CS Testifies At House Subcommittee Hearing on the Role of Freight and Passenger Rail in the U.S. Economy (January 2009)
Lance Grenzeback, Senior Vice President of Cambridge Systematics, Inc., testified before the Rail Subcommittee of the House Committee on Transportation and Infrastructure on Wednesday, January 28, 2009. The Subcommittee hearing examined the role of freight and passenger rail and their importance to the United States economy.
In her opening statement, Subcommittee Chairwoman Corrine Brown (D‑FL) noted that railroads are the backbone of North America’s transportation network, carrying 40 percent of all intercity ton-miles of freight. She cited the National Rail Freight Infrastructure Capacity and Investment Study, prepared for the Association of American Railroads and National Surface Transportation Policy and Revenue Study Committee by Cambridge Systematics in 2007. The study found that demand for rail freight service was pressing the capacity of the national rail system and that upwards of $148 billion in additional investment would be needed by 2035 to keep pace with economic growth.
Chairwoman Brown asked the witnesses: “Will the railroads be able to make the necessary investments given the current economic crisis? What will happen if we do not expand railroad capacity? How will we accommodate demand for freight and passenger rail service when the recession eases and demand increases again? Should the Federal government invest in freight and passenger rail to expand capacity?”
Chairwoman Brown reminded the witnesses that these issues would come up again later in the year when Congress writes a new multiyear authorization bill for surface transportation. “As we begin to develop and reauthorize the next [transportation] bill, it is critical that the need for additional rail capacity for both freight and passenger rail be addressed,” she said.
Participating subcommittee members, including House Transportation and Infrastructure Committee Chairman James Oberstar (D-MN), and invited witnesses agreed on the need to expand freight and passenger rail capacity. Among the 13 witnesses appearing before the subcommittee were Joseph Boardman, President and CEO of Amtrak; James Young, Chairman, CEO, and President of Union Pacific railroad; Will Kempton, Director of the California Department of Transportation; Lance Grenzeback, Senior Vice President of Cambridge Systematics; and Anne Canby, President of the Surface Transportation Policy project and a OneRail Coalition member.
>Mr. Boardman testified that “[Our] remarkable [rail] network provides surface connectivity for passengers and freight from coast to coast and border to border. Congressional interest must make this investment a national priority for the next decade or beyond if we are to remain a competitive and healthy economic engine of the world.” Mr. Young pointed out that “When one considers the amount of freight we carry, our investment in American jobs and infrastructure, the safe and efficient manner in which we operate, and our benefits to energy consumption, the environment, and congestion relief, the industry provides enormous benefits to the country. We have the world’s best, most cost-effective, environmentally friendly freight system—one that keeps American industries competitive in the world marketplace.”
Mr. Kimpton emphasized the need for better intercity passenger rail service. He said that he “believes intercity passenger rail must be a stronger component in our transportation system. In its adopted surface transportation authorization policy, AASHTO is recommending nearly $35 billion for intercity rail investment over five years.” Ms. Canby called for stronger public-private partnerships. “Because most rail infrastructure is privately operated and maintained, there can be significant public benefit by shifting a greater share of freight to rail through reduced costs for new highway capacity and ongoing maintenance, as well as reduced energy use and GHG emissions.”
In his testimony, Mr. Grenzeback noted that freight rail is a critical part of the freight transportation spectrum; that rail productivity and cost-effectiveness have improved significantly; but that rail traffic had not grown significantly since 2005—in part because of growing rail system congestion; and that rail traffic now was dropping as the recession reduced economic activity.
He argued that during the current recession, track maintenance and replacement will be cut back and investment in new capacity expansion will largely cease. “As a result, when the recession eases and the demand for rail service picks up, we will likely find ourselves with less capacity than we have today and well behind what we need for tomorrow.”
Mr. Grenzeback recommended that Congress use the opportunities afforded by the economic stimulus bill and the pending authorization of the surface transportation program to position the rail industry to absorb future growth by:
- Establishing a national rail policy and outlining the future of the national rail system. We do not need a detailed blueprint but we do need a broad consensus on when and where we must make improvements.
- Increasing public and private investment in freight and passenger rail and agreeing on how we will share the benefits, costs, and risks equitably.
- Creating a mechanism such as a national infrastructure investment bank to finance freight and passenger rail improvements where the costs are too high for a single railroad or state to undertake but the improvements benefit many states and industries. And finally,
- Expanding state and local rail programs to coordinate freight and passenger rail services, build grade separations, and mitigate the community impacts of more train traffic.”
Mr. Grenzeback’s testimony can be found here. Copies of the written statements by the Subcommittee members and witnesses are available at http://transportation.house.gov/hearings/hearingDetail.aspx?NewsID=800.