Investment Key to Rail Legislation

As efforts continue in Congress to craft a new rail competition bill that shippers and railroads can both accept, a top railroad CEO says the pivotal lawmakers understand the need for rail firms to earn enough to reinvest in their networks.

Matthew K. Rose, the chairman, president and CEO of BNSF Railway, told The Journal of Commerce that rail officials have “had lots of talks” with Sen. Commerce Committee Chairman Jay Rockefeller, D.-W.Va., and with House Transportation & Infrastructure Committee Chairman James L. Oberstar, D.-Minn.

He said those talks, which also include participation by rail shippers and labor groups, are exploring ways to improve the process of rail oversight by regulators and resolution of disputes between shippers and railroads.

The current process, Rose said, “doesn’t work for everybody. We know that. Can we improve the process?” He said the STB has been trying to accommodate shippers through some procedural changes, and BNSF has worked with some of its shipper groups as well. “At BNSF, we don’t take any exception to making the process more efficient for shippers,” he said.

Yet Rose said carriers see those talks with lawmakers as dealing with more than the shipper complaints, and touching on how to keep railroads financially healthy to play a strong role in the economy.

“There’s a lot of desire, concern, expressed on behalf of the railroads that the railroads have to remain re-investable. I think what we have in both chairman are two people that really want to see a very robust, very healthy and very expanding railroad industry.”

He sees it less as a railroad competition bill that sets new rules for the Surface Transportation Board, and “more a review of the process itself and where this country wants to be in terms of how the railroads are structurally set up.”

“If we can, through changes in process, allow shippers to feel they have more access to the process, that’s fine,” Rose said. “But what the railroads will always come back to is that there is this fundamental, basic business imperative – and I really do believe it’s an imperative for the nation – for the railroads to earn significant amount of returns to be able to reinvest.”

Contact John D. Boyd at jboyd@joc.com.