WASHINGTON (August 2, 2022) — The American Chemistry Council (ACC) welcomes the introduction of the Freight Rail Shipping Fair Market Act and calls on members of Congress to support its passage.
Earlier this year, ACC’s Chris Jahn testified before the U.S House Committee on Transportation and Infrastructure to offer recommendations on how Congress can help the Surface Transportation Board (STB) address the service problems resulting from massive consolidation and operational changes within the freight rail industry.
Chairmen Payne along with Chairs DeFazio, Scott and Costa have carefully crafted a sensible legislative package after listening to testimony from the STB, shippers, rail carriers and other important stakeholders.
Why it matters
The legislation comes at a critical time when the STB is trying to resolve serious freight rail service problems that are disrupting the economy and contributing to the supply chain crisis. A recent survey of ACC members found that freight rail service has degraded with almost 40% of companies reporting that rail problems are worse this year compared to the third quarter of last year. The survey also found that 75% of companies have been forced to switch cargo from rail to truck because of rate and service issues. Poor rail service and missed deliveries meant lost production for chemical manufacturers and the other economic sectors they support – from farms to factories.
Rising freight rail problems are not solely the result of the COVID-19 pandemic. Years of railroad actions to cut workers, close rail yards, and take locomotives out of service have gutted network resilience, making service disruptions more frequent, severe and long-lasting.
The STB is the sole federal agency charged with resolving commercial freight rail issues and Congress must ensure that the Board has the resources and tools needed to fulfill its vital mission.
Helpful Solutions
The bill addresses many key issues to help support the STB, including the following:
- Establish service standards: The bill requires the development of standards for service performance and helps hold railroads accountable for failing to meet their service obligations.
- Provide higher funding authorization: This funding will help the Board handle its growing challenges and responsibilities, including its expanded role in passenger rail.
Bottom line
“Our industry is one of the biggest customers of freight rail and our transportation needs continue to grow with the expansion of U.S. chemical manufacturing,” said Chris Jahn, President and Chief Executive Officer of the American Chemistry Council. “This should be good news for the freight railroads, but ongoing rail service problems are putting the brakes on manufacturing and future growth.”
“This important legislation contains many thoughtful solutions that complement and line up well with the much-needed reforms being considered by the STB,” he continued. “We urge Congress and the STB to work together on meaningful reforms that will incentivize the railroads to provide reliable and competitive service and hold them accountable when they fail to deliver.”
