[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
H.R. 6707, THE ``TAKING RESPONSIBLE ACTION FOR COMMUNITY SAFETY ACT''
=======================================================================
(110-164)
HEARING
BEFORE THE
COMMITTEE ON
TRANSPORTATION AND INFRASTRUCTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
SECOND SESSION
__________
SEPTEMBER 9, 2008
__________
Printed for the use of the
Committee on Transportation and Infrastructure
----------
U.S. GOVERNMENT PRINTING OFFICE
44-651 PDF WASHINGTON : 2008
For sale by the Superintendent of Documents, U.S. Government Printing
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800;
DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC,
Washington, DC 20402-0001
COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE
JAMES L. OBERSTAR, Minnesota, Chairman
NICK J. RAHALL, II, West Virginia, JOHN L. MICA, Florida
Vice Chair DON YOUNG, Alaska
PETER A. DeFAZIO, Oregon THOMAS E. PETRI, Wisconsin
JERRY F. COSTELLO, Illinois HOWARD COBLE, North Carolina
ELEANOR HOLMES NORTON, District of JOHN J. DUNCAN, Jr., Tennessee
Columbia WAYNE T. GILCHREST, Maryland
JERROLD NADLER, New York VERNON J. EHLERS, Michigan
CORRINE BROWN, Florida STEVEN C. LaTOURETTE, Ohio
BOB FILNER, California FRANK A. LoBIONDO, New Jersey
EDDIE BERNICE JOHNSON, Texas JERRY MORAN, Kansas
GENE TAYLOR, Mississippi GARY G. MILLER, California
ELIJAH E. CUMMINGS, Maryland ROBIN HAYES, North Carolina
ELLEN O. TAUSCHER, California HENRY E. BROWN, Jr., South
LEONARD L. BOSWELL, Iowa Carolina
TIM HOLDEN, Pennsylvania TIMOTHY V. JOHNSON, Illinois
BRIAN BAIRD, Washington TODD RUSSELL PLATTS, Pennsylvania
RICK LARSEN, Washington SAM GRAVES, Missouri
MICHAEL E. CAPUANO, Massachusetts BILL SHUSTER, Pennsylvania
TIMOTHY H. BISHOP, New York JOHN BOOZMAN, Arkansas
MICHAEL H. MICHAUD, Maine SHELLEY MOORE CAPITO, West
BRIAN HIGGINS, New York Virginia
RUSS CARNAHAN, Missouri JIM GERLACH, Pennsylvania
JOHN T. SALAZAR, Colorado MARIO DIAZ-BALART, Florida
GRACE F. NAPOLITANO, California CHARLES W. DENT, Pennsylvania
DANIEL LIPINSKI, Illinois TED POE, Texas
NICK LAMPSON, Texas DAVID G. REICHERT, Washington
ZACHARY T. SPACE, Ohio CONNIE MACK, Florida
MAZIE K. HIRONO, Hawaii JOHN R. `RANDY' KUHL, Jr., New
BRUCE L. BRALEY, Iowa York
JASON ALTMIRE, Pennsylvania LYNN A WESTMORELAND, Georgia
TIMOTHY J. WALZ, Minnesota CHARLES W. BOUSTANY, Jr.,
HEATH SHULER, North Carolina Louisiana
MICHAEL A. ACURI, New York JEAN SCHMIDT, Ohio
HARRY E. MITCHELL, Arizona CANDICE S. MILLER, Michigan
CHRISTOPHER P. CARNEY, Pennsylvania THELMA D. DRAKE, Virginia
JOHN J. HALL, New York MARY FALLIN, Oklahoma
STEVE KAGEN, Wisconsin VERN BUCHANAN, Florida
STEVE COHEN, Tennessee ROBERT E. LATTA, Ohio
JERRY McNERNEY, California
LAURA A. RICHARDSON, California
ALBIO SIRES, New Jersey
DONNA F. EDWARDS, Maryland
(ii)
CONTENTS
Page
Summary of Subject Matter........................................ v
H.R. 6707 ``Taking Responsible Action for Community Safety Act,''
as introduced in House......................................... xiii
TESTIMONY
Baxandall, Ph.D., Dr. Phineas, Senior Analyst for Tax and Budget
Policy, U.S. Public Interest Research Group, Federation of
State Public Interest Research Groups.......................... 64
Bean, Hon. Melissa, a Representative in Congress from the State
of Illinois.................................................... 9
Biggert, Hon. Judy, a Representative in Congress from the State
of Illinois.................................................... 8
Buttrey, Hon. W. Douglas, Board Member, Surface Transportation
Board.......................................................... 17
Darch, Karen, President, Village of Barrington, Illinois......... 35
Foster, Hon. Bill, a Representative in Congress from the State of
Illinois....................................................... 13
Harrison, E. Hunter, President and Chief Executive Officer,
Canadian National Railway...................................... 35
Manzullo, Hon. Donald, a Representative in Congress from the
State of Illinois.............................................. 6
Mulvey, Hon. Francis P., Vice Chairman, Surface Transportation
Board.......................................................... 17
Nekritz, Hon. Elaine, State of Illinois.......................... 35
Nottingham, Hon. Charles D., Chairman, Surface Transportation
Board.......................................................... 17
Roskam, Hon. Peter, a Representative in Congress from the State
of Illinois.................................................... 11
Schwieterman, Ph.D., Dr. Joseph P., Director of the Chaddick
Institute for Metropolitan Development, DePaul University...... 64
Silvestri, Peter, President, Village of Elmwood Park, Illinois... 35
Swanson, John, Executive Director, Northern Indiana Regional
Planning Commission............................................ 35
Tolman, John, Vice President and National Legislative
Representative, Brotherhood of Locomotive Engineers and
Trainmen....................................................... 64
Visclosky, Hon. Peter, a Representative in Congress from the
State of Indiana............................................... 4
Weisner, Hon. Tom, Mayor, City of Aurora, Illinois............... 35
Yagelski, Mark, Chairman of the Board of Trustees, Northern
Indiana Commuter Transportation District and Member of the
LaPorte County Council......................................... 35
PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS
Altmire, Hon. Jason, of Pennsylvania............................. 71
Bean, Hon. Melissa L., of Illinois............................... 72
Biggert, Hon. Judy, of Illinois.................................. 75
Carnahan, Hon. Russ, of Missouri................................. 77
Costello, Hon. Jerry F., of Illinois............................. 78
Cummings, Hon. Elijah E., of Maryland............................ 80
Manzullo, Hon. Donald A., of Illinois............................ 86
Mitchell, Hon. Harry E., of Arizona.............................. 88
Roskam, Hon. Peter J., of Illinois............................... 89
PREPARED STATEMENTS SUBMITTED BY WITNESSES
Baxandall, Ph.D., Dr. Phineas.................................... 92
Buttrey, Hon. W. Douglas......................................... 94
Darch, Karen..................................................... 95
Harrison, E. Hunter.............................................. 100
Mulvey, Hon. Francis P........................................... 118
Nekritz, Hon. Elaine............................................. 123
Nottingham, Hon. Charles D....................................... 127
Schwieterman, Ph.D., Dr. Joseph P................................ 133
Silvestri, Peter................................................. 137
Swanson, John.................................................... 140
Tolman, John..................................................... 144
Weisner, Hon. Tom................................................ 147
Yagelski, Mark................................................... 151
SUBMISSIONS FOR THE RECORD
Harrison, E. Hunter, President and Chief Executive Officer,
Canadian National Railway, additional remarks.................. 109
ADDITIONS TO THE RECORD
Berry, Christopher; Bueno de Mesquita, Ethan, Harris School of
Public Policy Studies, the University of Chicago, ``Stalemate
over Rail Plan Reflects Failure of Political Leadership''...... 155
Cook County Board of Commissioners, Gregg Goslin, Commissioner,
14th District, written statement............................... 159
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
HEARING ON H.R. 6707, THE TAKING RESPONSIBLE ACTION FOR COMMUNITY
SAFETY ACT
----------
Tuesday, September 9, 2008,
House of Representatives,
Committee on Transportation and Infrastructure,
Washington, DC.
The Committee met, pursuant to call, at 11:00 a.m., in Room
2167, Rayburn House Office Building, the Honorable James L.
Oberstar [Chairman of the Committee] presiding.
Mr. Oberstar. The Committee on Transportation and
Infrastructure will come to order.
The Chair would like to take this opportunity to welcome
colleagues back to Washington, back to the Committee from our
district work period, and I know for all of us it has been
work. Conventions are work. The district period is a work time,
and it is so refreshing, during August, not to be in
Washington. You can breathe.
And welcome all those Representatives of wide-ranging
interests from across the Country back to Washington. It is
good to have you all back with us.
I know that my Committee colleagues on the Republican side
had a very invigorating convention in Minneapolis-St. Paul and
had an opportunity to see an element of transportation success
with the reconstruction of the I-35W Bridge.
This morning, we convene to review legislation to give the
Transportation Board or to ensure the Transportation Board has
the authority and the policy direction to deal with mergers
that involve a Class I railroad and a Class II or III or other
in which there may be safety, environmental or quality of life
problems for the various communities.
This is a rather complex subject of transportation, of rail
transportation law, and I want to take just a few moments to
elucidate the reasons for this legislation, for this hearing
and for action.
The Canadian National Railway filed a merger application
that raises issues that have long simmered under the surface
within the Surface Transportation Board and rail policy since
enactment of the Staggers Act in 1980.
The CN asks approval of the Board to acquire the Elgin,
Joliet and Eastern Railway, EJ&E. In their application, CN says
they will divert traffic on three of their lines going through
Chicago onto the main line of EJ&E and that, thereby, they will
reduce traffic going through the City of Chicago, better
service, better transit times, decreased rail traffic, lower
cost to the railroad.
Opponents, however--there are always two sides to these
issues, especially in transportation--cite safety concerns and
environmental consequences on the 50 communities lying along
this 180-mile track.
I took the opportunity to visit several of those
communities at the request of Members who represent communities
affected by the proposed merger. I met in situ. I walked the
rail grade crossing areas, and I have listened to Ms. Biggert
and Ms. Bean, Mr. Manzullo, Mr. Visclosky, Mr. Foster and Mr.
Roskam who all voiced the concerns of the communities they
represent, their constituents.
Now, regardless of whether you support the CN acquisition
or not, the transaction highlights a serious question: Does the
STB under current law have authority to disapprove a merger or
consolidation of a Class I railroad and a Class II or III on
public interest grounds? That is an issue of law that has not
been settled in court or any challenge or directly addressed by
the Board.
There are two differing standards in existing law.
Depending on the class of railroad, STB must use one or another
of these standards. The law gives the Board considerable
discretion to disapprove a transaction involving at least two
Class I railroads, much less discretion to disapprove
transactions not involving two Class Is or two or more Class Is
such as the case of the EJ&E acquisition by CN.
But that wasn't always the case. Before the Staggers Act in
1980--I remember this era quite well--the criteria for a merger
or acquisition of two Class Is or a Class I, Class II or Class
III were identical. The Commission was required to approve and
authorize the transaction only when it found that the
transaction was consistent with the public interest, not
inconsistent, but consistent with the public interest. It is a
different burden of proof.
The Commission also was authorized to impose conditions
governing the transaction, but Section 228 of the Staggers Act
considerably altered the standards for consolidation
applications after date of enactment.
A new section was added governing this type of transaction
that we are considering today, and that section provides that
the Board shall approve such transactions of a Class I or a
Class II or III unless the Board finds there is likely to be a
lessening of competition, creation of a monopoly or restraint
of trade or the anti-competitive effects outweigh the public
interest in meeting transportation needs.
On the face of it, this language does not seem to provide
the Board with authority to disapprove a merger or
consolidation even if the Board finds that the transaction
should be disapproved on general public interest grounds such
as safety or environment.
In the testimony we will hear from Chairman Nottingham, he
suggests that the Board assumed it still has the power to
refuse to approve a merger of a Class I with a Class II or
Class III railroad on environmental grounds, but he also
concedes the Board has never tried to exercise this power and
it has never been tested in court.
CN's testimony also suggests that it believes the Board
does not have this power.
In this uncertain situation, it occurs to me in the context
of this transaction, which reflects so much of what is
happening in the rail sector today across the County, that we
should have legislation to clarify the authority of the Board
to deny a merger on environmental grounds or to modify the
merger to comply with the concerns expressed justifiably by the
affected communities.
Transportation benefits are critical and important. Rails--
we almost need not say it--they are so vital to movement of
goods in America, but that significance and that role should
not trump all other concerns regardless of how important those
other concerns are. It should not be allowed to trump
everything else.
That is not good public policy, and I don't think that is
what the original drafters of the Staggers Act had in mind.
There are not very many of them around anymore in the Congress
or outside or in retirement. But in going through the debate
and sitting on the House floor and rubbing my worry beads about
what was the right vote, eventually, I cast my vote in favor of
deregulation, never thinking it was going to have these kinds
of consequences.
So, with that, I overstayed my five minutes and framed the
issue that we will consider this morning.
I will recognize the gentleman from Florida, our
distinguished Ranking Member, and then we will proceed to the
witnesses.
Mr. Mica. Well, thank you for convening this meeting.
I also want to thank you for the hospitality extended to
the Republican Members in Minneapolis-St. Paul at our
convention last week. I said I hadn't been in that area for 24
years. One of the things I think we get to see in our position
is the majesty of this great Country and the beauty of some of
our cities like Minneapolis and St. Paul.
It was an incredible convention. There were a few people
who made it unpleasant.
Mr. Oberstar. Both conventions.
Mr. Mica. At both conventions. I told the Chairman that
people actually came up and apologized for some of the actions
of some of the folks there but, again, I thank you.
And, the I-35 Bridge visit we had--and I know you couldn't
be with us but sent words of greeting--Mn/DOT and other folks
are to be commended for a remarkable project that will be
completed in less than 437 days which I think should be a model
for all of our replacement projects.
I also appreciate your holding this hearing. I know it is
important to Members. I haven't really taken a position on this
yet, and I want to hear some of the testimony and what you have
to say.
It does alter the review process, and it also can have a
significant effect on some future rail mergers. As you know
right now, STB participation is limited to the larger rail
mergers, and this would change that.
I do think that we have to look at public policy here, and
in an era when we are trying to save energy and move goods and
services and reduce congestions there are also benefits to the
proposal to acquire the line and move some of the traffic in
the perimeter area.
Now, I have exactly the same issue going on in Central
Florida with a commuter rail line and moving freight to another
line, and it does raise issues of the impact on various
constituencies. So I am glad to see Members here who are doing
their best to defend their interests and represent their
communities on the adverse impacts and the positive effects
that this plan will have.
As we change, though, Federal policy relating to this, I
don't want it to have a chilling effect on some of the mergers
that make sense or plans that may make sense in enhancing
transportation alternatives that are good for the environment,
good for energy and good for moving products around our
metropolitan areas.
So we will look at it, and I thank you again for allowing
this forum, and I look forward to the presentation.
I have dueling competition between guns and rail, and I
will shuttle between here and my other Committee across the
hall, and it will be in good hands with Mr. Shuster today.
Mr. Oberstar. Defend the guns.
Mr. Mica. I am for them, me and Sarah. Thank you.
[Laughter.]
Mr. Oberstar. I thank the gentleman for his kind remarks
about the Twin Cities and on the bridge, and I think that
bridge will stand as a very salient lesson for us as we shape
the next transportation bill.
Now we will begin with Mr. Visclosky and go through the
list of Members present in descending order of seniority.
TESTIMONY OF THE HONORABLE PETER VISCLOSKY, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF INDIANA
Mr. Visclosky. Or age perhaps, Mr. Chairman.
Mr. Oberstar. Oh, no, no, no. You are younger than when you
came here, first came to Congress.
Mr. Visclosky. Mr. Chairman, I want to thank you, and I
want to thank Mr. Mica for holding this hearing today and
especially for your leadership on addressing, in a bipartisan
fashion, our Nation's aging infrastructure.
My remarks are going to be focused on the issue of safety
but following up on the Ranking Member's comments about the
necessity, potentially, of some of these mergers taking place,
I would make it clear for the record I am not opposed for
businesses making money or gaining efficiencies.
But in my congressional district, we also have a mass
transportation system we want to expand. After six months of
negotiation, the Canadian National didn't even know which
railroad had been trying to negotiate with them for six months.
In the case of the Gary Airport, to the railroad to be bought,
had been negotiating for six years to relocate one line. There
are public interests.
I would, at the beginning, also acknowledge the presence of
two Indiana residents, Northwest Indiana Regional Planning
Commission's Executive Director, John Swanson, who will testify
later and LaPorte County Councilman, Mark Yagelski, and
Chairman of the Northwest Indiana Commuter Transportation
District Board of Trustees.
I would also be remiss if I did not acknowledge the
presence in the audience of my very good friend, Councilman
Stan Dobosz of Griffith, Indiana.
I come before you today as an original co-sponsor of H.R.
6707, the TRACS Act, and I am appreciative of the Chair's
sponsorship of this measure.
I was born and raised in Lake County, Indiana, and I, like
every resident of that county, am very experienced with freight
rail traffic and the danger it poses to local residents. In
1977, my mother, Helen, was struck by a train and, thankfully,
survived the experience.
Waiting at crossing gates and finding alternative routes
are a fact of life when you live in this heavily industrialized
area that serves as the eastern gateway for freight into
Chicago. Lately, though, it has become apparent to the
residents of the region that the waits are becoming longer,
that the detours are becoming more congested and that safety
seems to be deteriorated.
FRA statistics show three people died and four were injured
via crossing collisions in Lake County, Indiana, alone from
January to May of this year.
On July 7th, three additional residents of my congressional
district died at a CSX grade crossing. On July 25th at a CN
crossing, three more were injured.
In September, this month, September 3rd, a woman was killed
at a CSX crossing.
That is 1 death every 16 days in my congressional district
at a rail crossing since July 7th. That is 1 accident at a rail
crossing at my congressional district every 21 days.
In 2007, Indiana was tied with the State of California--and
think about the disparity in size and population--for the
number of accidents at grade crossings, 161 in our States.
To illustrate the need for the TRACS Act, I would like to
highlight the situation created in northwest Indiana by the
Canadian National proposed acquisition of the EJ&E railroad:
In northwest Indiana, the CN/EJ&E transaction would result
in a three-fold increase in rail traffic on the existing EJ&E
line and cause the average train length to go from 2,590 feet
to 6,321 feet.
With as many as 34 trains per day running on the track, it
would bisect communities, impede the flow of automobile traffic
and create a considerable public safety concern.
The proposed acquisition, as I have mentioned, also would
create new barriers and fail to remove other obstacles to local
economic development initiatives.
Since this transaction was first proposed in the Fall of
2007, I would acknowledge that the STB has made some decisions
in this transaction that would be considered favorable to the
public's interest, including their decision last evening to
deny CN's petition to shortcut the environmental review
process. However, the recently released draft Environmental
Impact Statement gives me a new appreciation for the term,
getting railroaded.
I would like to read just one passage from that statement
from page 17 of the Mitigation section: Railroads,
historically, have not paid more than a small share, 5 to 10
percent, of grade separations because grade separations
primarily benefit the community and not the railroads.
Well, I would suggest to those families that lost four
people in train accidents since July 7th, there is a greater
public interest and would hope, as the Committee considers the
testimony today and the TRACS legislation, that balance--and
that is all I am looking for here--balance between public
interest and private interest is struck.
With that, Mr. Chairman, I thank you again for the
opportunity to testify today.
Mr. Oberstar. Thank you for that compelling statement. That
is shocking news about the fatality incidents in your district.
We have to address that.
Mr. Manzullo.
TESTIMONY OF THE HONORABLE DONALD MANZULLO, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ILLINOIS
Mr. Manzullo. Thank you, Mr. Chairman, for the leadership
that you have been providing to the people of this Country.
The Chairman has stated the anomalies that are in the law.
It simply means that the STB will not stop a transaction
because of community concerns unrelated to antitrust issues,
such as the safety of the people or environmental concerns. It
may seem like semantics, but it is an important distinction
that has long tipped the scale toward privately-owned rail
carriers and away from communities who have to live with them.
Let me state this. I have always encouraged rail for
passengers and freight. In fact, I helped bring the Union
Pacific intermodal hub to Rochelle, Illinois, which is in the
rural area of my congressional district.
However, in northern Illinois, in Ms. Bean's district, the
community of Barrington and surrounding areas are unalterably
opposed to the proposed sale of the EJ&E line to Canadian
National as evidence by the thousands of people who showed up
at the STB scoping session last January and a formal hearing in
August.
This is not because of not in my back yard syndrome.
Everybody understands the need to improve the national rail
transportation network and would be willing to compromise, but
having additional freight train traffic traverse on the aging
EJ&E track would not just be a simple minor inconvenience. It
will fundamentally alter the entire nature of the town and
people who travel through the town such as the people that I
represent in adjoining McHenry County.
I am honored to serve the thousands of commuters who live
in southern McHenry County and must travel through Barrington
either by car or rail to get to work or perform daily errands.
While I have been concerned about this deal since day one,
the draft Environmental Impact Statement recently released by
the STB confirmed many of our worst fears about increased
accident risks, increased air pollution, increased exposure to
hazard material and increased traffic, but at the same time
said that CN would only have to pay 5 to 10 percent of the cost
to mitigate these problems.
This will leave taxpayers paying the tab for a transaction
that solely benefits a private company's bottom line. I say it
is not about what is tradition. It is about what is fair.
The people from the 16th District of Illinois, which I
represent, have had plenty of chances to talk over these issues
in the past few weeks with me. I have heard from a lot of them.
Your bill, Mr. Chairman, H.R. 6707, corrects an oversight
made in 1995 and requires the STB to weight impacts on local
communities more heavily when considering any railroad
transaction. In fact, the STB would have to reject a proposed
acquisition if it finds that transactions and impacts on the
affected communities outweigh the transportation benefits.
We have to learn from the experience of this particular
transaction and make sure no community in the Nation will have
to go through what Barrington is experiencing now.
In this particular case, I understand that the transaction
will have many macro benefits, but CN accomplishes that goal
primarily by shifting the train congestion from downtown
Chicago to outlying suburban areas such as Barrington. They
don't solve the problem. They shift the problem.
Tens of thousands of motorists in northern Illinois,
especially those in McHenry County, travel through Barrington
on their way to work each day, crossing the EJ&E line at Route
14, 59 and Lake Cook Road. Approximately another 4,000
commuters from McHenry County ride metro rail to work in the
Chicagoland area each day.
When I talked to the CN authorities about trains that could
be as long as 10,000 feet, blocking all three intersections at
one time, their response was, well, we will make the trains go
faster.
I don't think that is a responsible attitude, especially in
light of the fact that we are very, very sensitive in northern
Illinois when several years ago we lost seven children when a
Metra train smashed into the school bus.
Those problems are on top of all of this. They haunt us.
There would be over 800 crossings of school buses each day just
at the 3 crossings in Barrington. So the people that we
represent are very sensitive to balancing the issues of safety
with the need for increased transportation enhancements.
In closing, I would like to express my appreciation to you,
Mr. Chairman, for introducing this piece of legislation, for
working with me and others in the suburban Chicago delegation
in a bipartisan manner and for calling this hearing on such a
timely matter.
We would urge our colleagues to support H.R. 6707.
Mr. Oberstar. I thank the gentleman for those comments and
for that. Again, did you say 800 school bus crossings?
Mr. Manzullo. Eight hundred and forty.
Mr. Oberstar. Yes, thank you.
Mr. Manzullo. Mr. Chairman, there are about 130 grade
crossings. Those 840 school bus crossings each day are just at
3 of those in Barrington. Ms. Bean has more information on
that.
Mr. Oberstar. Thank you for that clarification--Ms.
Biggert--and thank you for your advocacy at this hearing and
the resolution that we propose.
TESTIMONY OF THE HONORABLE JUDY BIGGERT, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ILLINOIS
Ms. Biggert. Thank you, Mr. Chairman and Members of the
Committee and thank you, Mr. Chairman. I appreciate your giving
us the opportunity today to speak on behalf of the TRACS Act,
and I would like to express my gratitude for your willingness
to work with my colleagues and me in such a bipartisan fashion
on this important legislation.
As you have heard from the previous speaker, the bill under
consideration today is of vital interest to the people we
represent in Illinois.
In my district, there are over half a dozen cities and
villages that would be devastated by the Canadian National's
proposal of the acquisition of the EJ&E. Their current plan is
to increase freight traffic on the line through our communities
by as much as 400 percent in some places.
The result, according to the STB's own findings, will be a
disturbing increase in accidents, blocked crossings, pollution,
noise, traffic and more. Home values will drop. At least 11
emergency response providers will be cut off from those who
need their protection, and total automobile weight times would
increase up to as much as 165 hours per day at a given
crossing.
Further complicating matters is the fact that the STB and
the Canadian National expect local taxpayers to foot the bill
for 90 to 95 percent of grade separation construction costs.
Like many communities in America, right now our towns and
cities are facing tough economic times. Forcing them to come up
with this 95 percent of the 40 to 60 million dollars necessary
to build just one grade separation will literally break the
bank.
Coupled with the extra safety, noise and other
infrastructure improvements necessary to accommodate the added
traffic through over 112 crossings along the EJ&E, the burden
on the Illinois taxpayer would be crippling, and this is all so
some foreign company can add to its bottom line.
Those defending this merger claim that it will reduce
traffic elsewhere in the Chicago region, but mark my words, it
won't last.
The demand for freight service in Chicago is expected to
nearly double over the next 20 years. Even if some rail lines
see a temporary decline in CN trains, they will be replaced in
short order by trains from other shippers.
And, many of those who currently support this acquisition
haven't yet realized that they too will be asked to pay for
CN's plans in the form of taxes and the disruption of commuter
rail service.
For rail companies, it is an easy and cheap way to increase
traffic through the region without paying for the real
infrastructure investments necessary to balance the needs of
taxpayers, local communities and shippers.
Mr. Chairman, during the time that this acquisition has
been pending before the Surface Transportation Board, Members
of our delegation have had to become quick experts of the laws
governing the approval process for rail mergers. The STB is
required to study how mergers would affect our communities,
environment and even the social-economic impact.
It allows them to set certain and, in my opinion, right now
inadequate conditions on the merger to partially mitigate the
damage. But no matter how bad the impact is, no matter how
contrary to the public interest, the STB approves or denies the
merger based on whether or not it would create a rail monopoly.
That is so unfair to be criminal or at least it should be, and
that brings us to the subject of the hearing today and the
TRACS Act.
Mr. Chairman, I would like to again commend you for your
work on this bill, and I am proud to be an original co-sponsor.
It does exactly what a reasonable person would expect. It
simply requires the STB to weigh the public costs a merger
would have against the transportation benefits. If the
transportation benefits of a proposed plan are completely
outweighed by the damage to the public interest, then a merger
could be denied or additional mitigation required.
And, it spells out common-sense factors that the STB should
consider when determining the public interest: things like
public safety, emergency response time, noise and hazardous
material safety.
To Members of this Committee, I would ask that you strongly
consider this bipartisan vital legislation and, when you do,
keep in mind that your community could be next. The next time a
massive rail company tries to unilaterally impose its will on
small town or suburban America, we should have rules in place
that provide some protection and basic fairness. The TRACS Act
would do exactly that.
Again, thank you for holding this hearing, and I yield back
the balance of my time.
Mr. Oberstar. Thank you very much for your comments and for
your assessment of the common-sense factors. I think that may
be a good new name for the bill, the Common-Sense Railroad
Bill.
Ms. Bean.
TESTIMONY OF THE HONORABLE MELISSA BEAN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ILLINOIS
Ms. Bean. Thank you, Chairman Oberstar, Ranking Member Mica
and Members of the Committee here today for giving us the
opportunity to testify in strong support of H.R. 6707, the
Taking Responsible Action for Community Safety Act or TRACS
Act.
I want to commend Chairman Oberstar's leadership on the
bill and look forward to working with the Committee.
Last month, during a field hearing that my colleagues and I
held in Chicago, we heard testimony from the Illinois
Department of Transportation and the Chicago Metropolitan
Agency for Planning who expressed serious concerns about the
STB review process. The process' narrow focus on a given
transaction in the private sector disregards existing
transportation plans, investments and input from local and
Federal officials.
These hearings raised the following questions:
How is it that a transaction initiated by and for the
benefit of a foreign company and their shareholders would allow
that shareholder upside to be paid for by American taxpayers?
How is it that an Environmental Impact Statement can
acknowledge an egregious burden on American communities but
offer few or no solutions?
Why is it that a private company can preempt regional
planning and transportation priorities that have been worked on
by all levels of government and agreed to in a bipartisan
fashion?
We are here today and got involved in reviewing the STB's
mission and decision-making process because of the local deal
that you have been hearing about that is impacting communities
in all of our districts. But while we will share specific
examples from CN's proposal to acquire the EJ&E, it is
important for you all to note that unless the mandate of the
STB is clarified, communities in your districts can face the
same sorts of challenges.
The current process has historically put the interests of
industry over those of American families and taxpayers. This
doesn't have to be the case. As noted by the Board's most
recent decision, the STB has the ability to deny an acquisition
on environmental grounds. Toward that end, I hope that they use
the CN/EJ&E case to set that precedent.
However, the TRACS Act would clarify their obligation as a
Federal Agency to protect the interests of the taxpayers who
fund them. The impact on a local shipper, while important,
shouldn't outweigh the impact on communities and the citizens
who live there. This bill will require that public impact
concerns are given equal consideration to those of commerce,
but that is not how it appears to be working currently.
As I share details about this transaction with you, I am
speaking not just on behalf of the 8th District constituents
but as a mom who crosses those tracks to get to my daughter's
school, to the grocery store, the post office, almost anywhere
in my community.
But there are over 40 communities along the EJ&E in
Illinois and northwest Indiana whose families will experience a
400 to 900 percent increase in freight train traffic. That is
why there is such strong bipartisan opposition to this deal.
Last November, I requested an Environmental Impact
Statement be prepared to give our local residents a forum to
raise their concerns, and thousands of residents have shown
unprecedented levels of involvement, culminating in over 5,000
residents attending a recent hearing held at a high school that
Congressman Manzullo and I attended right in my district.
The intent of an EIS should be to balance the priorities
between issues of commerce and transportation with community
concerns including safety, quality of life and economic impact.
Regrettably, the draft EIS seemed to endorse allowing a private
company to destroy local communities' quality of life, safety
and economies while expecting those communities to pick up the
tab.
It failed in scope and solutions, specifically placing an
egregious tax burden on local communities by expecting them to
fund the vast majority of mitigation costs for a project they
don't want and will not benefit from.
CN has offered $40 million towards mitigation which is
laughable considering costs are projected at well over a
billion dollars, and that is just for grade separations.
It fails to provide other options or review existing
alternatives. We don't have the time to get into those, but
there are many options about how we build our transportation
infrastructure for the growth that Congresswoman Biggert just
mentioned and to support that growth in the future.
It identifies 11 communities who would be cut off from
their police, fire and emergency providers. It disregards
deadlocked traffic, emissions, noise levels, safety concerns,
thousands of children standing in the cold winters of Chicago
to get to school while 2-mile trains go by and the economic
burdens as well.
The reason we need this bill is that the STB acknowledged
all these concerns, and we need this bill so that they can
weigh those concerns when they make their final decisions and
balance issues of commerce with issues that our taxpayers pay
for. It is a common-sense solution, and it will create equity
and serve the communities and the taxpayers who we all, as
Federal officials or Federal workers, are entrusted to do.
Thank you and I yield back.
Ms. Brown. [Presiding.] Next.
TESTIMONY OF THE HONORABLE PETER ROSKAM, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ILLINOIS
Mr. Roskam. Thank you. I want to thank Chairman Oberstar
particularly for taking the time to come to our region and to
visit and look and listen and spend the time on the ground, to
come to the Chicagoland area and see firsthand. I know he has
been there many times, but it was a great encouragement to me
and my constituents to know that we have a Chairman who is
willing to do that, rolling up his sleeves and taking the time,
physically, to come in.
I just want to point out to the Committee this is a
bipartisan group here, three Republicans and three Democrats
that have come together and are unanimous in this effort in
joining with Chairman Oberstar.
It is sort of an old playbook in Illinois to have city
versus suburb tension, and those of you who represent
metropolitan areas understand that natural tension. Those of
here largely represent suburban areas.
This is a case, with all due respect to the City of Chicago
with whom we have good relationships, but the City of Chicago
benefits from this. And, essentially, they are saying take the
rail traffic that is coming our way and why don't you just
scoot it out and run it through the suburbs?
As Ms. Biggert mentioned a couple of minutes ago, that may
be a good deal for them in the short run, but ultimately in the
long run I don't think that is a very good deal.
I think it bears out in even some of the observations that
have made by the Surface Transportation Board. For example,
they raise the point that there is going to be a 28 percent
increase, likely, in the accidents that come out in the area
that would be impacted as a result of this merger.
With all due respect to CN and the offer that they have on
the table, I don't think it really passes the straight face
test and, frankly, the law at this point doesn't require them
to do it.
I think that this is an effort, and with the Chairman's
leadership we hope to change that dynamic so that they don't
simply have to offer 5 percent of the infrastructure costs and
get all of the benefits because think of the deal that they are
offering.
Essentially, they are coming in and they are saying: Look,
we are going to string rail, and we are going to run it, and we
are going to increase traffic that is going to blow right
through your particular town.
You, as the local community, as the local property
taxpayer, are going to be asked to take on the infrastructure
burden of rail traffic that is blowing through your town,
coming from hundreds of miles away, going hundreds of miles
away.
And, it doesn't create any great value to that particular
community.
I represent Bartlett, Illinois. Bartlett, Illinois is a
town that is out west, in the northwest suburbs of Chicago. It
had conflict after conflict in the past with CN over some of
the rail line.
They are currently putting in place a new fire station, but
this new fire station is going to be cut off from some of the
areas that they need to serve in the future. So, again, CN gets
the benefit, but ultimately it is the local tax payers that
pick up the burden, and that is just not a good deal.
I think the wisdom of the Chairman's approach is brilliant,
and it is elegant in a way because all it does is says: Look,
we are going to put this new and make this one of the
considerations, safety and environmental effects on the
proposed transaction including the effects on local communities
such as public safety, grade crossing safety like Ms. Bean
mentioned, hazardous materials, transportation safety,
emergency response time, noise and other impacts.
Also, we have not really touched on because we have been
focusing primarily on the safety impact, but there is a
commuter line that is in place to be used in this area. Our
region has a real need for enhanced commuter rail up in sort of
the north-south corridor, making an arc around the Chicago
area, and it is called the STAR line.
This is not a NIMBY issue because this is in our back yard.
I mean we represent rail communities. We represent rail-
oriented people. But what we have to do is use this, make sure
that this is used wisely because these types of infrastructure
decisions that are made are going to have an impact not only
today but literally a ripple effect, I think, for a generation
to come.
So we are here as a bipartisan group that has joined
together in, essentially, sending up the signal flare because
we are not going to be alone in this. This is going to be an
issue that is going to have an impact on other communities.
Our hope is that we can invite you to come alongside us and
to come alongside the Chairman to put these really common-sense
things into place and ultimately come up with a system so that
the right criterions are evaluated properly and that it is
balanced.
Mr. Chairman, thank you for the time and the opportunity to
spend with you today.
Mr. Oberstar. [Presiding.] Thank you, Mr. Roskam, for your
very thoughtful comments, well expressed. The effect on the
fire department that you described is evident all through
communities, the 50 or so communities along this route.
And, your statement, goods come from hundreds of miles away
and are destined for hundreds of miles further and little
benefit to the local community, but that wasn't always the case
when the railroads had less than carload service and they would
stop in small towns and pick up and drop off goods, pick up and
drop off the mail and pick up and drop off passengers. That
disappeared with the discontinuances in the 1960s and 1970s and
with the Staggers Act.
Mr. Foster.
TESTIMONY OF THE HONORABLE BILL FOSTER, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ILLINOIS
Mr. Foster. I would like to thank Chairman Oberstar for
this opportunity to testify today and also for his leadership
on an issue of great importance to the people of Illinois and
to our Country.
I would also like to recognize the bipartisan efforts of my
colleagues from Illinois--Representatives Biggert, Bean,
Manzullo and Roskam--and whose work on behalf of their
constituents these past several months has been exemplary.
Finally, I would like to thank my friend and constituent, Mayor
Tom Weisner of Aurora, for appearing today. He has stood up for
his community, provided leadership to the nearby communities
and brought the fight against this acquisition to Washington.
For several months, families and businesses in my district
have overwhelmingly declared their opposition to the potential
acquisition of the EJ&E by Canadian National. I have heard from
them in public forums, on the phone and in private meetings.
They have held rallies and petitioned the Surface
Transportation Board in writing.
Meanwhile, both CN and the STB have ignored these voices.
Last month, Canadian National skipped a public hearing on the
purchase, refusing to participate in any panels not moderated
by their de facto ally, the Surface Transportation Board.
One hundred years ago, railroad barons struck deals in
smoke-filled rooms and made fortunes on the backs of ordinary
Americans. It appears that not much has changed.
Sadly, the public has been largely left out of the process
even though they stand to lose the most in this transaction.
There will be no improvement in the quality of life in the
region and no economic upside.
The recently released draft Environmental Impact Statement
estimates the acquisition will lead to the loss of about 300
jobs in the region. It will also unreasonably saddle local
taxpayers with the cost of mitigation for the project.
The draft EIS provided, at best, a vague and incomplete
study of the 133 grade crossings in the area and, from this,
recommended that CN pay only 5 to 10 percent of mitigation
costs. Grade separations cost about $50 million a piece, and
the STB apparently expects local communities or the States or
perhaps space alien to shoulder most of this burden.
The deal also raises serious public safety concerns, many
of which are simply glossed over in the draft EIS. Increased
traffic on the EJ&E will raise the probability of train
accidents in the area by 28 percent.
Furthermore, the ability of the local fire, police and EMS
services to respond to emergencies in the affected communities
will be hampered by blocked intersections. Once again, the CN
is not directed to help fund projects that will mitigate this
potentially life-threatening problem.
Public transportation will also be adversely affected. Each
year, millions of suburban commuters rely on Metra, but CN has
not agreed to share the tracks along EJ&E. This threatens
construction of Metra's suburban STAR line and presents yet
another financial burden to residents already dealing with high
fuel prices.
The STB must consider the impacts of transactions like this
if they have unwelcome communities. That is why I support H.R.
6707, the Taking Responsible Action for Community Safety, the
TRACS Act.
This legislation would require the STB to consider a
transaction's effect on public safety, grade crossing safety,
hazardous materials transportation and emergency response time
in its decision to approve or reject an acquisition proposal.
Such a proposal would be approved when it is consistent with
the public interest, rejected when it is not.
To be clear, I do not mean to oppose all railway
transactions. Railways are an extremely efficient means of
transportation, and their use can and should increase in
response to rising fuel prices.
However, transactions such as the EJ&E expansion should
only proceed when there is an overall commercial and economic
benefit. That is not the case here. There is something
seriously wrong with a process that leaves out the public
interest and deflects the cost of these acquisitions and
traffic increases onto local communities.
H.R. 6707 will help change this.
Now, a final observation I would like to make is that this
problem, the problem here, is not limited to STB approval of
mergers and acquisitions. A fundamental problem is that there
is no mechanism in Federal law to ensure that the public costs
are balanced against private profit.
As railway traffic increases in the coming decades, if
companies such as CN continue to conduct themselves in ways
that are indifferent or antagonistic to the public interest,
they can fully expect Congress' attention to turn to explicit
mechanisms to ensure environmental and economic remediation for
their actions.
Once again, I thank Chairman Oberstar for the opportunity
to testify and thank the Committee for its consideration.
Mr. Oberstar. I thank the gentleman for his statement. I
think he summed it up very well. The public has been left out
of the process, and the purpose of our legislation is to
reinsert the public interest into the process.
I would simply observe that in a previous hearing on rail
issues, I pointed out that in the period 1820 to 1871 the
Federal Government gave to the railroads 173 million acres of
public land, nearly 9 percent of the land surface of the United
States for the public use, convenience and necessity to develop
a rail system across the land.
There is a public responsibility on the part of the
railroads, to be responsive to the public.
Do Members have any questions? Mr. Shuster?
Mr. Shuster. No, sir. I have no questions, just to express
that I certainly am sympathetic to the needs of the communities
that all of you represent and that are affected by this deal
and also to point out, at this point, I am in no position to
judge whether this should move forward and that in this
Committee, I believe, our role is to make sure that the STB has
the tools in place to make good, wise decisions on whether
mergers and acquisitions like this should proceed.
My concern is that this particular legislation might have
much broader and longer lasting implications and effects on the
rail industry and the transactions that may occur in the
future.
But again, I appreciate all of your being here, and all of
you obviously know your subject matter and put forth a very
compelling case. So I want to thank you for taking the time to
do that. Thank you.
Mr. Oberstar. I thank the gentleman.
Are there other Members who wish to make a comment or
question our colleagues? Mr. McNerney?
Mr. McNerney. Thank you, Mr. Chairman.
I just want to say the testimony was very compelling.
Everyone on the panel said something that was very memorable.
In my own community, we have a similar problem. We have a
town that is bisected by rail. It has cut off the emergency
services from the people that need it, school buses, crossings.
And another town, Tracy, is considering expanding rail service.
So these are very relevant questions and issues.
I want to thank you for your testimony, and I want to thank
the Chairman for bringing this issue in front of the Committee.
Mr. Oberstar. I thank the gentleman.
Are there any others who wish to make comments? Mr. Brown?
Mr. Brown. Thank you, Mr. Chairman. I, too, appreciate the
bipartisan support that this hearing has conducted.
My question would be if we did not pass this bill and the
merger did not go through, would it mean that those railroads
could not be used or could they use them without the merger?
Mr. Oberstar. I think the answer to your question is yes.
The EJ&E, if the STB disapproved the merger, EJ&E would remain
in the hands of U.S. Steel Corporation. The CN would continue
operating as it does. They would just operate on different
levels of service.
Ms. Bean. I think if there is also a question, could the CN
add traffic on the EJ&E?
They could work out a lease arrangement. However, the
length of these new trains that they are proposing to put on
there could not be supported by the existing track. So I think
it is less likely that it would proceed, but that would be
between what their arrangement to do something like that.
Mr. Brown. And my question would be then would this bill
have any influence on extending those tracks under some kind of
new management?
Ms. Bean. No. This bill really doesn't affect this
transaction. It is just affecting the considerations and
clarifying the considerations that we would expect the Federal
Agency to consider and that they already can consider.
But because there is a lack of clarity in balancing the
community considerations with issues of commerce, it will
require them to do that more clearly.
Mr. Brown. Okay. I was just concerned about the
discouraging more train usage because I know the efficiency we
are all dealing with now with the energy crisis and with the
shortage of and dealing with foreign energy. I just felt like
since the rail is more efficient at moving freight, that we
certainly should try to consider all alternatives whether it be
above-grade crossings or some other ways to mitigate the
transaction.
I know I am not from Chicago. I am from Charleston, South
Carolina, but we all have transportation needs and problems
related to that.
Mr. Foster. If I could make, no. Go ahead.
Ms. Biggert. I think that we all really appreciate the
railroads and how they affect our economy and how important
they are and don't want to cause any loss of that, and I think
this type of bill is important particularly.
What is unusual about this merger and most of the mergers
are not concerned with the density in population that this
proposed merger and where the track is would cause such angst
to the communities because of the disruptions and because of
the numbers of grade crossings that you don't really find in
train traffic.
There have been some proposals that will move this out to
an area that is not densely populated. So there is other
consideration and other options that they would have.
So we are not trying to say we don't want commerce, we
don't want trains, but really look very carefully at what the
public interest is, and that is what this bill would allow the
Surface Transportation Board to do.
Mr. Foster. I would just like to explain my comment at the
end in my testimony. The merger and acquisitions are only part
of the problem. As was mentioned by Representative Bean, you
could have a leasing arrangement that would accomplish pretty
much the same thing in terms of transferring the traffic load.
So the problem is bigger than just acquisitions, and I urge
the Committee to think through a set of solutions that would
cause the public interest to be considered everywhere as train
traffic evolves.
Ms. Bean. Can I add one final comment to just draw
attention to what Congressman Manzullo had said?
There is a sincere interest by all of the Members here
today in wanting to solve the issues of congestion and expand
rail traffic and efficiencies in the area, but moving the
problem from one congested, densely populated area to another
densely populated area is just moving a problem. It is not
solving anything.
Mr. Manzullo. Chairman, as the Chairman knows, whenever a
railroad wants to extend a passenger service, there has to be
an alternative study to see if it is the best way to do it, et
cetera.
But here, it is very strange because we are moving the
problem from urban Chicago to suburban Chicago, and the only
consideration by the Surface Transportation Board has to do
with an anti-monopoly issue. The law simply does not make
sense.
Mr. Oberstar. With those remarks, I think the gentleman
from Illinois summed it up quite well, we want to establish a
balance. The purpose of the legislation is to establish a
balance between consideration of mergers between two Class I or
more railroads and those between a Class I and a Class II or
III and to have equitable treatment and consideration of the
public interest.
I thank the panel, each and separately, for their advocacy
on behalf of their communities in bringing this issue to the
attention of the Chair and to our Committee. Thank you very
much for being with us.
We will now proceed to our next panel which consists of Mr.
Nottingham, Mr. Mulvey, Mr. Buttrey, the Board Members of the
Surface Transportation Board.
And, in case you haven't done so before, you have just
heard from the voice of the people, the Members of Congress who
represent the citizens of the communities along the route that
will be affected by the proposed merger. Having thus been
informed, we welcome you to the Committee hearing and look
forward to your testimony.
We will begin with you, Chairman Nottingham.
TESTIMONY OF THE HONORABLE CHARLES D. NOTTINGHAM, CHAIRMAN,
SURFACE TRANSPORTATION BOARD; THE HONORABLE FRANCIS P. MULVEY,
VICE CHAIRMAN, SURFACE TRANSPORTATION BOARD; AND THE HONORABLE
W. DOUGLAS BUTTREY, BOARD MEMBER, SURFACE TRANSPORTATION BOARD
Mr. Nottingham. Good morning, Chairman Oberstar, Ranking
Member Mica, distinguished Members of the Committee. I
appreciate the opportunity to appear before the Committee today
to discuss H.R. 6707.
The purpose of the bill is to direct how the Board should
take certain environmental and safety considerations into
account into its decision-making in merger and acquisition
proposals involving only one large railroad. My testimony will
be fairly general because an issue addressed by the bill is
raised in a pending Board proceeding.
Railroads may not merge with or acquire another railroad
without prior Board approval.
In 1980, Congress changed the standards and procedures for
considering railroad mergers and acquisitions that do not
involve more than one large railroad. Congress found that over-
regulation had contributed to the railroad industry's financial
woes, and so Congress sought ``to provide, through freedom from
unnecessary regulation, for improved physical facilities
financial stability of the national rail system.''
Essentially, Congress changed the statute to require the
Agency to rule on smaller transactions, those that do not
involve two large carriers, more quickly and it ``reduced the
number of factors the Agency must consider'' in those cases.
Under the current standard, the Agency examines whether
there would be a substantial lessening of competition or
restraint of trade if the transaction were approved
The Board must also comply with the broad Federal statute
governing Agency decision-making regarding environmental
impacts. Proper deference to and compliance with the National
Environmental Protection Act, or ``NEPA'' is a matter of great
importance and has been of interest to me personally since law
school where it was a focus of my studies.
I first began working on the front lines of NEPA
implementation and interpretation 20 years ago at the U.S.
Department of Justice's Environment and Natural Resources
Division, the litigating division that advises and defends most
Federal Agencies in NEPA cases.
As any student of NEPA knows, there is a rich history
connecting transportation infrastructure projects with the
development and enactment of NEPA. Much of the justifying
rationale for the enactment of NEPA in 1970 grew out of
concerns that highway planners in particular were selecting
construction corridors with little or no regard to
environmental and community impacts.
As a former State DOT Chief Executive Officer and former
senior official in the Federal Highway Administration, I gained
extensive firsthand experience in NEPA interpretation and
compliance related to projects such as the Woodrow Wilson
Bridge Corridor replacement in Virginia and Maryland, the
Stillwater Bridge replacement project in Minnesota and
Wisconsin, the I-80 widening project in Nebraska and the
Intercounty Connector project in Maryland--important projects
that raised extensive NEPA concerns.
In my more recent work at the STB, I have gained additional
experience working on NEPA issues related to a variety of
proposed rail line construction projects, abandonments_
including those that may lead to Rail-to-Trails projects_and
proposed mergers. I am pleased to report that the STB has an
excellent record in the areas of NEPA compliance and
environmental stewardship.
NEPA requires Federal Agencies to consider ``to the fullest
extent possible'' the potential environmental consequences in
every major Federal action that could significantly affect the
quality of the human environment.
This means that when considering an action that has the
potential for significant environmental impacts, the Federal
Agency must examine potential impacts, inform the public of
those impacts and generally take those impacts into account in
its decision-making.
In doing so, NEPA's implementing regulations direct Federal
Agencies to consider a range of alternative courses of action,
including the ``no action'' alternative, also known as denial.
The consideration of alternatives is intended to prevent
decision-makers from preselecting a preferred course of action
and then ignoring information about alternatives to that
action.
The nature and extent of the Board's environmental review
in railroad merger and acquisition cases varies, depending upon
the extent to which operational changes and traffic increases
are projected as a result of the proposed merger or
acquisition.
However, the environmental review that the Board has
conducted under NEPA in various types of Board cases routinely
includes consideration of the safety and community impacts
described in H.R. 6707, and the Board has imposed mitigating
conditions addressed to those sorts of impacts in various cases
in the past.
H.R. 6707 would place transactions involving only one large
railroad together with one or more smaller Class II or III
railroads under the standard now applicable only to the merger
of two or more large railroads. The bill also would amend the
standards that specifically enumerate certain safety and
community impacts along with effects on passenger
transportation as mandatory criteria that must always be
considered in the analysis.
H.R. 6707 was introduced ``in response to an application
filed last year by the Canadian National Railway, seeking the
STB's approval to acquire control of the 198-mile Elgin, Joliet
and Eastern rail line encircling Chicago.''
It is inappropriate for me to discuss any aspect of this
proposed acquisition while it is currently pending at the
Board. When it is reviewing a proposed merger or acquisition
application, the Board is operating in a quasi-judicial role
similar to an administrative court. As such, Board Members must
exercise extreme caution in commenting on any aspect of a
pending proceeding in a manner that might give the impression
that the Board has reached certain conclusions about a case
before the record is complete and a decision is rendered.
The Board is currently receiving public comments on the
proposed CN/EJ&E transaction. The comment period ends September
30th, 2008.
I understand that the Committee may wish to discuss the
legal question of whether the Board believes that it always had
the authority under the current statute to deny on
environmental grounds a transaction that does not involve two
or more large railroads. However, that issue recently has been
raised in the CN/EJ&E case.
It is a legal issue of first impression, as the Chairman
mentioned, that has not been addressed by the Board or any
court. Accordingly, it would not be appropriate for me to
discuss that issue at this time.
I should note, however, that the introduction of the bill,
purportedly to provide clarity, has to date served primarily to
create confusion. Until this bill's introduction, it had been
assumed that the Agency had the authority to deny a transaction
on environmental grounds. The Board's environmental staff along
with the parties have put forth extensive efforts in studying
the environmental issues in the CN/EJ&E case.
Unfortunately, the overarching premise of this bill_that
the Board currently lacks authority to protect the public
interest, public safety and the environment_could now be
referenced in litigation by parties seeking to pressure the
Board to either approve or deny a pending merger application.
This Board takes its merger review and environmental review
responsibilities seriously, and we have always been able to
take appropriate action to address the environmental concerns
that have been brought before us. If we determine that existing
law does not allow us to protect the public interest and the
environment, we will not hesitate to seek legislative reform.
I would be happy to respond to any questions so long as
they are not focused on a pending proceeding. Thank you for
providing me this opportunity.
Mr. Oberstar. Thank you very much, Chairman Nottingham.
I didn't realize you spent such a chunk of your career on
the NEPA law or that you had been involved in the Wilson Bridge
Corridor or the Stillwater Bridge. You know that issue has
finally reached a decision, and there is now an agreement to go
ahead. The problem is after 20, almost 25 years, the cost went
from $15 million to $330 million, and I don't know when that
bridge is ever going to be built.
Mr. Mulvey, welcome back to the Committee.
Mr. Mulvey. Thank you very much and good morning, Mr.
Chairman, Mr. Shuster sitting in for Mr. Mica, Ms. Brown.
Always nice to see you again Mr. Lipinski and other Members of
the Committee.
I would like to thank you all for giving me this
opportunity to testify today on H.R. 6707, the Taking
Responsible Action for Community Safety Act or TRACS.
At the outset, I would like to make clear that my testimony
today pertains only to the TRACS Act, and it should not be
interpreted as signaling my views on any cases currently
pending before the Board including three control transaction
cases: those between the Canadian Pacific and the Dakota,
Minnesota and Eastern; the oft referenced here Canadian
National and the Elgin, Joliet and Eastern; and the most recent
Norfolk Southern proposal to merge with the Pan American
Railways.
Whether or not the Board can deny approval of a merger that
it has categorized as a minor transaction on grounds other than
potential anti-competitive impacts is a question that is under
review at present. To date, however, the Board has never
rejected any merger on such grounds.
Our statute with respect to minor transactions specifies
that we focus on anti-competitive impacts. On the other hand,
the National Environmental Policy Act or NEPA directs that
agencies take a so-called hard look at potential environmental
impacts in carrying out their mandates.
``The Congress authorizes and directs that, to the fullest
extent possible, one, the policies, regulations and public laws
of the United States shall be interpreted and administered in
accordance with the policies set forth in this chapter'' of
NEPA and, secondly, that ``all agencies of the Federal
Government shall'' give appropriate consideration to
environmental concerns in their decision-making along with
considering economic and technical aspects.
They should also explain the environmental impacts of the
proposed action, identify any unavoidable adverse impacts and
any alternatives to the proposed action including the no action
alternative.
There seems to be a conflict here, and as a result the
question of the scope of the Board's authority is very likely
to wind up in the courts in the very near future.
A related concern of mine is the way in which the Agency
has categorized mergers in the past. That is we have three
categories of mergers: major, significant and minor.
I have long thought that the Agency's categorization was
problematic in practice because the significant category is
almost a null set. The Agency has only categorized one
transaction as significant since 1993.
Now when I was on this Committee staff, I was very critical
of the Board's categorizations. Several proposals came before
us, which I believed should have been categorized as
significant because of their far-reaching impacts, which the
Board classified as minor. In fact, virtually all non-major
transactions were determined to be minor even where there were
important regional impacts, at least in my opinion.
I believe that mergers, other than those involving two
Class I railroads, that have regional or national
transportation significance should be classified as significant
in accordance with our existing statute.
Over the past year, I have made clear my views regarding
the Board's categorization of particular transactions, in
several cases dissenting when they were classified as minor.
I believe it is important that we continue to differentiate
amongst transactions although what is considered significant
needs to be recalibrated because of changes in the railroad
industry since the Staggers Act of 1980.
I also believe the Board should accord the fullest due
process permissible under our existing statute to all
transactions before it, including adequate opportunities for
stakeholder participation in developing the evidentiary record
and in undertaking the environmental review process.
Now I am not opposed to the TRACS Act. I believe the Board
should consider the public interest, including environmental
issues, in some manner in deciding whether or not to approve
control transactions.
If the Board already has a direct authority to do so, then
the TRACS Act is not needed. If it does not have that
authority, then I would welcome the additional authority to do
so.
So while I have already stated I don't oppose the TRACS
Act, I do want to comment on a practical problem that I do see
with it. Section 2 of the TRACS Act requires that the Board
hold public meetings ``in the affected communities unless the
Board determines that public hearings are not necessary in the
public interest.''
It appears that this language provides a suitable amount of
discretion for the Board to determine whether or not and where
to hold hearings and how many hearings to hold and how to
conduct such hearings. However, I do want to emphasize that as
a small agency, we currently dedicate a considerable portion of
our resources to holding hearings, and I urge the Committee to
be mindful of this in light of the size and scope of potential
future transactions.
As you know, Class I railroads operate networks in the tens
of thousands of miles running through literally hundreds of
communities. It would be impractical and impossible for us to
hold hearings in every community that might affected by a major
merger.
That concludes my statement, and thank you for the
opportunity to testify today, and I look forward to answering
any questions the Committee might have.
Mr. Oberstar. Thank you very much for, as usual, your
thoughtful comments on pending legislation--as you, Mr.
Chairman.
Now, Mr. Buttrey.
Mr. Buttrey. Good morning, Mr. Chairman and other Members
of the Committee.
What I would like to do, if I could with your permission,
is to associate myself with the remarks of the Chairman. If I
had said what my views were, they would be exactly in line with
what the Chairman said.
So I am not going to submit separate testimony in the
interest of time. I would be happy to answer any questions you
might have.
Mr. Oberstar. Well, thank you very much. You are of one
accord.
Chairman Nottingham, you say it has been assumed that the
Agency has the authority to deny a transaction on environmental
grounds. Then you go on to say it is a legal issue of first
impression that has not been addressed by the Board or any
court.
So how can you come to the assumption or conclusion that
the Board has authority when it hasn't been tested and when the
precedent is with the Interstate Commerce Commission that the
Board does not have that authority and a Federal Court affirmed
the ICC position?
Mr. Nottingham. Thank you for the question, Mr. Chairman.
The case you reference, I believe, is the Seventh Circuit
case. It did not relate to NEPA whatsoever. As you point out,
the ICC was affirmed.
It related to a labor issue. The petitioner sought to
require the Board to consider a labor question. So there
weren't two competing statutes at play there. There was an
argument that the Board should consider labor impacts.
In this situation, I have to be careful wading very deeply
into it at all because, as you did point out, we have been
served legal paperwork by the CN indicating very clearly we may
well be in court with them very soon, where they seem to assert
that we don't have certain authority.
But it is important to recognize we do have two statutes
here. In the first panel, you heard a lot about the first
statute which is the one that says we should consider, and look
at impacts, economic impacts and what not.
You didn't hear much about the National Environmental
Policy Act which is a very broad and sweeping statute. We have
always assumed that it applies to everything we do, every
Federal action, just as it does to reach every other agency in
the Federal Government.
We often and very regularly interpret statutes before they
are ever litigated in court. Usually, it is not too difficult
to read a law and make sense of it, and that has always been
the understanding with the Agency.
Mr. Oberstar. Well, this is a very important issue to
address and goes to the heart of the concerns of the previous
panel of Members and those witnesses who represent the
communities from whom we will hear shortly.
I go back to the origins of the dissolution of the ICC and
the Staggers Act, and subsequently Reese Taylor, who was
Chairman of the ICC, said in a hearing in the Senate that in
those cases, the cases not involving two Class I railroads, the
Commission is directed to approve the application unless it
finds there is likely to be a substantial lessening of
competition and the anti-competitive effects outweigh the
public interest.
Then Reese Taylor goes on to say that, I think, this is an
area of the law that should be addressed by the Congress. The
Senate didn't address it, unfortunately, and left it lying
there on the table for all this time.
But the direction that the application shall be approved
unless the Board finds serious anti-competitive effects that
outweigh the public interest, the burden of proof really shifts
doesn't it?
Mr. Nottingham. I don't know former Commissioner Taylor.
That was, I think, in the early eighties when apparently he
testified.
Mr. Oberstar. It was. It was 1981.
Mr. Nottingham. I don't know the full context even of the
hearing. I expect, though, that it was not focused on NEPA
whatsoever. Very often, we get into dialogues about our
statutes, and if we take statements in a certain context and
try to apply them to another context they are not really good
fits.
But, in any event, if the Committee is inclined to address
the issue of what authority the Board may or may not have, I
would propose that there are very short and more surgical ways
to do that, just something as simple as nothing should be
interpreted to imply that the STB isn't governed by the full
parameters of NEPA. I am sure counsel could draft it even more
capably than that.
We have no problem being governed by NEPA. We have been
acting as if we have been governed by NEPA for many years. We
are acting currently as if we are governed by NEPA in all of
its entirety.
The bill, unfortunately, does a lot more than that and sets
up kind of a parallel regime that is very similar on the one
hand, but on the other hand looks to be crafted, perhaps by
some--it may be not the intention of the Chair by any means--
but to add litigation, add points to argue over in addition to
the NEPA issues which we very thoroughly address and are
addressing.
Mr. Oberstar. Well, that hearing that I referred to in the
Senate was a review a year after enactment of Staggers on the
issues, on the concerns, the problems, try and raise issues
about what might need further to be addressed.
Chairman Taylor said that transactions involving smaller
railroads was a problem area in the legislation possibly in
need of redrafting. That was rather insightful at the time,
foreshadowing the issue we are dealing with today.
It wasn't specifically on NEPA, but the hearing was
generally on the issues involved in implementing the Staggers
Act.
What unintended consequences do you think there are of this
legislation, since you made that statement, and how would you
propose we address them?
Mr. Nottingham. I have some concerns about the
retroactivity of the bill, the fact that it would reach back
and apply to matters that are currently before the Board. We
have at least three good-sized--I use that phrase because I
don't think it gets me in legal trouble, good-sized. We have
words like ``significant'' and ``minor'' and ``major'' that all
have these special technical meetings, I have learned at the
STB_we have at least three good-sized mergers pending with us
now.
It is a little awkward for the Board, although absolutely
fully within Congress' discretion to reach back in a situation
like this and address something retroactively. We respect that
completely. We will implement whatever regime the Congress asks
us to.
What we are currently doing is our best to implement the
regime that currently is in law.
I do worry that having set up a parallel structure that on
the one hand is very similar to NEPA but goes by a different
name and was put forward into the record with a lot of
statements, both in the record and also in the media about
intent, the intention to affect one particular transaction that
we heard about in the first panel and we will hear about in
later panels. It is of concern to me. I think we will see more
litigation, not less.
It could in cases, future merger cases where there really
aren't major environmental issues, it could be taken advantage
of to basically have a dampening effect on transactions.
In a hypothetical case, it could really be a win-win-win
merger, but you can always find someone who, for whatever
reason, wants to object to or take advantage of a new second
opportunity, a second bite at the apple, so to speak.
Mr. Oberstar. Well, your statements are on the record, and
I appreciate that. If you have further thoughts, we welcome
your written submission subsequently, and we will take those
into consideration when we eventually move to a markup on the
bill.
Our purpose is not to stop transactions necessarily but to
give Board authority to adjust those transactions to
accommodate the public interest.
Now, Mr. Mulvey, is there any reason we should not have or
the Board should not have authority to deal with a transaction
of a Class I and a Class II or III as it does with transactions
between two Class Is?
Mr. Mulvey. No. I don't think it is the size. It is not so
much the size of the transaction or the size of the railroads.
It is the impact of the transaction that we should be looking
at.
It can be a situation where although the railroad is
relatively small, if the environmental impacts are large, then
we ought to be able to impose the mitigations that are
necessary to protect the public interest. So we should always
be balancing the public interest versus the benefits of the
transaction.
As I have said in my statement, I am not opposed to us
having this authority. The question, of course, is whether or
not we already have the authority, and that is the question
that is unanswered.
In light of what you were mentioning before about
Commissioner Taylor, this was right after the Staggers Act, and
as you recall, in those days the interest was making sure that
the railroads were free from excessive regulation, as Chairman
Nottingham mentioned a few moments ago.
I think the focus was on making it as easy as possible or
focusing on making it easier for railroads to merge and to
rationalize the system because the ICC had been seen as a
barrier to rationalizing the rail system, and in those days
there were too many railroads. So, focusing on that, one can
understand why that would be the case.
NEPA, I think, wasn't thought of at the time, but I think
he was pressured in realizing there could be problems coming up
later on.
Mr. Oberstar. Thank you very much.
I will withhold further questions at this time and
recognize the gentleman from Pennsylvania, Mr. Shuster.
Mr. Shuster. Thank you, Mr. Chairman.
I thank the members of the Board for being here today.
Could each of you just briefly clarify? Do you believe that
you can decline an approval on transactions between Class Is
with a Class II or a Class III? What is your position?
I am not sure I understand what your thoughts are. Do you
think that, the three of you?
I know you are going to go to court, but your view today is
can you decline an approval at this point under the current
law?
Mr. Nottingham. Congressman Shuster, you asked the question
generally, which I appreciate, because generally the answer is
very simple: Yes.
What is untested, though, is whether or not we can invoke
NEPA to deny.
We can certainly, if the right facts and circumstances
exist. It is unquestioned that we can invoke our other
governing statute if the facts are present.
But I need to just refrain. We are going to be in court
soon, we expect, fighting this out. Despite what you might have
heard in the first panel, the railroad, at least one of the
railroads with a pending matter seems pretty inclined to
express unhappiness with the Board and take us to court, and we
need to be prepared to protect the public interest in that
setting.
Mr. Shuster. Right. Mr. Buttrey?
Mr. Buttrey. I have really nothing to add substantively,
Congressman, to what the Chairman said.
It is clear, I think, if you look at all the reports,
statements and opinions and decisions in this matter up until
this point and the fact that we are going through this
environmental process right now where we are having public
hearings in the areas that are affected by this proposed
action, that the Board has assumed all along that it had that
authority.
Mr. Shuster. Right. Mr. Mulvey?
Mr. Mulvey. Well, the authority is what we can do about
environmental impacts. We certainly have said that we have the
authority to require mitigation of environmental impacts, and
this was for non-double Class I merge. This is one of the first
times that we have actually done such an extensive
environmental review of a merger.
I might add, by the way, it was mentioned earlier about the
Board's environmental review being somewhat cursory. I think if
you took a look at our draft Environmental Impact Statement, it
looks far from cursory. The thing looks like New York City
phone books. It is a fairly extensive look at this.
The issue really is whether or not we can turn down the
merger based on environmental impacts alone or whether there
also has to be competitive considerations or whether we are
limited to only requiring reasonable environmental mitigations
of the merger, and that is something which is before the
courts. We will have to see how the courts rule on that,
whether or not we have the authority or not.
Mr. Shuster. Right. That brings me to, when you mentioned
that environmental study, the law states that the STB shall
approve transactions if it does not involve two Class I
railroads unless it impacts competition. Can you talk a little
bit about that?
You are doing a full environmental review. As you have
said, it is no little thing. I understood it is $20 million and
several hundred, if not a thousand, pages. Can you give the
rationale of why you went through that and what?
Mr. Mulvey. Although that transaction was classified as a
minor transaction, and I disagreed with that--I thought it was
at least a significant transaction--we did feel, however, the
potential environmental impacts of all these communities that
would be affected and the number of trains that would be
increased certainly met the threshold for requiring an
Environmental Impact Analysis.
And so, we said that despite the fact that it is a minor
transaction we are going to go ahead and a full Environmental
Impact Analysis, and a contractor was employed.
I believe they have a couple hundred people working out
there, looking at all these grade crossings and calculating the
safety impacts, the pollution impacts and the like. Then,
depending upon their report, at some point we would have the
responsibility of recommending appropriate mitigations.
The question as to whether or not we can actually turn it
down based solely on that is one that is open and hasn't been
decided yet.
Mr. Shuster. Right.
Mr. Nottingham. I can just add, Mr. Shuster, that our
decision to conduct a full blown NEPA Environmental Impact
Statement has at least two rounds of public comment. We are in
our second round of public hearings now. We did some in
January. We did some a couple weeks ago. We are doing more this
week in the communities that are impacted.
We have had record turnout, thousands and thousands of
attendees. The record is being well developed and is open until
September 30th.
That wasn't an accident. We didn't do that by some
oversight. It was a thoughtful step and, frankly, a step to
keep us from losing a NEPA lawsuit because we fully anticipated
that unhappy stakeholders would see our ignoring NEPA as very
consequential if we were to do that.
Mr. Shuster. Right. Thank you.
Mr. Chairman, I see my time has wound down, but I have one
more question.
Mr. Oberstar. The gentleman may proceed.
Mr. Shuster. Thank you.
Concerning the proposed changes in this legislation, have
you looked at it? What do you feel will happen to the review
process and the work load at the STB? Do you have the
resources?
It would be my view that it would significantly increase
the time to review something, the manpower to do these reviews
on what are much smaller transactions. Can you just address
that a little bit?
Mr. Nottingham. I want to be careful not to overstate the
impact on the Agency. That is not a big concern to me. It very
often is, as the Chief Executive of the Agency. As Chairman, I
have to keep a very keen eye on resource allocation and staff
work burdens.
It is fair to say we do most, if not, I believe, all of
this type of analysis that is referenced in the bill when we do
a full-fledged EIS as we currently are with the pending merger
of the CN/EJ&E. So, in many respects, the bill is not asking us
to do work that we don't always do.
It is just, by setting up a parallel regime, it gives
parties who want to object to our work kind of two bites. They
can attack us on whether or not we followed NEPA perfectly.
Then they can attack and say, well, we didn't cross-reference
it to this other statute.
It creates something that you don't see. I am not familiar
in the highway sector or other transport sectors where you have
NEPA review, which governs all the sectors across the board of
the government and an additional environment review.
Now, with this bill we will pick on the railroad sector in
particular and have this only for the railroad sector, this one
additional review, implying that there is not adequate review
currently. We think, of course, there is adequate review
currently.
If the concern truly is about whether or not NEPA in its
full glory applies to every action the Board takes, that can be
stated in a congressional statement in about 12 words or less.
Mr. Shuster. Okay. Mr. Mulvey, how do you feel? You look
like you were needing to add.
Mr. Mulvey. I wanted to add that we do a lot of
environmental analysis above and beyond these kinds of mergers.
Every time there is a major abandonment or a significant
abandonment of a mile or two of railroad, we make sure that
that line of railroad is abandoned in accordance with the
environmental laws to make sure that the tracks or the ties are
taken away and that they are not allowed to pollute streams and
what the impact of abandoning a line would be on fisheries and
historic sites, et cetera.
So we are very much involved in doing environmental
analysis with abandonments, and it is also true for any new
construction.
If we have any new railroad construction, for example, the
new construction by the DM&E into the Powder River Basin, we do
a very, very thorough environmental analysis. We did so for PRB
as we will also do if the Yucca Mountain project goes forward.
So we already do environmental analyses for new constructions.
Mr. Shuster. Thank you.
Thank you, Mr. Chairman.
Mr. Oberstar. I thank the gentleman for his questions and
the Board for their response.
Ms. Brown, the Chair of our Rail Subcommittee.
Ms. Brown. Thank you, Mr. Chairman, and thank you for
holding this hearing.
I guess I will go right to you, Mr. Chairman. How does the
Board define public interest?
Has the Board ever denied any merger application on public
interest grounds such as adverse safety and environmental
conditions since the enactment of the Staggers Act? To the
Chairman and then the others can respond.
Mr. Nottingham. I don't believe the Board has ever denied a
merger on environmental or community impact or safety grounds.
The first part of your question about how do we define.
Ms. Brown. Public interest.
Mr. Nottingham. Public interest and was it reasonable
mitigation? Was that the question?
Ms. Brown. No. Has the Board ever denied any merger
application on public interest grounds such as safety or
environmental conditions?
Mr. Nottingham. Not on environmental. Occasionally, I
believe in the past, distant past, the public interest could
have been cited in sort of the economic analysis and sort of
the traditional non-environmental analysis of a merger or two
but not on environmental or community impact grounds.
Ms. Brown. Anyone that is going to respond to that?
Mr. Mulvey. No. That's is an accurate statement. We have
never. As I said in my own statement, we have never turned down
a merger on environmental bases.
Ms. Brown. The panel just before you had serious concerns
about safety and the number of accidents. It seems as if it is
not addressed, and I guess that would be the concerns of any
Member, of the safety. It just doesn't seem to be in place.
In reading, reviewing the information, I understand that
accidents will go up, but overall it will go down.
I know you don't want to talk specifically about this
particular case. But the safety, it is not being addressed?
That is what it seems.
Mr. Nottingham. Chairwoman Brown, if I could just say,
generally speaking, I am not speaking on any particular case
here.
Ms. Brown. Right.
Mr. Nottingham. When we review transactions at the STB, we
absolutely consider safety impacts. We, and the Federal
Railroad Administration, look carefully at the rail safety
integration plan as we have done in the pending merger that has
been discussed today. We absolutely look at any safety benefits
or dis-benefits and assess those. We look at historic data.
We have a draft, very voluminous as Vice Chairman Mulvey
pointed out, a draft Environmental Impact out for the public
right now, and it spotlights and flags a number of issues.
I just want to be careful. We are not at the point in the
process where we are announcing the Board's action based on
those issues.
Some of the first panelists, I worry, confuse the fact that
there is a draft out and they haven't seen action out yet with
the belief that we would never take corrective action or
appropriate action. That couldn't be further from accurate. I
just want to make sure we have a chance to clarify that.
Ms. Brown. Back to public interest, what is your
definition?
Has the Board ever denied any merger application on public
interest grounds and you are saying?
Mr. Nottingham. Not in terms of invoking environmental or
community impact.
What I don't know is whether back, and this Agency has a
100 plus 20-some year history going back to the ICC. I don't
know whether I can turn to counsel.
I am advised, excuse me, that it bears correction. A
predecessor board did deny the Santa Fe Railroad/Southern
Pacific proposed merger sometime in the past, before my time,
on public interest grounds.
Ms. Brown. Okay. I yield back.
Mr. Oberstar. I thank the gentlewoman for those remarks.
Mr. Lipinski.
Mr. Lipinski. Thank you, Mr. Chairman.
I thank Chairman Nottingham and Vice Chairman Mulvey and
Mr. Buttrey for their testimony here today.
As you all know, I represent a district in Chicago, in the
suburbs of Chicago. I grew up living less than a football
field's length away from railroad tracks, and I now live in a
village of a little under 13,000 that is bisected by a railroad
line that has between 160 and 170 trains per day going through,
3 of which had me stuck on the way to the airport yesterday.
This line also cuts off my side of town from the fire
station, and there are no grade separations there. So I know
all too well the safety issues and the inconveniences that can
be caused by trains.
But I also know that Chicago is the rail hub of North
America. As you well know, it is also a very bad choke point
for rail in North America. So that is why I was happy to get
$100 million in the SAFETEA-LU bill a few years ago to begin
phase one of the CREATE program, the public-private partnership
to help ease congestion on the rails and on the roads in
Chicagoland.
I am very proud of that earmark. No matter what people are
saying about earmarks right now, I am very happy about that,
and I want to thank Chairman Oberstar for support in that. You
all know how important that program is for not just Chicagoland
but the Country.
So when the CN acquisition plan was announced, I
immediately wanted to know two things: first, the regional
impact on safety and on affected communities and, second, the
economic harm and benefits to the region due to the effect on
the congested rail lines.
Now, while I commend the STB for holding a series of public
meetings in Chicagoland, I do want to express my strong concern
that the attention and focus has been on the communities along
the EJ&E while communities in Chicago and inner suburbs such as
those in my district have largely been left on the sidelines.
Analysis by two faculty members at University of Chicago's
Harris School of Public Policy Studies points out some
interesting facts. Professor Berry and Professor Bueno de
Mesquita note in their analysis that the majority of the public
meetings have largely been held in communities along the EJ&E.
There were seven scoping meetings. Six were held in the
outer suburbs, only one in Chicago.
There were 22 outreach meetings for minorities. Only one
was held in Chicago.
And, there were eight public hearings to comment on the
draft EIS, and only one was held in Chicago.
I would like to ask unanimous consent to include this
report in the record.
Mr. Oberstar. Without objection, so ordered.
Mr. Lipinski. It is also my concern that 45 of the about 60
pages of draft EIS Executive Summary concentrated impacts in
communities that might see an increase in train traffic.
Bridgeport, Beverly, Mount Greenwood, Garfield Ridge,
Clearing, Chicago Ridge, LaGrange Park, North Riverside,
Berwyn, Riverside, Oak Lawn, these are some of the communities
in my district that are going to see fewer trains as a result
of this transaction. There are more than 60 communities,
densely populated communities that will see fewer trains.
Now I believe that all voices need to be heard. A loud
minority should not drown out a silent majority especially when
there may be issues here of environmental justice.
Now to better understand where we are at right now, I sat
down and reviewed Section 11324 of Title 49, U.S. Code, as we
have been talking about here today.
Subsection A says the Board shall hold a public hearing. It
also speaks to the issue of public interest. As Chairwoman
Brown just suggested, public interest here is unclear, what
that means.
The statute does not speak to the issue of community
concerns and impacts, and it does not specifically direct that
all voices be heard. So that is why I believe we need to
clarify the current statute to ensure that all voices are
heard.
I want to applaud Chairman Oberstar for his leadership on
this issue and for introducing this bill because of this needed
clarification.
Now, with a little bit of time left, I wanted to just ask
the Board what is the methodology that is used in determining
where hearings will be held and how can we ensure that all
voices are adequately heard in the future on any railroad
acquisitions?
Mr. Nottingham. I will take a stab at that, Mr. Lipinski,
if I could.
We don't have any printed established methodology per se on
holding hearings. It is a case by case decision. The Chairman
typically collaborates with the other Board Members on matters
like that.
I will say we have had more public involvement
opportunities in this proceeding, this EJ&E application, than I
believe the Board ever has in the past. I believe eight scoping
meetings, eight meetings on the draft EIS that are going on
currently. When the record closes September 30th, we will get
together and decide what, if any, additional hearings might be
appropriate.
The record, based on the mail I am getting and I read every
day_and those letters all go into the record_the record, as I
have reviewed it, it is extensive. I don't get the impression
as I sit here today that too many people are not being heard,
but I will reserve judgment on that until the end of the
comment period.
I know that the team is working on the EIS, and I won't
speak substantively about it. I can't.
But you asked a process question. They are very aware and
focusing a lot on both the benefits and dis-benefits,
potentially, of this merger, costs and benefits, looking at the
safety data and whether or not safety is improved in some
places and not improved in others and trying to quantify that.
So these are incredibly important considerations that you
flag that are definitely getting into the record appropriately,
and they will definitely be considered.
On hearings, we are open to suggestions. We have received a
lot of mail about hearings, and we will keep an open mind on
that.
Mr. Lipinski. Any way that you could see that you could see
changing the statute to ensure that all voices across the board
are heard, all that may be impacted?
I can understand that usually when you are looking at a
situation just as this, maybe the first thing is you look at
where is there going to be a negative impact caused by more
trains going through. I think this may be a unique situation
where there really is a need for a regional view rather than
just looking at the impact on that one line that may be
purchased.
So is there anything specific that you might recommend to
make sure that all voices will be heard, any changes in the
statute to be more clear to the STB in the future how this
should be done?
Mr. Nottingham. I just think NEPA is very comprehensive on
this point. It has been very well litigated. The agencies are
required to make informed considerations of significant
environmental impacts, both positive impacts and negative, and
we are doing that.
I don't see the problem here. It is a little bit like
voting, I guess, to a certain extent. It would be nice if every
single person always voted in every election, but some people
opt not to. I don't know why.
But we think we have gotten comments, believe me, thousands
on all perspectives.
Mr. Lipinski. I truly believe that.
Mr. Nottingham. On all perspectives and viewpoints on this.
So we will wait to see after September 30th to cast judgment
whether we think it has been a failed public comment and
interaction process or not. So far, I don't think it is.
Mr. Mulvey. I think it is a judgment call, and I think you
have to rely upon making good judgments as to when and where to
hold these hearings. We do work with the contractor who helps
put together these hearings.
And, I think you are absolutely right, that the concern
starts out being, well, where are the negative impacts, and
perhaps you have many more hearings where you are expecting
negative impacts and not having a sufficient number where there
are, as you say, positive impacts.
That is something I think is a learning process. If this
comes again, one could expect that perhaps you would be
sympathetic to making sure that we have a better balance in
where we are holding these hearings.
Mr. Nottingham. If I could just add, Mr. Lipinski, under
the National Environmental Policy Act, what an agency cannot do
is just tally up the comments, put them in different piles--
pro, anti, neutral--and then you vote for the tallest stack.
That is not how it works. That just would reward people who
have the money to hire consultants and lobbying teams and
grassroots teams to go out and flush neighborhoods with flyers
and get people to sign petitions.
We look at the thoughtfulness of the comments, have experts
double-check those for accuracy. One or two very salient,
thoughtful comments can make more difference than one or two
thousand comments that were just ginned up by some grassroots
consulting firm with people not even knowing what they are
signing onto.
But we look. We try to get beyond the numbers and look at
the actual data impacts.
Mr. Lipinski. I appreciate your understanding of how this
process oftentimes will work and that all the voices are heard,
not just the ones that do have the extra cash to hire the
consultants.
So I thank the Board for their comments and thank the
Chairman for his indulgence.
Mr. Oberstar. I thank the gentleman.
The gentlewoman from California, Ms. Richardson.
Ms. Richardson. Thank you, Mr. Chairman. It is good to be
back and see you.
Gentlemen, both the Port of Los Angeles and Long Beach are
just one block outside of my district. So 45 percent of the
entire Nation's cargo goes through my district.
And, Mr. Chairman, I thought I would bring out a point of
something we haven't talked about today.
In a letter dated from the Port of Long Beach, it says:
According to the statements made by CN, the EJ&E merger will
allow the railway to expedite cargo moving from Canada to the
U.S., resulting in cargo diversion from the U.S. ports to
Canadian ports. Such statements and their implications must be
studied by STB in detail when assessing the value of this
proposal.
The Port of Long Beach knows firsthand the environmental
and transportation impacts of goods movement as well as the
benefits of ports and what they have on the national economy.
That is why we respectfully ask that you contact--they are
asking me to contact--the STB to ensure that they review all
available information to determine the impacts this proposed
project will have on the Nation's economy, the job market, the
environmental and the movement of goods throughout the United
States ports.
So, therefore, my question is how much business do you
anticipate the ports would lose?
Have you conducted a job analysis, job loss analysis, and
would the U.S. gain any real jobs as a result of this merger?
Mr. Nottingham. I am afraid, Congresswoman Richardson, I am
not going to be able to answer that question partly because it
relates to a pending proceeding.
I will say we are getting a lot of information along the
lines of the statement you just made on the record. The record
will close September 30th, and we will be reviewing it after
that intensely. We already are reviewing aspects of it now.
So I don't want to say anything. If I say anything further,
I think I would be stepping over the line of saying something
that sounds like I think the merger is a terrific idea or not a
terrific idea or what have you. I just need to check myself
there, and I apologize for that. I hope you can understand.
Ms. Richardson. Sure. Then my only request would be that
due diligence would be met to address the concerns that I
brought forward for the record.
Thank you, Mr. Chairman.
Mr. Oberstar. I thank the gentlewoman.
I just have a follow-up question. We need to get on to the
other witnesses.
Mr. Mulvey made a very pertinent observation, that the size
of the railroad should not be the determinant on whether action
is taken on environmental or other public interest factors.
Has the Board ever rejected or ordered a modification of a
proposal involving a Class I and non-Class I railroad, Mr.
Nottingham?
Mr. Nottingham. Well, your question raises a couple quick
issues, Mr. Chairman. One is, first, let me say it is not our
position that the size of the railroads involved in the
transaction dictate the level of environmental scrutiny.
Two of the smallest railroads in the world could get
together in the wrong place at the wrong time and trigger all
of NEPA and its implementing regulations, that we follow. We
don't check or curtail our level of NEPA review based on the
size of the railroads involved.
But, as Vice Chairman Mulvey pointed out, the statute has
two different processes on what I will call the economic impact
analysis, the effect on shippers and competition and the
market. I don't want to speak for Mr. Mulvey, but I think he
said smaller looking transactions can trigger pretty serious
competition and marketplace and shipper impacts.
So I won't speak for you any further than that.
Mr. Mulvey. That is fine. No. That is what I was saying.
In light of what you were saying before, by the way, with
regard to when taking into account public interest, the only
time we have taken into account public interest was an economic
interest in that merger.
I don't want to leave the impression that that public
interest was environmental or safety in that case. It was, to
respond to Ms. Brown's question, it was an economic interest.
Mr. Oberstar. Sure. There are a range of public interests
and concerns, yes.
But the Board, in fact, has not exercised authority to
modify, has it, a transaction involving a Class I and non-Class
I railroad?
Mr. Nottingham. Excuse me, Mr. Chairman, if I could confer
with counsel because I want to make sure I get this right.
There is a long history here, and I want to make sure.
Mr. Mulvey. Since 1966.
Mr. Oberstar. We have not been able to find any. Maybe in
the recesses of your memory over there, maybe you do have some.
Mr. Nottingham. I'm sorry to be delayed. I do need to say
that in the not too distant past our review of the DM&E/
Canadian Pacific merger, we imposed very significant mitigating
conditions.
If your question is denial.
Mr. Oberstar. No. The question is modification, and the
DM&E was denied subsequently on other grounds by the Secretary
of Transportation on the financing side.
Mr. Mulvey. The loan was.
Mr. Nottingham. The financing, yes. We prevailed in the
court of appeals on the quality of our review, and we will be
doing a full-fledged EIS of that in due course if they actually
proceed with their new line construction.
Mr. Oberstar. All right. I welcome your thoughts,
collectively, on our proposed legislation or introduced
legislation, I should say, and any recommendations you have for
further clarification or clarity and wording of the legislation
would be welcome.
In a precedent I am thinking of in France, in the TGV line
between Paris and Tours, a 220-some mile line, Ms. Brown will
remember this. She was on the tour with us when Florida was
considering their high-speed line from Sanford to Miami.
As the line approached this rich wine-growing region of
France, the vintners, raised vigorous objection that the train
was going to cause vibrations in the substrata that would
affect the bottled wine in the caves, in the limestone caves
where it was aging, and they were concerned it was going to
deteriorate the quality of this very rich, especially white,
wine in the Tours region.
That is a language I speak fluently, French, and I had
quite an engaging discussion with the mayor of the town, the
president of the oldest vineyard in the region and the TGV
authority, government authority who was there with us.
I won't go into all the details. But after a year of
testing of vibrating wines in bottles, aging, there was a test,
a blindfolded test in which the vintners themselves were
required to taste wine that had been vibrated with the
sensitivity of the vibration would be emitted by the TGV and
those that were not.
At the end, they were asked to grade the wine. The one that
got the highest value was the wine that had been vibrated.
[Laughter.]
Mr. Oberstar. These are people who that is their business.
That is their livelihood.
Mr. Nottingham. Mr. Chairman, you may have just identified
a point where we would, I think, all agree that there is an
opportunity for expanded STB jurisdiction, if you want to have
us help with that dispute resolution.
Mr. Oberstar. I think you should have that authority over
there in Tours.
Mr. Nottingham. I thought you were making a Buy America
statement until you got to the end there.
Mr. Oberstar. No, no. In the end, they said: We don't care
whether it makes the wine better or not. We don't want the
vibrations.
So they built a tunnel, and they built huge blocks of
styrofoam into that, feet in depth blocks of styrofoam into
that tunnel to absorb any possible mitigation.
Mr. Mulvey. Mr. Chairman, we had the same issue with regard
to the Mayo Clinic and the DM&E. The Mayo Clinic was concerned
that the vibrations from the increased traffic on the DM&E
would affect the MRI machines, and so that was a concern even
though these trains were six blocks away.
As you also remember, with the Maglev, people were
concerned about electromagnetic fields coming from the Maglev
trains that would affect the milk production of the cows along
the area. Of course, as you know, the Germans spent a lot of
time looking at whether or not EMF would affect the cows and
their milk production.
So these are always concerns, and they do deserve to be
studied.
Mr. Oberstar. They certainly do, and we want to give you
authority to be able to deal with those problems, and that is
the purpose of this legislation.
I thank you all.
Mr. Shuster, do you have anything further?
Mr. Shuster. No.
Mr. Oberstar. Thank you for your presentation this morning.
Mr. Nottingham. Thank you, Mr. Chairman.
Mr. Oberstar. Our next panel will include Mr. E. Hunter
Harrison, President and CEO of the Canadian National Railway;
Ms. Karen Darch, President of the Village of Barrington; the
Honorable Tom Weisner, Mayor of the City of Aurora; Mr. John
Swanson, Executive Director of the Northern Indiana Regional
Planning Commission; and Mr. Mark Yagelski, Chairman of the
Board of Trustees of the Northern Indiana Commuter
Transportation District; and the Honorable Elaine Nekritz,
State of Illinois of the State Legislature; and Peter
Silvestri, President of the Village of Elmwood Park, Illinois.
Welcome and thank you very much for your patience.
Chairman Harrison, good to see you again. Thank you for
being with us. We welcome your statement.
TESTIMONY OF E. HUNTER HARRISON, PRESIDENT AND CHIEF EXECUTIVE
OFFICER, CANADIAN NATIONAL RAILWAY; KAREN DARCH, PRESIDENT,
VILLAGE OF BARRINGTON, ILLINOIS; THE HONORABLE TOM WEISNER,
MAYOR, CITY OF AURORA, ILLINOIS; JOHN SWANSON, EXECUTIVE
DIRECTOR, NORTHERN INDIANA REGIONAL PLANNING COMMISSION; MARK
YAGELSKI, CHAIRMAN OF THE BOARD OF TRUSTEES, NORTHERN INDIANA
COMMUTER TRANSPORTATION DISTRICT AND MEMBER OF THE LAPORTE
COUNTY COUNCIL; THE HONORABLE ELAINE NEKRITZ, STATE OF
ILLINOIS; AND PETER SILVESTRI, PRESIDENT, VILLAGE OF ELMWOOD
PARK, ILLINOIS
Mr. Harrison. Thank you. Mr. Chairman and Members of the
Committee, I want to thank you for the opportunity to offer
CN's perspective on H.R. 6707.
Allow me briefly to introduce myself. I have spent over 40
years in the railroad industry from my first job in the freight
yards of the Frisco Railroad as a laborer in Memphis,
Tennessee, to my present job as CEO of CN.
CN operates from the Atlantic to the Pacific in Canada and
all the way to the Gulf of Mexico in the U.S. We have operated
in the U.S. since the 1870s.
In the last 10 years, the STB has approved three
acquisitions by CN, and each has smoothly and safely integrated
into our family of 6,500 employees in the U.S. We understand
U.S. railroad operations, especially operations in Chicago,
very well.
I lived in Chicago for 20 years, ironically, in the western
suburbs and am proud of the fact that I helped nurse Illinois
Central back from the brink of bankruptcy to a high level of
efficiency before it was acquired by CN.
Back then, we had to struggle with congestion in Chicago
every day, and things have only gotten worse. Chicago is the
most congested area in the North American rail system.
All of the railroads, both freight and passenger, will
operate better and more effectively if we can, and I emphasize
together, find ways to relieve congestion. Relieving that
congestion should be a national priority.
Rail is inherently safer, more environmentally friendly,
more fuel efficient than our competition, the truck. Every time
we improve efficiency so that freight stays on a rail, our
Country is better off. Accordingly, we strongly support the
national goal reflected in the Staggers and ICC Termination
Acts of promoting railroad acquisitions that encourage
efficiency.
We are seeking to make our railroad and the national system
more efficient by acquiring EJ&E. This small acquisition would
permit us to remove trains from the congested lines that run
through urban Chicago by shifting traffic onto the under-
utilized EJ&E. Our $300 million investment would greatly help
decongest the Chicago gateway.
Our acquisition is strongly supported by a range of
shippers, by the NIT League, chambers of commerce and by the
communities in which we would remove trains in Chicago.
However, because CN would put new trains on the EJ&E lines,
the transaction is opposed by some suburban communities that
have built up around those lines.
In response to that opposition, the transaction is being
subjected to the most intensive environmental review ever
undertaken by the STB. The Board is studying the environmental
impacts of our acquisition of 158 route miles in 2 States, but
it will take longer to do than it took for a 10,500 route mile,
$10 billion Conrail transaction that spanned 13 States and the
District of Columbia.
And, it will be extremely costly. Assuming the transaction
is approved, the roughly $25 million that we will pay for the
environmental review, together with the cost of our
comprehensive voluntary mitigation, will total more than 20
percent of the cost of the acquisition, a portion clearly
unprecedented.
This experience has provided us with a perspective on the
issues raised by the legislation under consideration. I just
want to touch on some key points here.
First, I believe that CN shares the same goals as this
Committee. We want the most efficient rail network possible,
and we want to assure that when railroads take steps to improve
efficiency there are ways to address environmental impacts.
Second, we believe that Congress has properly required
independent analysis of transportation efficiency and
environmental impacts in railroad transactions. We recommend
you maintain that distinction.
Our industry is one of the few for which acquisitions are
subject to both competition and NEPA review. However, what
concerns us is not environmental review itself but the lack of
predictability and the significant costs and delays that the
Board's regulatory review process imposes.
This Committee understands well the capacity issues facing
our industry as well as the challenging congestion in Chicago.
If CN and other railroads are going to fix these issues, we
need to be able to predict and get confirmation as to whether
our initiatives will be permitted. Together, predictability and
early confirmation strengthen our ability to direct our energy
to the most productive alternatives.
For smaller transactions especially, the key test is
whether a transaction is anti-competitive. If we fail that
test, then there is no need to complete any environmental
review. If we pass, then we know that the investment in
environmental review is likely to produce real benefits.
Unfortunately, we have been denied this regulatory
certainty. After 10 months of review, while no substantial
competition concerns have been raised, the STB has still not
made a determination whether the EJ&E transaction passes the
competition test.
Meanwhile, our strategic plan remains in regulatory limbo,
and we are paying huge sums to consultants employed by the STB
for an environmental review that would not be needed if the
transaction failed the competition test.
Accordingly, our hope is that Congress would not direct the
STB to mix its competition and environmental reviews. Instead,
we suggest that it would better serve the Nation's
transportation policy if the Board were to conduct its
competition review as expeditiously as possible so long as any
environmental impacts are deferred, pending a final
environmental review.
Now we are confident that our transaction, if considered on
the merits, will ultimately pass the competition test. We,
therefore, continue to participate in the environmental review
process.
This leads me to my third point. There is no need to add a
new requirement to determine whether approving a transaction is
consistent with environmental considerations. What is needed is
a more structured way for the STB to make those determinations.
Relying on its current authority, the Board conducts a
thorough review of any significant environmental effects
arising from a control transaction. No further legislation is
required to accomplish this goal.
We respectfully disagree with those who want the Board to
compare transportation merits with environmental impacts before
deciding whether to approve a transaction. If a transaction
that is in the public interest has significant adverse
environmental impacts, the answer is to reasonably mitigate
those impacts. The railroad's fair share of those costs should
be determined in light of any offsetting environmental
benefits, the causes of the impacts to be mitigated and the
relative benefits to be realized by the parties.
In any event, the environmental review process should be
disciplined. It should be conducted on a well-defined schedule.
As long as the environmental review if open-ended, it may
encourage some people who place their local interest above the
national transportation interest to abuse the process. They can
seek to defeat the transaction or attempt to extract
unreasonable mitigation.
The STB should have in place the resources to assess
potential environmental impacts thoroughly, yet expeditiously.
In this way, the board can encourage the timely development of
mitigation to address reasonable local concerns while
precluding opponents from unduly dragging out the process.
This process should be more balanced. In our case, the
SEA's voluminous draft EIS is far more concerned with adverse
impacts than with positive impacts. The focus implicitly favors
the interest of suburbs over those of urban communities in
Chicago that will benefit enormously from our transaction.
Unfortunately, it is too late to improve the process in our
case and, at this point in our transaction, delay is taking its
toll. Our focus recently has been on finding a practical
solution to the fact that regulatory delays have created a
substantial risk that the transaction will be terminated.
In order to avoid this risk, we asked the Board to decide
our case on competition grounds, so we can close before the
year's end. If we are allowed to close, we would agree with the
Board of maintaining effectively an environmental status quo,
not moving any trains from the present routes that they take
and until the Board completed its environmental review, we
would stay with that plan.
Now the fact that some of the suburban interests oppose
that request even though it fully protected the environment and
protected their rights may suggest that the true goal is not to
mitigate but to terminate.
Late yesterday, however, the Board denied our request, and
we are assessing our options.
In any event, given the status of our transaction, I urge
that you not apply this bill retroactively. H.R. 6707's overall
purpose is to ensure sufficient environmental review of rail
transactions. The STB's extraordinary environmental review of
the EJ&E has already met that purpose.
Even though the adverse environmental impacts are largely
outweighed by the benefits that will be realized by the
millions of Chicago residents who will see fewer trains, we
have volunteered to provide mitigation for all the significant
adverse impacts as measured by the sound standards used by the
Board in prior cases. In other words, we have already committed
to mitigate more than the net adverse impacts of our
transaction.
For these reasons, no useful public purpose could be served
by retroactive application of the legislation that could cause
the death of our transaction.
Mr. Chairman, thank you again and we would welcome
questions of you or any of your panel.
Mr. Oberstar. Thank you very much. We will have questions
later on, and we will go on with the other witnesses.
Ms. Darch, thank you for coming. Good to see you again.
Ms. Darch. Good afternoon, Chairman Oberstar and Members of
the Committee. I would like to thank the Chairman and the
Congressional proponents of H.R. 6707, particularly from the
Illinois and Indiana delegations and my Congresswoman, Melissa
Bean, for your leadership on this issue.
My name is Karen Darch, and I am the President of the
Village of Barrington, Illinois, and Co-Chair of a bipartisan
coalition of local and county elected officials in northern
Illinois and Indiana who have formed in response to a proposed
rail transaction by Canadian National that will have
devastating environmental and safety impacts on many of the
collar suburbs of the greater Chicago area.
I am pleased to have the opportunity to speak to this
distinguished Committee in support of H.R. 6707, the Taking
Responsible Action for Community Safety Act.
The legislation would make it absolutely clear to the
railroad industry and to the Surface Transportation Board that
the public interest of residents and communities threatened by
the negative environmental and safety impacts of railroad
merger and acquisition transactions involving a Class I
railroad must be considered on an equal basis with the alleged
transportation benefits of any such transaction.
As a municipal elected official responsible for developing
local ordinances that balance the needs of our residents with
business development goals, I know full well that the Members
of this Committee have an important and challenging
responsibility when it comes to establishing public policies
that facilitate freight movement while protecting the interests
of communities.
The economic and system benefits that may accrue to a large
railroad company from a particular merger or acquisition need
to be carefully weighed against other equally valid safety and
environmental impacts that will result from any such
transaction. This is particularly important if significant
volumes of freight traffic will be rerouted through high
density residential areas that were not designed and do not
have the infrastructure to accommodate such drastic changes.
Based on my experience over the last 11 months since the CN
proposed to acquire the EJ&E, it has become evident that CN and
other large railroads do not believe the STB has the authority
under current law to consider the environmental impacts of such
railroad transactions on an equal footing with rail and shipper
competition issues.
In reviewing the STB's treatment of past merger and
acquisition transactions involving large railroads, one finds
that the STB has never rejected a comparable transaction on
environmental impact grounds and has never shifted the burden
of meaningful mitigation to the railroad applicant. It seems
that as a practical matter the STB, itself, appears to doubt
whether it has the authority to reject such a transaction on
environmental grounds.
This ambiguity needs to be clarified through H.R. 6707 if
environmental review process mandated by NEPA is to have any
significance in large railroad transactions subject to STB
review.
Since CN applied to the STB for approval of its plan to
purchase and reroute the significant volumes of freight
traffic, my village has been actively involved in the STB
process.
The line that CN wants to buy and transform into a high
density corridor for mile or two-mile long intermodal trains
runs right through the heart of Barrington, intersecting at
grade level with four busy roads in the center of the village
that are used by our residents and visitors to access downtown
businesses, medical facilities, local schools and that serve as
regional commuter corridors. This issue is life-changing for my
community.
Numerous other communities along the EJ&E line have joined
together in the TRAC Coalition to protect our shared interests
in avoiding the significant environmental and safety harms that
our constituents will experience as a result of the proposal.
The TRAC communities are facing harms that any community across
this Country can face, absent the TRACS Act.
Much of our U.S. rail infrastructure was laid when vast
stretches of the Country were sparsely populated, and rail
served as a vital point of connectivity for small outposts.
Today, we confront a vastly different landscape.
The STB should be required to disapprove of proposed
acquisition involving a large railroad and major traffic shifts
if community harms outweigh the transportation benefits.
Federal Agencies are not authorized under NEPA to contemplate
environmental impacts as an abstract exercise but instead must
consider those environmental impacts as an important component
of the Agency's process of deciding whether to approve a
Federal action.
Under H.R. 6707, the STB would be required to conduct an
environmental review. This will be money well spent when the
communities may live with the transaction for a lifetime.
Rail law that makes American communities second-class
citizens in the regulatory review process is a relic of another
era.
The railroads today are highly profitable, and they can
well afford to make the investment necessary to integrate their
operations into our communities. They will not do so, however,
unless they are incentivized to do so by a law like H.R. 6707
that makes it clear that environmental and safety impacts on
affected communities will be considered fairly on a level
playing field with purported transportation benefits.
It is a law that's time has come, and communities of TRAC
speak in one voice for our communities and communities across
America that will find themselves in similar circumstances. We
ask this Committee to take the first step in making this bill
the law of the land before Congress adjourns.
I thank you for your time and attention and would be happy
to answer questions.
Mr. Oberstar. Thank you for your testimony and for your
thoughtful comments.
Before I go to the next witness, I just want to observe for
the record the presence of your able Washington counsel, Mr.
Harrison, Karen Phillips who represents your railroad with
great effectiveness.
Mr. Harrison. Thank you.
Mr. Oberstar. Mr. Weisner.
Mr. Weisner. Good afternoon, Chairman Oberstar, Mr. Shuster
and Members of the Committee.
My name is Tom Weisner, and I am the Mayor of Aurora, the
second largest city in the State of Illinois. I have the
pleasure to serve as Co-Chair of TRAC, a bipartisan coalition
of suburban municipalities and counties in the Chicagoland area
who are opposed to the proposed acquisition of the EJ&E line by
Canadian National Railway.
I would like to thank you, Chairman Oberstar, as well as
Members of the Illinois delegation, particularly
Representatives Bean, Biggert and Foster, and other Congressmen
responsible for initiating this needed legislation.
Thank you for holding this hearing to examine legislation
that would bring our Nation's rail regulatory policy into the
21st Century. Current law remains grounded in the days when
government would do almost anything to spur rail development as
your citing of the land grants in the 1800s, Mr. Chairman,
exemplified.
While rail services remain important to us today, the
impact of rail development on local communities must be
considered equally and fully. Unfortunately, under the current
interpretation of the law the U.S. Surface Transportation Board
uses to review, analyze and issue a decision on rail industry
mergers and acquisitions, impacted communities and residents
are considered as an afterthought.
We have learned this the hard way. Despite the enormous
impact this deal would have on millions of residents and
taxpayers along the EJ&E line, no study was guaranteed.
Instead, President Darch and local communities had to pleased
our case to the STB to order a draft environmental study.
I would submit there is no better example than why this
legislation is long overdue, not because our situation is
unique, quite the contrary. The economic, environmental, safety
and mitigation burden that looms before us could occur in any
congressional district, perhaps yours.
H.R. 6707, the TRACS Act simply asks for the public
interest to be fairly and fully considered before any deal is
approved.
I would like to share with you some examples of how this
acquisition would impact our communities and ask you to
consider whether you would want your constituents heard if this
were to happen in your district.
As we speak, 55,000 vehicles per day pass over a particular
grade crossing in my community along the EJ&E line. If, as
proposed, the number of 10,000-foot freight trains triples,
that will cause lengthy delays for commuters who are driving to
work, taking their kids to school or businesses transporting
goods and services.
Further, our hospital is on one side of the tracks, and a
third of our population is on the other. As a result, we may no
longer be able to guarantee rapid emergency response to many of
our residents.
School administrators are rightfully concerned about the
safety of our kids crossing busier at-grade crossings where
children have already tragically died under current train
volume. They are worried that the increased noise will affect
student ability to learn, and they want answers as to whether
there will be increases in hazardous material transport near
schools.
I believe their concerns deserve to be heard.
The draft EIS lacked a real analysis of the impact on
property values, instead simply guessing that property values
would most likely be affected in a minor way.
Our communities continue to grow tremendously as new
families realize the American dream and transform our cities
and villages into bustling economic development engines with
subdivisions, hospitals, schools and commerce. Do we now
reverse that progress?
If freight traffic increases by 400 percent, and let me be
clear--that is not the high water mark but simply a jumping off
point--these communities will literally be split in half by
freight traffic, dividing residents, creating congestion and
stalling economic development. I believe these impacts need to
be carefully considered.
There are multiple communities along the EJ&E that fall
below the median household income level. Aurora's population is
55 percent minority population with a considerable percentage
of low income residents.
For years, we have worked hard to encourage new commerce
and development to keep property values up. They will now take
two steps back instead of continuing to move on the economic
ladder. I do not believe their efforts should be ignored.
Canadian National told the Chicago Tribune that the bulk of
costs for mitigation would be paid for by State and Federal
Governments and should be paid for by State and Federal
Governments. I am pretty sure that the Federal Government does
not have millions of dollars of loose change to devote to
mitigation of this particular instance or those that happen in
the future, and I know that the State of Illinois has trouble
filling its potholes.
Our communities are not opposed to profitable companies or
rail expansion, but we are opposed to profitable companies
becoming more profitable at the expense of our taxpayers in
terms of mitigation, not to mention our quality of life. This
is not, as some would argue, an issue of not in my back yard.
It is more an issue of not in our back pocket.
By the end of this week, eight open houses will occur in
the affected region. Thousands of residents will have attended
these hearings and providing oral and written testimony
outlining their concerns over one acquisition. The STB is
experiencing an unprecedented show of opposition to this
acquisition which is further demonstrated by this hearing
today.
Our residents want to be considered, and I expect yours
would too if their quality of life and safety were threatened.
I hope you agree they deserve to have their concerns balanced
with those of corporation who seek to profit at the expense of
taxpayers who live, work and invest in these communities.
H.R. 6707 represents an opportunity to recognize the
shortcomings of the current process and update it to consider
the paradigm that exists today.
The Federal Government does not need to expedite mergers
and acquisitions to jump-start rail activities. Those days are
long over. The Federal Government needs to strike a balance
that weighs the quality of life of the affected residents with
the desire for more efficient and profitable rail systems.
As I said earlier, this experience really showcases the
need to update the current law to require full consideration of
community impacts and greater powers to put mitigation costs on
someone other than the American taxpayer.
Thank you for your time and consideration.
Mr. Oberstar. Thank you very much, Mr. Weisner.
Mr. Swanson.
Mr. Swanson. Thank you, Chairman Oberstar, Congressman
Shuster and other Members of the Committee. I would especially
like to thank our Congressman, Pete Visclosky, for his
leadership on transportation and infrastructure throughout
northwest Indiana.
My name is John Swanson. I am the Executive Director of the
Northwestern Indiana Regional Planning Commission commonly
referred to as NIRPC.
With me is Stan Dobosz from the town of Griffith. He is the
Chair of NIRPC's Transportation Policy Committee as well as a
Councilman for the Town of Griffith.
We are appreciative that you are holding this hearing and
for the opportunity to testify on behalf of this important
bill, H.R. 6707.
NIRPC is a council of governments comprised of 52 elected
local government officials plus 1 State Legislator appointed by
the Governor of the State of Indiana. It serves as the
designated metropolitan planning organization for
transportation planning and programming for Lake, Porter and
LaPorte Counties in northwest Indiana. We are located adjacent
to the City of Chicago, and we are part of the larger
metropolitan area for Chicago.
Our northwest Indiana region is extremely concerned about
the proposed CN acquisition of the EJ&E that is currently under
consideration by the Surface Transportation Board.
We believe this transaction will have a negative impact on
five major issues in our region: one, our region's air quality
where we are already designated as a severe non-attainment
area; two, the efforts to expand our commuter rail service;
three, the efforts to expand the Gary-Chicago Airport; four,
the redevelopment of our Lake Michigan shoreline; and five, the
quality of life of our affected communities.
The CN/EJ&E transaction would result in three to four times
more trains running through our affected communities. The
average train length is expected to increase from one-half mile
to over a mile in length.
During a 24-hour period, total vehicle delays would
increase by a factor of 6 to 11 times, and these idling
vehicles will emit more pollutants into our air.
The Towns of Griffith, Dyer and Schererville will be
bisected and unable to function effectively or safely. Impacted
communities face considerable safety concerns due to an
expected increase in crashes and longer routes for fire and
police vehicles because of blocked crossings.
Let me identify specific impacts on just one of our
communities, the Town of Griffith. Griffith has a population of
17,000 residents. It has seven at-grade crossings at the EJ&E
line.
Average trains per day will increase from 7.6 to 28.6 a
day. Total vehicle traffic will increase from 9 to 11 times
during a 24-hour period.
The transaction will effectively cut the town in two, and
emergency delay response time could double for police, fire and
ambulance service. All three fire stations and the police
station located in Griffith are located on the west side of the
tracks. If crossings are blocked, response times could double
to the east side.
The environmental impacts--noise, vibration, whistle-
blowing and air quality--will be disruptive to adjacent
neighborhoods. A derailment could be catastrophic to residents.
Finally, there are no economic benefits for the Town of
Griffith with the increased train traffic. Indeed, this
transaction will probably have an adverse effect on property
values.
Griffith is not alone. The same scenario exists for the
Towns of Schererville and Dyer and the City of Gary, Indiana,
and communities throughout suburban northeastern Illinois.
During the course of our communications with the STB on the
issue of the proposed CN and EJ&E transaction, we have come to
understand that when the STB makes decisions on railroad
transactions, it is mandated by Congress to focus on the impact
on the railroad industry and overall transportation benefits.
The STB does not appear to be required to focus as much on the
impacts the transaction would have on our local communities and
their quality of life.
The result is that the STB could approve a transaction that
shifts and indeed increases the transportation and economic
burdens from communities to other communities, so long as it
can be shown that over a large area there are some positive
transportation benefits.
Changes to railroad infrastructure and operations in
northwest Indiana brought by the CN transaction will affect the
daily lives and economic well being of our residents, workers
and businesses and our entire transportation system for many
decades to come.
It should be in the Nation's interest as well as the
railroads' interest to have an integrated surface
transportation system that benefits everyone, including
residents and businesses in the local communities that will be
hosting and living with the railroads' business decisions for
many, many years to come.
I believe that the TRACS bill under consideration today
will significantly improve the Surface Transportation Board's
capacity to make decisions on railroad transactions that will
be in the Nation's interest as well as the interest of local
communities and metropolitan areas. It will also help STB
decision-making be more consistent with the spirit and intent
of the Surface Transportation Act.
On behalf of the communities and counties of the
Northwestern Indiana Regional Planning Commission, I wish to
express our support for the provisions of H.R. 6707 relating to
certain railroad transactions that would require the STB to do
the following:
One, hold public hearings in the affected communities;
Two, consider the safety and environmental effects of
proposed railroad transactions on local communities;
Three, consider the effects of proposed rail transactions
on both intercity rail and commuter rail passenger
transportation;
Four, require conditions to mitigate the effects of the
transaction on local communities; and,
Five, reject transactions if the adverse impacts on the
public outweigh the public benefits.
Mr. Chairman and Members of the Committee, I appreciate
this opportunity to show support for H.R. 6707 to require the
Surface Transportation Board to consider the impacts of certain
transactions on local communities and those of our region.
Thank you.
Mr. Oberstar. Thank you for a very thoughtful, very
succinct presentation.
Mr. Yagelski.
Mr. Yagelski. Good morning, Chairman Oberstar, Mr. Shuster
and Members of the Committee.
My name is Mark Yagelski, and I am the LaPorte County
Councilman and Chairman of the Northwest Indiana Commuter
Transportation District Board of Trustees. I am honored to
appear before you today, and I appreciate the opportunity to
offer NICTD's strong support for H.R. 6707, the Taking
Responsible Action for Community Safety Action.
On behalf of NICTD, we applaud the Chairman's common-sense
approach to reforming the Surface Transportation Board's, the
STB, approval process of proposed mergers and acquisitions.
Thank you for making these reforms a priority by introducing
the critical legislation and holding this hearing today.
NICTD would also like to thank Congressman Visclosky for
his co-sponsorship of this important legislation and for being
our constant and ardent champion here in Washington.
This year, NICTD is celebrating its 100th Anniversary of
the South Shore passenger service, and I pleased to share with
you that the line is experiencing another record year of
increased ridership. Even before gas prices reached a whopping
$4 a gallon, more and more Hoosiers were turning to NICTD in
search of non-automotive transportation alternatives. Since the
mid-1970s, ridership has grown from 1.5 million to over 4.2
million passengers in 2007.
This is an exciting time for commuter rail. However, we are
deeply concerned that the STB's current process will literally
derail our efforts to provide even greater service to our
communities.
While the acquisition of the EJ&E railroad may be just one
of the many that STB will review this year, our situation
brings to light an urgent need for reform.
In particular, NICTD supports the Chairman's legislation
which would give the STB the authority to consider the effects
of the proposed transaction on the intercity passenger rail and
commuter rail. Such authority is necessary to prevent
worthwhile projects like the West Lake Corridor from being
derailed by harmful, inaccurate conclusions and to ensure that
the STB's assessments accurately account for public interest in
long-term transportation improvements.
Already, we are feeling the negative effects of the draft
EIS, and we will be working tirelessly to correct them and
recover from the unnecessary setback. In fact, the draft EIS
dismisses the future of transportation in northwest Indiana as
``not reasonably foreseeable.''
The statement is factually inaccurate and could not be
further from the truth. It is a shame to see that, for the time
being, our limited resources will be spent on clearing the West
Lake Corridor's good name and reputation rather than bolstering
the project in preparation for the return of the Indiana
legislators.
NICTD is a critical piece of Indiana transportation
infrastructure, and we represent the future of northwest
Indiana.
Let me set the record straight. The West Lake Corridor is
alive and well. The project which has been in the forefront of
planning efforts for the past two decades has strong support at
local, State and Federal levels and is moving ahead.
We are about to complete an Alternatives Analysis on Phase
1 which is a critical step in determining the eligibility in
the Federal Transit Administrator's New Start Process. As you
are aware, this is a highly competitive process, and statements
like those made by the STB only serve to undercut the project.
In addition, earlier this year, legislation to help finance
the project was approved one house of the Indiana Legislature.
We expect the Legislature to continue these efforts during the
next session.
Most troubling is a draft EIS severely limits our ability
to negotiate a right of way agreement with CN. Obtaining such
an agreement is the linchpin between the expansion toward
Valparaiso. Moving both goods and people is essential to the
economy.
However, the STB's draft EIs is incredibly shortsighted and
fails to recognize the need for increased transit capacity in
the corridor. This is a significant shortfall and will cripple
our economy should it ever become final. There is simply too
much at risk, too much potential that will not be realized, too
much previous work and planning that will be lost.
The benefits of the West Lake Corridor are numerous and
cannot be overstated. This type of transportation investments
would spur local development, reduce vehicle miles traveled,
VMT, therefore limiting the harmful production of greenhouse
gases and open up thousands of good-paying jobs.
It is good for the economy, it is good for the environment,
and it is good for our pocketbooks.
I recognize the focus of today's hearing is not to espouse
the benefits of transit. However, it is important for the
Committee to appreciate exactly what is at stake. Even more so,
it is essential that I highlight the tremendous benefits of the
West Lake Corridor in my testimony as you will find this
critical information absent from the STB's draft EIS.
In conclusion, H.R. 6707 is timely, much-needed
legislation. It is essential that mergers of all railroads be
treated the same way as Class I mergers are currently treated,
and this legislation would provide a level playing field.
I thank you for the opportunity to testify today, and I
would look forward to any of your questions.
Mr. Oberstar. Thank you very much, Mr. Yagelski. I just
want to pick up on your reference to the Northern Indiana
Economic Development Initiative.
Mr. Shuster, who is very deeply engaged in economic
development in his district and throughout the region of
Pennsylvania he represents, would envy, as I did, the gathering
of over 600 people at a meeting of the Northern Indiana
Economic Development authorities and entities gathering with
local development groups, mayors, councils, business people.
I participated in that a couple of years ago. I was just
blown over by the intensity of interest. They really care, and
they are all engaged.
Ms. Nekritz, a Representative, thank you. Good to see you
again.
Ms. Nekritz. Thank you, Mr. Chairman. Good to see you.
Mr. Oberstar. Thank you for being here.
Ms. Nekritz. I appreciate being here and, Congressman
Shuster, thank you for this opportunity.
I am going to go ahead and deliver my testimony anyway even
though I think Congressman Lipinski covered almost all the
points that I was going to discuss.
I am a member of the Illinois House of Representatives,
representing a suburban district with the current CN line
running right through the heart of it, and I am also the Chair
of the Illinois House Rail Committee.
I don't oppose giving the STB authority to hold public
hearings, as long as it is in all affected communities as
proposed by H.R. 6707, nor do I oppose including safety and
environmental concerns as part of the STB review process as
well as impacts on intercity passenger or commuter rail.
I am very concerned, however, that the local, regional and
national benefits of a transaction will get lost in the clamor
created by those who are opposed. I encourage the Committee to
ensure that all impacts be considered and weighed as part of
any STB review.
I would like to point to Des Plaines, Illinois, which is a
community I represent. It has about 60,000 people and is home
to 3 Class I railroads along with a busy commuter rail line
station.
We have 32 at-grade crossings and only 2 grade separations.
Frankly, it is impossible to go anywhere in Des Plaines without
crossing railroad tracks.
Up until the mid-1990s, railroads in Des Plaines were a
minor inconvenience, but now we have approximately 140 trains a
day rumbling through Des Plaines. So the 32 at-grade crossings
are frequently, if not routinely, blocked.
All the complaints that have been raised by the opponents
of the EJ&E transaction are a daily reality in Des Plaines.
Children getting to school are put in harm's way. Emergency
vehicles are delayed or rerouted. Daily commutes are longer,
and local businesses suffer when customers find it difficult to
get to their destination.
And, it is going to get worse. According to AASHTO, freight
rail will grow another 67 percent by 2020. Consequently, Des
Plaines looks forward to even greater and greater delays.
So when the CN seeks to reduce the number of trains it
sends through Des Plaines from 19 per day to 2, this is a local
benefit that should receive consideration on par with the
concerns raised by others. As Congressman Lipinski said, our
voices deserve to be heard.
Des Plaines is a middle class community. Its residents
include teachers, firefighters, electricians and many seniors
who have come to the downtown condos in order to be able to
afford to live on a fixed income. This is not a community that
can hire influential lobbyists, expensive public relations
firms or print thousands of yard signs or t-shirts.
Furthermore, because the freight lines in Des Plaines are
already owned by the Class I railroads, we never had any
opportunity to object to increased traffic nor have we been
offered any funding for mitigation.
I am deeply troubled by giving those who will only now feel
the effects of increased train traffic an opportunity to jump
to the front of the line for funding for much-needed safety
equipment, grade separations and noise abatement while those
who have been living with freight traffic for years, if not
decades, continue to wait and wait.
I urge the Committee to make it crystal clear that H.R.
6707 requires all local impacts, both positive and negative, to
be taken into consideration in part of the STB decision-making
process.
There are also some very important regional and national
considerations that should be weighed by the STB, and again I
am going to use Chicagoland as an example.
We are the world's fifth largest intermodal hub. We have
nearly $8 billion in economic activity as a result of the 6
Class I railroads traversing our region. We have over 9,000
railroad jobs with thousands more in warehousing, logistics and
distribution. We are a rail hub, and the resulting economic
activity is critical to maintaining our vibrant economic
diversity.
Unfortunately, as you well know, our regional rail system
is antiquated and horribly congested. If we fail to address
this congestion, shippers and freight railroads will ultimately
decide to take their business and the corresponding trade and
industrial activity to other locales, thus damaging our
regional economy.
Finally, I know this Committee is very aware of the CREATE
program in Chicago. In the last Federal transportation bill,
this Committee was instrumental in designating CREATE as a
project of national significant. The problem of congestion in
Chicago was acknowledge to have an impact on the national
freight system.
Ultimately, CREATE received $100 million toward the $1.5
billion cost which is not enough. I am not casting any stones
because we at the State of Illinois have not been able to come
up with anything. So, while we continue to haggle over taxpayer
funding for critical congestion relief, the CN is offering a
purely private solution to this congestion problem.
Trains are the most economically and environmentally form
of transportation. In the global economy which is dependent on
transporting goods quickly and reliably, freight trains are a
fact of life.
The transactions to be considered under H.R. 6707 deserve a
fair review that considers all factors including positive
local, regional and national benefits.
And, Chairman, I know you went out to visit the far out
suburbs. If you would like to come visit communities that
Commissioner Silvestri and I represent, we would welcome that
so you could see what is going on there.
Thank you.
Mr. Oberstar. Thank you very much. It is quite evident why
you are Chair of the Rail Safety Subcommittee. You know your
subject matter well, and you are an articulate advocate for
your communities and for the issue. You see the broader
implications, and you can see both sides of the issue.
I thank you very much. Good to see you again.
Our next witness, I appreciate, Mr. Silvestri from Elmwood
Park.
Mr. Silvestri. Thank you. Mr. Chairman, Mr. Shuster,
Members of the Committee, I thank you for this opportunity to
appear before you today to discuss H.R. 6707, the Taking
Responsible Action for Community Safety Act, and I would like
to thank you all for your leadership on this very important
issue.
I would also like to thank Congressman Dan Lipinski for his
leadership and scholarly approach to reviewing this issue and
all transportation-related issues as well as to thank our
Representatives Jan Schakowsky, Rahm Emanuel, Danny Davis and
Jesse Jackson who are supporting our coalition efforts to see
this transaction approved.
I would also like to acknowledge the presence of Rich
Pellegrino who is the Executive Director of the West Central
Conference of Municipalities which represents 35 west suburban
communities in metropolitan Chicago.
My name is Peter Silvestri. I am a member of the Cook
County Board of Commissioners and serve as Village President or
Mayor of the Village of Elmwood Park.
My village is a community of about 25,000 residents who
live in two square miles. We are located just west of the City
of Chicago, and we are approaching our centennial year. It is
crossed by a railroad track right down the middle of town, and
let me assure, as many of my neighbors, have experienced
firsthand the effects of rail benefits and problems.
When I became Mayor in 1989, the Village of Elmwood Park--
remember, a town with 12,500 residents per square mile--
experienced 40 trains day. Today, that number has tripled, and
more than 120 trains pass through Elmwood Park each and every
day.
At the same time, 24,000 vehicles travel across these
tracks at its main intersection. Half of our public high school
students, half of our middle school students and half of our
preschoolers and kindergartners try to cross these tracks with
their parents on a daily basis.
With four crossings within a one-mile stretch through town,
I believe the people of our community know the issues that
surround trains. In fact, one of these crossings has been
determined to be the most dangerous crossing in the State of
Illinois by the National Transportation Safety Board after a
commuter train slammed into thirteen vehicles trapped on these
tracks at rush hour on the eve before Thanksgiving in 2006.
The reduction of rail traffic in my community has been a
major concern for years, and that is why I, along with 60 other
suburban communities in the Chicagoland area, formed a group
named START which supports the benefits that would result from
the EJ&E purchase by the Canadian National.
In my 1 community, this 1 transaction would result in a
reduction of 7 to 10 trains, meaning that we would still suffer
from over 115 trains a day. Yet, we would welcome this
reduction.
Similar reductions in countless city neighborhood and inner
core suburbs would be welcomed as an improvement in our
collective lives in each and every case. Each of these
communities have similar stories with respect to public safety
issues, school transportation issues and issues surrounding
trying to get these people across the railroad tracks.
For example, in our communities, we have mutual aid
agreements with all of our neighboring communities, as most
suburban communities in the Chicagoland region do, to help
alleviate the impact of this crossing.
The TRACS Act is a good idea because it looks at the
specific concerns of a given area. In our region, for example,
over 4.1 million people could potentially benefit from fewer
and faster trains in 60 suburban communities in comparison to
the 30 communities that would increase in train traffic.
Unfortunately, Mr. Chairman, as an aside, only one STB
hearing was held in the parts of the Chicago region that would
benefit from this transaction. We would encourage additional
hearings in the inner suburbs and in the City of Chicago.
As a County Commissioner representing 14 municipalities and
countless neighborhoods on the northwest side of Chicago
consisting of approximately 320,000 residents, I understand the
importance of studying these sorts of things from a regional
approach and taking both the negative and positive aspects of
development of regional importance into account. In fact, the
Cook County Board has passed a resolution supporting the CN
purchase of the EJ&E as a benefit to the majority of the county
residents.
As Village President, I also understand the concerns of
communities who would experience more train traffic due to a
purchase such as this one and the reason behind including
language in H.R. 6707 that addresses adverse impacts on
affected communities. Reasonable accommodations must be
reached. This is not about transferring a problem. This is
about a fair solution for all of us in all parts of the region.
For example, we would still have 120 trains in our
community, which would be 400 to 500 percent more than the
anticipated impact in some of our neighbors to the west. Are
the lives of the inner suburban city areas any less important
than those of the further out suburbs along the EJ&E line?
The likely number of rail accidents on the CN rail lines
inside the EJ&E area estimated to approximately decline by 77
percent. Isn't the safety of our children and our residents and
our commuters who come through our villages to get home to the
villages along the EJ&E line less important than those
communities that do not want increases in rail traffic in their
communities?
In every case, relocating some of the freight traffic out
of Chicago and the inner ring suburbs benefits the local,
regional and national economy. Freight traffic, increasingly
more important because of fuel costs, chokes in our region.
This choking also results from these trains idling in our
communities and polluting our neighborhoods.
In effect, the EJ&E purchase helps reduce pollution as
these trains will move through our region quicker and helps
reduce our reliance on fuel oil as this alternative means of
transportation is utilized.
Mr. Chairman, this concludes my prepared remarks. I would
like to thank you and the Members of the Committee for this
opportunity and for your leadership, and I look forward to
working with you and all of our suburban neighbors in
continuing to enhance our rail systems.
Thank you.
Mr. Oberstar. Well, thank you very much, Mr. Silvestri, for
your statement. Together, you and Ms. Nekritz expressed the
spectrum of concerns that the board has to continue, that we
are trying to balance on the Committee in response to concerns
of Members of Congress on the panel that you heard at the
outset of this hearing.
The positives, I think our legislation does, despite what
Mr. Harrison seems to think, that our legislation seems to be
far more concerned with adverse impacts than with positive
impacts. I want to assure you that the legislation is balanced
in requiring consideration of both the benefits as well as the
adverse impacts. We certainly heard from those who feel
adversely impacted.
Mr. Harrison. Mr. Chairman, if I could, that statement was
in regard to the Environmental Impact Statement, not the
proposed legislation, if I could clarify that.
Mr. Oberstar. Thank you for that clarification.
Now, Mr. Harrison, do you think, as your testimony seems to
express, that the Board has authority under current law to deny
the CN application on public interest grounds, safety and
environmental considerations? I was just looking at your
testimony.
Do you think the Board has authority to modify
substantially, to direct modifications on public interests
grounds? That is safety and environmental considerations.
Mr. Harrison. Our view is that under the existing act, a
minor transaction cannot be turned down on environmental
issues. It can be mitigated or there can be conditions placed
that say you can only merge if you will mitigate, if you will
do the following.
But the true test, if you look at it, is to review the
anti-competitive nature of the transaction. If the transaction
is pro-competitive and it is not anti-competitive, then the
issue becomes--and we are perfectly willing to deal with that--
to resolve the environmental issues, mitigate the environmental
issues.
We are just concerned about how the process would work,
this open-endedness.
One of the reasons that we are concerned about the
retroactivity is we would never have structured this
transaction like it was today if we had known this legislation
could be passed and be retroactive. One of the reasons why is
because we have a deal that runs out at the end of the year.
The Act says that you will look at a minor transaction in
180 days. Well, what does 180 days matter if you are going to
take a year or two for environmental review? So this deal could
go dead on us, and we could spend fifty or seventy-five million
dollars for nothing.
So I have no problem going forward, effectively, with the
legislation and the purpose of the legislation. We cannot argue
with public interest. We can't argue with the environment. We
can't argue with anti-competitiveness. We are willing to deal
with all of those, and we think that is a fair proposition.
Mr. Oberstar. If the Board were to order modifications of
your proposal to deal with the safety issues raised, to deal
with the noise, to deal with the vibration, to deal with
separation of towns, ordering or proposing to order the
railroad to build rest areas, side lines, prior to or after a
community mile or two-mile length according to the length of
the train, so that you had to stop a train and you wouldn't be
severing a community in case of fire or medical emergency, if
they ordered you to do that for some number of these
communities, would you comply or would you challenge that in
court?
You can say that is too speculative and you can't make that
decision, and that would be perfectly understandable. But do
you have a general spirit of compliance?
Mr. Harrison. Yes, absolutely. I appreciate the question,
and let me clarify a couple of things.
Number one, we have never made a statement to the press of
Chicago that we thought the State and Federal governments ought
to pay for the bulk of the mitigation. The issue becomes
confusing when it deals with grade crossings, and grade
crossing separations.
Mr. Chairman, as you well know, for 50 years or more the
precedent has been that all grade crossings, if you add a grade
crossing or if you do a separation, it is the Federal share,
which is usually about 85 to 90 percent. It is the local and
State with about 5 or 10, and the railroad with about 5, and we
maintain it in perpetuity.
Now that has been that way for 50 years. If the Members of
Congress earlier here today don't think that is the right thing
to do, they should have corrected it a long time ago, not to
wait for this transaction.
We have committed so far up to $40 million for mitigation
in addition to the $100 million in improving the infrastructure
with connections and crossings.
And, I can say this: All the things that you mentioned,
every one of them we would deal with if you could put them
under the category of yes, they are reasonable.
If they came to us and said the mitigation is going to be
$2 billion, no, we couldn't do that. The transaction wouldn't
happen.
But we are reasonable people. We have employees that live
in these affected communities. I lived in the western suburbs.
I understand.
But if you look at it, the same number of trains are coming
to Chicago. It is just which route they are going to take. We
are taking them off a congested route where there will still be
trains there and putting them on a less congested route.
I understand and am sympathetic with the people in the
western suburbs. But if you really put a slide rule to it and
you take an average train, our average train size of 6,000 to
7,000 feet, going 40 miles an hour, they will go across the
crossing. They will block it for two minutes from the time the
gates start down on the approach.
If you do that in some of the communities that have said
they are going from 5 trains to 20, which is a 400 percent
increase, okay, that is 15 trains. What happens effectively is
the crossing is blocked 48 minutes a day, 2 minutes every hour.
That is a long traffic light.
I have been working 44 years, and I have never been accused
of a train blocking causing a mother to have a baby in a car.
You know we can cut crossings. We can react to emergencies.
We are reasonable people, and we will try to deal with every
one of these issues, but I will tell you that there will be
issues.
We can't create, as you well know, a grade separation. I
can't go in and put a viaduct, an underpass in. I have to go
all through environmental review. The State has to approve it.
The funding has to be approved. We can't do that individually.
We will pay what we think--and we will work with the other
communities--our fair share. That line is not drawn in the sand
at $40 million. So, yes, we would take all those things under
advisement reasonably.
Mr. Oberstar. Going back to 1986, in this Committee, this
very Committee room, we approved the first very substantial
funding for railroad grade separation be done out of the
Highway Trust Fund.
In fact, it was my colleague from Minnesota who initially
proposed it. He represented a large farm district in western
Minnesota where many communities were just exasperated with the
safety problems at grade crossings. We included that language
in the 1986 Surface Transportation Act.
Of course, this Committee didn't have direct jurisdiction
over railroad issues until the Republican majority. One of the
really good things the Republicans did was bring that total
transportation authority into this Committee.
In years past, the Committee never dealt with these issues,
the previous Committee. That is the Energy and Commerce. This
is the first time we are really taking a hard look at these
issues.
There are situations. They have happened in my district, a
different railroad that simply blocked a town. A young child
was choking on something that he swallowed the wrong way, and
the train is sitting right here.
The hospital emergency room is on the other side of the
track, and the child is on this side of the track. Fortunately,
there was a volunteer fire department person who was able to
respond.
The railroad wouldn't move the train. That is not our
problem.
You have to go three or four miles north and then another
three or four miles south in order to get to the clinic or to
the hospital or to an emergency support.
There are many cases. I have heard from these communities
that the railroad just sat there and blocked the town, and the
locomotive is idling and vibrating and the noise and the smell
and particulate matter descending upon them. You hear these
stories directly.
Mr. Harrison. I cannot justify that behavior. That is
wrong. It is absolutely wrong.
And, Mr. Chairman, we have been dealing with communities
and trying to resolve some of these issues. We have said to
them, we would talk about curfews during certain periods of
time. We would work with you when you are going to have a big
sports event or something where there is going to be a lot of
traffic, that we could work and deal with that.
We would agree that we would support legislation that if we
blocked a crossing longer than X that we would be severely
fined, that it would motivate us--if they think we are only
motivated by dollars--not to block the crossings.
But some people have said to us: Look, we don't want to
mitigate. We don't want you here.
Someone has to decide where the trains are going in Chicago
or they are going some place else.
You have heard in the inner city, how many trains there
are, 120 trains through these communities that they deal with,
effectively. Is it inconvenient? Sure, it is inconvenient.
There is going to be some that would shift to the western
suburbs. If the growth goes to the inner city, they are going
to be worse. If you don't want them in the western suburbs,
where do you want trains?
Not in Chicago? Then what is going to happen could happen
to Chicago, and Chicago becomes the next St. Louis.
St. Louis used to be the largest interchange gateway in the
U.S. Because of similar issues of congestion, lack of improving
infrastructure or service, now Chicago is king and St. Louis
has slid to about three or four. It would have a devastating
impact--a devastating impact on the economy.
So what we are trying to encourage is all of us,
collectively, work together. We've all got skin in this game.
Let's collectively work together.
Let's work with the communities, try to solve their issues,
at the same time effectively move freight and do it in a fair-
minded way, hopefully.
Mr. Oberstar. That is a very strong appeal, Ms. Darch, Mr.
Swanson, Mr. Yagelski.
Mr. Weisner had to leave. He told us earlier he had a plane
to catch, but his testimony says that average property loss of
one neighborhood would be $60,000 per property.
You are head of that coalition of which Mr. Weisner is a
member.
While there are adverse effects in the inner city now, in
the Des Plaines area, there will be adverse effects in the
future. In your area, what are those property losses while
there may be property gains elsewhere?
Ms. Darch. Mr. Chairman, thank you for the question.
As one of the panelists said in the first panel this
morning, I think a huge issue is shifting a problem instead of
solving a problem in our area.
We definitely have information that says property values
will go down substantially. We have homes, 8 percent of the
homes in my community, that are within 300 feet of the rail.
The issues of the block, the blockage times, the draft
Environmental Impact Statement, while we have some issues with
that, goes into some detail on vehicle waiting times.
In communities that are traversed by commuter lines that
would be now bisected by the EJ&E, mine is one, there will be
substantial waiting times if a CN rail train arrives when a
commuter train is supposed to be crossing. We are talking about
8, 9, 10-minute delays that could happen more than once,
several times a day. Hours of delay multiplied for the
communities up and down the line.
A fundamental issue that we have come to understand in this
and that you heard earlier is while some communities inside
Chicago, a lot of them have three or four trains now a day on
the CN lines--the same amount that some of our communities
have--everybody is not a Des Plaines with 19.
Many of the inner city communities have six or eight or
four or three, an average of four a day. So we are not talking
about a huge impact.
But we believe that even with the shift of those, if this
transaction were proposed, that other rail will fill that
space. Rather than create a huge regional problem by creating
places where billions of dollars in infrastructure improvements
need to be done because we don't have overpasses and
underpasses, the alternatives need to be reviewed by the STB.
Certainly under this legislation, that would be confirmed.
Under NEPA, that should be done.
The CREATE program, which you have heard about today, was
the decongestion alternative for Chicagoland. That is not being
funded. That is not helping the communities like Elmwood Park
and places that would have help.
Although we can talk, if there is no money to do
infrastructure improvements for those communities now, our
communities, were this transaction to be approved, it is not a
good situation.
It is something that needs to be looked at by the STB under
an H.R. 6707 or currently under NEPA, and if there is not
appropriate mitigation and there really can't be in the size of
this transaction, then it really does need to be turned down.
Mr. Oberstar. Thank you.
Mr. Swanson?
Mr. Swanson. Yes, Mr. Chairman. We are a regional agency.
We look at it not from the standpoint of just one particular
community's impacts but the total impact on the three-county
area.
There is one improvement in one of our communities should
this happen. The Town of Munster would have a reduction in the
number of trains through that community. I think it is about 25
to 3 or 4 a day. So that would go to a Level of Service A in
terms of roadway capacity.
On the other hand, we have 15 at-grade crossings that will
diminish from Level of Service A to Level of Service F unless
you did something like grade separation.
Now the numbers that are thrown around are downright scary.
Forty to sixty million dollars per grade crossing would be
needed to do this, and our communities are just now having to
live with one percent property tax cap. In polls by our Indiana
General Assembly, it is not realistic.
Mr. Oberstar. I have many other questions, but I want to
cede to Mr. Shuster, who I know has a number of concerns and
questions that he wants to ask.
Mr. Shuster. Thank you, Mr. Chairman. Many of my questions
have been answered in your questioning and this lively
discussion and passionate discussion, which I understand the
passion.
I certainly can sympathize with the communities. I had a
community, Chambersburg, Pennsylvania, that was bisected by a
rail line that has since been moved and the problem been
solved.
Also, the City of Altoona is the home to Norfolk Southern's
rebuild shop for locomotives. So I am constantly hearing about
the locomotives in the yard right across the way, running at
night. So, again, I certainly can sympathize with those
communities.
Chicago is a problem. It has tremendous congestion, and we
have to figure out a way to alleviate some of that congestion.
Building a brand new line certainly would be wonderful, but
again there are constraints with money and the environmental
constraints. The litigation would take years if it all got
done.
So I guess, as I said, a lot of my questions have been
answered. But I understand at the City of Joliet, there was
something worked out there, and I wonder if, Mr. Harrison, you
could talk a little bit about that.
And, Ms. Darch, after he gets done, your thoughts on what
they did in Joliet and is there a solution?
Mr. Harrison. We were able to sit down with our staff, with
the Joliet officials and figure out what were their issues,
what were their concerns. There were some infrastructure issues
there that were going to cause the speed of the trains to be
much slower than 40 miles an hour, which would in turn block
the crossings further, and they had some concerns.
And so, we agreed to improve the infrastructure there to
take some of the degrees out of the curve where we could run
faster, where we would block the crossings less. We did some
quid pro quo, and we came up with a cooperative agreement that
they would support the merger.
Joliet is a railroad town. There is a possibility there is
a lot of infrastructure on the EJ&E that is right there in the
Joliet area that could become a mixing center, an intermodal
center. It could create a lot of jobs, and I think they see it
from that standpoint as overall positive, given that we were
able to deal with their local issues.
Mr. Shuster. Ms. Darch?
Ms. Darch. Congressman, I am not privy to the specifics of
the Joliet deal. I recognize that it is a unique community in
terms of its railroad distribution centers.
The other communities in TRAC have different issues that CN
has not offered to mitigate to the satisfaction of the
communities if they even could be.
But again, with the dollars that we are talking about,
looking at the reasonableness of the whole deal, that is
clearly a question.
I should say too that overall, so far in this draft
Environmental Impact Statement, the regional benefit of this
transaction is assumed by many people, but on its face the EIS
is showing that the air quality impacts are worse for the
regional as a whole because the train route is longer, more
diesel and more cars idling at crossings, that there are more
people who will be bothered by noise because there are more
sensitive receptors along the miles of the EJ&E and then again
the issue of this being a temporary benefit for the communities
that are losing traffic. The EJ&E fills up at capacity by the
time this deal goes through and where will those other trains
go?
So, top to bottom, all of our communities have many issues
still.
Mr. Shuster. As Mr. Harrison mentioned, is there a way to
mitigate this for your community? Is it Barrington, I guess, is
your community?
Ms. Darch. Barrington.
Mr. Shuster. I have a map. I have been looking at this map,
trying to figure out where everybody is.
Is there something that they can put on the table that will
bring your community to the table to say, okay, let's do it?
Ms. Darch. We have had some discussions actually along the
way. I have 3 major strategic regional arterial roads crossing
the EJ&E line and a commuter rail line crossing within 5,918
feet. They are within 5,918 feet of each other which is less
than the length of a 6,000 regular CN train.
There are 74,000 cars a day that pass through my community
and 65 commuter trains at this point, a number expected to
increase, that pass through. So, basically, without grade
separation for those three roads and the rail, we are looking
at tremendous issues well into the future.
So the cost of that kind of mitigation is very substantial.
It is several hundred million dollars, and this transaction is
a $300 million transaction with $100 million in improvements
that CN is making on its own line.
Mr. Shuster. One of the components you left out there is if
we don't figure out a way how to get more capacity and have our
system running more efficiently than it is, our freight rail
system, we will have more trucks on the road. So you are going
to have not only more cars but more trucks.
Again, this is a national issue. Chicago is a choke point
in the system.
So I wonder, Mr. Harrison. Also, you said what you did in
Joliet. You were able to get some economic development along
these. I am sure not every community you can do what you did in
Joliet, but are you looking at those ways to have a positive
economic benefit to these communities?
Mr. Harrison. We are trying, but it is very, very
difficult. I mean to some degree when you come out and say if
the railroad moves to town, the housing prices are going to go
down, they are going to go down.
They predicted it, and they said our housing prices are
going to go down. So there is nothing I can do about real
estate prices going down.
We have talked about curfews. We have talked about
substantial fines if we block crossings. We have talked about
emergency response plans where if a crossing is blocked and,
God forbid, there is an emergency that we would make a call to
this agency. They would reroute the ambulance or the fire.
We have done just about everything we think that is
reasonably possible to do. At some places we offered to put up
berms, and they said, we don't want a berm. It is not going to
look pretty.
Well, what can we do about the noise? Put up a baffle. We
don't want a baffle in our little town. Well, I can't help you
with the noise then.
So all of those things and some of the people have just
said to us very frankly, we just don't want you here. If they
don't want us here, then there is nothing I can do to mitigate.
So that is the issue we have.
You are absolutely right in your observations, and it is
close at Chicago. We keep having to tell customers I don't know
when we are going to get your freight to Atlanta because I
don't know how long it is going to take to get through Chicago
or Chicago traffic.
I use the analogy: Some days, we get from Winnipeg,
Manitoba to Chicago quicker than we get from North Chicago to
South Chicago.
That won't last long. Traffic will come off the rails
because of service. It will go on the highway. And, guess what?
If you want to get delayed on the highway system, go to Chicago
on the interstate system. The trains move faster than the cars
on 294.
If you are talking about fuel efficiency, if you are
talking about environmental, it says you don't want trucks,
more of them, on the highway from a safety standpoint.
So the issue becomes we have to figure out a way to do
this, and people suggested in the western suburbs, build
another railroad. Go out further.
What do you think those people are going to say? What do
you think the environmental studies then would be? Get that
railroad out of here.
People forget this Country was built on railroads. That the
railroad was there a long time before those communities were.
Those railroads created those communities. People moved there
because that is the way you move people and commerce.
Then people say: No more. We would like to be a bedroom
community. Go some place else with your trains.
It is hard to solve.
Mr. Shuster. Mr. Darch, I will give you an opportunity.
Ms. Darch. To respond.
Mr. Oberstar. Would the gentleman yield?
Mr. Shuster. Certainly.
Mr. Oberstar. On that point, Mr. Harrison, I have to
observe that there is a symbiotic relationship between the
railroad and the communities. They need each other. They needed
each other from the very beginning, and I don't think it is
appropriate to say oh, well, these towns grew up after the
railroad. They grew up together.
Mr. Harrison. Fair point.
Ms. Darch. In fact, Mr. Chairman, my town was there before
the EJ&E line, and our community was built.
On this issue of the congestion in Chicago and what is
happening in this transaction, we recognize--and you heard from
the Congresswoman from California in her letter from the Port
of Long Beach and we heard from the Port of Seattle--the issue
that a lot of this is through traffic, transporting the Asian
goods from Port of Prince Rupert, Canada, down to Memphis, down
to New Orleans.
So the benefit to Chicago, it is going around. It is not
feeding the economic engine of Chicago.
The question of congestion in Chicago and these relative
benefits are the reason really that H.R. 6707 needs to be the
law, to confirm that the impacts on us, that they can be
properly evaluated and measured against the benefit to a
railroad of the transaction and that the communities aren't on
the losing end of the issue.
Mr. Shuster. Well, thank you.
I don't know if anybody else would want to comment.
Ms. Nekritz. I thank you, Congressman Shuster.
I would just like to say that Chicago isn't an economic
entity unto itself, neither is Memphis, neither is Atlanta. To
the extent that we all rise and fall together, the freight
traffic in the United States of America has to be addressed as
the whole Country, not just what is good for Chicago, because
what is good for Chicago is good for Memphis is good for
Atlanta.
Mr. Shuster. I heard once my predecessor actually said the
Port of Seattle should actually be called the Port of Chicago
because 70 percent of something like that of the freight that
hits the ground in Seattle goes right to Chicago.
Ms. Nekritz. I actually just was in Prince Rupert last week
and saw what is coming. I understand the Congresswoman's
perspective from California, but it is three days less shipping
time to Prince Rupert than it is to Long Beach, and that is an
economic advantage that is just geography.
You can't fight it necessarily, and we are not going to be
able to. Unless we impose tariffs, we are not going to be able
to change that.
Mr. Shuster. Right. Thank you very much.
Mr. Oberstar. I thank the gentleman for his observations
and questions and the panel for their response.
Before I go to Mr. Lipinski, on Prince Rupert Island,
Prince Rupert is 345 miles further out in the Pacific Island
than the Port of Long Beach-Los Angeles. It has the advantage
of the great circle of the Pacific Ocean route, a faster
transit time, plus it is further out into the ocean.
It gives great economic opportunity and advantage for the
railroad, and the CN is building on an already existing
facility and expanding it. It has deep water capability. It
doesn't need dredging, and Mother Nature does that daily with
the tide.
It will provide a great advantage to shippers and consumers
as well as to the railroad. I know the first point of entry in
the United States for a good deal of that traffic will be
northern Minnesota in my district, and therefore I would
encourage the CN to consider a short-sea shipping initiative
that would help avoid the congestion in Chicago.
Mr. Lipinski.
Mr. Lipinski. Thank you, Mr. Chairman. I want to note that
Mr. Shuster just quoted his predecessor. His predecessor is a
very wise man.
Mr. Shuster. He likes to remind me of that. For those of
you who don't know, that is my father who was the Chairman of
this Committee.
[Laughter.]
Mr. Lipinski. I will leave my predecessor out of this.
I want to thank everyone here on the panel, all the
witnesses. You really do provide the range of testimony that we
really do need to hear in regard to what the impact is going to
be all across the region in terms of the CN proposed
acquisition.
I wanted to start out by addressing Mr. Silvestri. You
noted in your testimony that Elmwood Park has one of the most
dangerous crossings or the most dangerous grade crossing in
Illinois, and I certainly remember in 2006 that horrific crash
with 13 cars involved there. That is just one of the worst
intersections I have ever seen that I think there could be.
Now I understand that the Illinois Department of
Transportation receives about $10 million a year specifically
for grade separations. It comes from a $220 million set-aside
from the Federal Highway Administration's Highway Safety
Improvement Program.
This $10 million for Illinois can't even pay for 1 grade
separation. While States do have flexibility that they can
spend other core highway program dollars for grade separations,
with limited funds and unlimited needs, that usually does not
happen. Money goes towards repaving, resurfacing a road or some
other important project.
Now I have been working on drafting a bill that would
direct more Federal resources and dedicate funds for grade
separations to improve safety and quality of life in the areas
that are congested and have a high density of grade crossings.
I was wondering if you could comment on this idea for more
Federal funding, dedicating more Federal funding. Obviously,
$220 million is not that much.
Now how could this potentially be helpful for Elmwood Park
and other municipalities in your area?
Mr. Silvestri. Well, as much as I would like to think
Elmwood Park is unique as its Mayor, it is very similar to many
of the communities in the inner ring suburbs or the older
suburbs of Chicago in that we were built up on the railroad. As
I mentioned, we have 4 at-grade crossings within a mile and we
get 127 trains per day that go through that, commuter and
freight.
When the commuter train traveling at 90 miles an hour hit
the 13 vehicles that were literally trapped on the crossing
because of the direction of the crossing and the backed up
traffic, which the NTSB also said was contributed to by the
fact that there are so many delays on that road because of all
these trains blocking traffic, the State initiated a study to
determine the cost of putting an underpass at that crossing.
The State was kind enough to pay for the analysis, and we
received three proposals. The cheapest proposal is in excess of
$70 million to build the underpass, and the one that is least
disruptive to the community, basically our downtown, would be
approximately $90 million to build.
So more Federal funding of crossings would, of course, be
welcomed by communities like ours. As you know, Congressman,
Illinois has the largest number of at-grade crossings of any
State in the Union, most of them located in the metropolitan
Chicago region. So more funding would obviously be welcomed by
all of the leadership and I am sure all the residents and
people of the greater Chicago region.
Mr. Lipinski. Thank you.
I wanted to just very briefly ask Ms. Nekritz as Chair of
the Rail Safety Committee. I know you have the expertise, and
you are charged, since you are doing this for the entire State
of Illinois, with really looking at what solutions that there
are to issues that we have with rail safety.
Now looking at what would happen, the impact of moving
trains from some areas to other areas, what do you see as the
difference? If we were just talking about reshuffling the deck,
does that make a difference?
Are we just moving trains from one congested area to
another or by reshuffling the deck, opening up another line,
overall when you look at the whole system does it make
improvements?
Ms. Nekritz. I think maybe the next panel would be more
capable of answering that because to my understanding, yes, if
we move off the already congested lines to a line that has
capacity, excess capacity, like the EJ&E, it does open up the
Chicago region and reduces the congestion and thus reduces the
time that is necessary to get through the area.
Mr. Lipinski. I was just trying to get at the point that it
would seem that if you are taking trains from a very congested
area to an area that is under-utilized, that there is a net
gain when you do something like that.
Ms. Nekritz. I believe that would be the case. I think the
STB report--I have only read the Executive Summary, and I
didn't read the big stack--indicated that there would be fewer
accidents overall and that safety would be improved overall by
this.
Mr. Lipinski. Chairman Oberstar was, a couple months ago,
out in LaGrange which is right next to Western Springs. The
same rail line runs through there, and there are about 160 to
170 trains a day.
That area along that route, Ms. Biggert, who was testifying
earlier, lives right next to Western Springs in Hinsdale. Those
villages are doing very well.
I just really think that there is an issue right here of,
yes, there are problems that are caused and issues. Certainly,
safety needs to be addressed. It needs to be worked out.
There is a lot of mutual aid agreements in a lot of the
villages as was mentioned here, and towns, but there is a
possibility of making things as good as they can be while still
having a rail line that goes through the area. Even when you
have 160 trains a day going through, it is possible, and I
think everything should be done.
Everything possible should be done to try to mitigate where
there are going to be issues, but we have to figure out where
these trains are going.
So, with that, I will yield back.
Mr. Oberstar. I thank the gentleman.
We are going to have votes on the floor in about 20
minutes, and I want to move to the next panel but before I do
that, a question to Ms. Nekritz.
Is the legislature of Illinois prepared to provide matching
funds to those that we might have to consider in the spirit of
Mr. Lipinski's testimony and to respond to the concerns of
others and to those of Mr. Harrison for all the mitigation that
would be required? That could be several hundreds of millions
of dollars.
If we were to consider or enact legislation to provide, as
Mr. Lipinski was just discussing, a Federal matching program,
there would have to be some participation from the private
sector, some from the State and local governments. Is the
legislature of a mind to move such legislation?
Ms. Nekritz. I hesitate to get into the mind of our
legislature right now. It is a very trying time in Illinois
politics.
That being said, we do have a grade crossing protection
fund that takes in several million dollars every year, and it
basically gets expended on safety crossing equipment because it
is insufficient to address, to do grade separations. But if we
were able to use that as matching funds for grade separations,
then I would think yes.
I think that the problem has become so bad in our region
that there is lots of support for doing something to help the
residents because we hear about it all the time. It is a very
common problem throughout the Chicago region, and so I think if
that opportunity arose there would be plenty of support for
that.
Mr. Oberstar. And, Mr. Swanson and Mr. Yagelski, do you
think the Indiana Legislature would be of a similar mind?
Mr. Swanson. Indiana is somewhat unique in that due to the
leasing of the toll road, it actually has a fully funded 10-
year roads program.
Mr. Oberstar. With your governor, they might find a way to
sell off the railroad and lease it back and toll it and so on.
Mr. Swanson. Well, in any event though, I would have to say
that for at least the 10-year program the money is not there.
Frankly, the legislation passed this spring, HEA 1001,
imposed a 1 percent limit on all property taxes on our local
governments which is causing many of them to contract
seriously, and some of them actually are almost entertaining
distressed community status. So, even if the legislature were
in its wisdom to come up with additional dollars, I don't think
the local funding is there, Congressman Oberstar.
Mr. Oberstar. Thank you.
Mr. Harrison, you responded with some enthusiasm and detail
about the effect of an increased number of trains at certain
grade crossings and saying it would be 2 minutes and a total of
48 minutes in certain circumstances.
But reviewing the draft Environmental Impact Statement of
the Board, the Surface Transportation Board, they reviewed 112
at-grade crossings on the EJ&E. Eighty-seven met the Board's
threshold for environmental analysis. The remainder either had
no train increases or had less than 2,500 vehicles.
And, they observed that if you delay 60 vehicles by 1
minute each, that is an hour total delay. If you delay 1,200
vehicles by 2 minutes each, that equals 40 hours of delay.
So the two minutes that you cite is of interest if there is
only one vehicle at that railroad grade crossing. But if there
are numerous, multiple vehicles, there is a cumulative
substantial delay impact on the totality of the citizenry, is
that not right?
Mr. Harrison. I guess it is kind of the devil is in the
details. I don't agree with necessarily all their analysis, but
you can put your finger on exactly what it is, however many
cars are stopped and however many feet there are from there to
the crossing.
I guess my point is this: The blockage at crossings is an
issue. We understand it, and we are willing to deal with it,
but we should deal with facts and not innuendo.
Mr. Oberstar. The Board has facts in here, a substantial
number of facts. Increase in total vehicle delay in their
analysis ranged from 50 minutes to 149 hours. So there is a
range of impacts.
Also, they say that 15 crossings would be substantially
affected, and delay for all vehicles would be more than 40
hours a day.
So there is and, in their appendix, there is a substantial
amount. I raise that for the consideration.
You point out, we will build a berm or we will build a
noise barrier.
Oh, we don't want that. Citizens want this, don't want the
other thing, but communities have readily accepted noise
barriers along highways that block noise from the interstate or
from a portion of highway on the National Highway System.
Somehow, those concerns have to be reconciled, and the
railroad has to be prepared to take some action on its own
where there is a conflict or potential conflict with passenger
rail.
Who has that cell phone? I have to say again the rules of
the Committee are that there is no audible sound permitted on
cell phones or Blackberries or any other communication device.
What is the cost of building a siding?
Mr. Harrison. A siding?
Mr. Oberstar. Yes, a mile or two-mile siding?
Mr. Harrison. A good round number today is a million
dollars a mile. It could be a little more, could be a little
less, depending on the grading you have to do and the location,
but a million dollars is a pretty good number.
And I would remind you, Mr. Chairman, that is part of the
$100 million is improving that improving that infrastructure
where we can pick the speed up and then have faster turnouts
and better connections where there will be less blockage.
The issue, as we tried to deal with individual communities,
is some communities--and I understand their issue--have decided
that they like their little downtown the way it is, and they
don't want to put a viaduct in. They would rather not have us
there.
So I can't create a viaduct. I can't create an underpass. I
mean the State or the local community has to be the moving
party. The STB can direct me to pay so much money with one
exception. The precedent has never been to be over what is in
current law and practice.
There was one exception in the Conrail transaction, I
think, where they said that Conrail should fund 25 percent of
that crossing.
That is the problem we have. When I talk to the community,
they say, well, the State doesn't have any money and we are not
going to get a grade crossing.
That is where we are, and that is why we are trying to look
at other ways to deal with it.
Mr. Oberstar. I thank you for your response.
I thank all the panel members for your contribution. We
will have to evaluate all these factors.
But I think it emerges, as the burden of the testimony
comes along, that the Board needs some authority and clarity to
deal with this issue of a large railroad acquiring a smaller
railroad and the effects and the authority the Board has to
direct changes to mitigate those effects or if the burden
exists to deny it.
As for CREATE, if other parties had been willing to
contribute as much to CREATE as our side did, it would have
$200 million. That was close to the goal of getting 40 percent
Federal funds into CREATE. We will deal with it next time.
Ms. Nekritz. Well, it is seriously under consideration in
the Illinois General Assembly, and we are looking at trying to
get $500 million for it.
Mr. Oberstar. Thank you. Thank you very much. I look
forward to your continuing participation in this process.
Our fourth panel includes Dr. Joseph Schwieterman of the
Chaddick Institute for Metropolitan Development at DePaul
University; Dr. Phineas Baxandall, Senior Analyst for Tax and
Budget Policy of the U.S. Public Interest Research Group; and
John Tolman, a long-time presence in this Committee's
deliberations on rail issues, the Vice President and National
Legislative Representative for the distinguished Brotherhood of
Locomotive Engineers and Trainmen.
Take up positions.
Dr. Schwieterman, thank you for being with us, for your
very scholarly work and testimony. Please begin.
TESTIMONY OF DR. JOSEPH P. SCHWIETERMAN, PH.D., DIRECTOR OF THE
CHADDICK INSTITUTE FOR METROPOLITAN DEVELOPMENT, DEPAUL
UNIVERSITY; DR. PHINEAS BAXANDALL, PH.D., SENIOR ANALYST FOR
TAX AND BUDGET POLICY, U.S. PUBLIC INTEREST RESEARCH GROUP,
FEDERATION OF STATE PUBLIC INTEREST RESEARCH GROUPS; AND JOHN
TOLMAN, VICE PRESIDENT AND NATIONAL LEGISLATIVE REPRESENTATIVE,
BROTHERHOOD OF LOCOMOTIVE ENGINEERS AND TRAINMEN
Mr. Schwieterman. Mr. Chairman, Members of the Committee, I
am honored to be here today to express my views on the TRACS.
I have written a great deal about community impacts of
freight railroad projects. In 2000, I wrote a study at the
request of Senator Durbin on railway whistle-blowing noise and
implications of the new FRA's quiet zone ruling. I have written
a book on rail freight service, and I understand the concerns
being voiced here today.
My remarks are specifically on the Act itself and not on
the CN/EJ&E transaction per se.
The idea of asking the Board to conduct more robust
examinations of environmental impacts has many implications,
and I will attempt to explain why I think there are many
unintended consequences that we need to think two or three
years down the road as cities, railroads, lawyers learn to work
with the exact wording that is in the Act and why, if it is
literally interpreted, does push us toward full-blown benefit-
cost analysis which would greatly delay the approval of many
railroad transactions.
I believe without a more thorough reassessment of the STB's
resources and responsibilities, asking it to formally weigh the
environmental costs and transportation benefits risks creating
a systematic bias against railroad mergers and acquisitions.
That is the Act may focus attention mostly on the immediate
negative impacts on communities on the line without offering a
balanced presentation of any offsetting benefits which can only
be understood with a more comprehensive analysis than that
which is conducted today.
Transportation markets are dynamic. When one carrier
acquires another, of course, there are many indirect benefits:
fewer trucks on the road, fewer highway accidents, less traffic
on competing rail lines, less pollution from mobile sources.
There are also competitive changes triggering a second
round of investments which are not even subject to STB
approval, which have implications for communities.
This puts the STB in a very difficult position. If it
limits its attention to the most obvious impacts, such as the
environmental consequences on communities along the railroad to
e acquired, its assessment will be incomplete and skewed
against the transaction. But evaluating all the benefits,
direct and indirect, will require comprehensive and scenario-
based analysis that is not presently part of its work.
For the analysis to be completed in a timely fashion, the
STB would need to make many assumptions and subjective
judgments which would make the process much less predictable.
I am not suggesting the STB should not consider and
vigorously deal with community impacts in its decisions. I do
believe, however, that bringing greater formality to the
process and the language as the Act is currently written would
greatly change the nature of the Board's, lengthen its
investigations and trigger unintended consequences.
Here is a simple example of the analysis that would be
needed. Environmental impacts of a merger would need to include
a counter-factual analysis of how traffic would change if the
merger did not take place.
In the case of the CN application, the STB would need to
consider whether and when congestion in Chicago would otherwise
result in greater use of the EJ&E bypass and how this would
affect traffic on other routes. In order to do this right, the
STB would need to make difficult assumptions and greatly
elevate the level of analysis it provides.
My second point: No other transportation mode providing
intercity service in the United States, whether it is intercity
trucking, airlines, barge operators, motor bus operators, even
Amtrak, is subject to the kind of criteria established in H.R.
6707.
The unintended consequence will likely be that the Act will
become an impediment toward moving forward to cooperative
solutions to community issues involving railroads. Let me
articulate several of these potential unintended consequences
which may result from pushing Federal policy into what I
consider uncharted waters.
Railroads and communities may have an incentive to be less
than candid when discussing the impacts of a transaction. Thus,
the Act may serve to place the two parties in a more naturally
adversarial role.
Railroads may sidestep the need for STB approval entirely
by negotiating trackage rights and hauling rights agreements
with other railroads rather than pursuing a merger and
acquisition.
Railroads may be reluctant to let commuter agencies and
intercity operators use their right of way, afraid that they
may creating a new stakeholder who has incentive to fight for
the status quo.
A muddled political debate may result from the language in
the Act that the socioeconomic impacts of railroad mergers and
acquisitions be evaluated and weighed. Do we really think such
impacts can be evaluated convincingly without opening the door
to lengthy delays?
My third point is the implication of greatly stepping up
the transactions that require different levels of STB approval
beyond Class I railroads greatly increases the STB work load.
That, too, has implications. I am not saying the STB can't deal
with these implications, but I do feel a more vigorous
assessment of the ramifications are warranted.
The history of railroad regulation prior to the Staggers
Act suggests the need for great caution here.
And finally, as I think we heard in the previous panel, the
Act risks shifting some responsibility for solving problems of
rail transportation from their roots, which often is grounded
in inadequate State and Federal funding, to private railroad
companies.
We are seeing a great deal of frustration being directed at
Class I railroads. We have heard much of it today. In many
respects, we are living with the consequences of inadequately
funding CREATE, the congestion relief program for Chicago.
Public agencies have also not brought forth, particularly
in our State, the funds to support grade crossing separations,
and communities now lack practical options to abate noise of
locomotive horns through the creation of quiet zones in some
situations.
So, in summary, I urge caution in crafting any legislation
that would change in mid-stream a policy process that has been
in place for many years, that it certainly warrants greater
discussion and evaluation before moving ahead.
I believe the Act is well intended, and I have great
respect for the sponsors. However, there is an immediate need
here. It is the need to look systematically at the implications
of the Act, so we don't create a new set of policy problems.
Mr. Chairman, I thank you for the chance to express my
view.
Mr. Oberstar. Thank you very much for those well-expressed
thoughts and insights. We will come back to that in a moment.
Mr. Baxandall.
Mr. Baxandall. Chairman Oberstar, Members of the Committee,
thank you for the invitation to present the views of the U.S.
Public Interest Research Group.
As you know, U.S. PIRG serves as the Federal lobbying
office for State public interest research groups. We are non-
profit and nonpartisan citizen advocacy groups who are active
in over 20 States.
U.S. PIRG believes that rail is critical to America's
transportation future and that Federal policy must ensure that
key decisions affecting the Nation's rail network consider the
public interest. As such, U.S. PIRG speaks today in support of
the TRACS Act.
Transportation patterns have profound consequences that
extend far beyond individual rail companies and their
shareholders as we have heard today. Impacts also extend beyond
the local communities that abut the transportation routes.
Rail plays an increasing role in addressing important
national issues that extend beyond the development, local
traffic, rights of way and the industry competitiveness that we
have heard so much of.
For instance, major decisions about our Nation's rail
network will significantly determine the extent of our Nation's
dependence on oil, much of which continues to come from
unstable or unfriendly regimes.
Our rail network will shape the regional patterns of
residential and commercial development. It will profoundly
affect the quantity of global warming pollution we emit, the
range of travel choices available to our aging population and
the integration of America's dynamic urban centers with their
surrounding suburbs.
These are issues that are best considered by a national
decision-making body, one such as the Surface Transportation
Board.
In the years ahead, America will need to greatly expand its
rail network, not just the portion of freight tonnage hauled by
rail that was mentioned earlier but also more and better
commuter service on tracks often owned by freight companies
and, finally, to build out our Nation's designated high-speed
rail networks in ways that will stimulate regional economies
and relieve the short-haul traffic in our distressed air travel
industry.
U.S. PIRG takes no position on the application filed by CN
to acquire EJ&ER. On the one hand, the merger will provide
opportunity to relieve gridlock and other impacts. On the other
hand, the abutting communities will be unprepared and adversely
affected by the rail traffic.
Over the long term, the most important implications for the
broader public impact may be how this proposed acquisition
could prevent attainment of a decades long vision to connect
communities around Chicago's circumference through the Suburban
Transit Access Route, the STAR program.
In the particular northeastern Illinois context, we applaud
the fact that CN is striking voluntary deals with individual
communities such as in Joliet to improve affected traffic
crossings and reduce noise. We do not, however, think that
these ad-hoc local deals can be a substitute for Federal level
attention to national priorities.
Beyond the local context, the broader issue is whether
future mergers and acquisitions in the rail industry will serve
the public interest or only the short-term interests of the
rail company stockholders. These two interests often overlap,
but we cannot treat them as identical.
Like laws for other natural monopolies such as utilities or
telecom, this Act before us would provide important oversight
to ensure that mergers advance, rather than undermine, the
public interest.
Now since the 19th Century, we have often learned the hard
way that railroad mergers can create society-wide impacts that
harm the public interest. Rail mergers reshape the network
because each route is typically a natural monopoly. There is
virtually no means to compete for service on a particular route
once another company owns the tracks, and it is highly
inefficient for multiple firms to complete for the same route
over duplicate tracks.
The issue is not just that the railroad acquisitions can be
anti-competitive by extracting monopoly prices from shippers or
consumers. Current law, in any event, already gives the STB
authority to deny certain mergers that would be anti-
competitive.
We support the TRACS Act because it would address the fact
that mergers can also undermine the public interest by
affecting how railway companies reroute traffic, maintain
existing tracks or develop new lines.
The legislation, we believe, would appropriately empower
the STB to consider the broader public interest including the
impacts on commuter and intercity rail. This makes sense as we
look forward toward the challenges of the future and the role
that transportation must play in meeting those challenges.
Thank you for the opportunity to share these comments with
the Committee.
Mr. Oberstar. Thank you very much for your comments.
Mr. Tolman.
Mr. Tolman. Good afternoon, Chairman Oberstar, Ranking
Member Shuster and Members of the Committee.
I would like to first take the opportunity to thank the
Chairman for introducing H.R. 6707.
Chairman Oberstar, for many years, you have been a tireless
advocate for a sensible national transportation policy which
includes both freight and passenger rail. I believe that your
efforts, combined with the skyrocketing price of fuel and the
discussions today about infrastructure investment in the
railroad industry, may finally change the course of our Nation,
and I applaud you for them.
H.R. 6707 requires STB to address the public interest in
railroad transactions, and we are fully supportive of this.
Current law, as contained in the Staggers Act, does not
provide STB with the authority to disapprove mergers or
consolidations of Class I's with a Class II or III railroad if
it finds a transaction is not consistent with the public
interest nor can the STB impose conditions to address
legitimate community concerns.
Growing sentiment regarding the safe transportation of
hazardous materials and spent nuclear fuel along with
opposition to various mergers and acquisitions was the impetus
for this legislation. We live in an era where there is a ``not
in my back yard'' aversion to such transactions which often
causes them to be politicized.
Two transactions which best illustrate the problem are the
Canadian National's purchase of EJ&E and the Department of
Energy's proposed Yucca Mountain repository. In each of these
cases, the surrounding communities have voiced their concern
for safety, just as we have, and have problems with these
transactions.
The BLET has not received enough information about the EJ&E
merger to fully judge its impact to our members. However, our
general committees, of which there are four involved in this
particular transaction, they have not received enough
information.
Of the four general committees involved in this
transaction, only one of them is fully supporting this. Another
one is absolutely opposed to it, and the other two do not have
enough information.
I guess I ask this question: Is this any way to run a
railroad?
The BLET has a number of issues with the proposed plan to
ship nuclear waste to Yucca Mountain which we have expressed
throughout the years and will continue to do so. We believe
that this will have a negative impact on the safety of our
members and the communities through which we run the trains.
First and foremost among these problems is the lack of
exposure protection for our members. Also training in handling
these materials received by our members is almost nonexistent.
Unquestionably, both these transactions directly impact the
safety of the surrounding communities as well as causing fear
and anxiety among their residents.
However, while crafting and adjusting a national policy is
a legislative matter, executing that policy should not take
place in an overly politicized environment nor can it take
place in a vacuum. The concern of localities impacted by rail
transactions should be heard, considered and, where
appropriate, addressed.
The appropriate body for this input is the STB which has
regulatory authority over these transactions.
The BLET supports 6707 because it provides a mechanism to
hear legitimate local concerns and also deal with unreasonable
fears which often arise through the lack of information and
community input. We feel this legislation would not overly
burden the railroads with greater regulation but would provide
a mechanism for communities to express their concerns about
safety of the citizens in an appropriate manner, and it would
do so in an orderly fashion.
As for the discussion of highway grade crossing, separation
technology today, we absolutely support it. It is extremely
traumatic for a locomotive engineer or trainman to go through
any highway grade crossing accident.
Again, Mr. Chairman, I appreciate the opportunity to
testify in front of you. Thank you.
Mr. Oberstar. Well, you did a remarkable timing, all three
of you.
I have one observation, and you can see the votes that we
have. Mr. Shuster and I are both going to have to rush off to
the floor.
The compilation of railroad laws provides in the case of
construction of new line that the Board shall issue a
certificate unless the Board finds that activities, building
the new line, are inconsistent with the public convenience and
necessity. The certificate may approve the application as filed
or with modifications and may require compliance with
conditions the Board finds necessary in the public interest.
But there is no such requirement on the Board for merger or
for acquisition.
So I appreciate your observation, Dr. Schwieterman, that
there may be unintended consequences, but let me read the
language:
``The Board shall hold public hearings including public
hearings in the communities unless the Board determines
hearings are not necessary in the public interest''--there is
no unintended consequence there--``and shall consider the
safety and environmental effects of the proposed transaction.''
It doesn't say adverse safety. It says shall consider the
safety and environmental effects ``including the effects on
local communities.''
It doesn't say negative or positive, but it presumes that
the Board consider both negative and positive, ``such as public
safety, grade crossing safety, hazardous materials
transportation safety, emergency response time, noise and
socioeconomic impacts.''
Perhaps you are suggesting we should add the words, both
positive and negative, to avoid unintended consequences.
Mr. Schwieterman. I think my concern about the Act is not
that environmental impacts be dealt with and considered, but
there is very explicit language about weighing the
environmental consequences with the transportation benefits
which, to me, implies a level of analysis that requires a
degree of quantification of the benefits and the costs, were it
to be interpreted very literally, at least implicit.
To do that right really requires a fairly expansive
addition to the level of analysis the STB provides because
currently, in its approach to evaluating a problem, it looks
primarily at the implications of the community affected by the
transaction itself. The secondary benefits to other cities, it
is very difficult to measure those.
My fear is that puts the negative impacts front and center
where the positive impacts much more difficult to quantify.
Mr. Oberstar. We don't want to do that. If you have some
suggestion of language to mitigate that effect and achieve more
of balance, I would welcome your suggestion.
But as for Mr. Harrison talked about how much time will be
required to do this analysis, whatever that time is, the
outcome is permanent for the communities. So they have to live
forever.
If there is a year or two years time for evaluation, that
is small in comparison to the permanency of the decision, say,
to proceed with the acquisition on the employees, the
brotherhoods, on communities. That is there forever.
Mr. Schwieterman. Yes, and my response there would be that,
sure, more is good. I mean more analysis clearly yields some
benefit.
But there is a consequence, and the consequence is the
railroad industry trying to make decisive decisions with a
degree of predictability, that when you subject it to that kind
of a process, there are all kinds of ways the process can be
manipulated. There is difficulty in conducting analysis in a
timely manner.
Mr. Oberstar. You might also put a limitation on time
within which to do that analysis as we have done in other
transportation considerations.
Mr. Schwieterman. Yes, yes.
Mr. Oberstar. But thank you for that cautionary thought,
for testimony. I wish we had a little more time to explore
other issues, but any additional thoughts may be submitted in
writing.
The Committee is adjourned.
[Whereupon, at 2:53 p.m., the Committee was adjourned.]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]