STB bill is still on the clock - by Tony Hatch

by Tony Hatch

More than 600 railroaders, analysts, suppliers and observers came to D.C. on Feb. 25 for "Railroad Day on The Hill," all of them mindful of Washington's increasing role in the rail industry — for good (TIGER grant wins) and, perhaps, not so good (the unfunded positive train control mandate, coal threats), with the Senate's Surface Transportation Board Reauthorization Act of 2009 (S. 2889) sitting squarely in between and taking the spotlight.

Consumers United for Rail Equity Executive Director Bob Szabo put it thusly at the Southwest Association of Rail Shippers' meeting in San Antonio on Feb. 18: For shippers who want to see regulatory change, the time is now, with this Congress. Many observers agree; time, the changing government makeup and priorities aren't on "re-reg's" side. If something's going to happen, it'll have to be by midsummer at the very latest, given the political realities and election cycle. Here are a few takeaways, undercurrents and inferences from this year's "Railroad Day":

• S. 2889 remains a high priority for the Senate Committee on Commerce, Science and Transportation (SCC). That was apparent during a meeting I had with SCC staff during Railroad Day. It's also a priority for SCC Chair Sen. John "Jay" Rockefeller (D-W. Va.). As of last month, SCC was continuing to meet with Sen. Herb Kohl's (D-Wis.) staff on the still-to-be-inserted antitrust provision — it should be completed fairly soon. Rail and shipper advocates also were still negotiating a few of S. 2889's lingering points of contention, including how the bolstered STB (should the bill pass) would impact future decisions and precedents.

• This can get done ... The SCC and staff believe there's a negotiable solution, contrary to some published reports. Regardless, someone will be disappointed. Could shipper groups, which already have received quite a bit, accept a compromise? Will the rails accept S. 2889 in order to avoid a potentially worse bill?

• ... but the clock is ticking. And then there's the House, which has yet to act. Will it rubber stamp S. 2889? Forge its own bill (tick tock, tick tock)? And this House is, indeed, a House divided — and not necessarily on partisan lines. So far, the GOP staffers on Rep. James Oberstar's (D-Minn.) House Transportation & Infrastructure Committee (T&I) have been sitting out the STB reauthorization bill talks in what would seem to be a form of protest. But Railroad, Pipelines and Hazardous Materials Subcommittee Chairman Corrine Brown (D-Fla.) told us in no uncertain terms during a Railroad Day visit that her committee was "not going anywhere with re-reg" and that she had rescheduled her snowed-out Feb. 11 hearing to March 23, which subsequently was postponed, as well.

• More juice? The rails now have some options, and perhaps a bit more juice, than they did when the bill process started a year ago. Having solid union support helps (confirmed by nice chats I had with leadership of the largest rail union, the United Transportation Union). They have solid support from key committee members and subcommittee chairs, especially in the House. They also know time is on their side. Any delays mean change is less likely.

On the other hand, the benefits of removing the Damoclean Sword that is re-reg (and therefore, it is implied, receiving additional government support in the form of tax credits, etc.) are obvious, as well. But by taking part in such a constructive process, and with rail being so obviously part of the country's future transport/infrastructure plans — and by so radically improving their services (as the STB-commissioned, updated Christensen & Associates report suggests) — the rails have earned considerable goodwill and political clout, the kind that could protect their shareholders from any potential disaster.

• Completed bill may come this month. My best guess is that a final bill, complete with (maybe?) non-threatening antitrust language, will be introduced not long after Major League Baseball's Opening Day. At that point, we'll know if the ongoing discussions have led to the kind of changes the rails can live with ... or we start up all over again in the next Congress.

Tony Hatch is an independent transportation industry analyst and consultant, and program consultant for Progressive Railroading's annual RailTrends conference