WASHINGTON, Feb. 25, 2015 – Already one of the biggest spenders in domestic infrastructure improvement, the U.S. rail industry doesn’t seem interested in seeking federal help to improve its system.
The idea for a pool of resources for infrastructure improvement is not a new one; most recently, Sen. Richard Blumenthal, D-Conn., has been championing the cause from his spot as the ranking member of a transportation subcommittee. At a Feb. 10 hearing of the Senate Commerce Committee’s Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety, and Security, he asked why more companies aren’t pounding the table for better infrastructure and why more users of that infrastructure aren’t begging for an improved funding mechanism.
It might be because they aren’t interested.
“One of the things that our industry has learned . . . is that you never, ever, ever want to be in a position where you have to trust the public for funding. Never,” said John Gray, Association of American Railroads senior vice president for policy and economics. Speaking at the USDA Agricultural Outlook Forum last week in Arlington, Virginia, Gray said the rail industry watches what happens in often fruitless funding debates for Amtrak and the inland waterways system every year, so he feels using the same system for rail would be “absolutely a recipe for disaster.”
“You hear about things called trust funds: reality is they can be appropriated to any purpose as the waterway folks have found out to their dismay several times,” Gray said. “Do we have any desire to participate in a freight trust fund? Absolutely none.”
Without much federal help, the rail industry is projected to spend $29 billion on infrastructure improvements in 2015. Rail’s agricultural transportation was in the spotlight for much of 2014 as it worked through a grain backlog that crippled grain elevators in the upper Midwest. The popular consensus is that those issues aren’t expected to carry over and that the 2014 harvest will be moved without the same delays that plagued the rail system with 2013’s grain.
USDA acting Chief Economist Robert Johansson said Upper Midwest rail transport “is expected (to) return to normal in 2015.” Approaching the situation from an economic perspective, Johansson noted that rail congestion increased costs of transportation to historic highs, but freight rail costs “returned to more typical levels” since November.
BNSF Railway, one of the largest rail corporations in the country, was one of two major companies that worked to move grain from the Upper Midwest, where North Dakota’s grain shippers were hardest hit. BNSF’s past due orders were at their peak March 27 of last year, when there were 16,470 late orders across the country. Speaking at a transportation luncheon at the forum, John Miller with BNSF said the company was “hitting it hard” to prevent a repeat of last year’s disastrous grain movement as even more grain enters the system.
“This year, we knew that the ‘past dues’ would spike up due to a very large harvest,” Miller said, addressing the “past due” statistic that triggers whenever an order for rail cars is four days late for its scheduled arrival to a shipper. “They did, but not nearly as high as last year, because of our performance during the course of the harvest”
Miller said his goal was reduce past due orders “down to zero in the next couple of months.” He added that goal would be difficult because “we’ve always got lots of orders and things change,” but said past due numbers would “go down and down.” In a Feb. 19 update to BNSF customers, Miller said velocity on ag-related trains is increasing, and past due orders were trending downward. He said there were 3,340 orders past due with an average of 17.8 days late, a dramatic improvement from the 11,698 past dues reported Feb. 27 of last year.
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