Contact: Scott Jensen (202) 249-6511
WASHINGTON (March 1, 2013) – The American Chemistry Council (ACC) filed comments with the Surface Transportation Board (STB) that urge the Agency to take action on reforms that would benefit U.S. manufacturing and the economy by increasing access to competitive freight rail service for domestic producers. ACC filed the comments in support of the National Industrial Transportation League’s (NITL) proposed competitive switching reforms that are being considered by the STB.
Two years ago, the STB began a formal examination of the state of competition in the U.S. freight rail system. After a careful review, the STB decided to pursue reforms and initiated Ex Parte 711, an important proceeding, examining NITL’s proposed competitive switching reforms that are designed to create more competition in the freight rail industry. The NITL proposal would require a Class I railroad to enter into a competitive switching arrangement whenever a shipper or receiver demonstrates that its facility is served by only one Class I railroad, that there is a lack of effective inter- and intramodal competition, and that there can be a working interchange within a reasonable distance of the shipper’s or receiver’s facility.
According to ACC’s comments, railroads have increasingly leveraged their unique market power – harming U.S. manufacturers and the economy as a whole. Competitive rail switching, as embodied in NITL’s initiative, would provide benefits to a broad range of rail shippers, including shippers of coal, grain and chemical products. According to NITL’s analysis, the proposed framework could impact a total of 1.2 million carloads and provide potential benefits of approximately $1.3 billion on an annual basis.
ACC’s comments also referenced the research released last month that detailed how the lack of rail competition and unreasonably high rates have negatively impacted chemical shippers and the economy providing further evidence that reforms like competitive switching are needed.
“Given this new and compelling data, we encourage the STB to expeditiously initiate a formal rulemaking for competitive switching reforms,” said Thomas Schick, ACC’s Senior Director of Distribution, Regulatory & Technical Affairs.
To learn more, visit www.americanchemistry.com/rail