRACT ALLOWS FOR REVISIONS OR CHANGES IN THE PLANS AND SPECIFICATIONS, SUBJECT TO THE APPROVAL OF THE RAILROAD AND THE CONTRACTING OFFICER. WHILE IT IS NOT CLEAR WHY THE NECESSITY FOR THE 17- CAR SETOUT TRACT IN QUESTION WAS NOT DETERMINED BEFORE EXECUTION OF THE CONSTRUCTION CONTRACT, WE FEEL THAT THE PROPOSED MODIFICATION OF THE CONTRACT TO PROVIDE FOR REIMBURSEMENT OF THE RAILROAD FOR CONSTRUCTION OF THE SETOUT TRACT IS PERMISSIBLE BECAUSE IT MERELY MAKES THE WRITTEN INSTRUMENT CONFORM TO THE INTENT OF THE PARTIES THAT THE RAILROAD BE PROVIDED WITH EQUIVALENT FACILITIES AT NO COST IN RETURN FOR ITS RELINQUISHMENT OF ITS RIGHT OF WAY WITHIN THE PROJECT AREA.

ACCORDINGLY, WE HAVE NO OBJECTION TO THE PROPOSED SUPPLEMENTAL CONTRACT ENCLOSED WITH MR. ROBINSON'S LETTER OF MARCH 15, 1966. THAT ENCLOSURE, ALONG WITH THE OTHER ENCLOSURES SUBMITTED WITH MR. ROBINSON'S LETTER, IS RETURNED HEREWITH.