A push-pull this week over future rail legislation had state farm commissioners urging Congress to enact a law to force more shipper-oriented competition onto U.S. railroads, while the railroad lobby saluted a proposed Senate bill to give top carriers a tax credit.
Although the actions came just as Congress was headed into a long summer break, they showed that rail freight issues will be contending for attention as Congress tries to work through a crowded legislative calendar this fall.
On Aug. 4 the Midwestern Association of State Departments of Agriculture issued a statement calling for Congress and President Obama to complete work this year on the rail competition bill that already passed the Senate Commerce, Science and Transportation Committee but has not yet come to the Senate floor for final action. House leaders plan to push through a measure identical to whatever the Senate passes, and negotiations have gone on for months behind the scenes on final bill language.
The Midwest farm group represents Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota and Wisconsin. The MASDA said the proposed change in rail economic regulations, as part of a reauthorization and further empowerment of the Surface Transportation Board, would give shippers more freight handling options and hold down rail transportation costs.
Its action was relayed by an activist shipper lobbying group in Washington, Consumers United for Rail Equity. Robert Szabo, CURE’s executive director, added that “excessive shipping charges are hitting America’s farmers when they’re hurting, and this is the latest sign of their frustration . . . these same charges are hitting households, consumers, and our entire economy, and we’re hopeful that Congress and the president will act this year.”
Railroad executives have sharply criticized that Senate bill as something that would threaten future profits, even as they keep saying they will work with Commerce Committee staff to try to reshape the legislation more to their liking. They have also said at times they think working with Congress to enact some new shipper-friendly measures could help the largest railroads get a long-sought, special tax credit for 25 percent of their investments in extra capacity.
But the rail industry has also been stressing that the freight rail system is vital to a broad range of U.S. policy goals, and therefore should be aided by government rather than put under stress by new regulations. Some rail sources have said they hope the competition bill will simply die later this year, leaving the current regulatory structure to deal with shipper concerns.
Late this week, Sens. Kent Conrad, D-N.D., and John Ensign, R-Nev., offered a bill to give railroads that 25 percent tax break, along with friendlier accounting for capital investments. Their bill matches one that has long sat in the House from Rep. Kendrick Meek, D-Fla.
The Association of American Railroads quickly praised the Conrad-Ensign bill as “encouraging private capital investments that can generate tremendous public benefits through expanded rail network capacity needed for moving more people and goods by rail.”
AAR President and CEO Edward Hamberger said the measure could help meet the nation’s “great expectations for our nation’s railroads – to provide not only the vital connection for U.S. business to the global marketplace but also the underlying network for expanded intercity passenger and high-speed rail.”
-- Contact John D. Boyd at email@example.com.