Employee Protection Provisions of the Rail Act Need Change

The Regional Rail Reorganization Act authorized a $250 million fund to pay workers whose compensation or working conditions were adversely affected by the reorganization of bankrupt railroads into Conrail. After more than 3 years, the program showed that costs would be far greater than originally expected. Estimates of the eventual cost ranged from $884 million to $1.7 billion, but none of the estimates could be relied upon as accurate predictions of the total cost. It was expected that the fund would be depleted in late 1979. However, the law required employers to continue paying eligible employees regardless of the state of the fund.