NIT League Backs Bill to Strip Rail Exemption

A powerful shippers’ lobby, the National Industrial Transportation League, threw its weight behind a Senate bill to strip freight railroads of a limited antitrust immunity.

The action came late on May 29, at a time when the bill was slated to go to the Senate floor for debate starting on June 1 and with a possible vote on June 2.

And it comes as key lawmakers are trying to work out a thorny jurisdictional issue that could threaten passage. Last week, leaders of the Senate Commerce Committee and its surface transportation panel – led by committee Chairman Jay Rockefeller, D-W.Va., and ranking member Kay Hutchison, R-Texas – urged colleagues to vote against allowing a final vote on the bill.

The Railroad Antitrust Enforcement Act is sponsored by Sen. Herb Kohl, D-Wis., of the Senate Judiciary Committee, and the Commerce panel says its own bill still in the making should take precedence because it has authority over laws affecting rail regulation and the Surface Transportation Board.

The Kohl bill would allow both the Justice department and the Federal Trade Commission to review proposed rail mergers as they do in other industries, and would allow challenges in federal courts to alleged railroad anticompetitive behavior before taking those issues to the STB, which now has primary oversight and can only be challenged in appeals court after it has ruled.

The railroad industry has pushed to throw the Kohl bill off track, saying any changes in law affecting them and their regulatory structure should be in the context of global legislation being negotiated by the Rockefeller staff. Defenders, though, say both bills can work together and want to see the Kohl bill advance in the meantime.

The NIT League said its board “voted overwhelmingly in favor of supporting S. 146,” Kohl’s bill, despite the threat that it would be filibustered this week. The board was guided by a recommendation of support earlier in May by its railroad committee.

NIT League President Bruce Carlton wrote all 99 senators urging passage of the antitrust bill, and then coordination of it with the bill to come later from Rockefeller.

“The League’s board believes it is imperative that both pieces of legislation be developed in tandem, in order to avoid the consequences of taking a piecemeal approach to legislation of such importance to shippers and railroads: uncertainty for both interests, and inevitable conflicts in law and policy direction,” Carlton wrote.