Cantwell Presses Railroad Industry to Reduce Freight Delays that Cost WA Jobs

Senator: ‘We’re losing jobs and we have product that’s not being delivered in a timely fashion’

WASHINGTON, D.C. – Today, U.S. Senator Maria Cantwell (D-WA) questioned a top rail industry executive whether railroads are investing enough in infrastructure as increasing delays in freight rail traffic have impacted shipments of goods nationwide, and recently forced a Washington state agriculture shipper to suspend service and cut jobs.

Cantwell referenced companies such as Cold Train, an intermodal agriculture shipper in Quincy that announced it was suspending rail service due to increasing delays on rail lines and a near-doubling of transit times – in part due to oil trains hauling Bakken crude from North Dakota.

“They went out of business and announced they were going to cut off 80 jobs. That is what’s happening to us in the Northwest, so I’m very empathetic to my colleagues from the Dakotas and clearly this isn’t just about a bumper crop,” Cantwell said during a hearing of the Senate Committee on Commerce, Science and Transportation. “The bottom line is we’re losing jobs and we have product that’s not being delivered in a timely fashion.”

Video is available here.

In an exchange with Ed Hamberger, President and CEO of the Association of American Railroads, Cantwell asked how freight rail service could be worsening for many shippers despite railroads having spent $25 billion on infrastructure and maintenance in 2013. The nation’s seven Class I railroads, including BNSF Railway and Union Pacific, which operate in Washington state, reported $68 billion in total revenues in 2012. 

“The question here is you’re making a lot of money and we don’t see our businesses being protected,” Cantwell said.

Wednesday’s hearing focused on delays in freight rail service nationwide, particularly in the Midwest. Representatives from the railroads, agriculture, and the chemical and auto industries testified about increased congestion that is affecting shipments of everything from wheat and soybeans to automobiles and coal. Rail congestion also affects passenger rail service, including the Amtrak Empire Builder, which runs between Chicago and Seattle/Portland

Cold Train in Quincy had guaranteed three-day service on shipments of apples, cherries, potatoes and other produce to the Midwest, and had seen volumes increase to 7,000 containers in 2013 from 1,000 in 2010. But its on-time performance dropped from 90 percent to 5 percent as rail traffic increased.

An energy boom in North Dakota has led to a dramatic surge in crude-by-rail shipments. Railroads now transport about 800,000 barrels a day, when they hauled almost no crude almost four years ago.

Railroads are investing record amounts back into new track and maintenance, Hamberger said. “Some of that investment takes time to put track in – it takes time to get the employees trained,” he said.

Cantwell sought assurance from Hamberger that railroads wouldn’t attempt to reduce freight rail volumes by increasing rates. Hamberger said anti-trust laws prevented him from speaking about members’ pricing policies. “I really can’t talk about price,” he said.

He said current shipping rates are lower than they were in 1989 when adjusted for inflation.

Washington state contains more than 3,000 miles of railroad line, which provide a vital mode of transportation for agriculture, manufacturing, construction, forest products, and wholesale and retail trade. In 2012, railroads directly employed 4,700 people in Washington state.

Cantwell – hailed by former Transportation Secretary Ray LaHood as “the freight senator” – has been a longtime advocate of improving freight mobility. She spearheaded the effort to develop a high-level freight mobility strategy that resulted in the formation of the National Freight Advisory Committee. She has worked with LaHood and current Transportation Secretary Anthony Foxx to implement new initiatives to improve strategic freight and better prioritize the freight investments that will support job growth across the country.