WASHINGTON – The Association of American Railroads Nov. 21 issued the following statement from President and CEO Edward R. Hamberger in response to the Senate Commerce Committee staff report Update on the Financial State of the Class I Freight Rail Industry.
“Unfortunately the Committee’s updated report ignores that the rail industry’s return to financial health has resulted in record private investments – not taxpayer dollars – being plowed back into the nation’s rail network that serves the needs of diverse freight shippers and passengers alike. At a time when there is pressure to reduce government spending on just about everything – including transportation infrastructure – the country’s privately owned freight railroads have, in the last three years alone, reinvested nearly $70 billion back into the rail system, including $25.5 billion in 2012. This includes billions of dollars in a new, Congressionally-mandated, state-of-the-art positive train control system that the Rail Safety Improvement Act of 2008 requires railroads to install by the end of 2015.
There is nothing wrong with success. In fact, the rail industry’s success is predicated on the fact that the balanced regulatory system in place today is working. This success should be lauded, not undermined. Freight railroads provide safe, reliable and efficient service to American businesses large and small, and help keep them competitive in domestic and world markets, all the while keeping average rates lower than where they were 30 years ago when the Staggers Act was passed.
The rail industry didn’t stand on the sidelines during the recession, we continued investing and we continued hiring. In fact, our industry has seen almost a 6 percent increase in employment the last three years and as many as one in five of all new hires are veterans. That is a track record we are proud of.
Much is riding on freight rail to continue helping deliver our recovering economy and all efforts should be focused on letting the current system work.”
Earlier in the day, Commerce, Science and Transportation Committee Chairman John D. Rockefeller IV issued an update to the 2010 Committee Majority Staff Report that examined the financial state of the rail industry, concluding that the financial performance of dominant Class I freight rail companies is at its strongest since the passage of the Staggers Act of 1980.
“The Staggers Act was designed to give a boost to the rail industry during a time when railroads were struggling – but today the railroads are enjoying tremendous financial success,” Rockefeller said. “At this point the evidence is clear that the dominant freight railroads are financially strong.”
“It is not any secret that I think that – more than three decades after the Staggers Act – the Surface Transportation Board (STB) needs to take a close hard look at whether large freight rail companies now enjoy an unfair competitive advantage,” Rockefeller added.