Freight-rail regulation: Will re-reg resurface?

To some lobbyists and policy analysts, there isn't much to worry about regarding the freight-rail lobby's chief concern for several years running: maintaining the status quo when it comes to economic regulation. Even though there's still occasional talk about "re-reg," there has been no serious effort to increase freight-rail regulation the past couple of years, says NRC's Chuck Baker.

"There's a general consensus that increased regulation of the industry would be counterproductive," he says.

Perhaps. But the freight-rail lobby isn't taking any chances. CSX Corp. has one major defensive move pegged for 2013: block any attempt to change the current regulatory framework, or any re-reg attempts in Congress, says Vice President of Federal Legislation Anne Reinke.

Sen. John "Jay" Rockefeller (D-W.Va.), who chairs the Senate Committee on Commerce, Science and Transportation, has long quarterbacked a "balanced competition" bill that seeks to increase rail competition, strengthen federal rail oversight and improve rail shippers' access to regulatory relief. If Republicans win a majority of seats in Congress, the potential major candidates for the Senate committee chairmanship all support keeping rail regulatory policy as it is, Reinke says. But if Rockefeller is still chairman next year, the expectation is that he would propose "some type of re-reg bill," she adds. If that were to occur, the industry would "push back again with our story about how rail creates jobs and helps support a healthy economy," Reinke says.

What if President Obama were to be re-elected? Could that affect the regulatory framework? Of course it could. Witness the Surface Transportation Board, which as independent transportation analyst and Progressive Railroading columnist Tony Hatch notes, is "charged with big regulatory issues these days as regulatory efforts recede." But several observers don't think the current framework is fundamentally in peril.

"The current administration seems to understand that the existing regulatory environment has helped produce a good, strong freight-rail industry, so they haven't made any moves to re-regulate the industry and haven't indicated that they would in a second term," says NRC's Baker. "So at the presidential level ... the freight railroads are probably in pretty good shape either way."