Shippers call for update to Congressional rail policies
In reaction to a letter sent by the House Transportation and Infrastructure Committee to the Surface Transportation Board expressing restraint toward the topic of competitive switching, the National Industrial Transportation League and other shippers' groups have called for an update of Congressional policies regarding railroad oversight.
In the letter, sent April 14, the shippers asked "that Congress provide appropriate oversight to update policies that will further reduce the need for government regulation by increasing access to multiple railroads and promoting free market principles."
The letter was also signed by the chairmen and presidents of the Alliance for Rail Competition, the American Chemistry Council, the Chlorine Institute and Consumers United for Rail Equity.
The authors stressed a need for parity between the railroads and shippers, saying "it is in our collective interests to ensure an economically strong rail network." But, they said, the current rail industry is not competitive because a rash of railroad mergers — there are currently seven Class I railroads; in 1980, there were 26 — have left shippers in an unfair position.
"We believe there are common-sense regulatory reforms that are consistent with the governing statute and deserve consideration to help address this growing problem. Stated simply, we believe that whenever reasonably possible, rail customers should be able to receive competing bids for their business," the authors wrote. "This fundamental business tenet is not possible today for rail-dependent customers whose facilities are served by only a single railroad."
Bill Shuster, chairman of the T&I Committee, and Ranking Member Nick Rahall sent their letter on March 14 in anticipation of the competitive-switching hearing held by the STB on March 25. The hearing addressed the pros and cons of a proposal by the NIT League to allow captive shippers to switch railroad providers when appropriate. The letter was also signed by Jeff Denham and Corrine Brown of the Subcommittee on Railroads, Pipelines and Hazardous Materials. In it, they urged caution in the proceedings, writing that the railroad industry is healthy and that there is no need to revise the Staggers Act of 1980, which lays out competitive-switching rules. They called to continue the “current policy of balanced regulation by the STB that is called for in the Staggers Act.”
Noting that the Department of Transportation has said freight shipments will rise by 62 percent by 2040 when compared to 2011’s numbers, Shuster and Rahall said the freight industry needs to have the leeway to make needed investments in its future.
“Any policy change made by the STB that decreases the railroads’ efficiency, and limits their ability to reinvest, grow their networks and meet the nation’s freight transportation demands both today and in the future will be opposed by this committee,” they wrote.
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