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STB to Hold Hearing About Rail Competitive Switching

Volume 2, Issue 3
February 15, 2014
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A hearing by the Surface Transportation Board to explore the issues raised by a proposal to allow more railroad competitive switching will be held March 25-26 at STB headquarters in Washington, DC.

railroadThe National Industrial Transportation League petitioned earlier for the STB to modify its standards and grant captive shippers increased access to competing railroads if there is a working interchange within a reasonable distance (defined as 30 miles by NITL).

The board said it decided to schedule the hearing to deal with issues raised by the numerous comments it has received in response to NITL’s proposal.

The league asserts that its proposal will make the railroads more competitive and save shippers with access to only one line about $900 million annually.

The Association of American Railroads told the STB that Class I railroads could lose revenue up to 80% of their entire annual capital budgets if competitive switching is adopted. AAR says Class I railroads would suffer yearly revenue losses of up to $7.8 billion if the proposal is adopted, an amount that NITL disputes.

The league has informed the STB that its research shows 78% of the 28,000 places throughout the United States with rail service are served by a single major railroad, including 70% of chemical plants. NITL also told the board that for agricultural products, whole regions and in some cases entire states are served by only a single major railroad.

Scheduled to appear at the March hearing are representatives of NITL and AAR, along with individual shipper and individual rail companies, including coal, agricultural firms and both Class I and short-line railroads.

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