    [House Hearing, 116 Congress]
    [From the U.S. Government Publishing Office]

     WHERE'S MY STUFF? EXAMINING THE ECONOMIC, ENVIRONMENTAL, AND SOCIETAL
                       IMPACTS OF FREIGHT TRANSPORTATION

    =======================================================================

                                    (116-45)

                                 JOINT HEARING

                                   BEFORE THE

                      SUBCOMMITTEE ON HIGHWAYS AND TRANSIT

                                    AND THE

                     SUBCOMMITTEE ON RAILROADS, PIPELINES,
                            AND HAZARDOUS MATERIALS

                                     OF THE

                                  COMMITTEE ON
                       TRANSPORTATION AND INFRASTRUCTURE
                            HOUSE OF REPRESENTATIVES

                         ONE HUNDRED SIXTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                DECEMBER 5, 2019

                                   __________

                           Printed for the use of the
                 Committee on Transportation and Infrastructure

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

         Available online at: https://www.govinfo.gov/committee/house-
         transportation?path=/browsecommittee/chamber/house/committee/
                                 transportation

                               ______

                  U.S. GOVERNMENT PUBLISHING OFFICE
     43-121 PDF             WASHINGTON : 2020

                 COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

      PETER A. DeFAZIO, Oregon, Chair
    SAM GRAVES, Missouri                 ELEANOR HOLMES NORTON,
    DON YOUNG, Alaska                      District of Columbia
    ERIC A. ``RICK'' CRAWFORD, Arkansas  EDDIE BERNICE JOHNSON, Texas
    BOB GIBBS, Ohio                      RICK LARSEN, Washington
    DANIEL WEBSTER, Florida              GRACE F. NAPOLITANO, California
    THOMAS MASSIE, Kentucky              DANIEL LIPINSKI, Illinois
    MARK MEADOWS, North Carolina         STEVE COHEN, Tennessee
    SCOTT PERRY, Pennsylvania            ALBIO SIRES, New Jersey
    RODNEY DAVIS, Illinois               JOHN GARAMENDI, California
    ROB WOODALL, Georgia                 HENRY C. ``HANK'' JOHNSON, Jr.,
    JOHN KATKO, New York                 Georgia
    BRIAN BABIN, Texas                   ANDRE CARSON, Indiana
    GARRET GRAVES, Louisiana             DINA TITUS, Nevada
    DAVID ROUZER, North Carolina         SEAN PATRICK MALONEY, New York
    MIKE BOST, Illinois                  JARED HUFFMAN, California
    RANDY K. WEBER, Sr., Texas           JULIA BROWNLEY, California
    DOUG LaMALFA, California             FREDERICA S. WILSON, Florida
    BRUCE WESTERMAN, Arkansas            DONALD M. PAYNE, Jr., New Jersey
    LLOYD SMUCKER, Pennsylvania          ALAN S. LOWENTHAL, California
    PAUL MITCHELL, Michigan              MARK DeSAULNIER, California
    BRIAN J. MAST, Florida               STACEY E. PLASKETT, Virgin Islands
    MIKE GALLAGHER, Wisconsin            STEPHEN F. LYNCH, Massachusetts
    GARY J. PALMER, Alabama              SALUD O. CARBAJAL, California,
    BRIAN K. FITZPATRICK, Pennsylvania   Vice Chair
    JENNIFFER GONZALEZ-COLON,            ANTHONY G. BROWN, Maryland
      Puerto Rico                        ADRIANO ESPAILLAT, New York
    TROY BALDERSON, Ohio                 TOM MALINOWSKI, New Jersey
    ROSS SPANO, Florida                  GREG STANTON, Arizona
    PETE STAUBER, Minnesota              DEBBIE MUCARSEL-POWELL, Florida
    CAROL D. MILLER, West Virginia       LIZZIE FLETCHER, Texas
    GREG PENCE, Indiana                  COLIN Z. ALLRED, Texas
                                         SHARICE DAVIDS, Kansas
                                         ABBY FINKENAUER, Iowa
                                         JESUS G. ``CHUY'' GARCIA, Illinois
                                         ANTONIO DELGADO, New York
                                         CHRIS PAPPAS, New Hampshire
                                         ANGIE CRAIG, Minnesota
                                         HARLEY ROUDA, California
                                         CONOR LAMB, Pennsylvania

                      Subcommittee on Highways and Transit

    ELEANOR HOLMES NORTON, District of
              Columbia, Chair
    RODNEY DAVIS, Illinois               EDDIE BERNICE JOHNSON, Texas
    DON YOUNG, Alaska                    STEVE COHEN, Tennessee
    ERIC A. ``RICK'' CRAWFORD, Arkansas  JOHN GARAMENDI, California
    BOB GIBBS, Ohio                      HENRY C. ``HANK'' JOHNSON, Jr.,
    DANIEL WEBSTER, Florida              Georgia
    THOMAS MASSIE, Kentucky              JARED HUFFMAN, California
    MARK MEADOWS, North Carolina         JULIA BROWNLEY, California
    ROB WOODALL, Georgia                 FREDERICA S. WILSON, Florida
    JOHN KATKO, New York                 ALAN S. LOWENTHAL, California
    BRIAN BABIN, Texas                   MARK DeSAULNIER, California
    DAVID ROUZER, North Carolina         SALUD O. CARBAJAL, California
    MIKE BOST, Illinois                  ANTHONY G. BROWN, Maryland
    DOUG LaMALFA, California             ADRIANO ESPAILLAT, New York
    BRUCE WESTERMAN, Arkansas            TOM MALINOWSKI, New Jersey
    LLOYD SMUCKER, Pennsylvania          GREG STANTON, Arizona
    PAUL MITCHELL, Michigan              COLIN Z. ALLRED, Texas
    MIKE GALLAGHER, Wisconsin            SHARICE DAVIDS, Kansas
    GARY J. PALMER, Alabama              ABBY FINKENAUER, Iowa, Vice Chair
    BRIAN K. FITZPATRICK, Pennsylvania   JESUS G. ``CHUY'' GARCIA, Illinois
    TROY BALDERSON, Ohio                 ANTONIO DELGADO, New York
    ROSS SPANO, Florida                  CHRIS PAPPAS, New Hampshire
    PETE STAUBER, Minnesota              ANGIE CRAIG, Minnesota
    CAROL D. MILLER, West Virginia       HARLEY ROUDA, California
    GREG PENCE, Indiana                  GRACE F. NAPOLITANO, California
    SAM GRAVES, Missouri (Ex Officio)    ALBIO SIRES, New Jersey
                                         SEAN PATRICK MALONEY, New York
                                         DONALD M. PAYNE, Jr., New Jersey
                                         DANIEL LIPINSKI, Illinois
                                         DINA TITUS, Nevada
                                         STACEY E. PLASKETT, Virgin Islands
                                         PETER A. DeFAZIO, Oregon (Ex
                                         Officio)
                                    ------                                7

         Subcommittee on Railroads, Pipelines, and Hazardous Materials

     DANIEL LIPINSKI, Illinois, Chair
    ERIC A. ``RICK'' CRAWFORD, Arkansas  ALBIO SIRES, New Jersey
    SCOTT PERRY, Pennsylvania            DONALD M. PAYNE, Jr., New Jersey
    RODNEY DAVIS, Illinois               LIZZIE FLETCHER, Texas
    BRIAN BABIN, Texas                   ANDRE CARSON, Indiana
    MIKE BOST, Illinois                  FREDERICA S. WILSON, Florida
    RANDY K. WEBER, Sr., Texas           MARK DeSAULNIER, California
    DOUG LaMALFA, California             STEPHEN F. LYNCH, Massachusetts
    LLOYD SMUCKER, Pennsylvania          TOM MALINOWSKI, New Jersey
    PAUL MITCHELL, Michigan              GRACE F. NAPOLITANO, California
    BRIAN K. FITZPATRICK, Pennsylvania   STEVE COHEN, Tennessee
    TROY BALDERSON, Ohio                 JESUS G. ``CHUY'' GARCIA, Illinois
    ROSS SPANO, Florida                  ELEANOR HOLMES NORTON,
    PETE STAUBER, Minnesota                District of Columbia
    GREG PENCE, Indiana                  EDDIE BERNICE JOHNSON, Texas
    SAM GRAVES, Missouri (Ex Officio)    ALAN S. LOWENTHAL, California
                                         COLIN Z. ALLRED, Texas, Vice Chair
                                         ANGIE CRAIG, Minnesota
                                         CONOR LAMB, Pennsylvania
                                         PETER A. DeFAZIO, Oregon (Ex
                                         Officio)

                                    CONTENTS

                                                                       Page

    Summary of Subject Matter........................................   vii

                     STATEMENTS OF MEMBERS OF THE COMMITTEE

    Hon. Eleanor Holmes Norton, a Delegate in Congress from the
      District of Columbia, and Chairwoman, Subcommittee on Highways
      and Transit:

        Opening statement............................................     1
        Prepared statement...........................................     2
    Hon. Rodney Davis, a Representative in Congress from the State of
      Illinois, and Ranking Member, Subcommittee on Highways and
      Transit:

        Opening statement............................................     3
        Prepared statement...........................................     3
    Hon. Daniel Lipinski, a Representative in Congress from the State
      of Illinois, and Chairman, Subcommittee on Railroads,
      Pipelines, and Hazardous Materials:

        Opening statement............................................     4
        Prepared statement...........................................     5
    Hon. Eric A. ``Rick'' Crawford, a Representative in Congress from
      the State of Arkansas, and Ranking Member, Subcommittee on
      Railroads, Pipelines, and Hazardous Materials:

        Opening statement............................................     6
        Prepared statement...........................................     7
    Hon. Peter A. DeFazio, a Representative in Congress from the
      State of Oregon, and Chairman, Committee on Transportation and
      Infrastructure:

        Opening statement............................................     7
        Prepared statement...........................................     8
    Hon. Eddie Bernice Johnson, a Representative in Congress from the
      State of Texas, prepared statement.............................    93
    Hon. Steve Cohen, a Representative in Congress from the State of
      Tennessee, prepared statement..................................    94

                                   WITNESSES

    Erin Aleman, Executive Director, Chicago Metropolitan Agency for
      Planning, and Board Member, Coalition for America's Gateways
      and Trade Corridors:

        Oral statement...............................................     9
        Prepared statement...........................................    11
    Chuck Baker, President, American Short Line and Regional Railroad
      Association:

        Oral statement...............................................    16
        Prepared statement...........................................    18
    Anne Goodchild, Ph.D., Founding Director, Supply Chain
      Transportation and Logistics Center, University of Washington:

        Oral statement...............................................    24
        Prepared statement...........................................    26
    Ian J. Jefferies, President and Chief Executive Officer,
      Association of American Railroads:

        Oral statement...............................................    31
        Prepared statement...........................................    32
    Jason Mathers, Director, Vehicle and Freight Strategy,
      Environmental Defense Fund:

        Oral statement...............................................    39
        Prepared statement...........................................    41
    Jim Tymon, Executive Director, American Association of State
      Highway and Transportation Officials:

        Oral statement...............................................    48
        Prepared statement...........................................    50

                           SUBMISSIONS FOR THE RECORD

    Post-hearing Correction of Remarks Submitted for the Record by
      Erin Aleman, Executive Director, Chicago Metropolitan Agency
      for Planning, and Board Member, Coalition for America's
      Gateways and Trade Corridors...................................    83
    Statement of Erin Aleman, Executive Director, Chicago
      Metropolitan Agency for Planning, and Board Member, Coalition
      for America's Gateways and Trade Corridors, Submitted for the
      Record by Hon. Peter A. DeFazio................................    94
    Submissions for the Record by Hon. Eleanor Holmes Norton:

        Letter of December 4, 2019, from Catherine Chase, President,
          Advocates for Highway and Auto Safety et al................    95
        Statement of Chris Spear, President and Chief Executive
          Officer, American Trucking Associations....................    98
        Statement of the Association of Equipment Manufacturers......   103
        Letter of December 3, 2019, from Allen R. Schaeffer,
          Executive Director, Diesel Technology Forum................   104
        Letter of December 16, 2019, from David French, Senior Vice
          President, Government Relations, National Retail Federation   108
        Article entitled ``The Significance of Li-ion Batteries in
          Electric Vehicle Life-cycle Energy and Emissions and
          Recycling's Role in its Reduction''........................   111
    Statement of Stephen Gardner, Senior Executive Vice President,
      Chief Operating and Commercial Officer, National Railroad
      Passenger Corporation (Amtrak), Submitted for the Record by
      Hon. Daniel Lipinski...........................................   111

                                    APPENDIX

    Question from Hon. Daniel Lipinski to Erin Aleman, Executive
      Director, Chicago Metropolitan Agency for Planning, and Board
      Member, Coalition for America's Gateways and Trade Corridors...   115
    Questions from Hon. Eddie Bernice Johnson to Chuck Baker,
      President, American Short Line and Regional Railroad
      Association....................................................   116
    Questions to Anne Goodchild, Ph.D., Founding Director, Supply
      Chain Transportation and Logistics Center, University of
      Washington, from:

        Hon. Peter A. DeFazio........................................   116
        Hon. Steve Cohen.............................................   117
    Questions to Ian J. Jefferies, President and Chief Executive
      Officer, Association of American Railroads, from:

        Hon. Peter A. DeFazio........................................   117
        Hon. Eddie Bernice Johnson...................................   120
    Question from Hon. Peter A. DeFazio to Jason Mathers, Director,
      Vehicle and Freight Strategy, Environmental Defense Fund.......   121

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                                December 2, 2019

        SUMMARY OF SUBJECT MATTER

        TO:      LMembers, Subcommittee on Highways and Transit and
    Subcommittee on Railroads, Pipelines, and Hazardous Materials
        FROM:  LStaff, Subcommittee on Highways and Transit and
    Subcommittee on Railroads, Pipelines, and Hazardous Materials
        RE:      LJoint Subcommittee Hearing on ``Where's My
    Stuff?: Examining the Economic, Environmental, and Societal
    Impacts of Freight Transportation''
    _______________________________________________________________________

                                    PURPOSE

        On Thursday, December 5, 2019, at 10:00 a.m., in 2167
    Rayburn House Office Building, the Subcommittee on Highways and
    Transit and the Subcommittee on Railroads, Pipelines, and
    Hazardous Materials will jointly hold a hearing on ``Where's My
    Stuff?: Examining the Economic, Environmental, and Societal
    Impacts of Freight Transportation.'' The purpose of the hearing
    is for Members of the Subcommittees to explore the importance
    of freight transportation, investment needed to support freight
    transportation, and the ways in which demand for goods movement
    is growing and changing. The Subcommittees will hear from
    representatives of the Coalition for America's Gateways and
    Trade Corridors (CAGTC), the American Short Line and Regional
    Railroad Association (ASLRRA), the University of Washington
    Supply Chain Transportation and Logistics Center, the
    Association of American Railroads (AAR), the Environmental
    Defense Fund (EDF), and the American Association of State
    Highway and Transportation Officials (AASHTO).

                                   BACKGROUND

        Freight transportation and related industries significantly
    contribute to the U.S. economy. The nation's freight system
    transports, on average, 51 million tons of freight, valued at
    approximately $55 billion, on a daily basis, which amounts to
    approximately 17.7 billion tons of freight, valued at
    approximately $16.8 trillion, annually.\1\ In 2016, the demand
    for transportation accounted for 8.9 percent of U.S. Gross
    Domestic Product.\2\ Demand for freight transportation is
    rising at a disproportionate rate to freight system
    capacity.\3\ The U.S. Department of Transportation (U.S. DOT)
    estimates that freight movements are expected to grow across
    all modes, and by 2040, will increase by 42 percent.\4\
    ---------------------------------------------------------------------------
        \1\ TRIP, ``America's Rolling Warehouses: Opportunities and
    Challenges with the Nation's Freight Delivery System'', October 2019.
        \2\ Bureau of Transportation Statistics, Transportation Economic
    Trends 2018 (https://www.bts.gov/transportation-economic-trends/tet-
    2018-chapter-2-contribution-economy).
        \3\ FHWA, Urban Goods Movement, https://ops.fhwa.dot.gov/freight/
    technology/urban_goods/index.htm.
        \4\ U.S. DOT, National Freight Strategic Plan, Draft for Public
    Comment, p. 15.
    ---------------------------------------------------------------------------

    FREIGHT RAILROADS

        The U.S. freight railroad industry operates a 140,000-mile
    network across the country, delivering on average five million
    tons of goods every day. This industry is composed of varying
    sized railroads measured by their annual operating revenues
    into three different classes. The largest railroads include the
    seven Class Is, which are the biggest railroads that
    collectively provide long-haul operations in 44 states and
    D.C.\5\ The Class Is account for nearly 69 percent of the
    industry's mileage.\6\
    ---------------------------------------------------------------------------
        \5\ The seven Class railroads include Burlington Northern Santa Fe
    Railway (BNSF); Union Pacific Railroad (UP); Norfolk Southern Railway
    (NS); CSX Transportation; Canadian National Railway (CN); Canadian
    Pacific Railway (CP); and Kansas City Southern (KCS).
        \6\ Association of American Railroads https://www.aar.org/railroad-
    101/.
    ---------------------------------------------------------------------------
        The 603 short line and regional railroads operate nearly
    40% of the nation's rail network by mileage.\7\ Short lines are
    often the only way rural America can connect to the rest of the
    national freight rail network--playing an important role in
    providing first-mile and last-mile service that extends the
    reach of the rail network to rural communities, manufacturers,
    farmers, and others.\8\ These smaller railroads range in size
    from small operators handling just a few carloads a month, to
    others that cross state lines and approach the size of the
    large Class I railroads. These railroads operate 100 percent of
    the rail network in five states; and 50 percent of the rail
    network in another 15 states.\9\
    ---------------------------------------------------------------------------
        \7\ American Short Line and Regional Railroad Association https://
    www.aslrra.org/web/About/About/web/About/About.aspx?hkey=ffdbe611-bc49-
    4db1-902b-1ac672226682.
        \8\ American Short Line and Regional Railroad Association https://
    www.aslrra.org/web/About/Industry_Facts/web/About/
    Industry_Facts.aspx?hkey=bd7c0cd1-4a93-4230-a0c2-c03fab0135e2.
        \9\ American Short Line and Regional Railroad Association https://
    www.aslrra.org/web/About/About/web/About/About.aspx?hkey=ffdbe611-bc49-
    4db1-902b-1ac672226682.
    ---------------------------------------------------------------------------

    VOLUME OF FREIGHT MOVED BY RAIL

        In 2018, the freight railroads operating in the U.S.
    transported 17,910,549 carloads, including 17,708,351 moved by
    the Class Is and 202,198 moved by the short lines. Transported
    inside those carloads were a range of commodities such as:
    agricultural and food products; chemicals and petroleum; coal;
    forest products; metallic ores and metals; motor vehicles and
    parts; nonmetallic minerals and products; waste, scraps, and
    other products. Additionally, the freight railroads transported
    18,066,668 intermodal units, which are shipping containers and
    truck trailers that are transferred to the railroads and moved
    on rail cars.

    ENVIRONMENTAL IMPACTS

        In 2018, the freight railroads, on average, moved one ton
    of freight 473 miles on one gallon of fuel. This efficiency is
    a 101 percent improvement compared to 1980 and a 19 percent
    improvement from 2000.\10\ As a result, the freight railroads
    reduced their consumption of fuel by nine billion gallons and
    emitted 100 million fewer tons of carbon dioxide.\11\ In total,
    the freight railroads comprised just 2 percent of all
    transportation-related greenhouse gas emissions in 2017 and
    just 0.6 percent of total U.S. greenhouse gas emissions in
    2017.\12\
    ---------------------------------------------------------------------------
        \10\ Association of American Railroads, Freight Railroads Help
    Reduce Greenhouse Gas Emissions, April 2019, Available at https://
    www.aar.org/wp-content/uploads/2018/07/AAR-Railroads-Greenhouse-Gas-
    Emissions.pdf.
        \11\ Id.
        \12\ U.S. Environmental Protection Agency (2019, April). Inventory
    of U.S. Greenhouse Gas Emissions and Sinks. Publication No. EPA 430-R-
    19-001. Accessible at: https://www.epa.gov/sites/production/files/2019-
    04/documents/us-ghg-inventory-2019-main-text.pdf, page 38.
    ---------------------------------------------------------------------------
        The freight railroads use various technology systems to
    help achieve such levels of sustainability and efficiency. For
    example, fuel management systems are integrated into
    locomotives and draw on data about topography, track curvature,
    etc., providing the engineers with real-time instructions on
    how to operate the train to gain maximum fuel efficiencies that
    can net up to a 14 percent increase in fuel efficiency. The
    most advanced locomotives, Tier 4s, include hundreds of sensors
    that generate thousands of data points about the performance of
    the locomotives. That data is monitored from operations centers
    that alert the railroad of performance issues when necessary.
    These technologies reduce diesel locomotives' particulate and
    nitrogen oxide emissions by as much as 90 percent and 80
    percent, respectively.\13\
    ---------------------------------------------------------------------------
        \13\ Association of American Railroads, Putting Technology to Work,
    How Freight Rail Delivers the 21st Century, Available at https://
    www.aar.org/wp-content/uploads/2018/05/RailxTech-AAR-White-Paper-Final-
    Web.pdf Page 6.
    ---------------------------------------------------------------------------
        The industry is also pursuing initiatives to reduce
    emissions in freight rail yards. This includes technologies
    that turn off locomotives that have idled for too long or
    automatically restart it if temperatures are low. Small diesel
    engines also may be used to keep the main locomotive engine
    warm when it is powered down to prevent freezing. These
    technologies reduce fuel that is wasted while locomotives
    idle.\14\
    ---------------------------------------------------------------------------
        \14\ Id at 7.
    ---------------------------------------------------------------------------

    FEDERAL FUNDING OPPORTUNITIES

        The short line and regional railroads, and any rail carrier
    (including Class Is) in partnership with at least one state
    entity, public agency, and/or local government, are eligible
    for grants under the FRA's Consolidated Rail Infrastructure and
    Safety Improvements (CRISI) grant program.\15\ These
    discretionary grants fund projects that improve the safety,
    efficiency, or reliability of freight (and passenger) rail
    transportation systems. Activities eligible for CRISI funds
    include capital projects that improve short line and regional
    railroad infrastructure; highway-rail grade crossing
    improvements projects; and rail line relocation and improvement
    projects, among others. The maximum Federal share of total
    project costs under the program is 80 percent. The Fixing
    America's Surface Transportation Act (FAST Act) (P.L. 114-94)
    authorized CRISI at $255 million in Fiscal Year 2019 and $330
    million in Fiscal Year 2020. In addition, the Short Line Tax
    credit, known as 45G, allows a credit of 50 cents for each
    dollar short line railroads invest in track and bridge
    improvements, up to $3,500 per mile. The credit, first enacted
    in 2005, expired in December 2017.
    ---------------------------------------------------------------------------
        \15\ 49 USC Section 24407. In addition to short line and regional
    railroads, states, Amtrak and other intercity rail passenger
    transportation provider, the Transportation Research Board, and others
    are eligible for CRISI.
    ---------------------------------------------------------------------------
        The Railroad Rehabilitation and Improvement Financing
    (RRIF) program offers long-term, low-interest loans for
    improving rail infrastructure. Eligible recipients include
    railroads, state and local governments, government-sponsored
    corporations, and joint ventures that include at least one
    railroad. RRIF-eligible projects include the following:
    acquiring, improving, and rehabilitating track, bridges, rail
    yards, buildings, and shops; preconstruction activities;
    positive train control (PTC); transit-oriented development
    projects; and new rail or intermodal activities. Under this
    program, the U.S. DOT is authorized to provide direct loans and
    loan guarantees up to $35 billion to finance development of
    railroad infrastructure. To date the RRIF program has provided
    $6.286 billion in financing since 2002. There is currently
    about $30.2 billion available in loan authority under the RRIF
    program.\16\
    ---------------------------------------------------------------------------
        \16\ RRIF was originally established by Congress in Title V of the
    Railroad Revitalization and Regulatory Reform Act of 1976 and later
    amended in the Transportation Equity Act for the 21st Century.
    ---------------------------------------------------------------------------

    TRUCKING

        Freight moves by truck on more than four million miles of
    public roads (including 223,000 miles on the National Highway
    System) and 616,000 bridges. The trucking industry is made up
    by over 700,000 trucking companies and more than 3.5 million
    commercial drivers.\17\
    ---------------------------------------------------------------------------
        \17\ https://www.census.gov/library/stories/2019/06/america-keeps-
    on-trucking.html.
    ---------------------------------------------------------------------------

    VOLUME OF FREIGHT MOVED BY TRUCK

        Trucks carried 11 billion tons of freight in 2017 \18\, and
    trucking accounts for approximately 72 percent of all freight
    tonnage by value and 66 percent by weight.\19\ According to the
    Bureau of Transportation Statistics, long-haul freight truck
    traffic is projected to increase ``dramatically'' on the
    National Highway System over the next three decades, from 311
    million miles per day in 2015 to 488 million miles per day by
    2045.\20\
    ---------------------------------------------------------------------------
        \18\ BTS, Freight Facts and Figures, (https://
    data.transportation.gov/stories/s/Moving-Goods-in-the-United-States/
    bcyt-rqmu).
        \19\ TRIP, p.17.
        \20\ Bureau of Transportation Statistics, ``Freight Transportation
    System Extent and Use'' (https://data.transportation.gov/stories/s/
    Freight-Transportation-System-Extent-Use/r3vy-npqd).
    ---------------------------------------------------------------------------
        In recent years, online retail has fundamentally changed
    how products are purchased and distributed. According to the
    U.S. Census Bureau, e-commerce sales have grown from just over
    4 percent of total retail sales in the first quarter of 2010 to
    over 11 percent of total retail sales in the third quarter of
    2019.\21\ From 2014 to 2018, e-commerce increased by 69 percent
    to $505 billion, and is expected to increase another 39 percent
    by 2022, to $706 billion.\22\ As a result of this trend, the
    demand for freight movements by truck, and the requirement for
    more timely and efficient deliveries, have grown significantly.
    This has also prompted changes to supply chains and increased
    the focus on last-mile delivery of freight, particularly in
    congested urban centers.
    ---------------------------------------------------------------------------
        \21\ U.S. Census Bureau, Quarterly Retail E-Commerce Sales, 3rd
    Quarter 2019 (https://www.census.gov/retail/mrts/www/data/pdf/
    ec_current.pdf).
        \22\ TRIP, ``America's Rolling Warehouses: Opportunities and
    Challenges with the Nation's Freight Delivery System'', October 2019, p
    4.
    ---------------------------------------------------------------------------

    ENVIRONMENTAL IMPACTS

        Medium and heavy-duty trucks contributed 23 percent of all
    transportation-related greenhouse gas emissions in 2017, and
    6.7 percent of total U.S. greenhouse gas emissions in 2017.\23\
    Greater congestion on roadways can exacerbate idling,
    emissions, and increase fuel use. More than two out of every
    five miles of America's urban interstates are congested.\24\
    Congestion cost the trucking industry $74.5 billion in 2017,
    $66.1 billion of which occurred in dense urban areas.\25\ The
    cost of congestion for truck drivers grew by 40 percent between
    2012 and 2017, compared to a 14 percent increase in congestion
    costs for non-commercial drivers.\26\
    ---------------------------------------------------------------------------
        \23\ U.S. Environmental Protection Agency (2019, April). Inventory
    of U.S. Greenhouse Gas Emissions and Sinks. (https://www.epa.gov/sites/
    production/files/2019-04/documents/us-ghg-inventory-2019-main-
    text.pdf).
        \24\ ASCE Report Card, 2017.
        \25\ ``Cost of Congestion to the Trucking Industry.'' American
    Transportation Research Institute, Oct. 2018. https://atri-online.org/
    wp-content/uploads/2018/10/ATRI-Cost-of-Congestion-to-the-Trucking-
    Industry-2018-Update-10-2018.pdf.
        \26\ Texas A&M Transportation Institute, Urban Mobility Report
    2019, https://mobility.tamu.edu/umr/.
    ---------------------------------------------------------------------------

    FEDERAL FUNDING & FAST ACT FREIGHT PROVISIONS

        Federal investments in roads and bridges are funded through
    Federal excise taxes levied on motor fuels (gas and diesel) and
    on related products such as tires, which are deposited into the
    Highway Trust Fund (HTF). Congress has not adjusted these taxes
    on gas and diesel since 1993, and the purchasing power of these
    taxes have fallen over 40 percent in the last 25 years.
    Improved vehicle fuel efficiency, due to higher Corporate
    Average Fuel Economy standards required by law, has further
    eroded Federal revenues. As a result, revenues coming into the
    HTF have not kept pace with expenditures from authorized
    programs. Congress has had to transfer $144 billion from the
    General Fund and other funds to keep the HTF solvent since
    2008. The Congressional Budget Office (CBO) estimates that over
    the next 10 years, the HTF will fall $171 billion short based
    on continuing currently-authorized highway, transit, and safety
    program levels. An additional $5 billion is necessary to ensure
    that there is a prudent balance in the HTF, which brings the
    shortfall to $176 billion. This does not include any higher
    investment levels to meet growing surface transportation needs.
        According to U.S. DOT's Conditions & Performance Report,
    there is a $836 billion backlog of unmet capital investment
    needs for highways and bridges \27\. One in three interstate
    U.S. bridges have repair needs, and over 47,000 of the nation's
    bridges are structurally deficient.\28\ Nearly one out of every
    five miles of highway pavement is in poor condition
    nationwide.\29\
    ---------------------------------------------------------------------------
        \27\ U.S. DOT, 2015 Status of the Nation's Highways, Bridges, and
    Transit: Conditions and Performance.
        \28\ ARTBA Bridge Report, 2019 (https://artbabridgereport.org/).
        \29\ U.S. DOT, 2015 Status of the Nation's Highways, Bridges, and
    Transit: Conditions and Performance.
    ---------------------------------------------------------------------------
        The FAST Act, the last major surface reauthorization bill
    enacted by Congress in 2015, included several provisions to
    support and invest in the movement of freight.
        The FAST Act established a new formula program to fund
    surface transportation freight improvements and provided $6.3
    billion over the five-year bill. States may use the funds for a
    variety of projects related to freight movement for road and
    bridge segments in States that are designated on the National
    Highway Freight Network. Up to 10 percent of the funds each
    year may be used for freight intermodal or freight rail
    projects, including projects within the boundaries of public
    and private freight rail and port facilities and projects that
    facilitate intermodal operations.
        The FAST Act also created a new competitive grant program,
    providing $4.5 billion over the life of the bill, to assist
    states in funding nationally-significant highway, bridge, and
    freight projects. The Nationally Significant Freight and
    Highway Projects program (referred to as INFRA by this
    Administration and FASTLANE by the previous Administration) is
    generally aimed at large-scale and multi-jurisdictional
    projects that cannot be funded with highway funding apportioned
    to the states. At least 25 percent of the funding is reserved
    for projects in rural areas, and 10 percent of the funding are
    reserved for smaller projects (project costs of less than $100
    million). Up to $500 million over the life of the FAST Act may
    be used to fund freight rail or intermodal projects if the
    projects will significantly improve freight movements on the
    National Highway Freight Network.
        The FAST Act modified the National Highway Freight Network
    established by the Moving Ahead for Progress in the 21st
    Century Act (MAP-21) (P.L. 112-141) to specify that the core
    portion of the network will be comprised of a 41,518-mile
    highway network previously identified by the U.S. Department of
    Transportation. The FAST Act allowed States and metropolitan
    planning organizations to add to the network by designating
    urban and rural freight corridors. The FAST Act also encouraged
    each State to establish a freight advisory committee and
    required each State to develop a comprehensive freight plan,
    which can be done separately or incorporated into the State's
    transportation improvement plan (STIP).
        In addition, the FAST Act established goals for a national
    multimodal freight policy and directed the Secretary to develop
    a National Multimodal Freight Network. U.S. DOT issued an
    Interim Network, published in the Federal Register, on June 6,
    2016, and re-opened the comment period through February 22,
    2018, in a notice published on October 25, 2017, but has not
    finalized the Network.
        U.S. DOT was also required to develop a national freight
    strategic plan to identify bottlenecks on the multimodal
    freight network, including the cost to address each bottleneck
    and strategies to improve intermodal connectivity. U.S. DOT
    issued a draft plan for comment in December 2015.\30\ The
    Strategic Plan has not yet been finalized. The draft plan
    identified several key trends and challenges facing the U.S.
    freight transportation system, including:
    ---------------------------------------------------------------------------
        \30\ https://www.transportation.gov/sites/dot.gov/files/docs/
    DRAFT_NFSP_for_Public_
    Comment_508_10%2015%2015%20v1.pdf

         LHigh expected growth in freight traffic over the
    next three decades
         LUnderinvestment in the freight transportation
    system
         LDifficulty of planning and implementing freight
    projects under current Federal programs
         LSafety and security concerns with freight
    movement and facilities
         LImpacts on our system of increasing international
    trade
         LNew technologies are revolutionizing freight
    movements

                                  WITNESS LIST

         LMs. Erin Aleman, Executive Director, Chicago
    Metropolitan Agency for Planning, on behalf of the Coalition
    for America's Gateways and Trade Corridors
         LMr. Chuck Baker, President, American Short Line
    and Regional Railroad Association
         LMs. Anne Goodchild, Ph.D., Founding Director,
    Supply Chain Transportation and Logistics Center, University of
    Washington
         LMr. Ian Jefferies, President & CEO, Association
    of American Railroads
         LMr. Jason Mathers, Director, Vehicles & Freight
    Strategy, Environmental Defense Fund
         LMr. Jim Tymon, Executive Director, American
    Association of State Highway and Transportation Officials

     WHERE'S MY STUFF? EXAMINING THE ECONOMIC, ENVIRONMENTAL, AND SOCIETAL
                       IMPACTS OF FREIGHT TRANSPORTATION

                                  ----------

                           THURSDAY, DECEMBER 5, 2019

                      House of Representatives,
      Subcommittee on Highways and Transit, joint with
          theSubcommittee on Railroads, Pipelines, and
                                   Hazardous Materials,
                Committee on Transportation and Infrastructure,
                                                        Washington, DC.
        The subcommittees met, pursuant to notice, at 10:02 a.m. in
    room 2167, Rayburn House Office Building, Hon. Eleanor Holmes
    Norton (Chairwoman of the Subcommittee on Highways and Transit)
    presiding.
        Ms. Norton. This is an unusual hearing because we are
    combining two subcommittees, and I think that says a great deal
    about the importance of this hearing today. So I want to
    welcome all of our guests, and all of you to a topic that has
    an effect on the daily lives of all Americans. Yet, as it turns
    out, few think about this subject: freight transportation.
    Goods appear magically. Nobody wants to think about how they
    got there and what it takes.
        I want to thank Chairman Lipinski, my counterpart on the
    Subcommittee on Railroads, Pipelines, and Hazardous Materials,
    for joining with me to hold this joint hearing.
        Facilitating commerce and goods movement is a fundamental
    role the Federal Government is supposed to do, and it is one of
    the essential responsibilities of this committee.
        Remember, we are preparing for a surface transportation
    reauthorization in 2020. This hearing will help the committee
    understand the improvements that Congress can help make to
    facilitate and ensure our infrastructure is able to handle
    freight transportation needs.
        And those needs are growing very rapidly. They are not only
    growing, they are changing. The well-established supply chains
    are now being challenged and reimagined as the rise of e-
    commerce--we didn't even talk about e-commerce 4 years ago,
    when the last transportation bill was passed.
        Since then we have had the rise of e-commerce, and that has
    forced a fundamental shift. Consumers now expect that anything
    can be delivered to their doorstep in a few days, sometimes a
    few hours. This amazing leap, in only the 4 years since we had
    our last reauthorization, comes at a cost. Without appropriate
    planning for last-mile infrastructure, we run the risk of not
    only congestion, which is clearly a major problem that we have
    discussed in this committee, but total gridlock in urban areas,
    where 80 percent of the American people now live.
        We will also hear testimony that freight is a significant
    and growing source of greenhouse gas emissions. The freight
    sector will emit 535 million metric tons of carbon dioxide
    emissions in just 1 year, 2020, a figure that is expected to
    grow annually unless we take some very serious steps to reverse
    that trend.
        I am committed to looking at a range of solutions under the
    purview of this committee to move trucking towards zero
    emissions. It is already too late. That is not a goal that is
    too steep to make.
        We will also hear on a topic that I have long championed:
    strong support for intermodal and multimodal investments.
        We understand, while Federal programs are currently and
    have been stovepiped since the beginning of this committee--and
    that is because of the unique funding streams for different
    modes. But we certainly can do more to provide flexible ways
    for our State and local partners to invest in their most
    pressing freight supply chain needs, regardless of mode, and to
    support seamless transitions between modes--nothing could be
    more important than not losing time going from one mode of
    transportation to another.
        In the last surface transportation bill, Congress laid the
    foundation for policies and resources to address the needs of
    our freight network. Today, as needs are rapidly evolving, we
    must not be constrained by the transportation network we have.
    This is the transportation network we have had since the very
    beginning. But rather, we have to explore and evaluate policies
    that will develop the network we need for the future. This
    hearing is the first step to support the committee in doing
    that work.
        [Ms. Norton's prepared statement follows:]

        Prepared Statement of Hon. Eleanor Holmes Norton, a Delegate in
    Congress from the District of Columbia, and Chairwoman, Subcommittee on
                              Highways and Transit
        Welcome to this hearing on a topic that impacts the daily lives of
    all Americans, yet that few think about--freight transportation. Thank
    you to Chairman Lipinski, my counterpart on the Railroads Subcommittee,
    for holding this joint hearing.
        Facilitating commerce and goods movements is a fundamental role of
    the Federal Government, and one of the essential responsibilities of
    this Committee. As we prepare our surface transportation
    reauthorization bill, this hearing will help the Committee understand
    the necessary improvements that Congress can help facilitate to ensure
    our infrastructure is able to handle freight transportation needs.
        Those needs are growing and changing. As we will hear from Dr.
    Goodchild's testimony, well established supply chains are now being
    challenged and reimagined as the rise in e-commerce has forced a
    fundamental shift. Consumers now expect that anything can be delivered
    to their doorstep in days, or sometimes hours. This amazing leap in
    convenience, however, comes at a cost. Without appropriate planning for
    last mile infrastructure, we run the risk of not just congestion but
    total gridlock in urban areas, where 80 percent of Americans live.
        We will also hear from Mr. Mathers' testimony that freight is a
    significant and growing source of greenhouse gas emissions. In the
    U.S., the freight sector will emit 535 million metric tons of carbon
    dioxide emissions in 2020, a figure that is expected to grow annually
    unless we take some serious steps to reverse the trend. I am committed
    to looking at a range of solutions under the purview of this Committee
    to move trucking toward zero emissions.
        We will also hear from Ms. Aleman on a topic that I have long
    championed--strong support for intermodal and multimodal investments.
    While I understand why our Federal programs are currently stovepiped,
    because of unique funding streams for different modes, we certainly can
    do more to provide flexible ways for our State and local partners to
    invest in their most pressing freight supply chain needs, regardless of
    mode, and to support seamless transitions between modes.
        In the last surface transportation bill, Congress laid the
    foundation for policies and resources to address the needs of our
    freight network. Today, as needs are rapidly evolving, we should not be
    constrained by the transportation network we have, but rather we should
    explore and evaluate policies that will develop the network we need for
    the future.
        This hearing is the first step to support the Committee in doing
    that. I thank our witnesses for joining us and to educate us in this
    important charge.

        Ms. Norton. Again, I thank our witnesses, and I ask
    unanimous consent that the chair be authorized to declare
    recesses during today's hearing.
        Without objection, so ordered.
        I also ask unanimous consent that Members not on the
    subcommittee be permitted to sit with the subcommittee at
    today's hearing and ask questions.
        Without objection.
        I will proceed now to ask our ranking member, Mr. Davis,
    for his opening statement.
        Mr. Davis. I thank you, Madam Chair. And I would also like
    to thank Chairman DeFazio, Chairman Lipinski, and also our
    ranking member of the Subcommittee on Railroads, Pipelines, and
    Hazardous Materials, Mr. Crawford, for having this joint
    hearing today. And it is a great opportunity to welcome all of
    our witnesses, too. I look forward to hearing your testimony.
        One of the key factors to America's economic
    competitiveness is the ability to effectively transport goods
    and products from where they are made, from where they are
    harvested, from where they are produced or processed, and
    eventually to where they are sold and consumed.
        The strength of our freight system in my home State of
    Illinois' position as the Nation's premier freight hub, relies
    upon a dependable system of highways, roads, bridges, rail
    tracks, and open skies. This is important because nearly every
    load of freight will be transported on a truck at some point in
    the journey, too.
        Over the next coming decades, demand for freight moved by
    truck is expected to increase significantly. Coupled with the
    dynamic nature of supply chains and changing consumer demands,
    we must focus on not only improving existing infrastructure,
    but also planning for a system that will take us into the
    future.
        I look forward to hearing from each of you about how
    Congress can improve freight programs and increase efficiency
    and productivity for our freight transportation system.
        [Mr. Davis' prepared statement follows:]

     Prepared Statement of Hon. Rodney Davis, a Representative in Congress
        from the State of Illinois, and Ranking Member, Subcommittee on
                              Highways and Transit
        One of the key factors to America's economic competitiveness is the
    ability to efficiently transport goods and products from where they are
    made, harvested, or processed to where they are ultimately sold and
    consumed.
        The strength of our freight system, and Illinois' position as the
    Nation's premier freight hub, relies on a dependable system of
    highways, roads, and bridges. This is important because nearly every
    load of freight will be transported on a truck at some point in its
    journey.
        Over the coming decades, demand for freight moved by truck is
    expected to increase significantly.
        Coupled with the dynamic nature of supply chains and changing
    consumer demands, we must focus not only on improving existing
    infrastructure, but also planning for the system of the future.
        I look forward to hearing from our witnesses about how Congress can
    improve freight programs and increase the efficiency and productivity
    of our freight transportation system.

        Mr. Davis. And Madam Chair, I yield back the balance of my
    time.
        Ms. Norton. Thank you, Mr. Davis, for your opening
    statement.
        Remember, I said this was a joint hearing. It is a joint
    hearing with the Subcommittee on Railroads, Pipelines, and
    Hazardous Materials. I now call on the chair of that
    subcommittee, Mr. Lipinski, for an opening statement.
        Mr. Lipinski. Thank you, Chairwoman Norton. As we work now
    on the surface transportation reauthorization bill, I always go
    back and think that--oftentimes people refer to this as the
    highway bill, sometimes the highway and transit bill. But it is
    important to recognize that, in the FAST Act, we clearly made
    it highway, transit, and rail.
        And so I think it is important and very fitting that the
    Subcommittee on Railroads, Pipelines, and Hazardous Materials
    is included in this hearing. And I expect that this
    reauthorization that we are working on right now will not only
    include Amtrak reauthorization and other passenger rail
    provisions, but also a robust investment in freight rail
    infrastructure.
        I am a strong proponent of this investment, because it will
    make freight movement faster and more efficient. This
    investment would have far-reaching positive impacts by
    increasing jobs, many of them good-paying union jobs; making
    businesses more competitive; and decreasing greenhouse gas
    emissions.
        I represent part of Chicagoland, which is the freight rail
    hub of North America. Six Class I railroads intersect in the
    region. About 25 percent of all freight trains and 50 percent
    of intermodal trains in the Nation pass through. The congestion
    in this region and its impact on freight movement in our
    country is well known.
        In addition, Will County, just south of Chicago and
    partially included in my district, is the largest inland port
    in North America, with major intermodal facilities which cause
    significant congestion and safety issues on Interstate 80 and
    surrounding roads. This year, the State of Illinois committed
    to raising the revenue needed to invest in a nationally
    critical I-80 corridor.
        It is time for the Federal Government to step up on this
    project and others like it across the country, and this
    reauthorization is the time to do it. As Ms. Aleman mentions in
    her testimony, the CREATE rail modernization program in
    Chicagoland, which has been ongoing for about 15 years, is a
    unique $4.6 billion public-private partnership designed to
    address the freight and passenger rail congestion, and to ease
    congestion on roads crossing rail lines. Through the years
    CREATE has been funded through Federal, State, local, and
    private sources.
        I have long been a champion of this program. I am able to
    earmark money to it as one of the 25 projects of national and
    regional significance in SAFETEA-LU. This is how megaprojects
    were funded in SAFETEA-LU, and I have no problem talking about
    earmarks.
        The FAST Act fund for megaprojects comes through
    Infrastructure for Rebuilding America, or INFRA grants, which
    are specifically for freight movement projects. INFRA grants
    have a $500 million aggregate cap for port, rail, and
    intermodal projects. This was a hard-fought compromise. The
    original proposal would have excluded multimodal projects
    altogether. This would have been a major mistake, because these
    projects clearly are critical to improving the movement of
    freight in our country.
        In its upcoming reauthorization, the aggregate cap needs to
    be eliminated or greatly raised. We also need to talk about the
    structure of the program through which the money for
    megaprojects is going to be disbursed. I do not believe we
    should continue to hand over the money to do this to any
    Presidential administration, not just this one. I don't think
    we should be handing it over for these decisions to be made
    over there.
        One thing I hope we can all agree upon, though, is that we
    need a robust level of funding for megaprojects which are
    critical to freight movement in our country and other projects
    critical to transportation in the country that, really, cannot
    be addressed by the States alone.
        Climate change is one of the most pressing challenges
    facing us today, and there is an urgent need for bipartisan
    solutions. The U.S. Environmental Protection Agency reports
    that the transportation sector is the largest emitter, by
    sector, of greenhouse gases, with 29 percent of the United
    States greenhouse gases in 2017 emitted by the transportation
    sector. One topic that I would like to hear about from our
    witnesses today is how we can mitigate the impact of freight
    movement on climate change.
        Finally, we need to permanently authorize the 45G tax
    credit to give the short line rail industry the investment
    certainty they need. This tax credit has been expired since the
    end of 2017, and it is time we take care of this issue once and
    for all.
        I look forward to hearing from our witnesses today on how
    we can make the U.S. freight network more robust, multimodal,
    and climate friendly.
        [Mr. Lipinski's prepared statement follows:]

        Prepared Statement of Hon. Daniel Lipinski, a Representative in
      Congress from the State of Illinois, and Chairman, Subcommittee on
                 Railroads, Pipelines, and Hazardous Materials
        Good morning. Today's joint hearing continues a series of hearings
    that the Rail Subcommittee has been conducting as we work on the
    surface transportation reauthorization. Our subcommittee is playing a
    significant role in the reauthorization because a rail title will once
    again be included in this bill as it was in the FAST Act. I expect this
    title to not only include Amtrak reauthorization and other passenger
    rail provisions, but also a robust investment in freight rail
    infrastructure. I am a strong proponent of this investment because it
    will make freight movement faster and more efficient. This investment
    would have far-reaching, positive impacts by increasing jobs--many of
    them good-paying union jobs, making our businesses more competitive,
    and decreasing greenhouse gas emissions.
        I represent part of Chicagoland which is the freight rail hub of
    North America. Six Class I railroads intersect in the region and about
    25 percent of all freight trains and 50 percent of all intermodal
    trains in the nation pass through. In addition, Will County, just south
    of Chicago and partially included in my district, is the largest inland
    port in North America with major intermodal facilities which cause
    significant congestion and safety issues on Interstate 80 and
    surrounding roads. This year the State of Illinois committed to raising
    the revenue needed to invest in the nationally-critical I-80 corridor;
    it's time for the federal government to step up on this project and
    others like it across the country and this reauthorization is the time
    to do it.
        As Ms. Aleman mentions in her testimony, the CREATE rail
    modernization program in Chicagoland, which has been ongoing for about
    15 years, is a unique $4.6 billion Public-Private Partnership (PPP)
    designed to reduce delays for freight and passenger trains and ease
    congestion on roads crossing rail lines. Through the years, CREATE has
    been funded through federal, state, local, and private sources. I have
    long been a champion of this program since I was able to earmark money
    to it as one of 25 Projects of National and Regional Significance
    Program. This was how megaprojects were funded in SAFETEA-LU.
        The FAST Act funds for megaprojects come through Infrastructure For
    Rebuilding America or INFRA, grants, which are specifically for freight
    movement projects.
        INFRA grants have a $500 million aggregate cap for port, rail, and
    intermodal projects. This was a hard fought compromise as the original
    proposal would have excluded multimodal projects altogether. That would
    have been a major mistake because these projects clearly are critical
    in improving the movement of freight. In this upcoming reauthorization,
    the aggregate cap needs to be eliminated or greatly raised. We also
    need to talk about the structure of the program through which the money
    for megaprojects is going to be disbursed. I don't believe we should
    continue to hand the money over to this or any presidential
    administration to make these decisions. But one thing I hope we all can
    agree upon is that we need a robust level of funding for megaprojects.
        Climate change is one of the most pressing challenges facing us
    today and there is an urgent need for bipartisan solutions. The U.S.
    Environmental Protection Agency reports that the transportation sector
    is the largest emitter by sector of greenhouse gasses with 29 percent
    of the United States greenhouse gasses in 2017 emitted by the
    transportation sector. One topic I would like to hear about from our
    witnesses today is how we can mitigate the impact of freight movement
    on climate change.
        Finally, we need to permanently authorize the 45G tax credit to
    give the short line rail industry the investment certainty they need.
    This tax credit has been expired since the end of 2017 and it is time
    we take care of this issue once and for all.
        I look forward to hearing from our witnesses today on how we can
    make the US's freight network more robust, multi-modal, and climate
    friendly. Thank you.

        Mr. Lipinski. Thank you, and I yield back.
        Ms. Norton. Thank you. Thank you, Mr. Lipinski.
        I want to ask the ranking member of the Subcommittee on
    Railroads, Pipelines, and Hazardous Materials, Mr. Crawford,
    for his opening statement.
        Mr. Crawford. Thank you. I thank the chair for recognizing
    me.
        Modern freight network means a strong, secure America.
    Farmers and businesses across my State--indeed, across the
    country--depend on our Nation's freight railroads to safely
    transport their goods throughout the country and the world.
        Important to Arkansas are short line railroads, who most
    often provide first- and last-mile service for farmers,
    manufacturers, and other industries. I am proud to support H.R.
    510, the BRACE Act, which would permanently extend the tax
    credit for short line railroad track maintenance, thereby
    increasing private investment in important rail transportation
    infrastructure.
        As total freight demand grows, the critical investments
    made by the railroads in both their people and in their
    infrastructure help ensure a safe and efficient transport
    system for our goods. This investment helps spur economic
    activity, drive innovation, and make operations safer and more
    efficient.
        In turn, the rail network can handle increased freight
    demand and help relieve congestion on our roads. I look forward
    to hearing about freight programs in the FAST Act and how
    Congress can improve the efficient flow of goods.
        [Mr. Crawford's prepared statement follows:]

    Prepared Statement of Hon. Eric A. ``Rick'' Crawford, a Representative
          in Congress from the State of Arkansas, and Ranking Member,
         Subcommittee on Railroads, Pipelines, and Hazardous Materials
        A modern freight network means a strong, secure America.
        Farmers and businesses across my state depend on our Nation's
    freight railroads to safely transport their goods throughout the
    country and the world.
        Important to Arkansas are our short line railroads, who most often
    provide first and last mile service for farmers, manufacturers, and
    other industries. I am proud to support H.R. 510, the BRACE Act, which
    would permanently extend the tax credit for short line railroad track
    maintenance, thereby increasing private investment in important rail
    transportation infrastructure.
        As total freight demand grows, the critical investments made by the
    railroads--in both their people and in their infrastructure--help
    ensure a safe and efficient transport system for our goods. This
    investment helps spur economic activity, drive innovation, and make
    operations safer and more efficient. In turn, the rail network can
    handle increased freight demand and help relieve congestion on our
    roads.
        I look forward to hearing about freight programs in the FAST Act
    and how Congress can improve the efficient flow of goods.

        Mr. Crawford. Thank you to all of our witnesses for being
    here today, and I yield back the balance of my time.
        Ms. Norton. Thank you, Mr. Crawford. I would like to ask
    the chairman of the full committee, Mr. DeFazio, if he has an
    opening statement.
        Mr. DeFazio. Thank you, Madam Chair. Yes, I do have a brief
    opening statement. I want to thank both the chairs and ranking
    members for holding this important hearing.
        We just had Black Friday, Cyber Monday, and Americans
    think, just one click, and the goods magically appear. But they
    don't realize the complexity of the network upon which they are
    dependent for those goods to appear at the doorstep.
        In addition to those sorts of issues, we obviously have the
    supply chain for industry. Our national freight system is
    crucial to connecting farmers' produce with kitchen tables,
    bringing logs out of the mountains to the sawmills in my State.
    The U.S. freight transportation network is critical to the
    economy of this Nation: 17.7 billion tons of freight valued at
    $16.8 trillion every year.
        But we have challenges ahead of us. By 2040 we expect
    volumes to grow by 40 percent. How are we going to meet those
    demands? Our existing infrastructure is at capacity, nearing
    the end of--or, in many cases, has already passed--its useful
    life, but still limping along.
        And how are we going to deal with this in the future? How
    are we going to reduce the environmental burden of the freight
    industry, both in terms of pollution in urban areas, and also
    in terms of the carbon that it contributes to climate change?
        Medium and heavy-duty trucks contributed 23 percent of all
    transportation-related greenhouse gas emissions in 2017. And I
    hope to hear today ideas about how we are going to reduce that
    burden.
        The freight railroads have been working to deploy
    technologies. They have been upgrading their fleets, reducing
    idling and fuel consumption, and they are, obviously, a more
    efficient per-gallon, per-freight-mile deliverer of goods. And
    so they have done quite a bit. Between 2000 and 2018, the
    freight railroads consumed 9 billion fewer gallons of fuel and
    emitted 100 million fewer tons of carbon dioxide, but can we
    move beyond that? I think we need to.
        As we will hear in testimony today, a significant portion
    of freight growth and a disproportionate share of the cost of
    freight movements come from the last mile. We have been reading
    some articles about congestion in our urban areas. It is
    extraordinary, because of this delivery adding new burdens to
    an already overburdened system.
        Normally, these areas were not considered integral to
    freight movement, but they have become so. So we are going to
    have to figure out how we are going to deal with that--again,
    the pollution, the carbon, and so forth.
        In the last reauthorization bill was the first time, in the
    FAST Act, really, that we established a dedicated funding
    source for freight. As important as it is, it has been
    neglected, in terms of our investment, as has the whole system
    been neglected by our levels of investment. And I am trying and
    hoping that we will do much better in our reauthorization.
        The DOT implements the INFRA program, Nationally
    Significant Freight and Highway Projects program. But
    basically, the money is insufficient, and there is a huge line
    of very meritorious projects waiting for funding. So, we are
    going to have to both tighten up the criteria for grants that
    are coming out of DOT, but also we are going to need to put
    more money into those programs.
        [Mr. DeFazio's prepared statement follows:]

       Prepared Statement of Hon. Peter A. DeFazio, a Representative in
         Congress from the State of Oregon, and Chairman, Committee on
                       Transportation and Infrastructure
        Thank you for holding this joint Subcommittee hearing to consider
    how our trucking and freight rail transportation systems are growing
    and changing, and how the recent surge in goods movement is impacting
    transportation investment needs.
        This hearing is timely, with consumers across the country preparing
    for the holiday season. Whether they realize it or not, shoppers who
    took advantage of Black Friday and Cyber Monday deals are relying on a
    vast and complex freight network to provide and deliver their
    purchases.
        Our national freight system is crucial to our lives every day of
    the year, providing vital support to a functioning supply chain,
    transporting raw materials to factories and finished products to
    market, and connecting farmers' produce with kitchen tables. Today, the
    U.S. freight transportation system already moves 17.7 billion tons of
    freight, valued at $16.8 trillion, every year. By 2040, freight volumes
    are expected to grow by 42 percent.
        We need to be proactive in preparing to meet these growing demands
    on existing infrastructure, much of which is at capacity and nearing
    the end of--or past--its useful life. We also need to actively work to
    reduce the environmental impacts of freight transportation.
        Today, more than two out of every five miles of America's urban
    interstates are already congested, imposing costs on the trucking
    industry and non-commercial drivers, driving up fuel usage, and
    contributing significantly to greenhouse gas emissions. Medium and
    heavy-duty trucks contributed 23 percent of all transportation-related
    greenhouse gas emissions in 2017.
        Freight railroads have been deploying various technologies and
    upgrading fleets to reduce idling and fuel consumption. As a result of
    these efforts, between 2000 and 2018, the freight railroads consumed 9
    billion fewer gallons of fuel and emitted 100 million fewer tons of
    carbon dioxide.
        As we will hear in testimony today, a significant portion of
    freight growth--and a disproportionate share of the cost of freight
    movements--comes from the last mile of deliveries. As Americans do more
    of their shopping online--and expect goods to show up the day after
    they click a button or sooner, these new patterns rely on the use of
    infrastructure not typically considered as integral to freight
    movement.
        Recent press accounts have documented that in already heavily
    congested cities and urban areas, there is a cost to this new
    convenience in the form of gridlock, the degradation of safety, and
    pollution. We need to figure out how best to balance the benefits of
    convenience with the numerous costs.
        In the last reauthorization bill, Congress attempted to support
    goods movement by establishing formula and competitive grant programs
    to fund freight improvements. Today we will hear in witness testimony a
    call for greater transparency in the selection process in discretionary
    grant programs administered by the U.S. Department of Transportation.
    The Nationally Significant Freight and Highway Projects Program (known
    by the Administration as INFRA), created by Congress in the FAST Act,
    has proven to be dramatically oversubscribed. This points to a
    significant need for greater funding to be made available for freight
    projects. It also underscores that Congress needs to enact tighter
    rules around grant allocations to ensure the most worthy projects are
    funded, which I intend to look at in reauthorization.
        I look forward to hearing from our witnesses today and learning how
    Congress can help address current and future freight needs in a surface
    transportation.

        Mr. DeFazio. So with that, Madam Chair, I look forward to
    hearing from the witnesses, and thank you for holding the
    hearing.
        Ms. Norton. Thank you, Mr. DeFazio. I would now like to
    welcome our witnesses, and I am going to go first to Erin
    Aleman. She is the executive director of the Chicago
    Metropolitan Agency for Planning. She is here on behalf of that
    agency and the Coalition for America's Gateways and Trade
    Corridors.
        Ms. Aleman?

         TESTIMONY OF ERIN ALEMAN, EXECUTIVE DIRECTOR, CHICAGO
     METROPOLITAN AGENCY FOR PLANNING, AND BOARD MEMBER, COALITION
       FOR AMERICA'S GATEWAYS AND TRADE CORRIDORS; CHUCK BAKER,
         PRESIDENT, AMERICAN SHORT LINE AND REGIONAL RAILROAD
     ASSOCIATION; ANNE GOODCHILD, Ph.D., FOUNDING DIRECTOR, SUPPLY
       CHAIN TRANSPORTATION AND LOGISTICS CENTER, UNIVERSITY OF
      WASHINGTON; IAN J. JEFFERIES, PRESIDENT AND CHIEF EXECUTIVE
      OFFICER, ASSOCIATION OF AMERICAN RAILROADS; JASON MATHERS,
     DIRECTOR, VEHICLE AND FREIGHT STRATEGY, ENVIRONMENTAL DEFENSE
     FUND; AND JIM TYMON, EXECUTIVE DIRECTOR, AMERICAN ASSOCIATION
             OF STATE HIGHWAY AND TRANSPORTATION OFFICIALS

        Ms. Aleman. Thank you this morning for the opportunity to
    testify. I am here on both behalf of the Chicago Metropolitan
    Agency for Planning, and also on behalf of the Coalition for
    America's Gateways and Trade Corridors, a coalition of public
    and private partners who are dedicated to investing in
    America's multimodal freight infrastructure.
        Thank you for your leadership, Chair Norton, Chairman
    Lipinski, Ranking Member Davis, and Ranking Member Crawford,
    and members of the subcommittees for the opportunity to share
    my views today.
        Investment in multimodal freight infrastructure is critical
    to this Nation's economy. Our Nation's ability to move goods
    safely, reliably, and responsibly to consumer demands will keep
    American businesses competitive in a global marketplace.
    Chronic underinvestment in our Nation's transportation system
    has resulted in companies spending $27 billion annually in
    expenses due to freight congestion.
        Ms. Norton. Speak up a little more, please. Would you speak
    up a little?
        Mr. DeFazio. Just pull it closer.
        Ms. Aleman. I am sorry, a little----
        Mr. DeFazio. There you go.
        Ms. Aleman. Sorry. With the FAST Act reauthorization around
    the corner, I am here today to ask you to include a robust
    freight program.
        I applaud members of this committee for prioritizing
    freight infrastructure in the FAST Act. The program sparked an
    important dialogue, and brought into focus the incredible
    magnitude of freight needs across our country.
        I would like to highlight how the FAST Act supported the
    Chicago region, changing how we pursue competitive funds,
    leveraging additional resources, and ensuring the projects that
    we put forth provide the greatest return on investment.
        Prior to CMAP, I was on the team at the Illinois Department
    of Transportation, working closely with CREATE partners as we
    developed our INFRA application for the 75th Street Corridor
    Improvement Project. By untangling one of the worst bottlenecks
    in the Nation, $3.8 billion of economic benefits will be seen
    upon completion. Because the economic benefit was so great, and
    the need was so significant, we came together to prioritize
    this project amongst individual needs.
        Together, the CREATE partners, both public and private,
    matched more than 2\1/2\ times the Federal INFRA ask. While
    more funding is necessary to complete the project, this project
    and investment will improve the reliability of 200 freight, 30
    passenger, and 10 Amtrak trains daily.
        Many of the largest and most complex freight improvements
    across our country cross State boundaries, and occur where
    multiple modes come together. These projects require a
    partnership at the Federal level to untangle choke points that
    burden our community and slow commerce.
        Our region has successfully shown that prioritizing
    multimodal freight investment leads to success. For example,
    whereas it once took 40 hours for freight trains to get through
    Chicago, it now takes 25 to 30 hours. But more improvement is
    necessary. While we have been able to address some of these
    problems on our own, the fact is that States cannot and should
    not shoulder the burden of nationally significant freight
    movement alone.
        Freight isn't confined to a single community or State. More
    than 77 percent of U.S. freight crosses State lines. I have
    often said that the public doesn't care who has jurisdiction
    over the roads they are driving on. The same can be said about
    our freight network. Businesses and consumers simply want a
    reliable system that gets their goods to market, or delivers
    their packages to their houses on time.
        To address our urgent freight needs and build on successes,
    the coalition respectfully submits four recommendations.
        First, a national strategy that guides long-term planning.
    An office of multimodal freight should be established within
    U.S. DOT's Office of the Secretary, emphasizing nationally
    significant projects.
        Second, dedicated, sustainable, and flexible funding. In
    2018 the INFRA program received $12 of unique requests for
    every $1 available. Given this level of oversubscription, we
    request $12 billion be invested annually in multimodal freight
    throughout the competitive programs. Congress should also
    eliminate caps on nonhighway spending.
        Third, projects should be selected through a performance-
    based program and framework that allows us to prioritize
    projects that improve national freight efficiency. Oversight
    and transparency in the decisionmaking process is critical to
    the program's integrity.
        And finally, funding should leverage private participation
    and support a variety of financing options.
        The FAST Act's programs are increasing the safety,
    efficiency, and reliability of how we move our goods. Consumer
    demands have shifted dramatically over the years, and the
    planner in me knows that more change is on the horizon. We must
    be proactive about investing and prioritizing our critical
    freight infrastructure needs.
        On behalf of the coalition and CMAP, I thank the
    subcommittees for their time and attention to this critically
    important topic.
        [Ms. Aleman's prepared statement follows:]

        Prepared Statement of Erin Aleman, Executive Director, Chicago
       Metropolitan Agency for Planning, and Board Member, Coalition for
                     America's Gateways and Trade Corridors
        I appreciate the opportunity to testify before two distinguished
    panels and thank the Subcommittee on Highways and Transit and the
    Subcommittee on Railroads, Pipelines, and Hazardous Materials for
    joining together on this important subject--after all, efficient
    freight movement requires multiple modes working together seamlessly
    and reliably. Improving the freight system to meet our growing freight
    needs is critical to our nation's economic competitiveness. Thank you
    for your leadership, Chair Norton, Chairman Lipinski, Ranking Member
    Davis, and Ranking Member Crawford.
        I am representing both the Chicago Metropolitan Agency for Planning
    (CMAP) and the Coalition for America's Gateways and Trade Corridors
    (CAGTC), a diverse coalition of more than 60 public and private
    organizations dedicated to increasing federal investment in America's
    multimodal freight infrastructure.
        CMAP is the federally-designated Metropolitan Planning Organization
    for the northeastern Illinois counties of Cook, DuPage, Kane, Kendall,
    Lake, McHenry, and Will. We represent a region of nearly 8.5 million
    people, working closely with the region's 284 communities to address
    transportation, housing, economic development, open space, environment,
    and quality of life issues. Our most recent plan, ON TO 2050, calls for
    bold steps toward a well-integrated, multimodal transportation system
    that seamlessly moves people and goods within and through metropolitan
    Chicago. To strengthen our economic competitiveness while improving
    quality of life, freight recommendations in the plan emphasize
    strategic investment in the freight network, improving local and
    regional truck travel, and mitigating the negative impacts of freight--
    congestion, safety, and air quality--on adjacent communities.
        The CMAP region is North America's freight hub. Six of the seven
    Class I railroads operate in our region, with one-fourth of the
    nation's freight rail traffic and nearly half of all intermodal trains
    passing through Chicago. Approximately 18 million twenty-foot
    equivalent units (TEUs) of cargo moved through the region's twenty
    rail-truck intermodal facilities in 2018, an increase of 52 percent
    since 2009.\1\ In short, our region moves more freight than the busiest
    seaports in the country.
    ---------------------------------------------------------------------------
        \1\ Chicago Metropolitan Agency for Planning, Chicago Intermodal
    Facility Lift Counts and Regional TEU Estimate, November 2019.
    ---------------------------------------------------------------------------
        As national freight demands grow, so too does the stress on our
    regional infrastructure. In 2003, the nationally and regionally
    significant Chicago Region Environmental and Transportation Efficiency
    (CREATE) program was formed. This innovative partnership between the
    U.S. Department of Transportation, the State of Illinois, Cook County,
    the City of Chicago, Metra, Amtrak, and U.S. freight railroads is a 70-
    project, $4.6 billion plan to improve the efficiency and effectiveness
    of freight, commuter, and intercity passenger rail and to reduce
    highway delay in the Chicago region.
        Chicago has been a national rail hub for almost 150 years. Every
    day nearly 500 freight trains and more than 760 passenger trains
    operate in the region. But the rail lines, built over a century ago,
    were not built for the volumes nor the types of freight being carried,
    turning Chicago into the nation's largest freight rail chokepoint. Rail
    congestion, resulting in delays and unreliable transit times, can be
    exacerbated by increased demand and severe weather. In 2014, for
    example, congestion in Chicago caused lingering service disruptions for
    farmers across the Upper Midwest. Revenues decreased due to increased
    transportation and storage costs and losses caused by spoilage.\2\
    CREATE aims to address such bottlenecks to increase the reliability and
    efficiency of the region's rail infrastructure. More than $1.6 billion
    has been spent or committed, with an estimated $3 billion needed to
    complete the full program. To date, federal sources have provided 40
    percent of spent and committed funds.
    ---------------------------------------------------------------------------
        \2\ U.S. Department of Agriculture, Rail Service Challenges in the
    Upper Midwest: Implications for Agricultural Sectors--Preliminary
    Analysis of the 2013-2014 Situation, January 2015.
    ---------------------------------------------------------------------------
        CREATE includes 25 rail grade separation projects to reduce freight
    and motorist delay and improve safety. Although only seven of the
    separations have been completed thus far due to insufficient funding,
    the success of CREATE cannot be underestimated. Whereas it once took
    freight trains more than 40 hours to pass through the Chicago region,
    due to implementation of CREATE, this is down to 25-30 hours. With
    continued funding, delays can be further reduced.
        Our nation's ability to move goods safely, reliably, and
    expeditiously keeps U.S. businesses competitive in the global
    marketplace and supports a higher standard of living for all. In 2015,
    this Committee created the first-ever dedicated freight program in the
    Fixing America's Surface Transportation (FAST) Act. The program began
    an important dialogue and has taught us much in the intervening years
    since passage. Most importantly, it brought into focus the incredible
    magnitude of freight needs across the country, setting the stage for
    the 2020 reauthorization. I urge you to make a robust freight program
    the hallmark of this upcoming reauthorization.
        All infrastructure investment has well-documented economic
    benefits, but freight infrastructure investment is inextricably linked
    to the long-term health of our national economy. The multimodal freight
    network directly supports 44 million jobs and impacts every American's
    quality of life.\3\ Unfortunately, chronic underinvestment in our
    national transportation system has resulted in a ``dysfunction tax.''
    U.S. companies spend around $27 billion annually in extra freight
    transportation expenses due to congestion,\4\ and the total cost of
    congestion is estimated at $1 trillion annually--roughly seven percent
    of U.S. economic output.\5\
    ---------------------------------------------------------------------------
        \3\ U.S. Department of Transportation, National Freight Strategic
    Plan, October 2015.
        \4\ U.S. Department of Transportation, National Freight Strategic
    Plan, October 2015.
        \5\ Ibid.
    ---------------------------------------------------------------------------
        Population growth will present capacity challenges across our
    multimodal system, which currently moves 55 million tons of goods
    daily, worth more than $49 billion.\6\ That's roughly 63 tons per
    person annually; meanwhile, the U.S. population is expected to increase
    by 70 million by 2045 to reach a total of 389 million people.\7\
    ---------------------------------------------------------------------------
        \6\ Ibid.
        \7\ Ibid.
    ---------------------------------------------------------------------------
        But it's not just population growth that is putting stress on our
    systems. Consumer demands have shifted dramatically over the last
    decade. Notably, the rise in e-commerce and quick delivery is shifting
    supply chains and requiring metropolitan areas to refocus their plans
    with these trends in mind. CMAP is currently undertaking a research
    project to better understand and respond to the impacts of growing e-
    commerce on the transportation system, land use, and fiscal condition
    of communities. We look forward to sharing the results of this project
    with the Committee next year.
        Public investment in our nation's multimodal freight infrastructure
    is chronically inadequate to meet the system's demands. States and
    localities have attempted to increase their infrastructure funding--
    since 1993, 42 states have raised their own gas taxes.\8\ \9\ My home
    state of Illinois, for example, this year increased the gasoline tax by
    19 cents per gallon and the diesel tax by 24 cents per gallon; both are
    now indexed to inflation. However, states and localities cannot, and
    should not, shoulder the burden of nationally-significant freight
    movement alone. Through the Commerce Clause of the Constitution, the
    Federal Government is tasked with supporting interstate commerce. More
    than 77 percent of U.S. freight crosses state lines, illustrating the
    need for a federal role in freight planning and investment.\10\ At its
    peak, the Federal Government provided 38 percent of public
    infrastructure funding, but that number has fallen to just 25 percent
    in recent years.\11\ This places a strain on communities and local
    governments, many of whom have already raised user fees and are
    struggling to determine where to find additional funds.
    ---------------------------------------------------------------------------
        \8\ Institute on Taxation and Economic Policy, How Long Has It Been
    Since Your State Raised its Gas Tax?, May 2019.
        \9\ Institute on Taxation and Economic Policy, Most States Have
    Raised Gas Taxes in Recent Years, June 2019. < https://itep.org/most-
    states-have-raised-gas-taxes-in-recent-years-0419/ >
        \10\ Tomer, Adie and Joseph Kane, Brookings and JP Morgan Chase
    Global Cities Initiative, Mapping Freight: The Highly Concentrated
    Nature of Goods Trade in the United States, November 2014.
        \11\ Council on Foreign Relations, The State of U.S.
    Infrastructure, October 2017.
    ---------------------------------------------------------------------------
        While Congress and infrastructure advocates have contemplated a
    variety of federal funding solutions for transportation infrastructure,
    our group has coalesced around a waybill fee dedicated to freight
    infrastructure improvements, such as the one proposed by Congressman
    Lowenthal of this Committee. A waybill fee assessed on the cost of
    surface transportation movements would not skew the market for services
    and would grow along with the demand for freight transportation.
    Freight infrastructure needs are significant and continue to grow;
    CAGTC remains committed to exploring solutions that will provide robust
    and dependable funding.
        Many of freight infrastructure's largest, most complex, and most
    desperately needed improvements cross local and state boundaries and
    occur where multiple modes come together. These instances frequently
    require a partnership at the federal level to untangle chokepoints that
    burden our communities and slow commerce.
        The FAST Act created a number of much-needed tools to address the
    challenges described. The Nationally Significant Freight and Highway
    Projects Program, or INFRA program, is a competitive grant program
    designed to target investments in large freight and highway projects
    and contains criteria written into law that focus on goods movement
    infrastructure. The FAST Act also authorized the Consolidated Rail
    Infrastructure and Safety Improvements (CRISI) Program, which provides
    grants for projects that improve the safety, efficiency, and
    reliability of intercity passenger and freight rail systems.
        According to a 2019 study by the Congressional Research Service,
    ``discretionary grants may be more effective in providing large amounts
    of federal funding for very costly freight-related projects,
    particularly those requiring interstate cooperation.'' \12\ Competitive
    grant programs such as INFRA and CRISI assist in funding large-scale
    infrastructure projects, which often span modes and jurisdictional
    borders and are difficult, if not impossible, to fund through
    traditional distribution methods such as formula programs.
    ---------------------------------------------------------------------------
        \12\ Congressional Research Service, Freight Issues in Surface
    Transportation Reauthorization, January 2019.
    ---------------------------------------------------------------------------
        While formula programs typically invest through a standard 80
    percent federal to 20 percent non-federal match, competitive grant
    programs encourage states and localities to bring their best possible
    deal to the table, driving innovative and creative funding and
    financing arrangements. Through the INFRA grant program's four rounds,
    USDOT awarded $2,394,979,933 to projects with a strong freight
    component. Those monies combined with funds from various other sources
    to result in $11,089,207,231 in total project investments--meaning 78.4
    percent of funds came from sources other than the INFRA grant program.
        Prior to joining CMAP, I was the director of planning and
    programming at the Illinois Department of Transportation (IDOT),
    responsible for long range multimodal planning and setting priorities
    for spending federal funds. I was at the table when IDOT and the CREATE
    partners were developing the INFRA application for the recently funded
    75th Street Corridor Improvement Project (CIP). Recognizing the
    national significance of the CREATE program, USDOT awarded the 75th
    Street CIP, located on the south side of the City of Chicago, $132
    million through the INFRA program's FY17/18 funding round.
    Historically, IDOT submitted several applications for USDOT's
    competitive programs from across the state. What was different this
    time was that CREATE partners agreed to only submit one INFRA
    application from the region--everyone's top priority. CREATE partners
    leveraged the federal INFRA ask with $342 million in local funds to pay
    for the first portion of this project to separate several freight and
    passenger rail lines. While more funding is necessary to complete the
    project, this investment will ultimately improve the reliability and
    travel time for more than 200 freight trains, 30 Metra commuter trains,
    and 10 Amtrak trains daily. Benefits will begin to accrue upon
    completion of the first portion; however, $474 million represents less
    than half the funds needed to complete the project. Completion of the
    full project will result in an anticipated $3.8 billion of economic
    benefits.
        The INFRA program's ability to leverage federal dollars is
    impressive; but a small federal ask, or likewise, a significant private
    contribution should not be the primary considerations when deciding to
    fund a project. Perhaps more important are project outcomes--USDOT must
    consider the national benefits of a project, not just the source of the
    matching funds. Projects should first be evaluated on their ability to
    meet the program's goals, based on measureable and objective criteria
    defined by Congress. Just because a project requires less federal
    investment, does not make it the most valuable investment for the
    nation.
        Complementary to the INFRA competitive grant program is the FAST
    Act's freight formula program, which allows state departments of
    transportation to target freight system improvements, like first and
    last mile connectors. Some states, such as California and Illinois,
    have distributed the federal freight dollars through a state-level
    competitive program.
        To make the most out of FAST Act funds, IDOT developed a
    transparent, performance-based, competitive program to ensure the
    dollars allocated provided the greatest return on investment. One of
    the challenges the agency had to overcome was an internal one--changing
    the internal conversation about transparency and performance metrics
    related to programming. Would we get an unwieldy number of projects if
    we posted the project evaluation criteria, or would we get better
    projects? In the end, it was the latter. Of 23 projects selected, 17
    went to local agencies, and the non-federal match across the program
    was 35 percent. $17 million was awarded to intermodal projects that do
    not traditionally have access to federal funding sources.
        In order to increase the flexibility afforded to state departments
    of transportation, we encourage Congress to eliminate the cap on non-
    highway projects, currently set at 10 percent of total funds, so each
    state can invest in its most pressing supply chain needs, regardless of
    mode. It should be noted, that even administered as a state-level
    competitive grant program, the formula program is not a replacement for
    INFRA, which funds nationally and regionally significant projects that
    frequently span multiple states and jurisdictions. As stated
    previously, such freight projects require a federally-administered
    competitive approach.
                                Recommendations
        We need a strategic freight mobility program that prioritizes the
    current economic needs of our country while planning for generations to
    come. This campaign of strategic investment should expand capacity and
    increase efficiency, regardless of mode or political jurisdiction.
    Without such a campaign, U.S. productivity and global competitiveness
    will suffer.
        To address these needs, we respectfully ask that Congress:
    Develop a national strategy that guides long-term planning
        We need a national ``vision'' and strategy to shape and guide our
    freight infrastructure needs. Such a strategy should have active
    coordination among states, regions, and localities and should endeavor
    to anticipate freight needs extending over multiple decades to allow
    for a smooth path for free-flowing freight both today and into the
    future.
        Planning tools, such as the National Freight Strategic Plan (NFSP),
    the National Freight Network, and the National Multimodal Freight
    Program, should account for resiliency, route redundancy, and shifting
    trade patterns. The NFSP would be enhanced by the inclusion of a
    comprehensive analysis of our system's freight infrastructure
    investment needs, created with high-quality data sets. Currently,
    planning is often frustrated by incomplete and outdated publicly
    available data sets. Recognizing that developing this analysis is a
    challenge, due to factors such as mixed-use infrastructure and
    intertwined public and private infrastructure, it is nevertheless a
    critical tool.
        An office of multimodal freight should be established within the
    U.S. Department of Transportation's Office of the Secretary to guide
    freight mobility policy and programming with a particular focus on
    projects of national significance that aid in the movement of commerce.
    Because the movement of goods spans different modes of infrastructure,
    specialized knowledge at the federal level is essential. An office of
    multimodal freight will allow experts in the unique operational and
    economic needs of each mode to work together to make the best
    investments in our system. Additionally, this investment strategy
    should include innovative and flexible approaches to structuring
    federal financial assistance in a manner that encourages private sector
    investment.
    Provide sufficient levels of funding that are dedicated, sustainable,
            and flexible
        An investment program dedicated to multimodal freight
    infrastructure is necessary to ensure that public agencies can invest
    in their most critical goods movement needs--regardless of mode.
    Federal funding should incentivize and reward state and local
    investment and leverage the widest array of public and private
    financing. Funding should be based on revenue sources that are
    predictable, dedicated, and sustained. Because they are the primary
    beneficiaries of any system improvements, owners of goods should be
    part of the revenue user-base.
        Existing programs available to freight infrastructure, like the
    INFRA competitive grant program, are oversubscribed. For example, in
    the combined FY17/18 round, the INFRA grant program saw $12 in unique
    requests for every $1 available. Currently funded at an average of $900
    million annually, given this level of oversubscription, CAGTC calls for
    an annual investment of $12 billion in multimodal freight investment
    through a competitive grant program.
        As we approach the FAST Act's reauthorization next year, we
    encourage Congress to not only increase the funding levels of both the
    freight formula program and the INFRA grant program, but to also
    eliminate the caps on non-highway spending under both programs. Freight
    does not move on highways alone--where public benefit is derived,
    public investment must be made. Intermodal freight is one of the
    fastest-growing sectors of the freight market.\13\ And, it is often in
    the places where various modes come together that public assistance is
    needed to close the funding and infrastructure gaps, which result in
    capacity inefficiencies and bottlenecks. Examples include highway-rail
    grade crossings, rail spurs to access cargo, logistics or transfer
    facilities, tunnels and bridges for port access, border crossing
    capacity enhancements, and air-freight connectors.
    ---------------------------------------------------------------------------
        \13\ U.S. Department of Transportation, Beyond Traffic, February
    2015.
    ---------------------------------------------------------------------------
    Implement a set of merit-based criteria for funding allocation
        Projects should be selected through the use of merit-based criteria
    that identify and prioritize projects with a demonstrable contribution
    to national freight efficiency. Goals should include increasing
    national and regional economic competitiveness, improving connectivity
    between freight modes, reducing congestion and bottlenecks, and
    improving the safety, efficiency, and reliability of the movement of
    freight and people. Long-term funding must be made available to ensure
    that, once a project is approved, funds will flow through to project
    completion. Funds should be available to support multi-jurisdictional
    and multi-state projects, regardless of mode, selected on the basis of
    objective measures designed to maximize and enhance system performance,
    while advancing related policy objectives. The U.S. Department of
    Transportation's decision-making process should be made transparent to
    ensure the integrity of the evaluation process.
    Form a partnership with the private sector
        Private participation in the nation's freight infrastructure is
    vital to system expansion. Federal funding should leverage private
    participation and provide transportation planners with the largest
    toolbox of financing options possible to move freight projects forward
    quickly and efficiently. We recommend that Congress consider
    establishing an advisory council made up of freight industry members
    and system users who could assist and partner with the U.S. Department
    of Transportation in order to optimize results from planning,
    coordination, and evaluation processes.
    Provide oversight of existing freight programs
        We recommend Congress oversee execution of the INFRA program to
    ensure projects are evaluated against criteria codified in law. We
    commend Congress' foresight in mandating that the Government
    Accountability Office (GAO) publish a report on the decision-making
    process for the first round of the INFRA grant program and encourage
    Congress to continue such oversight to aid decision-making transparency
    and adherence to Congressional intent.
        The FAST Act's freight programs are increasing the safety,
    efficiency, and reliability of our nation's goods movement system, but
    they are only a beginning. On behalf of CAGTC and CMAP, I encourage you
    to implement these recommendations to improve the nation's
    competitiveness and respond to a changing economy. I thank Members of
    the Transportation and Infrastructure Committee for their time and
    attention to this critically important topic.

        Ms. Norton. Thank you, Ms. Aleman.
        We go now to Chuck Baker, president of the American Short
    Line and Regional Railroad Association.
        Mr. Baker. Thank you, Chairman, Chairwoman, Ranking
    Members, and members of the subcommittees. I am Chuck Baker,
    and I am president of the American Short Line and Regional
    Railroad Association, representing the Nation's 603 small
    railroads.
        This hearing will explore the economic, environmental, and
    societal impacts of freight transportation. And you have asked
    me to tell you where's my stuff, as it relates to the short
    line railroad industry.
        Well, I am happy to report that short line railroads have
    lots of stuff. It is the right stuff. And we are here to
    transport America's stuff in a safe, efficient, and
    environmentally friendly manner. Together, short line railroads
    operate nearly 50,000 miles of track, or approximately 30
    percent of the national rail network, and employ more than
    17,000 hardworking Americans. We operate in 49 States. Short
    lines are often called the first mile and last mile of the
    Nation's railroad system.
        The name ``short line'' can create the mistaken impression
    that all of these railroads are very short in length. The fact
    is we come in all sizes. The Peru Industrial Railroad in
    Illinois is 3 miles long. The Portland and Western is 516 miles
    long. Pan Am Railways operates 1,700 miles, and provides the
    majority of rail service in New England. Our common
    denominators are that we operate track that was not viable
    under the structure of the previous owners; we run lean and
    mean; we stay very close to our customers; we are dedicated to
    safety; and we hustle, scratch, and claw for every last carload
    of stuff we can help move.
        Short lines have the right economic stuff. Short lines
    preserve service over track that was previously headed for
    abandonment. Particularly for smalltown and rural America,
    short line railroad service is the only connection to the
    national network. For the businesses and farmers in those
    areas, our ability to take a 25-car train 75 miles to the
    nearest Class I interchange is just as important as the Class
    I's ability to attach that block of traffic to a 100-car train
    and move it across the country.
        Railroads are an all-American proposition. Virtually
    everything we buy for infrastructure improvement--the ties, the
    rails, the ballasts, the locomotives, the freight cars--it is
    made in America. So every dollar we spend is spent in America.
        As those of you who represent rural areas know, it is
    difficult to create jobs in rural America. Short lines and the
    shippers we serve are a significant source of good-paying jobs
    in rural America.
        Short line railroads lower transportation costs for our
    shippers, because one railcar holds the equivalent of three to
    four truckloads worth of stuff, and we use fuel more
    efficiently than trucks. Using an example from Oklahoma, moving
    1 ton of freight 95 miles from Clinton to Enid via rail
    provides a 40-percent savings per mile versus truck. That level
    of savings exists across the country, and is a very meaningful
    number for the businesses we serve.
        I will not pretend that the numbers I am talking about are
    a huge deal in an economy measured in the trillions. However,
    for those shippers we keep connected, for those communities
    where we create economic activity, for the employees we hire,
    these are meaningful numbers. It is not the biggest stuff, but
    it is important stuff.
        Short lines have the right environmental stuff. Railroads
    are the most fuel-efficient way to move freight over land,
    three to four times more fuel-efficient than trucks. Today, a
    freight train can move 1 ton of freight an average of more than
    470 miles on 1 gallon of diesel. The EPA has measured the
    sources of transportation-related greenhouse gas emissions, and
    rail is a big success story. Cars and light trucks account for
    60 percent. Heavy trucking is 23 percent. Air travel is 9
    percent. And freight rail is only 2 percent.
        Highway congestion, in addition to being a soul-destroying
    way to spend your time, is also a significant contributor of
    harmful emissions. The average railcar holds the equivalent of
    three to four truckloads, and removing those trucks from the
    highway helps reduce congestion.
        Finally, short lines have the right societal stuff. Rail is
    the safest option for moving freight by land in America.
    Measured on a comparable ton-mile basis, rail is approximately
    three to five times safer than trucking. Short lines are proud
    of our safety culture, and work diligently to reduce and
    eliminate injuries. In 2018, 265 of our short lines reported
    zero accidents. The average accident rate that year was a near
    record low of 1.84 per million train-miles. Because rail is the
    safest option for moving freight by land, any policies that
    Congress enacts that affect the balance between rail and
    trucking also affect public safety, and have major societal
    impacts.
        As this committee considers a surface transportation bill,
    my written testimony offers specific policy recommendations
    that we believe will improve the economic, environmental, and
    societal impacts of freight transportation in America, such as
    supporting the CRISI grant program, improving the INFRA and
    State freight formula programs by making them more multimodal,
    maintaining the current truck size and weight limits,
    refraining from an unnecessary Federal law on train crew sizes,
    returning the Highway Trust Fund to something resembling a
    user-funded system, and, of course, our favorite topic,
    extending the short line rehabilitation tax credit. Thank you.
        [Mr. Baker's prepared statement follows:]

     Prepared Statement of Chuck Baker, President, American Short Line and
                         Regional Railroad Association
        Thank you Chairman DeFazio, Ranking Member Graves, Chairs Lipinski
    and Norton and Ranking Members Crawford and Davis, and Members of the
    Subcommittees for inviting me to testify as part of this important
    hearing. My name is Chuck Baker and I am President of the American
    Short Line and Regional Railroad Association (ASLRRA), the national
    trade association representing the nation's 603 Class II and Class III
    railroads (referred to here collectively as ``short lines'').
        This hearing will explore the economic, environmental and societal
    impacts of freight transportation and you have asked me to tell you
    ``where's my stuff'' as it relates to the short line railroad industry.
    Well, I am happy to report that short line railroads have lots of
    stuff, it's the right stuff, and we are here to transport America's
    stuff in a safe, efficient, and environmentally friendly manner.
        Together, short line railroads operate nearly 50,000 miles of
    track, or approximately 30% of the national railroad network and employ
    more than 17,000 hard-working Americans. We operate in 49 states and in
    36 of those states we operate at least one quarter of the state's total
    rail network. In five states, short lines operate 100% of the state's
    rail network. In the states represented by the Members of the two
    Subcommittees holding this hearing, there are 450 short lines operating
    over 38,000 track miles. Short lines are often called the first mile/
    last mile of the nation's railroad system and handle in origination or
    destination one out of every five rail cars moving on the national
    system.
        Although short lines are most often associated with small town and
    rural America, we also serve large urban areas and many of the nation's
    busiest ports, including Miami, Los Angeles and Long Beach, Hampton
    Roads, and New York/New Jersey. Likewise various short line railroads
    operate as neutral terminal switch carriers for multiple Class I
    railroads in Chicago, New Orleans and St. Louis. The nation's short
    lines are much more than a quaint name on the Monopoly Board.
        The name ``short line'' can create the mistaken impression that all
    of these railroads are very short in length. The fact is we come in all
    sizes. The Peru Industrial Railroad in Congressmen Lipinski's and
    Davis's state of Illinois is three miles long. The Portland and Western
    in Congressman DeFazio's state of Oregon is 516 miles long. Pan Am
    Railways, headquartered in Massachusetts, is the nation's longest short
    line, operating approximately 1,700 route miles and providing the
    majority of rail service in New England. Our common denominators are
    that we operate track that was not viable under the structure of the
    larger national Class 1 railroads, that we run lean and mean, that we
    stay very close to our customers, that we are dedicated to safety, and
    that we hustle, fight, scratch and claw for every last carload of stuff
    we can help move.
                   Short Lines Have the Right Economic Stuff
        Short line railroads preserve service and jobs over track that was
    headed for abandonment under previous Class I ownership. These were low
    density branch lines that could not generate enough profit under the
    cost structure of the big national carriers. Because these were
    marginal or money losing lines, they received little investment prior
    to their sale, resulting in significant deferred maintenance. To be
    successful, short line owners have worked hard to not only bring their
    tracks and bridges up to a state of good repair but to upgrade them to
    handle the heavier, longer trains that are becoming the national
    standard. To do that, short lines invest on average from 25 to 33% of
    their annual revenues in rehabilitating their infrastructure and this
    makes short line railroading one of the most capital-intensive
    industries in the country. To provide some dollar perspective, to
    upgrade one mile of typical 90-pound track up to the 115-pound rail
    needed to handle today's modern railcars costs more than $500,000 per
    mile and while short lines have been working hard to update their
    lines, we still need to do that across a large percentage of the
    50,000-mile network.
        The economic importance of this investment cannot be overstated.
    For large areas of the country, especially in small town and rural
    America, short line railroad service is the only connection to the
    larger national railroad network. For the businesses and farmers in
    those areas, our ability to take a 25-car train 75 miles to the nearest
    Class I interchange is just as important as the Class I's ability to
    attach that block of traffic to a 100-car train and move it across the
    country. While these shippers cannot complete the journey to their
    markets across the country without Class I railroad service, they
    cannot start or end the journey without short line service. This is
    especially true for much of the ``merchandise'' or ``carload'' traffic
    that comes from manufacturing, paper and agricultural shippers that
    does not typically move in unit train quantities. We are crucial in
    providing those shippers access to the economic benefits of shipping by
    rail.
        Short lines serve over 10,000 shippers in thousands of communities
    nationwide and we find those shippers quite willing to testify to the
    importance of this first mile/last mile service. I have attached at the
    end of my testimony a list of quotes from short line customers. We have
    selected a wide variety from across the country to give you a sense of
    the important relationship between shippers and their short lines. In
    general, they sound like this: ``Our serving short line railroad is
    truly a partner for our paper mill. The services provided, including
    freight haul in and out, daily switches, and rail car maintenance help
    us keep our mill running successfully day in and day out. It is
    critical to the 400 plus people employed here that our short line
    railroad be able to continue to operate successfully.''
        The money invested by short lines also results in economic benefits
    beyond preserving local rail service.
        Investing in better track leverages significant additional
    investment by railroad customers. For example, in South Dakota the
    improvements made by the 670-mile Rapid City, Pierre & Eastern Railroad
    since it began operations in 2014 have already attracted over $311
    million in new facility investments by six South Dakota companies.
    Those facilities employ 260 workers. This result is being duplicated in
    the 49 states that are served by short line railroads.
        Railroads are an all-American proposition. We can not take our
    operations or jobs overseas. Virtually everything we buy for
    infrastructure improvement--the ties, the steel rail, the ballast, the
    locomotives and the freight cars--is made in America, so every dollar
    we spend is spent in America.
        Railroad rehabilitation is a labor-intensive effort. As small
    businesses, most short lines do not have the necessary in-house labor
    force or specialized equipment to complete major rehabilitation
    projects so we staff up or hire contractors and lease heavy machinery
    for new projects, so that new investment typically results immediately
    in new jobs. The FRA estimates that half of every dollar spent on short
    line track rehabilitation goes to pay workers.
        As those of you who represent rural areas know, it is difficult to
    create jobs in rural America. According to the US Department of
    Agriculture, from its post-recession low in 2010 through 2017, rural
    employment grew at an average annual rate of only 0.5%, compared to
    1.8% in urban areas. In urban areas, the prime-age labor participation
    rate was just 0.8 percentage points below its 2008 level while in rural
    counties the prime-age participation rate in 2017 was 2.7 percentage
    points below its 2008 level. Short lines and the shippers we serve are
    a significant source of good paying jobs in rural America. In the case
    of short lines themselves, these jobs also include health care benefits
    and a generous Railroad Retirement program.
        Short line railroads lower transportation costs for their local
    shippers. The economics stem from the fact that one rail car holds the
    equivalent of three to four truckloads worth of stuff and also that
    railroads use fuel much more efficiently than trucks. In testimony we
    recently submitted to the House Ways & Means Committee in support of
    the short line rehabilitation 45G tax credit, we cited an example from
    an Oklahoma short line, Farmrail. The cost of moving a ton of freight
    95 miles from Clinton to Enid, Oklahoma is $2.24 per mile on the
    railroad versus $3.75 per mile for comparable truck service. That level
    of savings can be cited with most short lines across the country and is
    a very meaningful number for the businesses we serve, which lets them
    compete effectively in both the domestic and global markets. Without a
    viable rail service option, some of these businesses would just
    disappear.
        Last year the ASLRRA engaged Pricewaterhouse Coopers (PwC) to take
    an independent look at the 45G tax credit and the economic
    contributions of the short line industry. I have attached a copy of
    that report. Among the study's findings:
          The short line industry directly provides 17,000 jobs
    annually, paying labor income of $1.1 billion and adding $2.2 billion
    to the nation's GDP;
          Operational spending by the industry supported 33,730
    indirect and induced jobs and capital spending supported another 10,240
    jobs;
          Across the US economy .51% of business inputs rely on
    transportation services provided by short lines, amounting to 478,820
    jobs, $26.1 billion in labor income and $56.2 billion in value added.

        I will not pretend that the numbers I am talking about are a huge
    deal in an economy measured in the trillions of dollars. However, for
    those shippers we keep connected, for those communities where we create
    economic activity, for the employees we hire, these are meaningful
    numbers. It is not the biggest stuff but it is important stuff.
                 Short Lines Have the Right Environmental Stuff
        As my colleague at the AAR has said, railroads are the most fuel-
    efficient way to move freight over land--three to four times more fuel
    efficient than trucks. Today, a freight train can move one ton of
    freight an average of more than 470 miles on one gallon of diesel fuel,
    double the average in 1980. The EPA has measured the sources of
    transportation-related greenhouse gas emissions and rail is a big
    success story. Of the greenhouse gas emissions from transportation,
    cars/light trucks/motorcycles account for 60.5%, trucking is 23.1%,
    aircraft 9.1%, and freight rail is only 2%.
        Highway congestion, in addition to being soul-crushing and quality-
    of-life-destroying, is a significant contributor to harmful emissions.
    Motor vehicles idle for hours on overcrowded roads--in total there were
    more than 8.8 billion hours wasted in traffic in the last year
    measured--that's the equivalent of a full working year from 4.4 million
    Americans! The average railcar holds the equivalent of three to four
    truckloads and removing those trucks from the highway helps reduce that
    congestion. The short line industry handles over 12 million carloads
    annually which equals about 40 million truckloads not on the highway.
        Short lines are often custodians of expensive infrastructure, such
    as bridges and tunnels that were originally built by the much larger
    railroads and are reaching the end of their useful life. Rehabilitation
    or replacement of this legacy infrastructure can be very challenging
    for small companies, but the benefits are substantial. These benefits
    are documented through the cost benefit analysis required by the BUILD
    (formerly TIGER) program. As an example, a federal grant award made
    through the TIGER program in 2014 enabled replacement of a failing
    strategic short line bridge in southwestern Indiana. This investment
    prevented over 45 million truck miles from being added to the regional
    road network over a 20-year period. This saved the public over $11
    million in truck traffic costs through avoided emissions, accidents,
    congestion and local road damage. Some 3.2 million gallons of diesel
    fuel consumption were also avoided.
        While advances in fuel efficient locomotives do not garner the
    headline grabbing attention of Tesla's electric cars, the railroad
    industry is making steady progress in that regard. Tier 4 locomotives
    maximize locomotive performance and reduce emissions. As you know, Tier
    4 diesel engine standards are the strictest EPA emissions requirements
    for off-highway diesel engines and the railroad industry is
    increasingly incorporating Tier 4 locomotive into its fleet. I am
    pleased to report that one of our short line members, Knoxville
    Locomotive Works, has earned EPA's Tier 4 certification for its SE
    series four and six axle locomotive designs and is providing these
    locomotives to short lines for switching operations. These locomotives
    reduce existing emission levels by more than 90%. The Chairman of
    Knoxville Locomotive Works is Pete Claussen who is also the Chairman of
    short line company Gulf and Ohio Railways and his son Doc is President
    of that railroad and is currently serving as Chairman of our Short Line
    Association.
                   Short Lines Have the Right Societal Stuff
        Rail is the safest option for moving freight by land in America.
    Using USDOT data and measuring on a comparable ton-miles basis, rail is
    approximately 3-5 times safer than trucking.
        Short lines are proud of our safety culture and work diligently to
    reduce and eliminate injuries. In 2018, 265 short lines reported zero
    accidents to the FRA. The average accident rate that year was a near
    record low of 1.84 per million train miles. We are also proud of the
    Short Line Safety Institute, which exists to provide voluntary intense
    safety culture assessments on short lines all over the country as we
    continually strive for zero accidents, injuries, and fatalities.
        Because rail is the safest option for moving freight by land, any
    policies that Congress enacts that affect the balance between rail and
    trucking also affect public safety and have major societal impacts.
                          The Right Legislative Stuff
        As evidenced by the discussion above, short line railroads have the
    right stuff when it comes to moving America's stuff, and we would like
    to share with the Committee several legislative recommendations that we
    believe will help our industry provide more of that stuff in the
    future.
        As you likely know, our number one legislative priority is the
    extension of the Short Line Rehabilitation Tax Credit known as 45G. I
    will mention this only briefly for three reasons. First, it is not in
    the jurisdiction of this committee. Second, you are no doubt as tired
    of hearing us talk about it as I am of talking about it. Third, 49 of
    the 62 Members of these two Sub-Committees are co-sponsors of this
    legislation so I'd only be preaching to the choir. Suffice it to say
    that this credit allows short lines to maximize infrastructure
    investment that is critical to producing the kind of economic,
    environmental, and societal results described above, and to the extent
    that any of the members of this committee are able to work with your
    colleagues on Ways & Means and in leadership to ensure that an end-of-
    the-year tax package advances that includes 45G, that would be a big
    win for the thousands of communities and shippers that count on short
    lines. The credit has been expired since December 31, 2017 and we
    respectfully call on Congress to address this before the end of this
    year. The negative consequences of the credit being lapsed are becoming
    more apparent by the day.
        We strongly support the Consolidated Rail Infrastructure and Safety
    Improvements (CRISI) grant program as it specifically provides for
    short line eligibility and puts a focus on benefit-cost analysis. We
    have seen that with this level playing field, short line projects fare
    well. Further, it includes a special focus on the deployment of
    railroad safety technology, which can potentially help our work
    implementing positive train control (PTC) in compliance with the
    federal mandate. The yearly authorized level for the program should be
    increased--we suggest to $592 million, which was the high-water mark
    appropriated in fiscal year (FY) 2018. We also recommend that program
    eligibility be tweaked to include non-profit associations representing
    short line railroads. These types of associations have previously been
    eligible for similar grant programs and successfully received grants
    that provided safety support to many short line railroads. The current
    FY20 House THUD Appropriations bill includes language to this effect.
    We believe CRISI is an important and effective program that should be
    continued in the next surface transportation authorization bill.
        We are also supportive of the INFRA grant program. There is value
    in a merit-based discretionary grant program open to multiple modes of
    transportation, especially one that is focused on freight and goods
    movement, but we do recommend two changes to this program:
        1)  Allow the program to support the most efficient and effective
    freight projects by fully removing or at least significantly increasing
    the $500 million cap on non-highway portions of the multimodal freight
    projects. Such a cap is particularly anachronistic now that the highway
    trust fund has been subsidized by more than $140 billion(!) in general
    funds since 2008.
        2)  Ensure that the program is able to fund all efficient and
    effective projects by increasing the ``small projects'' set aside.
    Currently, the 10% cap on small projects, defined as projects that do
    not meet the $100 million project minimum, does not provide enough
    opportunity for INFRA grants to be used to help with most short line
    infrastructure projects. The 10% set aside should be increased to 25%
    to more accurately represent the many needs in small town and rural
    America and the small but effective projects that are possible
    everywhere.

        Similar to the INFRA grant program, the state freight formula
    program is also a beneficial program that could be improved by
    increasing the percentage of the grants that can go to the non-highway
    portions of multimodal freight projects. Again, artificially limiting
    the types of projects that can be funded results in less than optimal
    projects being selected, and it also makes no sense in a world where
    road user fees are not funding anywhere near the full cost of the
    highway trust fund.
        We also support the BUILD program. While BUILD has traditionally
    not been an authorized program, if this committee is inclined to
    authorize the program going forward, we would suggest including
    language that encourages the USDOT to select projects that are multi-
    modal in nature and not just projects that could just as easily be done
    within the normal state highway allocation. And the committee could
    also strengthen language around prioritizing the environmental and
    societal benefits of projects.
        The RRIF loan authorization of $35 billion is viewed by many as a
    potential solution to railroad rehabilitation. That has unfortunately
    not been the case so far. Since its inception in 1998, the program has
    provided miniscule support for short line rehabilitation.
    Notwithstanding its relatively limited utility, we wake up optimistic
    every day and believe there are ways to improve the program and thus
    offer the following suggestions.
          Provide subsidies for RRIF loan credit risk premiums,
    along the same lines as TIFIA;
          Provide assistance for advisory fees associated with RRIF
    loan applications;
          Extend RRIF loan terms from the present 35 years to 50
    years to more accurately match loan terms with the economic life of
    railroad assets;
          Facilitate earlier identification of credit risk premium
    ranges so that an applicant knows if it's worth engaging in the
    process;
          Implement an express framework for RRIF applications
    meeting certain criteria;
          Ensure that RRIF loans are considered local matching
    funds for other federal programs provided that they are repaid with
    local funds, as is the rule under TIFIA; and
          Allow short line holding companies to be applicants.

        I know that Members of this Committee have been vocal advocates for
    a comprehensive infrastructure program that addresses well-documented
    and critical needs. We share your frustration with the political
    gridlock that has halted progress on this important subject. In the
    hope that good sense will eventually prevail, we offer up five general
    principals that will help short lines better utilize any grant programs
    funded within a surface transportation reauthorization bill or larger
    infrastructure package, whether those are the existing programs noted
    above or new programs:
        1.  Short lines should be directly eligible applicants for project
    grants, similar to CRISI. Too often in the past, federal programs have
    been only open for application to local units of government, which in
    turn requires short lines to create unnecessarily complex and
    burdensome applicant structures and which sometimes favors politically
    popular projects over economically beneficial projects.
        2.  The application process needs to be as simple and transparent
    as possible. Short lines are small businesses and generally the
    individuals writing these applications are employees with other duties
    on the railroad. We do not have full time grant writers or the
    resources to hire expensive consulting firms.
        3.  The analysis used to judge a project should not be a rigid one-
    size-fits-all process. For example, the process to apply, the public
    planning and the engineering required, and the appropriate benefit-cost
    analysis format for incrementally upgrading a ten-mile segment of
    existing track serving five small grain elevators should not be the
    same as building a new subway line or adding lanes to an interstate
    highway.
        4.  If there is to be an associated environmental approval process,
    it must be completed in a reasonable period of time. Approval processes
    that last for years are a deal-killer to those running a business.
        5.  Imposing limits on a state DOT's number of grant submissions
    allowed in a round of a program forces pre-application competition
    between smaller short line projects and other larger projects, often
    putting the smaller short line project at a disadvantage.

        Finally, I will wrap up with three policy issues to keep in mind as
    the Committee looks towards a surface transportation reauthorization
    bill and considers how to increase the economic, environmental, and
    societal benefits of freight movement:
        1)  Infrastructure legislation that this committee advances will be
    a target vehicle for those who want to increase truck size and weight.
    Short lines are part of a broad coalition of interests, including
    safety advocates, law enforcement officials, rail labor, truck labor,
    independent truckers, Class I railroads, and even some truckload
    carriers, who oppose bigger and heavier trucks. Bigger trucks mean
    diversion from rail to truck and thus more trucks, more expensive
    damage to our highways and bridges, more highway congestion, more
    environmental damage, and more danger for the motoring public. Of all
    the aspects of my job, this is the only thing that all the relatives at
    the Thanksgiving dinner table care about and agree on--NOBODY wants
    bigger trucks! The biggest hurdle to enacting new infrastructure
    funding legislation is finding the funding, so including a provision
    that guarantees higher infrastructure repair costs makes the hurdle all
    the more difficult to overcome and that just would not make sense.
        2)  Mandating crew sizes on trains would be counter-productive in
    that it would just make trains less competitive with other
    transportation modes and would do so for no good reason as there is no
    evidence of a safety benefit generated by a second crew member. It is
    ironic that as the government is working to facilitate the move to
    driverless vehicles on the complex open architecture of the highway
    system, Congress is considering making the railroads do just the
    opposite on the simpler closed architecture of the railroad system.
    Short lines operate safely all over the country with a variety of
    business models and crew sizes, and we need the ability to be flexible
    and to adapt to an ever-changing competitive marketplace or else we
    will simply vanish in the face of competition.
        3)  As has been said thousands of times by most of you all on this
    Committee and most of us in the transportation community, it is
    essential that the highway trust fund return to a largely user- funded
    system. There are many important reasons for this, but from our short
    line perspective the current system amounts to a $10b+ per year
    government subsidy to our biggest competitors, which artificially
    shifts traffic from the freight rail system to the highway system and
    thus loses the economic, environmental, and societal benefits that can
    be provided by freight rail.

        In summary, short Line railroads have the right stuff, and with
    your continued support in the areas I have identified, we will provide
    even more of the stuff that matters--jobs, economic opportunity,
    environmental sustainability, and business growth, particularly in
    small town and rural America.
        I appreciate the opportunity to appear before you today and am
    pleased to answer any questions you might have.
                                   attachment
      Short Line Railroad Customers Talk about Service and the Short Line
                         Rehabilitation 45G Tax Credit
    Dana Shellberg, of Allweather Wood LLC, in Loveland, CO (a customer of
            the Great Western Railway of Colorado)
        ``Without the Great Western Railway of Colorado we would have to
    truck all our lumber in from Oregon, Washington, Alabama, and Arkansas.
    This would not allow us to stay competitive in the lumber market.''
    Robert Glezen, of Mont Eagle Mills, Inc., in Oblong and Palestine, IL
            (a customer of the Indiana Rail Road)
        ``Short line railroads are an increasingly important piece of our
    nation's infrastructure. Our business depends upon the Indiana Rail
    Road to serve the agricultural base of southeastern Illinois.''
    David Doti, of Jadcore, LLC, in Terra Haute, IN (a customer of the
            Indiana Rail Road)
        ``The Indiana Rail Road is our only connection to the main line.
    All of the other carriers have either merged or are out of business.
    The plastics industry relies on the railroad for its delivery of
    finished products all over the country.''
    Daniel Semsak, of Pacific Woodtech Corporation, in Saginaw, MI (a
            customer of the Lake State Railway)
        ``We depend on short lines to get into our customers' facilities.
    Rail access is essential for our company and our customers to be able
    to grow. As the Class 1 railroads have focused more and more on unit
    trains for inefficiencies, small business has relied on short lines for
    survival. We need the short lines for the ``last mile''.''
    Brian Arnhalt, of Minn-Kota Ag Products, in Breckenridge, MN (a
            customer of the Red River Valley & Western Railroad)
        ``Our rail service from the Red River Valley & Western Railroad is
    outstanding. The personalized attention to our customer needs is a big
    help in the success of our business.''
    Curt Warfel, of Akzo Nobel, Inc., in Columbus, MS (a customer of the
            Alabama and Gulf Coast Railway)
        ``Akzo Nobel has long been supportive of the short line railroad
    tax credit. We see this as an excellent way in which short line
    railroads may ``stretch'' a dollar to upgrade their railroads and
    improve service to rail shippers.''
    Chuck Hunter, of PSC Metals, Inc., in St. Louis, MO (a customer of the
            Terminal Railroad Association of St. Louis)
        ``The six short lines that serve our facilities have and will play
    a vital role in the growth of our company. They have worked with us to
    add rail service to several of our facilities, issued rates to incent
    rail service-vs-truck. Their local presence and willingness to
    partnership in problem solving has been a blessing. These service
    providers are an essential part of our continued success in the North
    American marketplace.''
    Levi Ross, of Dead River Company, in North Walpole, NH (a customer of
            the Green Mountain Railroad)
        ``Our retail petroleum business is dependent on the service of
    short lines for a dependable regional supply chain.''
    Jason Tininenko, of Freeport McMoRan, in Hurley, NM (a customer of the
            Southwestern Railway)
        ``There are several short line railroads that are integral to our
    business. They provide a consistent, cost effective option for us to
    move large volumes of freight both to and from our mining locations.''
    Mike Sawyer, of Western Producers Cooperative, in Dill City, Rocky, and
            Sentinel, OK (a customer of Farmrail)
        ``Our livelihood depends on railroads shipping our grain. Farmrail
    does a great job in taking care of our needs. We need their services!''
    Steve Stivala, of MacMillan-Piper, in Tacoma, WA (a customer of Tacoma
            Rail)
        ``Tacoma Rail is an integral part of our business and overall
    operation in Tacoma. The short line railroad provides us with
    consistent and reliable service on a daily basis. By meeting our needs
    and requirements, we are better able to service our customers. This
    would not be possible without the assist from Tacoma Rail.''
    Maurice Bohrer, of Michels Materials, in Janesville and Waterloo, WI (a
            customer of the Wisconsin & Southern Railroad)
        ``Our short line and regional railroad, the Wisconsin & Southern
    Railroad, is the only railroad that provides service to our black
    granite quarry and without them we would not be able to sell our
    granite to many of our customers and the other railroads that use our
    ballast!''
                                   attachment
     The Section 45G Tax Credit and the Economic Contribution of the Short
                             Line Railroad Industry
        The report entitled ``The Section 45G Tax Credit and the Economic
    Contribution of the Short Line Railroad Industry'' is retained in
    committee files and is available online as an attachment to Mr. Baker's
    written testimony at the U.S. House of Representatives Document
    Repository at https://docs.house.gov/meetings/PW/PW12/20191205/110277/
    HHRG-116-PW12-Wstate-BakerC-20191205.pdf.

        Mr. Lipinski [presiding]. Thank you, Mr. Baker.
        Ms. Goodchild, you are recognized for 5 minutes.
        Ms. Goodchild. Good morning, Chairs Norton and Lipinski,
    and Ranking Members Davis and Crawford, as well as
    distinguished members of the committee. Thank you for the
    opportunity to speak with you about this important topic.
        My name is Anne Goodchild. I am a professor of civil and
    environmental engineering at the University of Washington, and
    the director of the Supply Chain Transportation and Logistics
    Center. I am the founding director of the Urban Freight Lab,
    and an urban freight expert.
        It is an uncommon pleasure to be in a room full of
    policymakers so interested in freight transportation.
        The freight system allows for economic specialization, and
    is a requirement for city living. It provides markets to
    producers and strengthens competition.
        I am here today to highlight that freight infrastructure is
    more than interstates, ports, pipelines, and rail facilities.
    It is also city streets, curbs, and sidewalks. This is where a
    supply chain's last mile is carried out. That is the
    infrastructure that gets a good to its final destination.
        When we talk about freight infrastructure investment and
    building a better freight system, we must include the last
    mile, and even the final 50 feet. Investments in this
    infrastructure and innovations in the last mile provide a
    substantial opportunity to improve supply chain efficiency,
    more effectively delivering essential services and the economic
    and social benefits that they promise.
        The last mile is not, as the name suggests, a small part of
    the freight system. It is the current obsession of the supply
    chain industry, and an increasing burden for cities and
    neighborhoods. The last mile is the most difficult and costly
    mile of the entire freight system, estimated to absorb between
    25 and 50 percent of total supply chain transportation spent.
        Dramatic growth in online shopping and faster and faster
    home delivery is increasing the cost of the last mile and the
    amount of last-mile traffic. Investments in improving the last
    mile and the final 50-feet infrastructure will bring
    disproportionate benefits to the freight system, carriers, and
    consumers.
        We will have to rethink how we build and manage our
    infrastructure if it is to accommodate the expected growth in
    delivery services. Departments of transportation are facing
    many rapid and complex changes and competing demands for space.
    For example, growth in home delivery, the use of ride-hailing
    services, the construction of dedicated bike lanes, and
    autonomous vehicles all want additional curb space. Relying on
    intuition can lead to policies such as truck bans that actually
    increase congestion and emissions.
        In fact, our research demonstrates that organized,
    efficient freight carriers reduce traffic and emissions because
    a single delivery truck can replace dozens of car trips. On the
    street we see high rates of unauthorized parking, long dwell
    times, and high failed delivery rates, which means both poorly
    utilized vehicles and drivers, high emissions, and poorly
    utilized public space.
        Developing effective solutions to these urban freight
    challenges requires new approaches. We need evidence-based
    solutions that will improve efficiency for carriers and improve
    transportation system performance. In the face of a fast-
    changing industry, limited data, and freight planning capacity,
    this requires new approaches. Our response at the University of
    Washington was to establish the Urban Freight Lab, an
    innovative partnership between private industry, academic
    researchers, and the Seattle DOT, as well as other public
    agencies, to jointly solve urban freight problems.
        Private-sector members, as well as the public sector,
    contribute financially to the research, and collectively decide
    on a research agenda. While all members contribute and play an
    essential role in defining and identifying needs, lab fees do
    not and should not cover the cost of all research. The findings
    have national impact, and testing solutions at scale cannot be
    the responsibility of only this group.
        Important financial support for the center also comes from
    the Department of Energy, Office of Energy Efficiency and
    Renewable Energy, and the University Transportation Center
    Program. These and other Federal programs play an essential
    role in sponsoring and guiding the direction of national
    research.
        I encourage you to include approaches to study and improve
    urban freight performance in future policies. Thank you very
    much for your time.
        [Ms. Goodchild's prepared statement follows:]

    Prepared Statement of Anne Goodchild, Ph.D., Founding Director, Supply
      Chain Transportation and Logistics Center, University of Washington
        Good morning, Chairs Norton and Lipinski and Ranking Members Davis
    and Crawford as well as distinguished Members of the Committee. Thank
    you for the opportunity to speak to you about this important topic. My
    name is Anne Goodchild and I am a professor and the Director of the
    Supply Chain Transportation and Logistics Center at the University of
    Washington. I am an urban freight expert. The freight system,
    ultimately, allows for economic specialization; it supports city
    living, provides markets to producers, and strengthens competition. On
    its own, the transportation and logistics sector represents
    approximately 10% of the US gross domestic product--a larger sector
    than either retail, or financial services \1\. The freight system is
    more than interstates, ports, pipelines and rail facilities. The
    freight system is city streets, local highways, sidewalks, bike lanes,
    and front steps--the last mile of where these supply chains is carried
    out. It is the delivery man walking to your door or mailbox. When we
    talk about freight infrastructure investment and building a better
    freight system, we must remember to include the last mile and
    particularly the Final Fifty Feet to the final delivery destination.
    Without completing this final step, supply chains fail to deliver the
    economic and social benefits they promise.
    ---------------------------------------------------------------------------
        \1\ https://www.bea.gov/system/files/2019-10/gdpind219_2.pdf
    ---------------------------------------------------------------------------
     Last mile costs businesses a disproportionate amount of time and money
        The last mile is essential, and expensive; the most difficult and
    costly mile of all. While estimates vary, the cost of the last mile has
    been estimated at between 25% and 50% of total supply chain
    transportation costs \2\ \3\.
    ---------------------------------------------------------------------------
        \2\ https://www.kuebix.com/the-high-costs-of-final-mile-delivery/
        \3\ https://www.supplychaindive.com/news/last-mile-spotlight-
    retail-costs-fulfillment/443094/
    ---------------------------------------------------------------------------
        The last mile is costly because:
        1)  It relies more on human labor than the other segments of supply
    chain transportation with drivers going door-to-door to drop off
    packages. In cities, drivers can spend 80 or 90% of their time outside
    the vehicle \4\.
    ---------------------------------------------------------------------------
        \4\ https://www.greenbiz.com/article/we-will-still-need-drivers-
    driverless-future
    ---------------------------------------------------------------------------
        2)  Goods are more fragmented the farther you travel down the
    supply chain. Upstream, goods are moved in large, consolidated
    shipments such as single commodities but the closer goods get to the
    consumer the more they are broken down into shipments for individual
    customers.
        3)  80% of Americans live in congested regions \5\ where travel
    speeds are slower and less reliable. This increases the number of
    vehicles and drivers required to do the same work.
    ---------------------------------------------------------------------------
        \5\ http://css.umich.edu/factsheets/us-cities-factsheet
    ---------------------------------------------------------------------------
        4)  There can be high rates of failed deliveries requiring repeated
    delivery attempts and resulting in ballooning costs. Failed delivery
    attempts can mean that two or three additional trips are require to
    accomplish the same task.

        While the high cost of the last mile is in part due to the
    distributed nature of deliveries, the cost is inflated by congestion, a
    lack of reasonable parking options, and other constraints put on
    commercial vehicle operations such as specific street or time of day
    bans.
                      Online shopping growing and speeding
        Online shopping rates are growing and this is increasing demand for
    last mile delivery. UPS, the world's largest package delivery company,
    experienced 23% revenue growth from 2014 to 2018 (5.5% annually \6\).
    With one-click shopping and free home delivery it is now often cheaper
    and easier to order something online than it is to go to the store.
    Retail e-commerce sales as a percent of total retail sales in United
    States rose to 9% in 2017 and this figure is expected to reach 12.4% in
    2020 \7\. With store-based shopping, most Americans use their personal
    vehicles for shopping trips; driving to the store alone, purchasing a
    few items, and returning home in their car. With an online purchase,
    the trip--now a delivery--is made with a commercial vehicle, extending
    the supply chain from the store or warehouse and bringing increasing
    numbers of commercial vehicles into towns and neighborhoods. The volume
    of daily deliveries to homes has soared--from fewer than 360,000 a day
    in New York City in 2009 to more than 1.5 million today \8\. Households
    now receive more deliveries than businesses; and this, with online
    retail representing only 10% of all retail. Imagine how many more trips
    there will be when online retail hits 20% or 50%.
    ---------------------------------------------------------------------------
        \6\ https://www.forbes.com/sites/greatspeculations/2019/10/18/ups-
    revenues-strong-last-few-years-but-slower-growth-ahead/#323b065368e4
        \7\ https://nrf.com/insights/economy/state-retail
        \8\ https://www.nytimes.com/2019/10/27/nyregion/nyc-amazon-
    delivery.html
    ---------------------------------------------------------------------------
        In addition to growth in the number of deliveries, the pace of
    delivery of speeding. Amazon, which currently holds about a 50% share
    of the online market in the US has, in the last 3 years, halved their
    average click-to-door speed from about 6 days to about 3 days \9\.
    Other retailers are attempting to keep pace. Just this week I received
    an email from Amazon notifying me that Amazon Fresh would now deliver
    at ``ultrafast speeds'' in my area: ``You can schedule same-day
    deliveries from 6:00am-10:00pm and get FREE 2-hour scheduled delivery
    windows on orders over $35''. Free two-hour delivery. This was not in
    response to a request, rather this is being rolled out to all Prime
    members. Depending on your location, you can also get 1-hour delivery
    for a small additional fee. This is also available in DC and Northern
    VA. There has also been a proliferation of on-demand delivery services,
    particularly in the food delivery sector, where online platforms now
    serve close to 30% of the market.
    ---------------------------------------------------------------------------
        \9\ https://www.emarketer.com/chart/221703/average-click-to-door-
    speed-us-digital-purchases-
    made-on-amazon-vs-other-retailers-dec-2015-march-2018
    ---------------------------------------------------------------------------
        The US leads the world in online shopping activity and speed of
    delivery \10\. Supply chains have spent decades investing in technology
    and building the information systems required to deliver on home
    delivery and service promises. More recently, venture capital has also
    invested in transportation and logistics, with PitchBook reporting
    $14.4 billion invested globally in privately owned freight, logistics,
    shipping, trucking, transportation management system (TMS), and supply
    chain tracking startups since 2013 \11\. Not only do these changes
    affect transportation and logistics companies, but these changes affect
    peripheral sectors as companies reorganize their operations to service
    these new demands.
    ---------------------------------------------------------------------------
        \10\ https://unctad.org/en/pages/
    PressRelease.aspx?OriginalVersionID=505
        \11\ https://www.joc.com/technology/vcs-taking-long-odds-big-
    logistics-wins_20190523.html
    ---------------------------------------------------------------------------
        As customers are offered, and accept, shorter and shorter click-to-
    delivery times, delivery companies have less opportunity to make
    consolidated, efficient deliveries. Instead of waiting for more orders
    and sending out full trucks, vehicles are sent out to meet their quick
    delivery promise; reducing vehicle utilization. This increases the
    number of vehicles on the road, increases the cost per delivery, and
    increases vehicle emissions.
                    There is a Significant Impact on Cities
        It is the roads and sidewalks built by American cities and towns
    that enable this last mile delivery. In Seattle, 87% of buildings in
    greater downtown rely solely on the curb for freight access \12\. These
    buildings have no off-street parking or loading bays.
    ---------------------------------------------------------------------------
        \12\ http://depts.washington.edu/sctlctr/sites/default/files/
    SCTL_Final_50_full_report.pdf
    ---------------------------------------------------------------------------
        Our cities were not built to handle the nature and volume of
    current freight activity and are struggling to accommodate growth \13\.
    At the same time, delivery of goods is just one of the many functions
    of our transportation networks. The same roads and sidewalks are also
    used by pedestrians, cyclists, emergency vehicles, taxis, ride hailing
    services, buses, restaurants, and street vendors, to name a few.
    ---------------------------------------------------------------------------
        \13\ https://www.nytimes.com/2019/10/27/nyregion/nyc-amazon-
    delivery.html
    ---------------------------------------------------------------------------
        Capacity on our transportation networks is increasingly scarce.
    Texas Transportation Institute's 2019 Urban Mobility Report, a summary
    of congestion in America, is titled ``Traffic is Bad and Getting
    Worse'' \14\. Over the past 10 years, the total cost of delay in our
    nation's top urban areas has grown by nearly 47%. It is on top of this
    already congested network, that we add this growing last mile traffic.
    American cities have yet to make any headway with congestion, and
    delivery traffic both adds to, and suffers from, this condition.
    ---------------------------------------------------------------------------
        \14\ https://mobility.tamu.edu/umr/
    ---------------------------------------------------------------------------
        To address congestion, many state Departments of Transportation are
    working to provide safe and competitive alternatives to single
    occupancy vehicle travel such as transit, bicycling, and walking. Other
    federal agencies are also working on addressing this issue, such as the
    Department of Energy, which has awarded UW and Seattle an EERE grant.
    In building dedicated bicycle facilities, one common solution is to
    convert the curb lane to a bike lane, removing commercial vehicle load
    and unload space. At the same time, American's are increasingly using
    ride-hailing services such as Uber and Lyft \15\. This also increases
    the demand for curb space as passengers request pickup and drop-off
    instead of parking their own vehicle off-street.
    ---------------------------------------------------------------------------
        \15\ https://www.citylab.com/transportation/2019/08/uber-lyft-
    traffic-congestion-ride-hailing-cities-drivers-vmt/595393/
    ---------------------------------------------------------------------------
        The result is too much demand for too little space, and there is
    ample evidence of a poorly functioning system. From a study in Seattle,
    52% of vehicles parked in commercial vehicle load zones were passenger
    cars, and 26% of all commercial vehicles parked in passenger load
    zones. In New York City, UPS and Fedex received 471,000 parking
    violations in 2018. Everyone has seen an image of a truck parked in a
    bike lane, or been stuck behind a delivery truck occupying an entire
    residential street. While we might expect a small percentage of
    violations, these levels reflect a failure of planning and design to
    deliver reasonable alternatives to commercial vehicles, and a city that
    has not caught-up with the changes in supply chain and shopping
    patterns.
        In addition to these operational challenges, commercial vehicles
    have impacts on American's health and safety. Per mile, trucks produce
    disproportionately more carbon dioxide and local pollutants (NOx, PM)
    than passenger vehicles so a substitution of delivery trucks for
    passenger vehicles has the potential to increase emissions \16\.
    However, delivery services also present an opportunity to reduce
    emissions per package as they can consolidate many packages into one
    vehicle; the same way transit or carpooling can be an emissions
    advantage over single occupancy vehicle trips. Research shows that in
    most cases a well-run delivery service would provide a carbon dioxide
    reduction over typical car-based shopping behavior \17\. While there is
    the opportunity for delivery services to provide this emissions
    benefit, the move towards very fast delivery erodes that benefit as
    delivery services are unable to achieve the same level of consolidation
    and begin to look more like butler services.
    ---------------------------------------------------------------------------
        \16\ https://www.epa.gov/regulations-emissions-vehicles-and-
    engines/regulations-greenhouse-gas-emissions-commercial-trucks
        \17\ http://depts.washington.edu/sctlctr/research/publications/
    evaluating-impacts-density-urban-
    goods-movement-externalities
    ---------------------------------------------------------------------------
        Diesel powered vehicles, often used for the movement of freight,
    produce disproportionately more particular matter and NOx pollution
    than gasoline engines, so the use of these vehicles in urban areas,
    where human exposure levels are higher, has significant negative
    outcomes for human populations in terms of asthma and heart disease
    \18\. This is particularly true for the very young, elderly, or
    immunosuppressed.
    ---------------------------------------------------------------------------
        \18\ https://www.lung.org/our-initiatives/healthy-air/outdoor/air-
    pollution/particle-pollution.html
    ---------------------------------------------------------------------------
        While it may seem intuitive that replacing a car trip to the store
    with a truck delivery would be bad for the city, in fact, delivery
    services can reduce carbon emissions and total vehicle miles travelled.
    This is because the truck is not just delivering to one home, but to
    many. In this sense, the truck delivery behaves like a transit vehicle
    or very large carpool. This can reduce congestion by reducing the
    number of vehicles on the road. Delivery trucks can be an asset when
    performing in this efficient manner because they consolidate many goods
    into a single vehicle reducing per package cost, emissions, and
    congestion impacts.
        Banning trucks and requiring or encouraging the use of smaller
    vehicles INCREASES the number of vehicles and the vehicle miles
    travelled; exacerbating traffic and parking problems.
        Growth in two and one-hour delivery INCREASES the number of
    vehicles and vehicle miles travelled; exacerbating traffic and parking
    problems.
       The Urban Freight Lab as a Public and Private Sector Collaboration
        Businesses are challenged by the high cost of the last mile, and
    the increasing time pressure for deliveries. Cities are working to
    manage congestion, the competing demands of many users, emissions, and
    intense pressure for curb space. This presents a complex set of
    problems, where:
          private carriers are struggling to comply with city
    regulations and remain financially competitive while meeting customer
    expectations
          customers are benefiting from high levels of convenience
    but also experiencing high levels of congestion and suffering from the
    effects of growing emissions
          cities and towns are struggling to meet demands of
    multiple stakeholders and enforce existing rules

        All of this, in a context where there are very limited data
    regarding truck or commercial vehicle activity, numbers of deliveries,
    or other measures of efficiency. The Freight Analysis Framework \19\,
    which compiles the nation's most significant freight datasets such as
    the Commodity Flow Survey, breaks the country into 153 zones, so that
    most states can only see what came into or out of the state, not how
    vehicles move around within cities and towns. The more recently
    developed National Performance Management Research Data Set (NPMRDS)
    \20\, presents truck specific data, and allows for highway speeds to be
    monitored at a county level, but does not show vehicle volumes, or give
    any insights into origin-destination patterns. At the national level,
    mode-specific datasets provide more spatial, temporal, and activity
    detail. For example, the Carload Waybill sample \21\ provides important
    data on rail cargo movements and the Air Operators Utilization Reports
    \22\ provide important data on airplane activity. Unfortunately, the
    Vehicle Inventory and Use Survey, which provided detailed data on truck
    and goods movements, was discontinued in 2002. This leaves cities and
    towns have no nationally consistent sources of or guidelines for
    collecting truck activity data.
    ---------------------------------------------------------------------------
        \19\ https://www.bts.gov/faf
        \20\ https://ops.fhwa.dot.gov/perf_measurement/index.htm
        \21\ https://www.stb.gov/stb/industry/econ_waybill.html
        \22\ https://www.faa.gov/data_research/aviation_data_statistics/
    ---------------------------------------------------------------------------
        The most economically efficient solutions to these challenges will
    be identified through collaboration between cities and private
    partners. One particularly successful and innovative solution can be
    found in the Urban Freight Lab at the University of Washington (https:/
    /depts.washington.edu/sctlctr/urban-freight-lab-0). As the director of
    the Urban Freight Lab, I have built a coalition of private companies
    and public agencies who work together to identify and measure problems,
    and develop and pilot-test solutions that will provide benefits for a
    diverse group of public and the private sector stakeholders. The goal
    is to find win-win solutions for businesses and city dwellers, and to
    avoid short-sighted solutions like blanket truck bans \23\.
    ---------------------------------------------------------------------------
        \23\ https://nyc.streetsblog.org/2018/08/20/city-abandons-clear-
    curbs-program-that-reduced-traffic-congestion-and-made-roosevelt-
    avenue-safer/
    ---------------------------------------------------------------------------
        The Urban Freight Lab is successful because:
        1.  All participants have skin in the game. Private sector
    contributions elevate public sector research funding and ensure that
    all participants fully engage. This is fundamentally different from an
    advisory board or oversight committee because members must report back
    to their leadership and justify participation with measurable returns
    on investment. This participation from the private sector improves
    relevance and timeliness of public sector support.
        2.  Collaboration amongst the private and public sector ensures
    that products of the lab are as mutually beneficial as possible.
        3.  Problems, evaluation metrics, and research ideas come from the
    group and are connected directly to real-world challenges faced, not
    the research directors, the public, or private sector alone.
        4.  Private- and public-sector participants are senior executives
    who have the authority to make decisions in quarterly meetings. They do
    not need to return to the organization for approval.
        5.  Cities need freight planning capacity but currently don't have
    any. The work of the Urban Freight Lab fills gaps in problem
    definition, data collection, solution generation, orchestration and
    evaluation of pilot tests.
        6.  Robust analysis is conducted by University researchers--they
    serve an important role in taking an unbiased view and base their
    analysis on data.
        7.  Quarterly meetings are working meetings with detailed agendas
    and exit criteria. The focus is on making progress, making decisions,
    and moving forward, not simply information sharing.
        8.  Private sector partners are operational and technical staff
    with knowledge of operations.
        9.  Public sector partners represent a breadth of functions
    including planning, engineering, curb management, mobility, and
    innovation.
        10.  University research focusses on practical outcomes and does
    not hide in theoretical concepts.
        11.  Solutions are tested on the ground through pilots and real
    tests. The slow work of collaboration building and overcoming obstacles
    to implementation is part of the research.

        Current private-sector lab members include Boeing HorizonX,
    Building Owners and Managers Association (BOMA)-Seattle King County,
    curbFlow, Expeditors International of Washington, Ford Motor Company,
    General Motors, Kroger, Michelin, Nordstrom, PepsiCo, Terreno Realty
    Corporation, US Pack, UPS, and the United States Postal Service (USPS).
    The Seattle Department of Transportation represents the public-sector.
        Seattle is a growing City and has now been ranked in the top 4 for
    growth among major cities for five consecutive years. It is a
    geographically constrained city surrounded by water and mountains, and
    boasts some of the highest rates of bike, walk, and transit commuting
    in the country \24\; with less than a quarter of City Center commuters
    now driving alone to work. It is a technologically oriented City; with
    the region serving as the home to many technology companies such as
    Amazon, Convoy, Facebook, Google, Microsoft, and Tableau. The City was
    one of the first to launch PayByPhone, electronic toll tags, weigh-In-
    motion, high-occupancy-toll lanes, passive bicycle counters, real-time
    transit monitoring, bike and car share programs, and most recently, an
    Open Data Portal \25\. In this sense, the City provides an excellent
    example for experimentation where the public and private sector face
    intense pressure to look for new solutions and approaches; and levels
    of congestion and pressure that other US Cities can anticipate in their
    future as populations grow and infrastructure construction does not
    keep pace.
    ---------------------------------------------------------------------------
        \24\ https://commuteseattle.com/mediakit/2017-mode-split-press-
    release/
        \25\ https://data.seattle.gov/
    ---------------------------------------------------------------------------
        With this private- and public-sector funding the Urban Freight Lab
    has:
          produced foundational research on the Final Fifty Feet of
    the supply chain \26\
    ---------------------------------------------------------------------------
        \26\ https://depts.washington.edu/sctlctr/sites/default/files/
    SCTL_Final_50_full_report.pdf
    ---------------------------------------------------------------------------
          developed and applied approaches to quantify urban
    freight infrastructure \27\
    ---------------------------------------------------------------------------
        \27\ https://depts.washington.edu/sctlctr/sites/default/files/
    SCTL_Alley_Infrastructure_
    Occupancy_Study_12-11-18.pdf
    ---------------------------------------------------------------------------
          developed and applied approaches to measure
    infrastructure \28\
    ---------------------------------------------------------------------------
        \28\ https://depts.washington.edu/sctlctr/sites/default/files/
    SCTL_Alley_Infrastructure_
    Occupancy_Study_12-11-18.pdf
    ---------------------------------------------------------------------------
          generated and tested approaches to reducing dwell time
    and failed deliveries in urban areas including common lockers \29\
    ---------------------------------------------------------------------------
        \29\ https://depts.washington.edu/sctlctr/sites/default/files/
    SCTL_Urban_Freight_Lab_
    5.18.18.pdf
    ---------------------------------------------------------------------------
          developed and implemented an approach to measuring the
    volume of vehicles entering and exiting the City of Seattle.\30\
    ---------------------------------------------------------------------------
        \30\ https://depts.washington.edu/sctlctr/research/publications

        Ongoing work is supported in large part by a grant from the
    Department of Energy U.S. Department of Energy: Energy Efficiency &
    Renewable Energy (EERE) titled Technology Integration to Gain
    Commercial Efficiency for the Urban Goods Delivery System, Meet Future
    Demand for City Passenger and Delivery Load/Unload Spaces, and Reduce
    Energy Consumption. This project, funded by DOE, provides $1.5 million
    over 3 years with matching funds from the City of Seattle, Sound
    Transit, King County Metro, Kroger, the City of Bellevue, and CBRE. The
    project will evaluate the benefit of integrated technology applications
    on freight efficiency. Within the scope of this grant, Urban Freight
    Lab members and the Seattle DOT will be involved in developing and
    testing applications of technology in the Belltown area of Seattle that
    will increase commercial efficiency and reduce impact of freight
    activity on city residents \31\.
    ---------------------------------------------------------------------------
        \31\ https://depts.washington.edu/sctlctr/research-projects/current
    ---------------------------------------------------------------------------
                                 Moving Forward
        Shopping patterns have evolved, but our infrastructure has not. We
    need to rethink how we use our streets, curbs, and sidewalks if we want
    to maintain and grow our current shopping and delivery habits.
        By consolidating many goods into a single route, delivery services
    could be an asset to communities; growing economic activity, reducing
    total vehicle miles travelled and associated carbon emissions, and
    supporting communities \32\ less dependent on cars. However, the
    current trend towards faster and faster deliveries; and businesses
    subsidizing delivery costs means we see lower vehicle utilization,
    higher numbers of vehicles and congestion, and increased emissions.
    ---------------------------------------------------------------------------
        \32\ http://depts.washington.edu/sctlctr/research/publications/
    evaluating-impacts-density-urban-
    goods-movement-externalities
    ---------------------------------------------------------------------------
        While some town and city governments have invested measuring the
    state of urban freight in their communities and developed improvements,
    most have limited resources and no guidance from the state or federal
    level. For example, they do not know how many trucks operate in the
    region, what they carry, whether the current curb allocation is
    satisfactory, or what benefit might result from improvements.
        New modes, technologies, and operational innovations provide
    opportunities for win-win solutions. These new conditions may allow new
    modes such as electric assist cargo bikes \33\ to outcompete existing
    modes. Electric and hybrid vehicles can reduce both global and local
    pollutants. New technologies such as robotics, artificial intelligence,
    and electronic curbs may fundamentally shift the existing
    infrastructure paradigms. Private companies are ready to test these
    innovations, and the US and state DOTs can play a role in supporting
    these tests and conducting evaluations.
    ---------------------------------------------------------------------------
        \33\ http://depts.washington.edu/sctlctr/research-projects/ups-e-
    bike-delivery-pilot-test-seattle-analysis-public-benefits-and-costs-
    task
    ---------------------------------------------------------------------------
        Investments in the freight system must include the last mile, and
    in particular the final fifty feet of the delivery route as a
    consideration to ensure economic vitality and support quality of life.
    This includes supporting towns and cities in investigating and
    understanding the current state of goods movement at the municipal
    scale, identifying and evaluating new solutions for cities and towns to
    adapt to changing supply chains, integrating freight planning and
    passenger planning, and ultimately providing healthy environments for
    businesses to thrive and great places to live.

        Mr. Lipinski. Thank you, Ms. Goodchild.
        I now recognize Mr. Jefferies.
        Mr. Jefferies. Good morning, Chairs DeFazio, Holmes Norton,
    and Lipinski, Ranking Member Davis, Crawford, and members of
    the committee. Thank you for the opportunity to be here today
    representing the U.S. freight railroads.
        As you examine the capability of U.S. freight modes to meet
    the challenges of today and tomorrow, know this: due to
    sustained private investment, the freight rail network is in
    the best shape of its storied history.
        Today's railroad is different than the railroad of the
    past. But the capital intensive nature is a constant, enabling
    railroads to safely serve today's customers and plan for
    tomorrow's demands. Case in point: in the past 3 years, Class I
    railroads averaged $25 billion in private investments to manage
    and upgrade infrastructure and equipment. That is more than $68
    million a day of private capital poured back into our network.
    This year is no different. Class I capex is up almost $1
    billion through the third quarter of this year, year over year.
        Railroads play the long game, and the industry is executing
    a strong vision for the future. The positive impacts of this
    vision can be found every day.
        First, railroads operate safely. Railroads maintain a
    safety culture second to none, constantly looking for ways to
    further the safety performance. The evidence of this commitment
    is clear. In 2018 the train accident rate was down 36 percent
    from the year 2000, while the employee accident rate was its
    second lowest in history, down 48 percent. To continue these
    trends, the industry is deploying new inspection and detection
    technologies that allow for significantly more advanced
    assessments of rail, track, and locomotive health. We will not
    be satisfied until we reach a future of zero incidents.
        Second, railroads are the most environmentally sound way to
    move freight over land. To reiterate what my colleague said, on
    average, railroads move 1 ton of freight 473 miles per gallon
    of diesel fuel. To put that in perspective, that is equal to
    moving 1 ton of freight on 1 gallon of diesel from DC to
    Cincinnati or Chicago to Omaha. While moving nearly one-third
    of long-distance freight volume, railroads account for just 2
    percent of transportation-related greenhouse gas emissions. In
    fact, if just 10 percent of freight that is currently moved by
    trucks were transported by rail instead, annual greenhouse gas
    emissions would fall by more than 17 million tons.
        Third, railroads alleviate highway congestion and
    deterioration. Because a single train can carry the freight of
    several hundred trucks, railroads cut gridlock and lower the
    costs of road construction and upkeep.
        And finally, freight rail is a critical economic engine.
    U.S. freight railroads move roughly 40 percent of intercity
    ton-miles of freight, ship one-third of U.S. exports, and
    support more than 1 million jobs across the Nation.
        So looking forward, a positive future for freight rail and
    other transportation modes relies on a sound public policy.
    Robust private investment in the rail sector is made possible
    by a balanced economic regulatory system overseen by the
    Surface Transportation Board that relies on market-based
    competition, while providing a backstop for rail customers. The
    structure benefits the entire freight ecosystem. Rail rates in
    2018 were 44 percent lower than they were in 1981, when
    adjusted for inflation. To continue the success story, the STB
    must adhere to sound economic principles and all actions, and
    reject reregulatory efforts by some stakeholders.
        At the same time, Congress has a role to ensure modal
    equity across freight transportation by fixing the Highway
    Trust Fund. To do this, railroads believe a mileage-based
    solution, such as a weight-distance fee, is the most
    appropriate and sustainable long-term solution. I give credit
    to my friends in the trucking industry for advocating for a
    higher gas tax.
        The bottom line, though, all stakeholders agree a viable
    funding solution is a must, one that enables full cost recovery
    for highway wear and tear.
        In closing, privately owned railroads have their eyes on
    the future. The industry will continue to invest to meet market
    demand and maintain our core role in the Nation's integrated
    transportation network. We look forward to working with this
    committee and others in Congress as you look towards surface
    transportation reauthorization and develop and implement
    policies that best meet this country's infrastructure needs.
    Thank you.
        [Mr. Jefferies' prepared statement follows:]

     Prepared Statement of Ian J. Jefferies, President and Chief Executive
                   Officer, Association of American Railroads
        On behalf of the members of the Association of American Railroads,
    thank you for the opportunity to appear before you today. AAR members
    account for the vast majority of freight railroad mileage, employees,
    and traffic in Canada, Mexico, and the United States.
        Simply put, railroads are indispensable to the U.S. economy. They
    connect producers and consumers across the country and the world,
    expanding existing markets and opening new ones. Whenever Americans
    grow something, mine something, or make something; when they send goods
    overseas or import them from abroad; when they eat their meals or take
    a drive in the country, there's an excellent chance that railroads
    helped make it possible.

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        The affordability of freight rail saves rail customers (and,
    ultimately, American consumers) billions of dollars each year and
    enhances the global competitiveness of U.S. products. Average rail
    rates (measured by inflation-adjusted revenue per ton-mile) were 44
    percent lower in 2018 than in 1981. This means the average rail shipper
    can move close to twice as much freight for around the same price it
    paid more than 35 years ago.
        Several years ago, the American Association of State Highway and
    Transportation Officials (AASHTO) estimated that if all freight rail
    traffic were shifted to trucks, rail customers would have to pay an
    additional $69 billion per year. Adjusted for increased freight volume
    and inflation, it's probably close to $100 billion today.
        An October 2018 study from Towson University's Regional Economic
    Studies Institute found that, in 2017 alone, the operations and capital
    investment of America's major freight railroads supported approximately
    1.1 million jobs (nearly eight jobs for every railroad job), $219
    billion in economic output, and $71 billion in wages. Railroads also
    generated nearly $26 billion in tax revenues. In addition, millions of
    Americans work in industries that are more competitive in the tough
    global economy thanks to the affordability and productivity of
    America's freight railroads.
        Without railroads, American firms and consumers would be unable to
    participate in the global economy anywhere near as fully as they do
    today. International trade accounts for around 35 percent of U.S. rail
    revenue, 27 percent of U.S. rail tonnage, and 42 percent of the
    carloads and intermodal units U.S. railroads carry.
                                 Sustainability
        According to the Environmental Protection Agency (EPA),
    transportation accounted for 28.4 percent of U.S. greenhouse gas
    emissions in 2017. The vast majority of transportation-related
    greenhouse gas emissions are directly related to fossil fuel
    consumption: higher fuel consumption means more emissions.
        Railroads, though, are the most fuel-efficient way to move freight
    over land. In 2018, railroads moved one ton of freight an average of
    473 miles per gallon of fuel--roughly the distance from Coos Bay,
    Oregon to San Francisco, or from Hannibal, Missouri to Columbus, Ohio.
    In fact, freight railroads, on average, are three to four times more
    fuel efficient than trucks--meaning that moving freight by rail instead
    of truck reduces greenhouse gas emissions by up to 75 percent. The rail
    fuel efficiency advantage helps explain why freight railroads account
    for just 2.0 percent of transportation-related greenhouse gas emissions
    and just 0.6 percent of total U.S. greenhouse gas emissions, according
    to the EPA, even though railroads account for one-third or more of
    long-distance freight volume (measured in ton-miles).
        If just 10 percent of the freight that moves by the largest trucks
    moved by rail instead, fuel savings would be more than 1.5 billion
    gallons per year and annual greenhouse gas emissions would fall by more
    than 17 million tons--equivalent to removing some 3.2 million cars from
    the highways for a year or planting 400 million trees.
        Railroads are constantly looking for ways to improve their fuel
    efficiency and further reduce emissions. Steps railroads have taken
    individually or collectively in recent years include:
          Installing highly advanced computer software systems that
    calculate the most fuel-efficient speed for a train on a given route;
    determine the most efficient spacing and timing of trains on a
    railroad's system; and monitor locomotive performance to ensure peak
    efficiency.
          Installing idling-reduction technologies, such as stop-
    start systems that shut down a locomotive when it is not in use and
    restart it when it is needed, and expanding the use of distributed
    power (positioning locomotives in the middle of trains) to reduce the
    total horsepower required for train movements.
          Acquiring thousands of new, more efficient locomotives
    and removing from service thousands of older, less fuel-efficient
    locomotives.
          Providing employee training to help locomotive engineers
    develop and implement best practices and improve awareness of fuel-
    efficient operations.

        Railroads also help reduce the huge economic costs of highway
    congestion. According to the Texas Transportation Institute's 2019
    Urban Mobility Report, highway congestion cost Americans $166 billion
    in wasted time (8.8 billion hours) and wasted fuel (3.3 billion
    gallons) in 2017. Lost productivity, cargo delays, and other costs add
    tens of billions of dollars to this tab. A single freight train,
    though, can replace several hundred trucks, freeing up space on the
    highway for other motorists. Shifting freight from trucks to rail also
    reduces highway wear and tear and the pressure to build costly new
    highways.
        In recent years, railroads have begun to investigate moving away
    from diesel locomotives in favor of alternatives--for example, to
    natural gas, or even potentially to batteries or fuel cells. At this
    point, it's not clear if an alternative will have the combination of
    affordability, reliability, and capability to be feasible for
    widespread use, but it does show that railroads are ``looking outside
    the box'' in terms of enhancing sustainability and environmental
    preservation.
                            Investing for the Future
        As America's economy and population grow, the need to move more
    freight will grow too. The Federal Highway Administration forecasts
    that total U.S. freight shipments will rise 35 percent from 2017 to
    2040. Railroads are getting ready today to meet this challenge.
        America's freight railroads operate overwhelmingly on
    infrastructure that they own, build, maintain, and pay for themselves.
    By contrast, trucks, airlines, and barges operate on highways, airways,
    and waterways that are almost entirely publicly funded.
        From 1980 to 2018, America's freight railroads spent more than $685
    billion--their own funds, not taxpayer funds--on capital expenditures
    and maintenance expenses related to locomotives, freight cars, tracks,
    bridges, tunnels and other infrastructure and equipment. That's more
    than 40 cents out of each revenue dollar spent to keep our economy
    moving.
        Railroads are much more capital intensive than most industries.
    Over the past decade, the average U.S. manufacturer has spent about 3
    percent of revenue on capital expenditures. The comparable figure for
    U.S. freight railroads is close to 19 percent, or about six times
    higher. Railroads know that if America's future transportation demand
    is to be met, they must have the capacity to handle it. Railroads are
    preparing for tomorrow today.

                    Capital Spending as % of Revenue
    ------------------------------------------------------------------------

    ------------------------------------------------------------------------
    Average all manufacturing                     2.9%

    Food                                          2.2%
    Petroleum & coal products                     2.4%
    Machinery                                     2.6%
    Fabricated metal products                     3.1%
    Primary metal products                        3.1%
    Wood products                                 3.1%
    Motor vehicles & parts                        3.2%
    Chemicals                                     3.4%
    Plastics & rubber products                    3.6%
    Paper                                         4.0%
    Nonmetallic minerals                          4.8%
    Computer & electr. products                   5.1%

    Class I Railroads                             19.1%
    ------------------------------------------------------------------------
     Avg. 2007-2016
     Source: Census Bureau, AAR

        Thanks to their massive investments, freight railroad
    infrastructure today is in its best overall condition ever--quite a
    contrast to, say, America's highway network. The challenge for
    railroads, and for policymakers, is to ensure that the current high
    quality of rail infrastructure is maintained, and that adequate freight
    rail capacity exists to meet our nation's current and future freight
    transportation needs. Policymakers can help by avoiding policies that
    discourage rail investment.
                        Always Pushing to Improve Safety
        For our nation's railroads, pursuing safe operations is not an
    option, it's a business imperative. Most importantly, it's the right
    thing to do. Railroads are not just faceless corporations from
    somewhere far away. Rather, your neighbors are their neighbors. No
    matter where you live, chances are good that current or former rail
    industry employees live nearby. Railroads know they have an obligation
    to operate safely for their benefit and for the benefit of all members
    of the communities they serve.
        Railroads recognize they've not yet reached their goal of zero
    accidents and injuries, but we should all be encouraged by their
    progress. Recent years have been the safest for railroads in history.
    From 2000 to 2018, the train accident rate fell 35 percent, the
    employee injury rate fell 48 percent, and the grade crossing collision
    rate fell 36 percent. Railroads today have lower employee injury rates
    than most other major industries, including trucking, airlines,
    agriculture, mining, manufacturing, and construction--even food stores.
        Rail operations are subject to stringent safety oversight by the
    Federal Railroad Administration (FRA). For example, stringent FRA
    regulations cover track and equipment inspections, employee
    certification, operating speeds, and signals. FRA safety inspectors
    (and in some states, state inspectors) evaluate rail facilities and
    operations. Railroads are also subject to oversight by the Occupational
    Safety and Health Administration, the Pipeline and Hazardous Materials
    Safety Administration, and the Department of Homeland Security.
        Railroads are constantly incorporating new technologies to improve
    safety. Just a few examples: sophisticated detectors along tracks that
    identify defects on passing rail cars; ground-penetrating radar that
    identifies problems below ground, such as excessive moisture, that
    could destabilize track; and specialized rail cars that use
    sophisticated instruments to identify defects in tracks.
        Many railroad safety-related technological advancements were
    developed or refined at the Transportation Technology Center, Inc.
    (TTCI), the finest rail research facility in the world, in Pueblo,
    Colorado. TTCI is a wholly owned subsidiary of the AAR. Forty-eight
    miles of test tracks, highly sophisticated testing equipment,
    metallurgy labs, simulators, and other diagnostic tools are used to
    test track structure, evaluate freight car and locomotive performance,
    assess component reliability, and much more. The facility is leased by
    the FRA from the state of Colorado, but has been operated by TTCI since
    1984.
        Rail industry safety is also being enhanced by the Asset Health
    Strategic Initiative (AHSI), a multi-year rail industry program that is
    applying advanced information technology processes to improve the
    safety and performance of freight cars across North America. Through
    this program, advanced defect detection systems use a wide array of
    sensors to identify potential problems with freight cars and freight
    car components such as wheels, axles, bearings, and brakes. Advanced
    analytical programs flag suspect railcars so they can be removed from
    service and fixed before issues arise. Freight cars often travel across
    the networks of different railroads, but thanks to the sharing of
    information at the individual railcar level facilitated by AHSI, no
    matter where a particular railcar is at a particular time, preemptive
    action can be taken. The sharing of information across the industry
    allows problems to be detected that would not be detectable otherwise.
    AHSI is based on the recognition that the best approach to railcar
    health encompasses monitoring the entire railcar life cycle.
        Finally, freight railroads are committed to safely completing the
    implementation of positive train control (PTC) as quickly as possible
    so that further safety gains can be achieved. The seven Class I freight
    railroads all met statutory requirements by having 100 percent of their
    required PTC-related hardware installed, 100 percent of their PTC-
    related spectrum in place, and 100 percent of their required employee
    training completed by the end of 2018. In aggregate, Class I railroads
    had 93 percent of required PTC route-miles in operation as of October
    2019. Each Class I railroad expects to be operating trains in PTC mode
    on all their PTC routes no later than 2020, as required by statute. In
    the meantime, railroads, in coordination with Amtrak, other passenger
    railroads, and other tenant railroads, are continuing to test and
    validate their PTC systems thoroughly to ensure they are interoperable
    and work as they should.
           Changing Markets Present a Serious Challenge to Railroads
        Freight railroads are what economists call a ``derived demand''
    industry. This means that demand for rail service is a function of
    demand elsewhere in the economy for the products railroads haul. For
    example, automakers' demand for rail service rises when consumers are
    buying more cars but dries up if consumers stop buying cars. Therefore,
    what affects the broad economy affects railroads too.
        It's no secret that the economy has not been doing as well,
    especially recently, as we all would like, and rail traffic has
    suffered accordingly. Total rail carload and intermodal volume in 2019
    through October was down 4.4 percent over the same period last year.
    Weakness in U.S. rail volumes today is consistent with an economy in
    which manufacturing and commodity-related industries especially are
    hurting. The ongoing trade war and accompanying uncertainty has had the
    most direct impact on manufacturing and commodity-related industries
    that are heavily served by railroads. Railroads are hopeful that this
    uncertainty will be eliminated and that firms here and abroad can again
    devote full attention to helping our economies grow.
        Railroads are also impacted by what's happening in specific
    industries. Wheat is a good example. In a typical year, exports account
    for more than 40 percent of U.S. wheat production and railroads move
    approximately 60 percent of U.S. wheat exports. When wheat producers
    elsewhere in the world have good crops, or when trade restrictions are
    put into place, U.S. wheat exports--and, consequently, U.S. rail
    carloads of wheat--are impacted.
        All this illustrates that the U.S. and global economies are
    constantly evolving. Firms, even entire industries, can and do change
    rapidly and unexpectedly, and railroads must be able to deal with that
    flux. These broad, often unanticipated economic changes are reflected
    in changes not only in the volumes but also in the types and locations
    of the commodities railroads are asked to transport, and in the amounts
    and uses of railroad assets. When traffic changes occur in different
    areas--as is usually the case and has certainly been the pattern in
    recent years--the challenges to railroads become magnified.
        To successfully adapt to these challenges, railroads must be
    flexible and innovative while improving the efficiency and productivity
    needed to maintain their long-term financial health. Railroads may also
    have to invest in additional capacity to meet changing demand. Public
    policies that hamstring railroads by preventing or limiting this
    flexibility and innovation are sure to have a negative impact on
    railroads and on their ability to meet the transportation needs of our
    evolving economy.
                 The Importance of Appropriate Public Policies
        Prior to passage of the Staggers Rail Act of 1980, excessive
    regulation put our nation's freight railroads in a huge financial and
    operational hole. By enacting Staggers, Congress recognized that
    regulation prevented railroads from earning adequate revenues and
    competing effectively. Survival of the railroad industry required a new
    regulatory scheme that allowed railroads to establish their own routes,
    tailor their rates to market conditions, and differentiate rates on the
    basis of demand.
        One of the fundamental principles of the Staggers Act was something
    that had been essentially ignored for decades prior to it: if our
    nation is to have a viable, efficient, privately owned freight rail
    system, someone has to be willing to pay for it, and the market is far
    superior to the government in determining who should pay.
        Importantly, the Staggers Act did not completely deregulate
    railroads. In addition to retaining authority over a variety of non-
    rate areas, the Interstate Commerce Committee, and now its successor,
    the Surface Transportation Board (STB), retained the authority to set
    maximum rates if a railroad is found to have ``market dominance'' and
    to take other actions if a railroad engages in anticompetitive
    behavior.
        Nevertheless, some rail customers and their supporters in Congress
    and elsewhere want the STB to make major changes in the scope and
    intensity of railroad rate and service regulation. Most of these
    changes would, in one way or another, limit the prices that railroads
    can charge and therefore limit the revenue railroads can earn. If
    successful, these regulatory changes would make it much more difficult
    for railroads to make the investments they need to maintain and upgrade
    their networks and to provide the safe, efficient, and reliable service
    their customers need to prosper.
        It would be a grave mistake to let this happen. A fundamental tenet
    of the economics of competition says that where competition exists,
    there should be no regulatory intervention. Because the vast majority
    of rail freight movements are subject to strong competitive forces--
    including competition from other railroads, from trucks and barges,
    product competition \1\, and geographic competition \2\--the vast
    majority of rail movements should likewise be free of governmental
    oversight. Moreover, no amount of rhetoric about ``competition'' can
    change the fact that if a railroad cannot cover its costs, it cannot
    maintain, replace, or add to its infrastructure and equipment. Nor can
    it provide the services upon which its customers depend. Simply put, if
    the existing balanced regulatory structure were changed, either
    taxpayers would have to make up the difference or the industry's
    physical plant would deteriorate, and needed new capacity would not be
    added. The rail industry would not collapse overnight, but over time
    rail service would become slower, less responsive, and less reliable.
    ---------------------------------------------------------------------------
        \1\ Substituting one product for another in a production process--
    for example, generating electricity from natural gas (which is not
    carried in significant amounts by railroads) instead of coal (which
    is).
        \2\ The ability to obtain the same product from, or ship the same
    product to, a different geographic area. For example, clay is used for
    taconite pelletization in Minnesota. This clay is available from
    Wyoming mines served by one railroad and from Minnesota mines served by
    another. Iron ore producers can play one railroad against the other for
    clay deliveries.
    ---------------------------------------------------------------------------
        It's true that freight railroad financial performance in recent
    years has been better than it once was. However, policymakers should
    not view these improvements as a reason to cap rail earnings through
    price controls or artificial competitive constraints, since it would
    cause capital to flee the industry and severely harm railroads' ability
    to reinvest in their networks.
        Today, our nation faces a number of serious transportation-related
    problems, many of which this Committee, to its credit, is working hard
    to address. It makes no sense to add to that list by trying to fix
    something that isn't broken. The current rail regulatory system is
    working well. At a time when the pressure to reduce government spending
    on just about everything--including transportation infrastructure--is
    enormous, it makes no sense to enact public policies that would
    discourage private investments in rail infrastructure that would boost
    our economy and enhance our competitiveness.
        With respect to FAST Act reauthorization priorities, the freight
    railroad industry supports the following:
    (1) Highway-Rail Grade Crossing Safety
        Reducing accidents and fatalities at highway-rail grade crossings
    is of paramount importance given that most collisions are preventable.
    Engineering solutions (such as closing unneeded crossings and upgrading
    warning devices), education and enforcement are key. Thanks in part to
    the Section 130 federal program, grade crossing collisions are down 37%
    from 2000 to 2018, but much work remains.
          The federal Section 130 program, which provides funds to
    eliminate hazards at highway-rail grade crossings, should continue to
    receive dedicated, formula funding out of the Highway Safety
    Improvement Program.
          Funding for Section 130 should be maintained at least at
    current levels ($245 million in fiscal year 2020) or increased.
          Increase Section 130 incentive payments for grade
    crossing closures from the current cap of $7,500 to $100,000.
          Expand flexibility in the use of Section 130 funds by
    eliminating the arbitrary 50% cap on spending for hazard elimination
    projects and by enabling replacement of certain protective warning
    devices.
          Enable costs by public and private entities incurred for
    preliminary engineering for grade crossing projects to be counted
    toward the non-federal share.
          Enable or incentivize states to bundle grade crossing
    projects into a single grant application under applicable discretionary
    grant programs, such as BUILD, INFRA or CRISI.
          Require or incentivize accelerated deployment of
    navigational warnings for motorists (e.g., smartphone apps) to warn of
    grade crossings.
          Require future fleets of automated vehicles to provide
    grade crossing warnings and/or prevention of incursions into grade
    crossings where gates or other devices have been activated.
          Require grade crossing safety training in driver
    education curricula at NHTSA through recommendations to states.
          Authorize at least $3 million per year for Operation
    Lifesaver through FHWA, FRA and FTA.
    (2) Innovations for Deployment of Safety Technologies
        Freight railroads require a modernized approach to federal
    regulations that allows them to innovate with new technologies and
    processes for an even safer and more efficient rail network. The
    current regulatory approach to rail safety is largely prescriptive and
    does not easily allow for the incorporation of the best technologies to
    improve safety and performance. Safety and efficiency improvements
    should be encouraged by the FRA.
    (3) Project Permitting Reforms
        While much has been done in recent years to cut the red tape
    associated with infrastructure project approval and construction, more
    can be done to fast-track routine maintenance and replacement
    construction projects without sacrificing environmental or historical
    preservation concerns. These include:
          Codify that a categorical exclusion and a Finding of No
    Significant Impact are the only NEPA documentation needed on projects
    where replacement of infrastructure on existing operating railroad
    right-of-way is the purpose.
          Convert select executive orders on streamlining the
    permitting process--such as timeclocks, intermediate deadlines and One
    Decision for large projects--to statute.
          Continue streamlining the Sec. 106 historic preservation
    review process, especially for projects needed to enhance or maintain
    safety.
    (4) Support Funding for Amtrak & Public Partnering with Freight
            Railroads
        The freight railroad industry supports funding for grant programs
    that enable the public sector, including state and local governments
    and passenger and commuter railroads, to partner with freight railroads
    to advance projects of mutual interest, including projects to help
    lessen road and port congestion, enhance safety at highway-rail grade
    crossings, improve port connectivity, facilitate intercity passenger
    and commuter rail service and improve the quality of life for
    communities. The following programs should continue to be authorized at
    existing or increased levels:
          INFRA Discretionary Grants ($1 billion in FY 2020). Caps
    should be upwardly adjusted or removed on multimodal freight
    eligibility in proportion to General Fund contributions to the HTF.
          BUILD Discretionary Grants (not authorized, but typically
    $1 billion appropriated).
          CRISI Discretionary Grants ($330 million in FY 2020).
          Federal-State Partnership for State of Good Repair ($300
    million in FY 2020).
          Funding and authorization for Amtrak and state-supported
    passenger routes.
    (5) Restore the Highway Trust Fund to a True User-Based Fund
        The current underpayment by road users, especially commercial
    trucking, has required a transfer of some $144 billion in General Funds
    to the HTF over the past ten years. Consequently, the rail sector is
    perennially placed at an unfair competitive disadvantage.
          Support mechanisms such as an increase in the gas tax, a
    vehicle miles traveled fee or a weight-distance tax that could help
    remedy this fundamental imbalance.
          Oppose measures to fund the HTF that would increase taxes
    or fees on freight railroads.
          Retain a competitive tax environment for the private
    sector.
    (6) Oppose Policies that Harm Railroads' Ability to Operate Safely and
            Efficiently
        Congress must reject policies that would disadvantage the freight
    railroad industry, the most environmentally friendly way to move
    freight over land. These include:
          Proposals to allow longer and heavier trucks on roads,
    bridges and highways, until, at a minimum, trucks of all legal
    dimensions pay the full cost of the damage that they cause to publicly
    provided infrastructure.
          Mandates requiring specific operating models such as
    railroad crew size.
          Mandates resulting in property takings on railroad rights
    of way for utility or broadband access.
                                   Conclusion
        America's freight railroads are working toward a single goal: to
    ensure that they remain the safest, most efficient, cost-effective, and
    environmentally-sound mode of transportation in the world. They are
    always willing to work cooperatively with you, other policymakers,
    their employees, their customers and all other interested parties to
    advance our shared interests in moving our nation forward with the help
    of our best-in-the-world freight railroads.

        Mr. Lipinski. I thank you, Mr. Jefferies. I am going to go
    back and make sure I say this, because I think I did--I forgot
    to do it: Mr. Jefferies is the president and CEO of the
    Association of American Railroads.
        And I was up here for Ms. Goodchild, so I know I skipped
    that, and Ms. Anne Goodchild is a Ph.D. and founding director,
    Supply Chain Transportation and Logistics Center, University of
    Washington. So I wanted to go back and correct that.
        And I will recognize Mr. Jason Mathers, the director of
    vehicle and freight strategy with the Environmental Defense
    Fund.
        Mr. Mathers, you are recognized.
        Mr. Mathers. Great, thank you, Chair Lipinski, Chair
    Norton, Ranking Members Davis and Crawford, and members of the
    subcommittee for having me here today.
        Now is the time to implement policies that will reduce air
    pollution and set us on a path of net zero carbon emissions by
    2050.
        Earlier this year, the Senate Environment and Public Works
    Committee unanimously approved its version of the highway
    reauthorization bill. And for the first time ever, it included
    a title on climate change. This committee can build on that
    effort in its version, and lock in the certainty needed to
    unleash public and private investment to clean up the
    transportation sector.
        Pollution from freight transportation has pernicious health
    impacts on communities near freight facilities and highways.
    Heavy trucks are, by far, the most significant source of
    freight pollution. Yet reducing pollution from freight movement
    is not primarily a technology matter. It is a matter of
    political will.
        The operational and equipment choices that can drive down
    air pollution are well-known. Many of these are being used
    today to create business value while improving community
    health. With congressional leadership we can make tremendous
    strides in reducing the nearly 11,000 premature deaths annually
    that occur from exposure to freight pollution in this country,
    and put the sector on a path to contribute to 100 percent clean
    economy by 2050.
        A few years back, I authored the ``Green Freight
    Handbook,'' which examined opportunities for freight shippers
    to reduce pollution. This work was based on projects EDF
    undertook with large companies, including Walmart, FedEx, Ocean
    Spray, and Caterpillar, among others. We condensed into three
    broad categories the range of tactics companies can use to
    reduce freight pollution and transportation costs. These are,
    first, get the most out of every move, which is about making
    sure that we use our freight capacity to the fullest; second,
    choosing the most efficient mode of transportation, which is
    about sending goods intermodally, rather than just by truck
    alone; and demand cleaner equipment.
        My testimony has examples of all these categories. I will
    focus now on this last category.
        Zero-emission heavy-duty vehicles are increasingly viable
    for freight. Services these trucks can do today include
    transporting cargo in and out of ports like NFI, one of the
    Nation's largest fleets, is doing today in L.A.-Long Beach;
    moving freight from a distribution center to a retail outlet
    like Penske is doing for a leading quick service restaurant
    chain; positioning trailers within a distribution yard, as
    Kraft is doing in Ohio; and delivering packages to businesses
    and homes, as FedEx is doing.
        We should invest in these trucks with policies that reward
    innovation and recognize the full cost of operating combustion
    engines. Investing in zero-emission trucks is a win-win
    opportunity. Fleets want these trucks, as they can drastically
    reduce fuel spend. Developing the manufacturing capacity for
    these vehicles will support good jobs. And households across
    this country will see lower cost goods.
        Congress can make this investment through policies that
    advance four objectives: first, encourage the production of
    zero-emission heavy-duty vehicles; second, increase the demand
    for these vehicles; third, ensure public expenditures drive
    just and equitable outcomes; and fourth, support the
    development of appropriate charging infrastructure.
        As this committee considers the highway reauthorization, I
    want to provide two specific ideas.
        First, create a commission to develop strategies for
    transitioning drayage trucks, those trucks moving goods in and
    out of ports and rail yards, to zero emission. The work
    performed by these trucks is a great match for the zero-
    emission technology. And given that they typically operate in
    urban environments, these trucks are highly polluting. There
    are unique challenges to move this sector to zero emissions.
    These can be overcome. A Federal commission should be
    established to develop recommendations for fully transitioning
    these vehicles to zero emissions by 2030.
        Second, create a Federal revolving loan fund for the
    purchase and installation of EV charging infrastructure.
    Creating charging systems for trucks remains a barrier.
    Congress could create a fund to help offset costs associated
    with charging equipment, facility upgrades, and the grid
    improvements necessary to power large fleets.
        Thank you for the opportunity to be here today. I look
    forward to your questions.
        [Mr. Mathers' prepared statement follows:]

      Prepared Statement of Jason Mathers, Director, Vehicle and Freight
                      Strategy, Environmental Defense Fund
        Thank you Chair Norton, Chairman Lipinski, Ranking Members Davis
    and Crawford and members of the subcommittees for the opportunity to
    testify today. My name is Jason Mathers. I am the Director of Vehicle
    and Freight Strategy for Environmental Defense Fund. EDF is a leading
    international nonprofit that creates transformational solutions to the
    most serious environmental problems. EDF links science, economics, law
    and innovative private-sector partnerships. With more than 2.5 million
    members and a global staff of 700 scientists, economists, policy
    experts, and other professionals, we're one of the world's largest
    environmental organizations.
                                    Overview
        Now is the time to implement policies that will reduce carbon
    pollution and set us on a path of net-zero carbon emissions economy-
    wide by 2050.
        Earlier this year, the Senate Environment and Public Works
    Committee unanimously approved its version of the Highway
    Reauthorization Bill and for the first time ever it included a title on
    climate change. This was a major step in accepting that the problem is
    real and the title provided some ways to start addressing it. This
    committee can build on that effort in its version and lock in the
    certainty needed to unleash public and private investment in the
    transportation sector, which is the leading source of climate pollution
    in the nation.
        Every mode of freight transportation has a significant pollution
    footprint and pernicious health impacts on communities near freight
    facilities and highways. Yet, reducing pollution from the freight
    movement is not primarily a technology matter. It is a matter of
    political will.
        The operational and equipment choices that can drive down air
    pollutants, including carbon emissions, are well-known. Many are being
    used today to create business value while improving community health
    and climate effects. Others will be ready to scale over just the next
    couple of years. The most significant uncertainty is whether we will
    have the policies in place to reward innovation and recognize the full
    cost of operating combustion engines.
        With Congressional leadership, we can--by the close of this coming
    decade--make tremendous strides in reducing the nearly 11,000 premature
    deaths annually that occur from exposure to freight pollution in this
    country and put the sector on a path to contribute to a 100% clean
    economy by 2050.
        As an environmentalist, father of young children and veteran who
    cares deeply about the future of this country, I urge us to act.
    1. The freight movement has significant impacts on human health and the
            environment.
        In 2015, transportation pollution resulted in 385,000 premature
    deaths globally, with on-road diesel vehicles accounting for half of
    this impact--by far the largest contributor. Collectively, on-road
    diesel accounted for 3.6 million lost years lived and over $450 billion
    in economic damage annually.\1\ In the U.S., international shipping and
    on-road diesel--two modes primarily used for moving freight--accounted
    for nearly 11,000 deaths in 2015. The health impacts of diesel-fueled
    heavy-duty vehicles are concentrated in urban areas, often in
    disadvantaged communities close to major freight hubs like distribution
    centers and port facilities.\2\
    ---------------------------------------------------------------------------
        \1\ Anenberg et al, ``A Global Snapshot of the Air Pollution-
    related Health Impacts of Transportation Sector Emissions in 2010 and
    2015,'' ICCT and Climate & Clean Air Coalition. (2019)
        \2\ Houston, D, Disparities in Exposure to Automobile and Truck
    Traffic and Vehicle Emissions Near the Los Angeles-Long Beach Port
    Complex, Am J Public Health. 2014 January; 104(1): 156-164.
    ---------------------------------------------------------------------------
        EDF has been studying how pollution from fossil-fueled trucks dirty
    our air at a hyper-local level, leading to more asthma, heart attacks
    and premature deaths. New sensor technology is allowing EDF scientists
    to collect data in innovative ways using Google Street View cars and
    dense stationary pollution detection networks. With the help of our
    partners, we are better able to see how changes in air pollution lead
    to harmful health effects that are distributed unevenly.
        Our recent analysis in Oakland, California showed that residents
    living near one particular freeway that is home to much of the city's
    diesel-fueled traffic were exposed to concentrations of black carbon
    (soot) 80% higher than those living near a similar road that had less
    diesel traffic. The more polluted roadway produced 60% more nitrogen
    dioxide--a lung irritating and smog forming gas.
        Combining our Google Street View project data with Kaiser
    Permanente's electronic health records of over 40,000 people in
    Oakland, we found that elderly people living in areas with the most
    elevated traffic-related air pollution had a 40% higher risk of heart
    attack,\3\ compared to elderly people living in places with less
    pollution. This is similar to an individual having a history of
    smoking.
    ---------------------------------------------------------------------------
        \3\ Alexeeffet al, High-resolution mapping of traffic related air
    pollution with Google street view cars and incidence of cardiovascular
    events within neighborhoods in Oakland, CA, Environmental Health (2018)
    17:38
    ---------------------------------------------------------------------------
        EDF also looked at air pollution hotspots near the Port of Oakland
    where diesel-powered ships, trucks and trains transport goods
    throughout California and across the United States.
          At an intersection near the entrance to the port, EDF
    found that black carbon levels were more than three times higher than
    the West Oakland neighborhood average.
          In a West Oakland neighborhood where homes mix with
    industrial facilities and heavy-duty trucks often fill nearby parking
    lots, black carbon concentrations were about twice as high as the
    neighborhood average at certain busy times of the day.
          At a nearby park downwind from a trucking company, air
    monitors found increased pollution exposure for children and adults
    playing soccer, football and baseball.

        We are now undertaking a similar analysis in Houston. The people
    living along the heavily industrialized Houston Ship Channel face
    higher exposure to air pollution than the region at large.
        Freight is a significant--and fast growing--source of climate
    pollution. Globally, the sector is on pace to add four gigatons of
    additional climate pollution per year by 2050. In the U.S., the freight
    sector will emit 535 million metric tons of carbon dioxide emissions in
    2020. This pollution is on pace to increase by another 25 million
    metric tons annually by 2050.\4\
    ---------------------------------------------------------------------------
        \4\ U.S. Energy Information Agency, Annual Energy Outlook, Table
    19. Energy-Related Carbon Dioxide Emissions by End-Use, January 24,
    2019.
    ---------------------------------------------------------------------------
        Within freight, heavy trucks are--by far--the most significant
    source of climate pollution. The phase two EPA greenhouse gas emissions
    standards--originally adopted in 2016 with stringency increases in
    2021, 2024 and 2027--are critical in slowing the growth of emissions
    from this sector. Yet, even with these standards, pollution from
    freight trucks is projected to increase by 40 million metric tons of
    carbon dioxide between 2036 and 2050. We must do more to ensure long-
    term pollution reductions from this sector if we have any hope of
    reining in climate pollution.\5\
    ---------------------------------------------------------------------------
        \5\ U.S. Energy Information Agency, Annual Energy Outlook, Table
    19. Energy-Related Carbon Dioxide Emissions by End-Use, January 24,
    2019.
    ---------------------------------------------------------------------------
    2. Solutions exist today to significantly reduce this impact.
        Heavy-duty trucks require specific focus, as the leading source of
    both local and global air pollutants from freight. Zero-emission heavy-
    duty vehicles are increasingly viable, as evidenced by the surge of
    product announcements over the past two years for parcel delivery
    trucks, urban delivery trucks, yard trucks, and regional trucking. Over
    two dozen truck models are in production or development. All major
    original equipment manufacturers and several new entrants have zero-
    emission offerings (see table 1). Reflecting the industry's interest in
    a cleaner future, Cummins--which has engines in 70% of trucks on the
    U.S. roads--just announced a goal of net-zero emissions in its
    operations and products by 2050.\6\
    ---------------------------------------------------------------------------
        \6\ Gibson, London, Cummins' most ambitious environmental plan yet
    targets net-zero emissions by 2050, Indianapolis Star, November 15,
    2019
    ---------------------------------------------------------------------------
        While we build for a zero-emission future, we must also push for
    further improvements from combustion engine trucks. Reducing emissions
    of nitrogen oxides (NOx)--a precursor to ozone--is critical to
    providing cleaner air for communities and families across the nation.
    NOx emissions standards for heavy-duty vehicles were last issued in
    2001 and implementation was completed in 2010. In the nearly 20 years
    since the last standards were promulgated, technology has continued to
    advance.
        It is also clear that additional reductions in ozone forming NOx
    are needed from the heavy-duty sector. In places like California--where
    much of the state is hard hit by ozone pollution--heavy-duty trucks
    still account for 33% of statewide NOx emissions.\7\
    ---------------------------------------------------------------------------
        \7\ CARB presentation at Board Hearing, ``Update on the Proposed
    Federal Phase 2 GHG and Fuel Efficiency Standards for Medium- and
    Heavy-Duty Vehicles,'' Sacramento, July 23, 2015
    ---------------------------------------------------------------------------
        Developing technologies, together with the improvement of existing
    emissions controls, can provide additional cost-effective, meaningful
    in-use NOx reductions from the nation's heavy-duty fleet.\8\ California
    is researching the technologies needed to reduce NOx significantly.\9\
    Other states recognize the need for further NOx controls.\10\ EPA
    announced a Cleaner Truck Initiative to ``update standards for nitrogen
    oxide (NOx) emissions from highway heavy-duty trucks and engines.''
    \11\ EPA should issue standards that leverages the best technology
    options to reduce NOx emissions and protect human health. The agency
    should fully partner with California's Air Resources Board in this
    effort.
    ---------------------------------------------------------------------------
        \8\ CARB, upcoming ``Draft Technology Assessment: Lower NOx Heavy-
    Duty Diesel Engines.''
        \9\ California Air Resources Board, Staff White Paper: California
    Air Resources Board Staff Current Assessment of the Technical
    Feasibility of Lower NOx Standards and Associated Test Procedures for
    2022 and Subsequent Model Year Medium-Duty and Heavy-Duty Diesel
    Engines, April 2019
        \10\ Marin, Arthur, Statement On the U.S. Environmental Protection
    Agency (EPA) Cleaner Trucks Initiative, Northeast States for
    Coordinated Air Use Management (NESCAUM), November 13, 2018
        \11\ U.S. EPA Press Office, EPA Acting Administrator Wheeler
    Launches Cleaner Trucks Initiative, November 2018.
    ---------------------------------------------------------------------------
        Solutions also exist for international shipping. International
    shipping can meet its target of at least halving its emissions by 2050,
    and can unleash trillions of dollars of investment opportunities in
    sustainable industrial infrastructure--particularly in developing
    countries--by using clean fuel such as ``green'' ammonia, as long as
    the fuel is produced using untapped renewable potential without
    increasing fossil fuel use.\12\ The International Maritime Organization
    (IMO) must act quickly to bring in legally enforceable measures to its
    April 2018 commitment to reduce the sector's greenhouse gas pollution
    by at least 50% by 2050 compared to 2008 levels, and to start reducing
    total emissions.
    ---------------------------------------------------------------------------
        \12\ Ash, N. and Scarbrough, T., `Sailing on solar: Could green
    ammonia decarbonise international shipping?', Environmental Defense
    Fund, London, 2019.
    ---------------------------------------------------------------------------
        Demand for air freight is expected to grow, especially with the
    dramatic increase in package delivery services. At the most local
    level, some shippers are starting to use drones. At the international
    level, the International Civil Aviation Organization (ICAO), the UN
    body that sets standards for international flights, has capped the net
    carbon emissions of these flights at 2020 levels, and adopted a four-
    pillar strategy, including new technologies, operational efficiencies,
    alternative fuels, and a carbon offsetting and reduction system for
    international aviation (``CORSIA''). While considerable work remains to
    be done to ensure that CORSIA is implemented with integrity, it is
    already spurring investment in lower carbon innovation. The aviation
    industry has asked ICAO to adopt a long-term goal for the industry, and
    we respectfully suggest that goal should be zero climate impact by
    2050.
        There are also operational approaches that can reduce emissions
    today. EDF worked with leading companies to document three broad
    opportunities to reduce freight pollution.
        Get more out of every move: We are using only 43% of the capacity
    of our freight trucks on the road today, between empty miles and
    underutilized ones. Capturing just half of this under-utilized capacity
    would cut freight truck emissions by 100 million tons per year and
    reduce expenditures on diesel fuel by more than $30 billion a year.\13\
    ---------------------------------------------------------------------------
        \13\ Russell D. Meller, Kimberly P. Ellis, Bill Loftis ``From
    Horizontal Collaboration to the Physical Internet: Quantifying the
    Effects on Sustainability and Profits When Shifting to Interconnected
    Logistics Systems'' Final Research Report of the CELDi Physical
    Internet Project, Phase I. September 2012.
    ---------------------------------------------------------------------------
        A high profile example of further increasing truck productivity
    comes from Walmart. The company set a goal of doubling its freight
    efficiency between 2005 and 2015. In 2015, the company delivered 1
    billion more cases and drove 460 million fewer miles than in 2005 by
    improving truck loading.\14\
    ---------------------------------------------------------------------------
        \14\ Mathers, Jason, The Fast and the Furious: A Company's Guide to
    Reducing Transportation Emissions, a webinar for the Climate
    Collaborative. June 2017.
    ---------------------------------------------------------------------------
        Colgate and Kimberly-Clark demonstrated how companies can
    collaborate to reduce the number of trucks on the road. The two
    companies pooled trips to CVS. Instead of each sending partially filled
    trucks to CVS, the companies worked to co-load their freight on the
    same trucks. The result was less pollution, fewer trucks and increased
    levels of service for CVS.\15\
    ---------------------------------------------------------------------------
        \15\ Logistics Management, Getting from Me to We: Creating a Shared
    Distribution Infrastructure, June 2014.
    ---------------------------------------------------------------------------
        Choose the most carbon-efficient mode of transportation: Typically,
    the more carbon intensive option for transportation is also the most
    expensive. Air freight emits 47 times more carbon per ton-mile than
    container ships, while costing 6.5 times more.\16\ Because rail is
    about 3.5 times more fuel efficient than trucks, companies can lower
    costs at least 15-20% with intermodal rail based primarily on fuel
    savings.\17\
    ---------------------------------------------------------------------------
        \16\ Simchi-Levi, David, Operations Rules, 2010, Massachusetts
    Institute of Technology.
        \17\ Kane Is Able, Look Who's Riding the Rails, 2013.
    ---------------------------------------------------------------------------
        Ocean Spray was shipping products by truck from a manufacturing
    facility in New Jersey to a Florida distribution center. Both Ocean
    Spray facilities were a short distance from rail yards used by a
    competitor, Tropicana, which shipped orange juice north from Florida in
    special refrigerated boxcars, via CSX Rail. These boxcars often
    traveled empty back to Florida. Tropicana's third party logistics
    provider (3PL) saw an opportunity for collaboration and proposed that
    Ocean Spray operate an intermodal lane from New Jersey to Florida that
    would put Tropicana's empty cars to use. By going from truck to rail
    and taking advantage of ready rail capacity, Ocean Spray cut
    transportation costs more than 40% for that lane and reduced greenhouse
    gas emissions by 65%.\18\
    ---------------------------------------------------------------------------
        \18\ Bradley, Peter, Collaboration bears fruit, DC Velocity, May
    2013.
    ---------------------------------------------------------------------------
        Demand cleaner equipment: Companies using freight services have a
    responsibility to push for the cleanest equipment available.
        Anheuser-Busch is deploying 21 Class 8 battery-electric trucks. It
    is also testing Class 8 fuel cell trucks.\19\ The company set a goal to
    convert its long-haul dedicated fleet to renewable powered trucks by
    2025.\20\
    ---------------------------------------------------------------------------
        \19\ Transport Topics, Anheuser-Busch, Nikola, BYD Complete First
    Zero-Emission Beer Run, November 21, 2019.
        \20\ ABInBev, Climate Action: Anheuser-Busch Drives Leadership in
    Clean Energy, February 14, 2016
    ---------------------------------------------------------------------------
        IKEA is insisting on zero-emission home deliveries from its
    carriers. In 2020, it will demonstrate this model in five cities and
    expand it globally by 2025.\21\
    ---------------------------------------------------------------------------
        \21\ Peters, Adele, Ikea is quickly shifting to a zero-emissions
    delivery fleet, Fast Company, September 2018.
    ---------------------------------------------------------------------------
    3. The United States of America would benefit by immediately adopting
            these solutions
        By leading a transition to a freight industry that supports a 100%
    clean economy, the U.S. will be well positioned to retain and expand
    manufacturing jobs. Automotive manufacturing employs a million U.S.
    workers.\22\ These jobs occur across the country \23\ and support both
    the domestic and export market. Manufacturing zero-emission heavy-duty
    vehicles can provide good paying, union jobs.\24\
    ---------------------------------------------------------------------------
        \22\ U.S. Bureau of Labor Statistics, Automotive Industry:
    Employment, Earnings, and Hours, September 2019
        \23\ BlueGreen Alliance, VISUALIZING THE CLEAN ECONOMY: THE
    AUTOMOTIVE SECTOR.
        \24\ Dean, S., Unionizing L.A. bus workers and their CEO come
    together over fighting climate change, Los Angeles Times, Nov 2019
    ---------------------------------------------------------------------------
        Global markets will see much of the growth in truck fleets in the
    decade ahead.\25\ If the U.S. invests in developing zero-emission
    trucks, our manufacturers will be well positioned to serve these
    markets. Conversely, failure to invest in these trucks risks
    disadvantaging U.S. manufacturers in the global marketplace where other
    markets--notably China and Europe--are already investing in their
    domestic manufacturing capacity for zero-emission heavy-duty vehicles.
    ---------------------------------------------------------------------------
        \25\ McKinsey & Company, ``ROUTE 2030--A Regional View of Truck
    Industry Profit Pools,'' (2018)
    ---------------------------------------------------------------------------
        In addition to reducing healthcare costs associated with diesel
    pollution, an investment in zero-emission trucks will help cut costs
    for families. The average U.S. household spends $1,100 a year to fuel
    heavy-duty trucks,\26\ which are paid through higher prices at the
    store. Zero-emission trucks will significantly reduce fuel costs, while
    also lowering the total cost of ownership.\27\
    ---------------------------------------------------------------------------
        \26\ Cooper, Mark, PAYING THE FREIGHT: THE CONSUMER BENEFITS OF
    INCREASING THE FUEL ECONOMY OF MEDIUM AND HEAVY DUTY TRUCKS, Consumer
    Federation of America, August 2015
        \27\ California Air Resources Board, Advanced Clean Trucks Total
    Cost of Ownership Discussion Document Preliminary Draft for Comment,
    February 2019.
    ---------------------------------------------------------------------------
    4. The U.S. Congress should pass policies that increase the adoption of
            these solutions today and invest in the development of
            solutions that can further drive progress over the next decade.
        Given the outsized pollution impact of trucking, I will focus my
    recommendations on this sector and outline how the U.S. Government can
    help accelerate a transition to a net-zero emissions future.
        Despite the recent zero-emission truck product announcements, the
    pace of progress remains much too slow. At our current pace of
    adoption, diesel trucks will still account for more than half of the
    trucks on the road in 2050.\28\ Federal policy leadership will be
    critical to accelerate the uptake of zero-emission vehicles, which
    would drive down carbon emissions; reduce air pollution, especially in
    urban communities; and strengthen a cornerstone manufacturing base that
    provides well-paying jobs. EDF urges Congress to enact policies that
    ensure zero emission vehicles account for at least 30% of new heavy-
    duty vehicles sales nationally by 2030.
    ---------------------------------------------------------------------------
        \28\ EDF analysis: Extrapolated annual market growth rates
    Bloomberg New Energy Finance projected for each sector in its 2019 EV
    Outlook report. EDF assumed 12 year turn over cycle and that the 2050
    fleet volumes per sector reflect 2019 mix.
    ---------------------------------------------------------------------------
        A well-designed policy can advance four objectives that
    collectively will determine the impact and pace of adoption for zero
    emission trucks. These objectives are:
          Encourage the production of zero-emission heavy-duty
    vehicles.
          Increase the demand for zero-emission heavy-duty
    vehicles.
          Ensure public expenditures drive just and equitable
    outcomes.
          Support the development of appropriate charging
    infrastructure.
                Encourage the production of zero-emission heavy-duty
                        vehicles.
        Policy can create the long-term certainty necessary to stimulate
    production investments from truck manufacturers and component
    suppliers. The federal government also has an important role in
    catalyzing the development and scaling of advanced technology solutions
    through robust R&D investments. To advance this objective, the U.S.
    Congress could:
          Launch a heavy-duty version of the Advanced Technology
    Vehicles Manufacturing Direct Loan Program. Through this program, the
    U.S. Government provided direct loans for light-duty vehicle
    manufacturers to produce fuel efficient cars. This program supported
    the production of over 4 million advanced technology vehicles and
    invested $8 billion into American auto manufacturing. A similar program
    would enable manufacturers to expedite bringing ZEV trucks to market.
          Increase and expand R&D funding for heavy-duty vehicle
    technologies. Through the DOE Office of Energy Efficiency and Renewable
    Energy, the U.S. Government supports critical research into advanced
    vehicle technology. The Super Truck program, for example, has played a
    critical role in accelerating the introduction of vehicle efficiency
    solutions. Increased funding could be targeted at technology
    advancements such as enhancing charging systems and advancing battery
    design to enable lighter, more energy-dense and lower-cost batteries.

        Additionally, the U.S. EPA should strengthen emission standards for
    heavy-duty vehicles. The EPA regulates greenhouse gas and criteria
    emissions from heavy-duty vehicles. The current GHG program standards
    increase in 2021, 2024 and 2027. However, criteria emissions standards
    have not changed since 2010. Technology advancements, including the
    emergence of zero-emission solutions, necessitate a significant
    strengthening of this program.
                Increase the demand for zero-emission heavy-duty vehicles.
        Another critical policy lever is to bolster market demand for these
    vehicles. To advance this objective, the U.S. Congress could:
          Expand the Low or No Emission Vehicle Program. Transit
    buses are largely purchased with funding contributions from DOT's
    Federal Transit Administration (FTA). FTA's Low or No Emission Vehicle
    Program provides competitive grants for state and local governments to
    purchase zero- and low emission transit buses and infrastructure. Given
    that electric buses are a viable option for much of the nation's fleet
    and will further expand their appeal as battery costs continue to fall,
    this program should be expanded significantly.
          Pass the Green Bus Act. EDF supports the Green Bus Act,
    introduced by Rep. Brownley, which would increase the funding for this
    program from $85 million in 2019 to $900 million in 2029 and require
    all new transit buses to be zero-emission by 2029.
          Expand the Diesel Emissions Reduction Act (DERA). DERA,
    which was first enacted in 2010, funded a highly popular and bipartisan
    set of projects that protect human health and improve air quality by
    curbing diesel emissions. It is currently funded at $75 million a year.
    A significant increase in this program to support the replacement of
    old diesel vehicles with ZEVs could help increase fleet turnover and
    get more ZEVs on the road as quickly as possible.
          Suspend the federal excise tax on zero-emission trucks.
    New heavy-duty trucks pay a 12% federal excise tax to provide funding
    for the Highway Trust Fund. This tax is based on the purchase price of
    the vehicle and therefore exacerbates the upfront cost discrepancy
    between diesel and ZEV vehicles, as the more advanced technology in
    ZEVs--which leads to significantly lower operating costs--currently
    results in higher upfront costs than diesel vehicles. Policymakers
    should waive this tax for ZEVs through the mid-2020s, when the upfront
    cost of diesel vehicles and ZEVs are expected to start converging.
          Enact the Clean School Bus Act. Introduced in both the
    House (Rep. Hayes) and the Senate (Sen. Harris), the Clean School Bus
    Act would authorize $1 billion over five years at the Department of
    Energy to fund a Clean School Bus Grant Program, which would award
    funding on a competitive basis to replace existing school buses with
    ZEV models. Several manufacturers are already producing quality ZEV
    buses, including Thomas and Blue Bird. EDF encourages these policies
    because the electrification of these vehicles will help reduce
    children's exposure to harmful diesel emissions while reducing GHG
    emissions.
                Ensure public expenditures drive just and equitable
                        outcomes.
        The pernicious health impacts of diesel trucks disproportionately
    impact low-income communities and communities of color. Policies should
    prioritize replacing combustion vehicles with ZEVs in these
    communities. To advance this objective, the U.S. Congress could:
          Prioritize deployments of ZEVs within front-line
    communities. Grant programs that support the adoption of ZEVs, such as
    the Low/No Emissions Vehicle Emission program for transit buses and the
    DERA should give preference to vehicle deployments within highly
    impacted communities.
          Create a commission to develop strategies for
    transitioning drayage trucks to ZEVs. Drayage trucks--which transport
    goods over short distances, for example, hauling cargo in and out of
    ports and rail yards--are often old and poorly maintained. The low-
    speed, high idling operation of these vehicles exacerbates the
    shortcomings of diesel emission control equipment. These vehicles also
    operate in densely populated areas. The combination of these factors
    results in drayage trucks being a significant contributor to poor air
    quality in numerous major metro areas. ZEV demonstrations are currently
    underway, but while the technology is ready, several systemic barriers
    remain to the wide-scale adoption of ZEVs for drayage. These include
    the lack of charging infrastructure to serve drayage drivers and few
    financing options for drayage operators seeking ZEVs. Given that the
    performance requirements of drayage operations pair well with the EV
    drivetrain, and the urgent need to drive down pollution around ports
    and rail yards, a federal commission should be established to develop
    recommendations for transitioning these vehicles to zero emissions by
    2030.
                Support the development of appropriate charging
                        infrastructure.
        A well-developed charging network is essential to accommodating
    large-scale deployments of electric vehicles of all kinds. This
    infrastructure should be deployed to effectively alleviate range
    anxiety, mitigate expensive, unnecessary grid upgrades, and facilitate
    greater integration of renewable energy. To achieve a robust charging
    network, Congress should direct the Department of Transportation (DOT)
    and the Department of Energy (DOE) to work with states to define a
    comprehensive national EV charging infrastructure plan. Such a plan
    should, among other things, detail how Congress should:
          Create a grant program to help states and municipalities
    develop and implement charging programs. Provide technical assistance
    to states regarding technology choices, purchasing practices,
    infrastructure options and siting.
          Create a grant program to incentivize commercial fleet
    operators and owners of large, non-government-owned parking facilities,
    to install charging stations.
          Create tax incentives for private companies to develop
    employee and customer charging opportunities. Reward companies that tie
    their charging networks to renewables, local storage, and utility
    providers' demand response programs.
          Create a federal revolving loan fund for the purchase and
    installation of EV charging infrastructure. Such a fund could be
    targeted at state and local governments and multijurisdictional transit
    agencies. Separate portions of the funds should be dedicated to
    creating infrastructure designed for use by light-duty and by heavy-
    duty vehicles. Large trucks and buses will have significantly different
    charging patterns than light-duty vehicles. These vehicles will have
    larger batteries, use most of their capacity daily and be mainly
    recharged at centralized facilities while also using some opportunity
    charging during their daily operations. Providing infrastructure funds
    specifically for this class of vehicle would help offset costs
    associated with charging equipment, facility upgrades and grid
    improvements necessary to power large fleets.
          Research, develop and fund best practices for depot
    charging. Given their distinct needs and patterns from light-duty
    vehicles, heavy-duty vehicles would benefit from dedicated research
    into how to manage their charging load. DOE should identify
    opportunities for heavy-duty vehicle electrification through a report
    similar in scope to the National Plug-In Electric Vehicle
    Infrastructure Analysis it conducted in September 2017. DOE should then
    make grants available to realize the opportunities identified in that
    report.
          Enact an investment tax credit for large-scale storage.
    Opportunities to enhance the use of renewables-based charging and to
    facilitate and encourage grid integration can be multiplied
    exponentially if Congress were to increase incentives for the
    deployment of large-scale storage. The goal would be to develop and
    advance--in Congress and in willing states--policies to achieve
    additional emissions reductions through the integration of electric
    charging infrastructure with local grids. Such initiatives would focus
    on policies that:
            Encourage the use of renewable energy and storage
    solutions to power charging stations. This work is a critical component
    of ensuring that electrification actually delivers the maximum
    potential emissions reductions.
            Demonstrate the use of smart charging infrastructure,
    storage and EV batteries to reduce utility grid impact through advanced
    services such as time-of-use rates, as well as balancing and ancillary
    services using ``virtual power plants.'' Leveraging the flexibility in
    these technologies can provide significant additional emissions
    reductions by, for example, alleviating the need for fossil fuel based
    short duration generation.
                                   Conclusion
        Reducing pollution from the transportation sector presents a
    significant challenge for the U.S. and the world. However, EDF's work,
    and that of our partners and colleagues in the private sector,
    universities and research centers underscore that the solutions--most
    notably the electrification of heavy-duty vehicles--are cost-effective
    and technologically feasible. While freight is a major source of air
    pollution, solutions are at hand, and Congress should act to provide
    the needed support to make the transportation sector a part of a 100%
    clean economy. Doing so will help bolster our manufacturing base,
    create jobs, and position the U.S. to export solutions globally, while
    equitably reducing health impacts to communities and showing global
    leadership in fighting climate change. The Senate took the first step
    by including a climate title in its highway reauthorization bill. Now
    the House can build on that foundation to create investment certainty
    for businesses, towns, states and the federal government.

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Mr. Lipinski. Thank you, Mr. Mathers.
        I now recognize Mr. Jim Tymon, executive director, American
    Association of State Highway and Transportation Officials.
        Mr. Tymon, you are recognized.
        Mr. Tymon. Thank you. Chair Norton, Chairman Lipinski,
    Ranking Member Davis, Ranking Member Crawford, and members of
    the subcommittee, thank you for the opportunity to provide the
    perspective of the Nation's State departments of transportation
    on freight transportation.
        My name is Jim Tymon, and I serve as the executive director
    of the American Association of State Highway and Transportation
    Officials. And it is my honor to testify on behalf of AASHTO's
    membership, comprising the State departments of transportation
    for all 50 States, Washington, DC, and Puerto Rico.
        My remarks today center around the following key points:
    importance of freight transportation in the context of surface
    transportation reauthorization; AASHTO's core principles for
    reauthorization, including freight, Federal freight policy, and
    specific freight policy recommendations for the next surface
    transportation bill.
        State DOTs strive to deliver the most effective and
    efficient surface transportation system that strengthens and
    grows the economy. It is the interconnected national multimodal
    transportation system, with States as a principal owner and
    operator of that system, that has enabled the United States to
    become the most vibrant and powerful Nation in history. To that
    end, we strongly support your efforts to enact a well-funded,
    multiyear, surface transportation reauthorization bill prior to
    the expiration of the FAST Act on September 30th, 2020.
        Nearly 2 years ago, AASHTO began soliciting input from
    policy experts in all 50 States on surface transportation
    reauthorization. Based on this membership-driven approach, I
    would like to share with you our core policy principles.
        First, ensure timely reauthorization of a long-term Federal
    surface transportation bill. Getting the next bill completed on
    time will ensure uninterrupted investment in our freight
    transportation infrastructure, which, in turn, will enable us
    to build on the current economic expansion.
        Second, enact a long-term, sustainable revenue solution for
    the Highway Trust Fund. Our current funding challenges demand
    bold action to invest in our transportation infrastructure.
    This action has the clear support of the American public, and
    it is time for the President and Congress to make it happen.
        Third, increase and prioritize formula-based Federal
    funding provided to the States. In the next reauthorization, we
    urge you to focus on maximizing Federal formula-based dollars
    provided directly to States through the existing highway core
    formula programs. Efficient goods movement nationwide is
    dependent on the Interstate Highway System and the National
    Highway System. Many of these facilities are over 50 years old,
    and nearing the end of their useful life. States rely on these
    formula dollars to keep these assets in a state of good repair.
    The next bill should continue to provide 90 percent of highway
    funding to States by formulas, so that States can continue to
    provide an efficient system for the movement of people and
    freight.
        Fourth, we ask that you increase flexibility, reduce
    program burdens, and improve project delivery. We recommend
    increased flexibility of and transferability between the
    various Federal programs to enable States to target their
    scarce resources toward the most beneficial freight programs
    and projects. Transportation priorities here in the District of
    Columbia are different from the priorities in rural Arkansas,
    and we should continue to provide States the program-level
    flexibility to use Federal dollars as efficiently as possible.
    In addition, assigning more decisionmaking authority to the
    States and cutting unnecessary redtape will help these projects
    get built faster.
        Fifth, support and ensure State DOTs' ability to harness
    innovation and technology. Specifically, we need to preserve
    the 5.9 gigahertz spectrum for transportation, safety, and
    connectivity purposes. For example, a U.S. DOT-funded connected
    vehicle pilot program on I-80 in Wyoming has used the spectrum
    to improve snow-related incident management in the corridor
    that carries 55 percent of all traffic in that State.
        In addition to these core principles, we recommend in the
    next bill that you expand eligibility to use Federal freight
    program dollars on any portion of a State's multimodal freight
    network, as defined in the State's freight plan; increase FAST
    Act freight funding caps for multimodal projects; reinstate
    additional funding for the National Cooperative Freight
    Research Program; and help identify ways to improve
    coordination between States and railroad partners.
        State DOTs remain committed to assisting Congress in the
    development of the next surface transportation legislation that
    further enables freight transportation to improve our quality
    of life and grow the economy.
        I want to thank you again for the opportunity to testify
    today, and I am happy to answer any questions that you may
    have.
        [Mr. Tymon's prepared statement follows:]

         Prepared Statement of Jim Tymon, Executive Director, American
           Association of State Highway and Transportation Officials
                                  Introduction
        Chair Norton, Chairman Lipinski, Ranking Member Davis, Ranking
    Member Crawford, and Members of the Subcommittees, thank you for the
    opportunity to provide the perspective of the nation's state
    departments of transportation on economic, environmental, and societal
    impacts of freight transportation.
        My name is Jim Tymon, and I serve as Executive Director of the
    American Association of State Highway and Transportation Officials
    (AASHTO). Today it is my honor to testify on behalf of AASHTO, which
    represents the transportation departments of all 50 States, Washington,
    DC, and Puerto Rico.
        In my role, I oversee a staff of 120 dedicated professionals who
    support our state departments of transportation (state DOT) members in
    the development of transportation solutions that create economic
    prosperity, enhance quality of life, and improve transportation safety
    in communities, states, and the nation as a whole. Before, I was
    AASHTO's Chief Operating Officer and the Director of Policy and
    Management from 2013 to 2018, working closely with state DOTs in the
    development of AASHTO's transportation policy positions and overseeing
    the monitoring of legislative, administrative, and regulatory
    activities relating to transportation; as AASHTO's COO, I also oversaw
    the management of the Association's internal operations. Prior to
    AASHTO, I had the great honor to serve as a staff director of the
    Highways and Transit Subcommittee, working on both MAP-21 and SAFETEA-
    LU.
        We appreciate your Subcommittees' focus on the topic of freight
    today because we share your recognition that the benefits of freight
    transportation to the economy are enormous. Freight transportation
    increases the value of goods by moving them to locations where they
    worth more. And it also encourages competition and production by
    expanding the spatial boundaries of commodity and labor markets where
    economic activities can take place. Freight transportation also
    facilitates the growing demand for goods and services and employs
    millions of people. Simply put, freight transportation and the
    infrastructure needed to support it is a significant component of our
    nation's wealth and productive capacity.
        My remarks today center around the following key points:
          Importance of freight transportation in the context of
    surface transportation reauthorization
          Core principles for reauthorization including federal
    freight policy
          Specific freight policy recommendations in the next
    surface transportation bill
        Importance of Freight Transportation in the Context of Surface
                         Transportation Reauthorization
        From the very beginning of our developing nation, we have valued
    investment in our freight transportation infrastructure, starting with
    rivers, harbors, and post roads, and later taking major leaps through
    canals, the transcontinental railroad, and the Interstate Highway
    System.
        Built on this national heritage of transportation investment, state
    DOTs strive to deliver the most effective and efficient surface
    transportation system that strengthens and grows the economy by
    increasing productivity, enhancing jobs and labor market accessibility,
    opening new markets for businesses, and optimizing supply chain
    efficiency for freight movement. It is this interconnected national
    transportation system--with states as a principal owner and operator of
    a multimodal surface transportation infrastructure system--that has
    enabled the United States to become the most vibrant and powerful
    nation in history.
        As such, AASHTO's vision for policy recommendations are founded
    upon transportation serving as the key enabler for a higher purpose: to
    provide the safest system possible, highest possible quality of life,
    and most robust economic opportunities for everyone. And we strongly
    support your efforts to enact a well-funded, multiyear surface
    transportation reauthorization on time by September 30, 2020. We
    believe given the strong bipartisan support from the American public
    for robust infrastructure investment, it is time for the President and
    Congress to take bold action on this consensus national priority.
      Core Principles for Reauthorization Including Federal Freight Policy
        Over the past two years, our state DOT experts engaged in a bottom-
    up policy development process that resulted in our comprehensive
    package of reauthorization recommendations, which was adopted by our
    Board of Directors in October. Based on our members' extensive work, I
    would like to share with you the following ``core principles,'' which
    we believe sets the appropriate federal framework, including for
    national freight transportation policy.
    1. Ensure timely reauthorization of a long-term federal surface
            transportation bill
          Funding stability provided by federal transportation
    programs is absolutely crucial to meet states' capital investment
    needs, which take multiple years to plan and construct.
          A long-term transportation bill is needed so that there
    is no authorization gap upon FAST Act expiration in September 2020.
    Short-term program extensions cause unnecessary program disruptions and
    delays safety and mobility benefits to states and communities.

        Our state DOT members do everything in their power to deliver
    needed priority projects to improve freight movement as quickly as
    possible, but due to the nature of large capital programs, including an
    extensive regulatory process, many of the projects take several years
    to complete. The lack of stable, predictable funding from the Highway
    Trust Fund makes it nearly impossible for state DOTs to plan for large
    projects that need a reliable flow of funding over multiple years. And
    these projects are what connect people, enhance quality of life, and
    stimulate economic growth in each community where they are built.
        Getting the next long-term surface reauthorization completed on
    time will ensure uninterrupted investment in our freight transportation
    infrastructure, which in turn will enable our nation to continue
    building on the current economic expansion.
    2. Enact a long-term, sustainable revenue solution for the Highway
            Trust Fund
          Ensuring Highway Trust Fund solvency in supporting a six-
    year federal surface transportation bill that simply maintains current
    FAST Act funding levels, will require approximately $100 billion in
    additional revenues for the Highway Trust Fund.
          To achieve a state of good repair, USDOT's 2015
    Conditions and Performance Report estimates highway and bridge needs at
    $836 billion and transit needs at $90 billion, which would require
    significant additional investment.
          Federal funding solutions can draw upon the experience of
    31 states that have successfully enacted transportation revenue
    packages since 2012.

        Despite substantial and recurring funding challenges facing our
    transportation system, the investment backlog for transportation
    infrastructure continues to increase--reaching $836 billion for
    highways and bridges and $90 billion for transit according to the
    United States Department of Transportation. According to the
    Congressional Budget Office, in order to simply maintain the current
    Highway Trust Fund (HTF) spending levels adjusted for inflation after
    the Fixing America's Surface Transportation (FAST) Act, Congress will
    need to identify $100 billion in additional revenues for a six-year
    bill through 2026. At the same time, the purchasing power of HTF
    revenues has declined substantially mainly due to the flat, per-gallon
    motor fuel taxes that have not been adjusted since 1993, losing over
    half of its value in the last 26 years.
        Fortunately, infrastructure investment has been one of the top
    national policy agenda items for both Congress and the American people
    over these last few years, even if significant action is yet to be
    taken at the federal level. Americans get it--they understand the
    benefits, and they want to see investment in our transportation
    systems. According to a Politico and Harvard poll earlier this year, 79
    percent of respondents said that infrastructure investment is,
    ``extremely important,'' falling just behind lowering prescription drug
    prices and substantially reducing the federal deficit on the list of
    issues polled.
        Infrastructure investment ranks high for both parties, with 88
    percent of Democrats and 81 percent of Republicans surveyed calling it,
    ``extremely important.'' A crucial step we can take to harness this
    momentum is to complete the FAST Act reauthorization before October
    2020 without relying on any short-term extensions. We believe this
    truly is a unique window of opportunity to ensure the continued quality
    of life and economic vitality that make America a nation we are proud
    to call home. To do this, the situation demands bold action to invest
    in our transportation infrastructure at the appropriate level to
    guarantee the success of our nation's future. This action has the clear
    support of the American public, and it is time for the President and
    Congress to make it happen.
    3. Increase and prioritize formula-based federal funding provided to
            states
          The current federal highway program optimally balances
    national goals with state and local decision-making.
          Formula-based transportation funding reflects the
    successful federal-state partnership by ensuring the flexibility
    necessary for each state to best meet its unique investment needs.
          Congress should increase the formula-based program's
    share of the Federal-aid Highway Program from 92 percent currently in
    the FAST Act.

        The heart and soul of the Federal-aid Highway Program are the
    formula dollars supporting state and local investment decisions. This
    nation-building program, starting with the Federal-aid Road Act of
    1916, established the foundation of a federally-funded, state-
    administered highway program, and has been perfectly suited to a
    growing and geographically diverse nation like ours. The stable federal
    investment enabled by the Highway Trust Fund has allowed states and
    their local partners to fund locally critical projects that at the same
    time serve the interests of the nation as a whole.
        As the full Committee unveils your reauthorization bill early next
    year, we urge you to focus on maximizing federal formula-based dollars
    provided directly to states though the existing core formula programs
    rather than looking at untested new programs and approaches that can
    divert the federal government's focus and role in the surface
    transportation program.
        Congress recognized in the MAP-21 legislation the need to
    consolidate a complex array of federal highway programs into a smaller
    number of broader programs, with the eligibilities generally continuing
    under such programs. This revised program structure was continued in
    the FAST Act and it has provided state DOTs with greater flexibility to
    deliver projects--including key freight projects--more efficiently, and
    it better supports data-driven investment decisions to meet national
    performance targets.
        Efficient goods movement nationwide has especially benefited from
    the formula-based program framework that built the Interstate Highway
    System and the National Highway System, the backbone of our national
    network of roads and bridges that drives our national economy. This
    remains the optimal approach to underpin the next surface
    transportation legislation that will serve all corners of our country--
    by improving mobility and quality of life in urban, suburban, and rural
    areas.
    4. Increase flexibility, reduce program burdens, and improve project
            delivery
          Increase programmatic and funding flexibility to plan,
    design, construct and operate the surface transportation system.
          Reduce regulatory and programmatic burdens associated
    with federal programs that are not part of the project approval
    process.
          Modernize Clean Water Act, Clean Air Act, and Endangered
    Species Act processes to improve transportation and environmental
    outcomes and reduce delays.
          To streamline and improve project delivery, states should
    be provided with opportunities to assume more federal responsibilities
    and the associated accountability.

        As mentioned earlier, state DOTs are appreciative of the
    flexibility in the federal program that supports the right mix of
    projects to meet the unique investment needs of their own states. To
    further enhance the effectiveness of federal funding, we recommend
    increased flexibility of and transferability between the various
    federal programs, which will better enable states to target their
    scarce resources into the most beneficial freight programs and
    projects.
        Each program has rules that are not always flexible regarding how
    the funds may be used, and each program is governed by transferability
    provisions that are established in statute. Specifically, because some
    set-aside programs have strict guidelines for use or narrow purposes,
    these programs tend to be underutilized. Yet limitations in the
    flexibility of set-aside programs prevent states from prioritizing
    projects based on local needs, as well as limiting the ability of state
    DOTs to maximize the use of available funding if a partner is not ready
    to begin a set-aside project.
        In addition, given the difficulties that local transportation
    partners face in obligating federal fund, we can further improve the
    efficiency of how limited federal transportation dollars are put to
    work under the suballocated portion of the Surface Transportation Block
    Grant Program (STBGP). The latest available data shows that 80 percent
    of total unobligated STBGP funds nationwide belong to the suballocated
    STBGP even though it comprises 54 percent of total STBGP funding in
    2019, rising to 55 percent next year. Increased program-level
    flexibility for STBGP would enable state and local governments to
    target funding to better meet their needs, whether for preservation,
    capacity, safety, or other unmet needs.
        With regard to project delivery, even with significant progress
    being made in the past decade, getting the projects done--especially
    larger improvements--still takes too long and is unduly costly and
    delay-prone. We believe there remain opportunities to not only make
    continued improvement in the National Environmental Policy Act (NEPA)
    process itself, but also in making the NEPA process work more
    efficiently with other federal requirements, all the while carefully
    and responsibly stewarding optimal environmental outcomes.
        Beyond NEPA, AASHTO has identified a number of touchpoints where
    states can make determinations in lieu of seeking Federal Highway
    Administration (FHWA) approval. Examples include: federal funds
    obligation management, project agreements, right-of-way acquisition,
    preventive maintenance, repayment of preliminary engineering and right-
    of-way costs, and credits toward non-federal share, among many other
    possible areas of current federal oversight.
    5. Support and ensure state DOT's ability to harness innovation and
            technology
          Innovative approaches and technologies should be embraced
    to achieve a safer and more resilient, efficient and secure surface
    transportation system.
          State DOTs, as infrastructure owners and operators, need
    the 5.9 GHz spectrum for transportation safety and connected vehicle
    deployment purposes.
          Preserve state and local government authority to regulate
    operational safety of autonomous vehicles.
          Preserve state and local government authority to
    responsibly manage data collected from transportation technologies.

        Today, the dramatic technological change underway within the
    transportation arena is no less significant than when the combustion
    engine was merged with the wagon in the early 1900s. Today, with the
    merger of technology between the car, truck and other vehicles--and
    with the roadway itself--we will enable unprecedented improvements to
    safety and mobility. This will change the way we move goods, services
    and people on our roads and highways. It is more important now than
    ever that we respect the roles at local, state and federal levels and
    work hard to develop a shared vision of this transportation future in
    order not to be a bottleneck to continued innovation.
        The top priority for the state DOTs and AASHTO has been--and will
    always remain--the safety of all transportation system users. The loss
    of 36,750 lives last year on our nation's highways and streets demands
    that we act boldly. To this end, connected vehicles (CV) utilizing
    Vehicle-to-Everything (V2X) communication in the 5.9 GHz spectrum will
    save lives by creating a seamless, cooperative environment that
    significantly improves the safety of our transportation system. This
    dedicated spectrum is currently at risk due to proposed action by the
    Federal Communications Commission next week to take away more than half
    of the safety band away from transportation safety and connectivity
    purposes.
        The FCC's proposed action would put great progress, such as what we
    recently saw in Wyoming, at risk. To improve safety along the 402 miles
    of Interstate 80, the Wyoming Department of Transportation implemented
    a USDOT pilot program using DSRC-enabled technology to connect vehicles
    to infrastructure and to other vehicles. This corridor along the
    southern section of Wyoming is prone to winter crashes affecting both
    commercial and private vehicles. It is subjected to some of the most
    extreme winter weather conditions--especially blowing snow and vehicle
    blow overs--of any highway on the Interstate Highway System. From
    October 2015 to September 2016, more than 1,600 crashes occurred on I-
    80 in Wyoming, resulting in 18 fatalities and 271 injuries. During this
    period, all or parts of I-80 were closed to all vehicles for a total of
    over 1,500 hours--impacting not only travelers but also the trucks that
    make up roughly 55 percent of the state's total annual traffic stream
    and carry more than 32 million tons of freight across the state each
    year.
        The Wyoming pilot program tested applications, such as advanced
    forward collision warnings, to let travelers know of crashes ahead. It
    also provided immediate situational awareness warnings about weather
    alerts, speed restrictions, and parking availability; detailed and
    current work zone warnings; specialized spot weather impact warnings
    for ice, fog, and other hazards; and notifications from disabled
    vehicles. Other sites under the federal pilot program looked at hot,
    humid weather (Tampa, Florida) and congestion (New Jersey/New York
    City) applications.
        We recognize that oversight of communications technology may lie
    outside of your Committee's jurisdiction--but it is important to
    understand how the FCC's decision could impact the transportation
    sector and the policy priorities of this Committee. So we very much
    appreciate your willingness to stand with the state DOTs to make sure
    that our nation's highway infrastructure assets are provided the
    necessary technology to greatly improve safety outcomes for all users.
          Specific Freight Policy Recommendations in the Next Surface
                              Transportation Bill
        Based on the extensive input from the freight policy experts at our
    state DOTs, the following are the specific recommendations we would
    like to make in the next bill.
    Expand the Extent of both the Primary Highway Freight System and
            National Multimodal Freight Network
        The current definition and limitations of the Primary Highway
    Freight System (PHFS), National Highway Freight Network (NHFN) and the
    National Multimodal Freight Network (NMFN) will not allow states to
    attain the comprehensive goals set forth in MAP-21 and the FAST Act and
    do not take into account the geographic and economic differences in
    states, including the challenges of rural, large, land-based states and
    other concerns of states.
        The PHFS network currently consists of 41,518 centerline miles,
    including 37,436 centerline miles of Interstate and 4,082 centerline
    miles of non-Interstate roads. The designation of PHFS roads in various
    states has resulted in a limited and disconnected network. The ability
    of a state to designate some additional mileage to the NHFN as critical
    urban and rural corridors still leaves an unduly limited and
    disconnected network. For the NMFN, the current draft network is
    limited and does not include all of the National Highway System (NHS)
    roads nor critical rural and urban transportation links.
        Since states are required to complete state freight plans, which
    must then be approved by USDOT, a framework exists to identify and
    define the appropriate freight network in any given state.
        We recommend the following changes:
          Expand eligibility of the National Highway Freight
    Program to include all of the NHFN. Eliminate the 2 percdent rule so
    states can spend funds on any NHFN route (to include Critical Urban
    Freight Corridors and Critical Rural Freight Corridors).
          Expand the PHFS to include all Interstate System roadways
    regardless of how much freight funding a state receives. Given that the
    Interstate System is just that--a system--a fragmented designation of
    the Interstate System is not appropriate to addressing freight
    transportation and goods movement. Freight program eligibility should
    include all Interstate miles by default.
          Remove restrictions on state authority to add mileage to
    the PHFS, NHFN and NMFN, including but not limited to mileage caps on
    critical urban and critical rural corridors.
          Add eligibility to use funds on any portion of a state's
    multimodal freight network as defined in a state's freight plan.
    Expand Eligible Activities through National Highway Freight Program
        The use of the nation's transportation system for freight is
    increasing, and with it the need for integrated solutions to better
    move freight throughout the country. Currently, no more than 10 percent
    of NHFP formula funding may be used for intermodal, freight rail, or
    water transportation. Integrated freight management solutions, freight
    safety programs, and research supporting future investments should be
    codified as eligible for NHFP and INFRA funds in new surface
    transportation reauthorization legislation.
        We recommend the following changes:
          Reform the National Highway Freight Program, both the
    formula program to states and the discretionary program (INFRA), to
    more clearly include eligibility for investment in integrated freight
    technology, management and operations strategies and solutions, freight
    safety programs (including for emergency responders), and research
    supporting future investments.
          Remove the 10 percent multimodal cap to provide
    flexibility for states to use discretion in determining the amount of
    NHFP formula funding to go toward multimodal freight projects
    identified in the state's freight investment plan and to invest more in
    multimodal projects if appropriate for that state. Eligibility should
    include multi-state proposals and projects for regions and corridors to
    improve freight intermodal connectivity.
    Changes to Infrastructure for Rebuilding America (INFRA) Discretionary
            Grant Program
        The FAST Act established a new discretionary grant program for
    Nationally Significant Freight and Highway projects. Grant eligibility
    is limited to highway projects on the NHFN, highway or bridge projects
    on the NHS, railway-highway grade crossing or grade separation
    projects, or intermodal or rail projects, including those within the
    boundaries of public or private freight facilities.
        Under the FAST Act, not more than $500 million in aggregate of the
    $4.5 billion authorized for INFRA grants (previously known as FASTLANE
    grants) over fiscal years 2016 to 2020 may be used for grants to
    freight rail, water (including ports), or other freight intermodal
    projects that make significant improvements to freight movement on the
    National Highway Freight Network.
        We recommend the following changes:
          Reauthorize the program and remove or increase the caps
    used for grants to freight rail, water (including ports), or other
    freight intermodal projects.
          Add eligibility to use funds on any portion of a state's
    multimodal freight network as defined in a state's freight plan.
          Minimize annual changes to the Infrastructure for
    Rebuilding America (INFRA) Discretionary Grant Program for consistency
    in grant applications and award criteria.
    Reinstate the National Cooperative Freight Research Program
        Throughout its history, a core element of the FHWA Research,
    Development, and Technology Transfer's (RD&T) mission has been to
    promote innovation and improvement in the highway system. Over the last
    decades, this critical mission element has developed into a broad array
    of research and technology activities covering the spectrum of advanced
    research, applied research, technology transfer, and implementation.
        The National Cooperative Freight Research Program, however, was
    last authorized under SAFETEA-LU. MAP-21 and the FAST Act provided much
    more emphasis on freight, while simultaneously reducing funding for
    freight research at the national level. States are concerned that
    freight research needs are not being met solely through the National
    Cooperative Highway Research Program (NCHRP). A dedicated national
    freight research program is needed.
        We recommend the following change:
          Reestablish the NCFRP to provide research products to
    assist states in their delivery of freight transportation projects with
    funding beyond the amount prescribed for the federally-managed Research
    Technology & Education programs and State Planning & Research funded
    programs.
    Railroad Coordination
        We heard from our state DOT members in every region of the country
    this past summer that restrictions and delays imposed on transportation
    agencies by railroad owners, either intentionally or unintentionally,
    are significantly affecting the timely delivery of transportation
    projects.
        We recommend the following changes:
          Congress should establish consistent requirements,
    commitments, and timeframes across all public and private railroad
    owners to facilitate transportation work within and across railroad
    rights of way, and provide USDOT the authority to enforce those
    provisions with the railroads.
          Congress should require USDOT to establish template or
    model agreements for standard activities conducted by the state DOTs in
    railroad rights-of-way (and vice versa), and provide guidance on the
    establishment of agreements for special or more complex activities.
                                   Conclusion
        State DOTs remain committed to assisting Congress in the
    development of the next surface transportation legislation that
    recognizes the importance of freight transportation, the investment
    needed to support freight transportation, and the ways in which demand
    for goods movement is growing and changing.
        Over the past year, AASHTO's members have been engaged with USDOT
    in their effort to develop a national freight strategic plan to
    identify bottlenecks on the multimodal freight network, including the
    cost to address each bottleneck and strategies to improve intermodal
    connectivity. We share your desire to see this national freight
    strategic plan come to fruition soon, which will enable all of us to
    take a holistic look at the national freight movement picture prior to
    reauthorization of the next long-term bill.
        I want to thank you again for the opportunity to testify today, and
    I am happy to answer any questions that you may have.

        Mr. Lipinski. Thank you, Mr. Tymon, and thank all of our
    witnesses for your testimony today. We are now going to move on
    to Member questions.
        Each Member will be recognized for 5 minutes, and I will
    start by recognizing myself. The first thing I wanted to
    address is the section 130 program for grade separations. I
    wanted to ask Mr. Jefferies.
        Can you elaborate on your thoughts in your written
    testimony where you talk about how we can improve the section
    130 grade crossing safety program?
        Mr. Jefferies. Absolutely. Thank you. So section 130 is one
    of our primary priorities when it comes to FAST Act
    reauthorization, and we have laid out a detailed proposal
    attached to my written statement.
        But a few examples that we would like to see is, one, any
    increase in funding, or even fully funding the authorized level
    of the program is a step in the right direction. But another
    example would be increasing the flexibility of how funds can be
    used.
        Right now, if you use section 130 funds to implement some
    grade crossing safety devices, time goes by, there are more
    effective devices that come available, you cannot use section
    130 funding to upgrade, and we think that is common sense to
    allow for upgrades, especially at those higher risk crossings,
    to make sure you have the most up-to-date technology available.
        Mr. Lipinski. Thank you. In grade separations--I mean
    section 130 covers all grade crossing safety programs. Grade
    separations are the best way to improve safety. I want to ask
    Ms. Aleman.
        Would the establishment of a dedicated Federal grade
    crossing separation program to help advance some of the grade
    separation still unfunded in CREATE be a good idea?
        CREATE has made great strides over the 15 years. But one
    thing that has lagged far behind is the grade separations.
    There are 25 that were included originally, and less than half
    of those have been funded.
        Ms. Aleman?
        Ms. Aleman. Yes, addressing the grade separations is of
    critical importance, not only to the CREATE program, but to the
    movement of freight in our region and beyond. Like you said, 25
    CREATE grade separations have been identified. Of those, only
    seven have been completed. This clearly shows that there is a
    need for additional funding to be able to address those
    critical cross points.
        Mr. Lipinski. Thank you. And I just wanted to ask about
    this, and I know a couple of our witnesses raised it, and I
    raised it in my opening statement--I just wanted to see, by
    show of hands, how many witnesses support eliminating or
    greatly raising the multimodal cap in the INFRA, or whatever
    kind of megaprojects program we are going to have.
        [Show of hands.]
        Ms. Goodchild. I am just abstaining. I am not not voting.
        [Laughter.]
        Mr. Lipinski. OK, thank you. I was going to ask that.
        The big question is how do we structure this program?
        And I don't want to keep talking about the INFRA program
    itself, because what we have done with each of the past
    reauthorizations is we create a somewhat different program. So
    I don't want to just say that we are going to move ahead with
    INFRA, but there has to be something for megaprojects.
        But how do we target that? And I want to start with Ms.
    Aleman. You know, given the limited amount of Federal dollars,
    should our freight strategic plan and our megaproject dollars
    focus on freight infrastructure bottlenecks, or improving the
    large freight network generally?
        How do we do that, in terms of targeting? What would you
    recommend?
        Ms. Aleman. I would recommend a comprehensive look at our
    national freight infrastructure as it exists today. I mean,
    really taking a comprehensive look across the United States
    will help Congress be able to evaluate the effectiveness of the
    programs that we have had to date, and will also allow you to
    shape future reauthorizations. So while we may not be able to
    increase funds, I think, thinking about this in a performance-
    based way, where you are applying those metrics on a national
    system as opposed to locally, will help greatly improve the
    next transportation bill.
        Mr. Lipinski. Thank you. I just very quickly want to ask
    Dr. Goodchild. Yesterday, New York DOT announced a pilot
    freight program which will encourage the use of cargo electric
    bikes instead of trucks to move freight within New York City. I
    am just personally intrigued by this, and how this would
    actually work.
        I am not sure where these cargo bikes are going to go, but
    have you looked at this, and would this type of climate-
    friendly transportation mode play an important role?
        Ms. Goodchild. So I am currently leading a project to
    evaluate a pilot of electric-assist cargo bikes in the city of
    Seattle. And so our task there is to evaluate the environmental
    safety and efficiency benefits of that approach.
        There is some complexity in that, because it doesn't
    replace a truck. It can only move smaller packages, and it has
    a much shorter range. And so it is used in complement with a
    truck. And it is important when we evaluate this system to look
    at the relationship between those two modes.
        Certainly, it is a more nimble vehicle. And depending on
    what the rules are, if it is allowed to use a bike lane, or if
    it is allowed to park in a sidewalk, or if it is allowed to
    park in a commercial vehicle load zone, it can provide some
    better maneuverability at a local scale. And if it is electric,
    then there is the local zero-emissions benefit of that mode.
        Mr. Lipinski. Thank you. We will look forward to seeing the
    results there.
        So my time is expired. I will now yield 5 minutes to Mr.
    Davis.
        Mr. Davis. Thank you, Mr. Chairman. And thanks again to the
    witnesses. I enjoyed your testimony. And I wish I had longer
    than 5 minutes to get to each of you to ask a few different
    questions. But I don't, so I will start with Mr. Tymon.
        In your testimony you mentioned the freight plans that each
    State has developed. And can you describe any trends that were
    identified across multiple States, and strategies that were
    employed to address these needs?
        Mr. Tymon. I am sorry. Across?
        Mr. Davis. Yes, can you describe any trends? You mentioned
    the freight plans that each State has. Are there any trends
    that kind of go beyond State lines that were employed to
    address kind of the freight strategies?
        Mr. Tymon. Well, I think the important point here is that
    each State is required to put together a State freight plan.
    And you are seeing that States are working with their partners
    across borders to identify projects that cut across States.
        As everybody here knows, freight doesn't just stop at the
    State line, and it is important that States are able to work
    with their neighbors to make sure that freight is moving as
    efficiently as possible. So most, I think, of the freight
    projects that are identified are done in concert with their
    neighbors to make sure that, once you get to a State border,
    that that freight doesn't back up there because the State on
    the other side of that border hasn't worked to make similar
    improvements.
        So we are seeing more and more coordination among States as
    they put together these plans to make sure that freight moves
    as efficiently as possible.
        Mr. Davis. Good. Have you seen the States finding strategic
    value in the plans that they have put in place? And have those
    plans helped to reduce congestion?
        Mr. Tymon. I don't think we have enough of a sample size to
    be able to say whether or not we are reducing congestion. But I
    think it is a step in the right direction. It has really
    required States to take a look at their entire inventory that
    handles freight transportation to make sure that they are
    making the investments that benefit freight as efficiently as
    possible.
        Mr. Davis. OK. Well, in my home State of Illinois, they
    took an innovative approach using their formula freight dollars
    to develop a transparent, competitive grant program that is
    open to stakeholder applications. It is like kind of a State-
    level INFRA grant program.
        What other innovative approaches have other States taken to
    use their freight formula funds? And have they allowed States
    to leverage more dollars for reducing congestion and improving
    performance?
        Mr. Tymon. Absolutely. We are seeing the Federal dollars,
    in a lot of cases, being used as seed money to bring in local
    dollars to address freight bottlenecks. The example that you
    have given in Illinois is a great example of States having the
    flexibility to use those formula dollars to create a program
    that works in that State by, essentially, setting up a mini-
    INFRA grant program, where it is competitive, and you are
    inviting other stakeholders to come to the table with their
    innovative ideas.
        If the States didn't have that flexibility, we wouldn't be
    able to do projects like that in Illinois.
        Mr. Davis. Great. Ms. Aleman, it is great to sit here with
    my good friend, Chairman Lipinski, who I know is always looking
    at improving the CREATE project. We have talked about it my
    entire 6\1/2\ years here working with him on this issue.
        And I know you mentioned how CREATE, in your testimony,
    will improve the rail system in our home State of Illinois. How
    does improved efficiency in the Chicago rail network benefit
    agriculture and manufacturers in the 13th Congressional
    District that I represent in central Illinois?
        Ms. Aleman. Sure. I think a great example is that in 2014
    there was a severe weather incident that really shut down and
    reduced the delivery service and infrastructure network in
    Chicago. And what that meant was that--it was prime agriculture
    movement season--produce was rotting on train cars, because
    they couldn't get through Chicago. And that produce wasn't
    headed toward Chicago, it was headed towards other parts of the
    country.
        So, you know, 25 percent of all freight trains and 50
    percent of all intermodal trains from the Nation's goods
    movement cross through Chicago. So this really is a national
    issue, and something that we really need to think
    comprehensively about.
        Mr. Davis. Great. It is important, obviously, being a
    center of freight movement in the Midwest. Not just the rail
    network, but also our locks and dams, waterways, and our
    roadways in infrastructure improvements.
        One last question. As somebody who believes we need to pass
    the USMCA through this institution, could you estimate how much
    traffic through the Chicago rail network would go to our
    greatest trading partners, Canada and Mexico?
        Ms. Aleman. I don't have those numbers at my fingertips,
    but I can get them for you for the record.
        Mr. Davis. Thank you, that would be great. I yield back the
    balance of my time.
        Mr. Lipinski. Now I will recognize Ms. Norton for 5
    minutes.
        Ms. Norton. Thank you very much. You will note the interest
    in this committee in multimodal investments, multimodal
    approaches. And, of course, our way in which we allocate funds
    is anything but that. It is stovepiped funding, which makes
    this even more challenging.
        We also know that the railroads, for the first time, were
    included--or at least freight needs were included in the FAST
    Act for the first time. That is really amazing, isn't it,
    considering how important freight has always been?
        And, of course, Mr. Lipinski spoke about the cap on
    funding. I am not sure how funding would operate, but I would
    like to ask perhaps Mr. Tymon, Ms. Aleman, why flexibility to
    pursue multimodal investments to meet freight needs, why that
    is important to States, or to cities, to planning agencies, and
    why you view it as an appropriate use of program funds.
        Ms. Aleman. So, from our perspective, freight doesn't move
    on highways alone, as you see from the stakeholders that are
    here today. We have got rail. Also in our State and across the
    country there are ports. And we believe that, where public
    goods are moving, public dollars should be invested.
        Mr. Tymon. And we absolutely agree that, you know, State
    DOTs right now are all departments of transportation. Gone are
    the days where we had departments of roads or departments of
    highways. All 50 States now have transportation as part of
    their name, and I think that reflects a movement towards a
    multimodal approach to transportation. It is not just about
    moving freight by one mode or another; it is an all-of-the-
    above approach.
        And I think, in order to solve the challenges that we have,
    both on the freight and the passenger side, we need to be
    looking at all modes of transportation, and we need the Federal
    programs to provide that flexibility so that States can choose
    the projects and strategies that work best in that State.
        Ms. Norton. Thank you.
        Ms. Aleman, I was intrigued by a suggestion on--I think it
    is page 8 of your testimony--to develop a national strategy
    that guides long-term planning. And you even say that there
    should be an office of multimodal freight.
        We have heard here that everything from the curbs down to
    the last inch of infrastructure is simply not ready for the
    21st century. Would you talk more about this national strategy?
        Ms. Aleman. Thank you, Chairwoman. The national strategy is
    critical, because we have the data to know where the freight
    bottlenecks are across this country, and we can use that as our
    North Star for programming project funds, and making sure that
    the projects that are funded are advancing the goals of this
    country and of Congress. And so that allows you a measurable
    tool to be able to look back and track your progress over time,
    and hold these programs and these discretionary funds more
    accountable.
        Ms. Norton. So I take it--Dr. Goodchild, your testimony
    highlighted the importance of supporting cities and local
    communities to grapple with this rapidly changing freight
    supply chain. What kind of tools would help cities build the
    capacity to plan for the future of freight deliveries, which
    are changing and perhaps becoming obsolete, even as they
    develop those strategies?
        That is why I asked Ms. Aleman about long-term planning.
    But what kind of tools do you have in mind?
        Ms. Goodchild. So one would be data about goods movement
    that is relevant at sort of the municipal scale, or even
    megaregion scale. When we just look at State-to-State, or
    regional data, like the Puget Sound, it doesn't provide any
    insight about movements within the region of the Puget Sound.
        Another would be to encourage groups like the Urban Freight
    Lab, local collaborations that could contribute to defining
    local problems, and there could be a Federal role in
    supporting, and initiating, and in catalyzing those kinds of
    organizations.
        Ms. Norton. Thank you very much. I see my time has expired.
        Mr. Lipinski. Thank you, Chairwoman Norton. The Chair will
    now recognize Mr. Crawford for 5 minutes.
        Mr. Crawford. All right. Thank you, Mr. Chairman. I want to
    start with Mr. Jefferies.
        I am going to direct this question to you. The advancement
    of technology over the past few decades is undeniable. It has
    led to tremendous gains throughout the economy. Can you provide
    some examples of how technology is being used in the rail
    industry, and the impacts they are having?
        And what do you think Congress can do to ensure an
    environment where future technologies are not stymied by
    regulatory burdens?
        Mr. Jefferies. Absolutely, thank you. So, I mean, you hit
    the nail on the head, that technology has played an
    evolutionary role in the railroad. If you look at where it was
    10, 15, 20 years ago, today's railroad, while still steel-on-
    steel, is a completely different animal.
        Locomotives are super-computers on wheels, and they are
    able to gather data throughout every aspect of the trip, pair
    that with detectors and other inspection equipment that is
    along the right-of-way throughout the system that is listening,
    watching, and analyzing not only the track as you go over it,
    but also the locomotive as it comes by, to identify potential
    flaws in the system, potential risk areas. It allows you to,
    through predictive analytics, to identify possible risks before
    they become serious problems.
        Even on the environmental side, using emissionless cranes
    in the yards, idle-reduction technology in the yards to reduce
    emissions in yard movements, which is where a lot of the
    emissions occur.
        And really, our main issue is, when we look at regulations,
    let's talk about where we want to go, and let railroads find
    that path to meet the outcome that Congress or the regulator is
    staking out. And let's not focus on the prescriptive way to get
    there, because I think ingenuity is a powerful tool, and it is
    amazing what people will come up with if you tell them the goal
    and let them get there via their best methods.
        Mr. Crawford. Excellent, thank you. This is just general.
    Anybody that wants to chime in, feel free.
        The current rate of highway capacity growth sufficient to
    address the growing freight demand and the--what do we need--
    what is the expanded capacity that is needed the most?
        Mr. Tymon. So, Mr. Crawford, I think that that is a great
    question, because I think it varies, depending on what part of
    the country you are in. Right now I think that the number-one
    priority for State DOTs is maintaining the assets that they
    currently have. But there are certainly some parts of the
    country and on certain facilities where additional highway
    capacity will help improve the efficient movement of both
    people and freight.
        With the projected growth that we are going to see in
    freight transportation in the future, I would have to assume
    that there are multiple projects in each State across the
    country where additional capacity will help make sure that that
    freight continues to move as efficiently as possible.
        Mr. Crawford. Do you think the demand for freight
    transportation is directly correlated to highway capacity, or
    is it more closely tied to other factors like economic growth?
        Mr. Tymon. I think that it is a combination of things. I
    think that, as the economy grows and the country demands more
    products and goods, there is just going to be more of a demand
    on the system. How we meet that demand, I think it will have to
    be a multimodal approach. I think it is going to have to be an
    all-of-the-above approach. It will have to be a, in some cases,
    additional highway capacity, but it will also have to be
    additional freight rail capacity in some way, shape, or form.
        So, you know, I think State DOTs out there are looking for
    multimodal solutions, not just one solution. But I do think
    that highway capacity increases are part of that solution.
        Mr. Crawford. In your view, what are the most significant
    trends in transportation and distribution that will impact
    where, how, how much freight will be moving over the Nation's
    highways in the coming years?
        Mr. Tymon. I am sorry, could you repeat that, again? It
    is----
        Mr. Crawford. What are the most significant trends that you
    see in transportation and distribution that would impact where,
    how, and how much freight would be moving over the Nation's
    highways in the years to come?
        Mr. Tymon. I think the number-one trend that we are seeing
    is changes in how people expect to get their goods and
    services, right?
        I mean I think Chairman DeFazio mentioned earlier we are
    just through Black Friday and Cyber Monday, and the real-time
    nature of what people expect and now demand, as consumers, is
    going to put a different stress on the system than we were
    thinking about 20, 30 years ago. And the system is going to
    have to adapt to be able to meet those demands. I think the
    consumers are now--you know, we thought 2- or 3-day delivery
    was a push 10 years ago. Now we have 4- to 6-hour delivery
    windows. If consumers are going to expect that kind of
    responsiveness, the system is going to have to adapt, and there
    is going to have to be some expansion and innovation within the
    system to be able to accommodate that.
        Mr. Crawford. Thank you, I yield back.
        Ms. Norton [presiding]. Chairman DeFazio for 5 minutes.
        Mr. DeFazio. Thanks, Madam Chair.
        Mr. Mathers, you point out that we are using 43 percent of
    the capacity of our freight trucks. You give some examples. You
    had examples of Ocean Spray, Colgate, Kimberly-Clark, and
    Walmart. What Federal policies could we adopt to encourage
    higher utilization so we don't have part-full trucks running
    everywhere?
        Mr. Mathers. Thank you, Mr. Chairman. It is a great
    question. I think, as we have seen, there is a lot of, you
    know, just operational choices that the shippers themselves
    have to make. So it is less clear to me exactly on Federal
    policy choices.
        But, I would think that part of this is kind of
    information- and data-sharing between companies. I think we see
    a great opportunity between shippers to co-load and collaborate
    in their shipping. And that was the example in the testimony of
    Colgate and Kimberly-Clark, right, where they are taking trucks
    off the road, they are delivering more products to CVS,
    inventory costs are going down.
        I think the big barrier there is data and transparency and
    companies working together. And so I think it could be an
    effort to study that issue, to bring shippers together, and
    really try to understand how they can get better data
    transparency amongst shippers.
        Mr. DeFazio. OK. I am still thinking about what the Federal
    policies would be, but I agree with the transparency and the
    data-sharing. But I have got to figure out ways to incentivize
    that or encourage that.
        Mr. Jefferies, as you know, a couple of decades ago
    Congress gave Amtrak trains preference over freight. And DOJ
    can enforce that preference. They have only done it once. And
    under PRIIA, Congress directed the FRA and Amtrak to develop
    minimum performance standards.
        And then, of course, the freight industry sued, and now our
    delays and on-time performance are up dramatically.
        I just was recently meeting with Richard Anderson.
        And, you know, I live 112 miles from Portland. I would
    rather not drive on Interstate 5, but their scheduled time is
    3\1/2\ hours for 112 miles. And they frequently don't meet
    that.
        We now have freights that are running 3 miles long, they
    don't have 3-mile-long sidings.
        How do you recommend that we might better deal with this
    issue? Because I am pretty much getting to the point of some
    pretty strong legislation. So do you have any suggestions,
    short of that?
        Mr. Jefferies. So I think we are happy to see FRA moving
    forward with a rule. They estimated at a hearing in the Senate
    Commerce, Science, and Transportation Committee they expect to
    have that out next June, I believe. We think they are taking
    the right approach by taking information from all stakeholders
    and moving forward.
        I think, on the----
        Mr. DeFazio. Was that the FRA?
        Mr. Jefferies. Yes, sir.
        Mr. DeFazio. Well, yes. We had Mr. Batory here. He is one
    of the most embarrassing witnesses we ever had, to tell the
    truth. So I am not putting a lot of stock in his rule, but we
    will see how that works out.
        But you have got to do something here, or we are going to
    have to do something in the surface bill that you are probably
    not going to like, and it is going to be very prescriptive. So
    I just want to get that----
        Mr. Jefferies. Well, we think it is important that FRA move
    forward with a rule to get metrics and standards----
        Mr. DeFazio. Yes, message across.
        Ms. Goodchild, you point out a whole host of issues, but I
    guess you are an academic. It is kind of short on solutions at
    this point, particularly the urban congestion, the last-mile
    delivery stuff.
        Ms. Goodchild. Well, I think that the industry is
    experimenting. I think if you look at--the example was raised
    of e-bikes in New York City. I am encouraged by the motivation
    to try new solutions. And those need to be tried before we can
    identify them as well-established solutions. So I think there
    is a need for experimentation.
        We can start with ideas. There are lots of ideas. But it is
    important to move from ideas to evaluation and consensus and
    establishing those as things we might want to set forth as
    solutions that communities should consider.
        So I think, you know, experimentation and test and
    supporting that, to the extent possible, allowing that to the
    extent possible, is important right now. And part of that also
    comes from having data and information, investing in data that
    we can use to actually evaluate and compare and contrast.
        Also, to the point about sort of trucks not being
    particularly well utilized, there is a very strong market
    incentive for trucking companies to utilize their equipment.
    They are very good at that. And the reason they don't is that
    they are responding to customer demands. And so, I think
    allowing--you know, considering the motivation and the role of
    the private carrier, listening to what would help them run a
    more efficient system, is important.
        So we have zero visibility about parking availability. If
    you run a tour in the city of Seattle and your goal is to do
    that quickly and efficiently, you have no idea what parking
    will be available, at what time. And it is essential to having
    good performance.
        So investing in technology that allows us to see what
    infrastructure is available, and to measure its performance,
    will result in benefits in supply chain efficiency.
        Mr. DeFazio. OK. That is interesting, thank you.
        I thank you, Madam Chair.
        Ms. Norton. Mr. Gibbs?
        Mr. Gibbs. Thank you, Madam Chair. Well, I will say the
    good news is the economy is really strong, so that gives us
    more stuff to move. Consumers are buying a lot of stuff, they
    are driving this economy. And plus, just earlier, the consumer
    demands--the attitudes are changing. More challenges for all of
    us in the transportation sector, right?
        I wanted to say, also, we need all modes. I think we all
    agree to that. If one mode breaks down or stumbles, it is going
    to affect all the other modes. So we always should be
    conscious, we--you know, keep that in mind.
        And I know we don't have any representation here, I guess,
    from the trucking industry, but hopefully we can in the future.
        I know we have met with the auto manufacturers. And on the
    passenger side they are pretty much saying they are going to be
    all electric at some point on passenger vehicles, all electric.
        Now, Mr. Mathers, I see in your testimony on the trucks,
    you are talking about heavy trucks, all electric. I just got a
    few questions on that.
        On your charts here, you have got urban delivery, regional
    haul. There is not long haul on there. So the first thing that
    comes to my mind is horsepower. Is the technology there? Where
    are we on the technology for the horsepower and also the cost
    for the, you know, industry driving this?
        And then take that a bit further, because I think we have
    reduced our greenhouse gas emissions in this country in the
    last decade about 13 to 15 percent, the reports I have seen,
    and that is from natural gas. And I think most people agree to
    that. If we have an all-electric passenger fleet, and we move
    to an all-electric freight fleet, has anybody studied what does
    that do to our demands on our grid, our electric generation,
    and the overall emissions, overall?
        So I guess my question is--most to Mr. Mathers, I think--do
    you know what the costs are to make these heavy-duty trucks
    electric in their operating costs, how that compares to a CNG
    or an LNG vehicle, and then also how it relates from the start
    of generation all the way through.
        Mr. Mathers. Great. Well, thank you. Thank you, Mr. Gibbs.
        I think that maybe the first thing to talk around is the
    horsepower, right? You are asking about, you know, right now,
    Daimler has--I believe it is 20 e-Cascadias pulling cargo out
    of L.A.-Long Beach. The horsepower is there, and the technology
    is working for drayage applications and kind of making inroads
    in the regional haul, which are, you know, 150-, 200-mile kind
    of duty cycles.
        And I think that is what we are looking for when we think
    about zero-emission, Class 8 trucks is having that day cab
    operation, going from a distribution center to a grocery store.
        And then, for the long haul, I think the question is how do
    you use that capacity in the long haul to the fullest, how do
    you use intermodal? And I actually think there is a great
    pairing between using intermodal to move freight for the long
    haul and using the zero emission to deliver the freight
    regionally.
        On the cost question, I think just yesterday Bloomberg New
    Energy Finance came out with their annual update of the cost of
    EV battery packs. And it was $156 per kilowatt hour. That is
    down from $1,100 per kilowatt hour in 2010. We are seeing a
    dramatic reduction in----
        Mr. Gibbs. How about cost of heavy-duty trucks, electric,
    the cost----
        Mr. Mathers. The trucks. Yes. So, like, the trucks on the--
    there is a paucity of data right now on the trucks themselves,
    because the trucks in operation right now are largely
    demonstrational projects. Where you have electric, heavy-duty
    vehicles is in the transit space.
        And right now, the electric transit buses cost more
    upfront, but they deliver savings over the life cycle of cost--
    --
        Mr. Gibbs. I am running out of time. Your organization, the
    Environmental Defense Fund, are you pro or con, integrating
    more natural gas where it makes sense to move this, or----
        Mr. Mathers. It is a great question. So I think I will make
    two really quick points on that.
        One is that electric power is inherently more efficient. So
    if you want to take natural gas and get miles out of it, you
    will get twice the miles by making electricity, and putting
    that electricity into a battery, and using that to move the
    vehicle.
        The second point is freight has two sources of emissions:
    criteria emissions that harm local air pollution, and global
    climate emissions. Natural gas can help with one. It hurts with
    global climate emissions because of the serious issue of
    methane leaks throughout the supply chain.
        Mr. Gibbs. I am out of time, so I have to yield back.
        Ms. Norton. The gentleman's time has expired. Mrs.
    Napolitano?
        Mrs. Napolitano. Thank you, Madam Chair.
        Ms. Aleman, you have discussed economic importance of
    freight investments. You also represent local communities
    throughout which freight moves, much like the Alameda Corridor
    in my district. Would you discuss the community impacts of
    freight movement on the quality of life impacts and concerns,
    and what projects are best at addressing these issues?
        And should the freight industry be more invested in
    addressing local impacts of rail?
        Ms. Aleman. Thank you for the question, Congresswoman. You
    know, we estimate the motorist delay in the Chicago region cost
    about $58 million in 2018, but we are reexamining that research
    to really look at what the local impacts are of congestion on
    communities across our region.
        We have 284 municipalities in 7 communities that I
    represent here, as the MPO. You know, and we are seeing that
    perhaps the number, just based on our preliminary research and
    the data that we are collecting, that perhaps the number of
    congestion is even worse in our communities.
        And, you know, to local communities, the impacts of
    congestion are real. Air quality impacts are real. The
    deterioration of their local roads, the safety impacts, and the
    noise impacts, these are things that communities are grappling
    with.
        So, as a planning organization, we are working with
    communities to help them address these projects, these
    concerns, proactively. We are doing local plans, we are helping
    them build their capacity at the local level, and really trying
    to get ahead of freight movement and freight demand increases
    by helping them figure out where trucks should be, and what
    time of day those trucks should be in different places. So
    thank you.
        Mrs. Napolitano. Thank you for your answer.
        Mr. Mathers, I represent part of southern California, which
    is home to the Ports of Los Angeles and Long Beach. Forty-five
    percent of the Nation's imports and exports go through it.
        Our ports have done a remarkable job in the past 10 years,
    and continuously greening their drayage trucking fleets.
        One problem with the retrofits is that their costly
    upgrades get passed on to the truck drivers themselves. This is
    a problem to where many corrupt trucking agencies force their
    employees to lease-own trucking models and then severely
    underpay drivers and force them into bankruptcy trying to pay
    for engines. How do we deal with this problem?
        Mr. Mathers. Thank you for the question. I think the
    drayage space is a complex and challenging space. As we are
    thinking about zero-emission opportunities there, I think the
    big challenge is just the connect between the cost of the
    technology and the availability of capital for the drivers
    themselves.
        And so I think one of the things I am noting here is hoping
    that this committee moves forward and brings stakeholders
    together to create a plan for moving that industry to 100
    percent zero-emission drayage trucks by 2030, and a key part of
    that is going to be financing mechanisms for the drivers and
    understanding the roles that the shippers should be playing,
    and that other folks, other stakeholders have, to make sure
    that drayage drivers can move into zero-emission vehicles.
        Mrs. Napolitano. Thank you very much.
        Ms. Aleman and Mr. Tymon, the FAST Act created two freight
    funding programs, one at 4.5 competitive grant, and the other
    at 6.3 formula for the States. We are all concerned that
    competitive freight has been overly politicized, and that
    projects are not being awarded.
        Should transportation put all the freight funding into the
    formula National Highway Freight Program so that each State is
    given freight equity?
        Ms. Aleman. I want to be sure that I understood your
    question, Congresswoman. Was it about the equity of the
    distribution of the funds in the program?
        Mrs. Napolitano. Should we move----
        Ms. Aleman. Yes.
        Mrs. Napolitano [continuing]. All the funds into the
    National Highway Freight Program, instead of having the other
    competitive--by the administration.
        Ms. Aleman. So I think both programs are necessary. I mean
    one of the things that I saw when I was at the DOT is that, you
    know, freight impacts across the State are very different than
    the freight programs where folks would come together across
    jurisdictional borders to work on those highly complex
    projects. And those competitive funds were really an incentive
    for communities, for multistates to be able to work together.
        And then, at the local level, to the distribution of those
    funds to the States, we are helpful in them addressing sort of
    the intrastate commerce challenges.
        Mrs. Napolitano. Mr. Tymon?
        Mr. Tymon. May I weigh in on that, as well? I think that
    that is--you bring up a great point. And I do think there is a
    role for both discretionary and formula programs.
        But the fact that there is such variation from Congress to
    Congress, or administration to administration, in how those
    discretionary dollars are distributed, I think, really adds
    more merit to the formula-based program, because it is a
    predictable stream of funding that will allow project sponsors
    such as States to be able to pick the projects that they need
    to do over a long period of time.
        So I just think that what you have highlighted there is a
    great supporting statement for formula dollars and the value
    for them.
        Mrs. Napolitano. I think you are right, and I think we
    should move them.
        Thank you, Madam Chair.
        Ms. Norton. Thank you, Mrs. Napolitano. We move on to Mr.
    Stauber.
        Mr. Stauber. I thank you, Chair Norton and Ranking Member
    Pence.
        Before I go into questioning, I think it is important to
    illustrate the freight networks in my district of Minnesota,
    and how they interact with each other.
        In northeastern Minnesota we have freight rail lines that
    carry taconite from the Iron Range to the Port of Duluth to be
    shipped by lakers across the Great Lakes through the Soo locks,
    and to be made into American steel.
        We have freight lines that transport coal and ag products
    from the upper Midwest to the Port of Duluth to be shipped to
    the east coast and across the Atlantic Ocean.
        The Port of Duluth, the most inland port in the Nation,
    accepts intermodal traffic, from trucks that must navigate
    through a treacherous traffic interchange to drop off or pick
    up their products. Our entire freight network in northeastern
    Minnesota is interconnected and codependent on each other. This
    means that if and when parts of the network fail, or are
    inefficient, the entire system suffers.
        Mr. Baker, can you please speak to the importance of the
    45G tax credit--which I support, by the way--to the
    interconnectedness of freight networks?
        Mr. Baker. Thank you very much for the question. Normally
    people ask me to stop talking about 45G, because I do it so
    frequently, but I appreciate you asking.
        It is the most critical policy that we have identified to
    help with short line railroads. We are largely a privately
    funded network. But given the nature of short line railroads,
    preserving service into small towns in rural America, Congress
    has long seen the wisdom in helping out a little bit.
        The credit has been expired since the end of 2017. It is
    beyond critical and crucial for us at this point. It is an
    extraordinarily effective way to get upgrades done in small
    railroads and----
        Mr. Stauber. Remain competitive?
        Mr. Baker. To remain competitive, and those small railroads
    can do an awful lot with just a little bit of help.
        Mr. Stauber. Thank you very much.
        Mr. Tymon, as I mentioned before, the Twin Ports
    Interchange project, also known as the ``Can of Worms''--so
    this tells you a little bit about the nature of this traffic
    issue just coming out of the Port of Duluth and in the city of
    Duluth. It is a major inefficiency, and endangers the freight
    network in my district around the port.
        Can you please speak a little bit about how the highways--
    and specifically, the interchanges such as the ``Can of Worms''
    in Duluth, Minnesota, can impact freight travel, and how
    important it is to ensure there are efficiencies to maximize
    our shipping capabilities?
        Mr. Tymon. Thank you for that question. You know, I think,
    first, you mentioned safety. And safety is the number-one
    priority for every State DOT across the country. So, in
    addition to making sure that we can move that freight as
    efficiently as possible, we need to make sure that the system
    operates as safely as possible.
        So, you know, I think that the project that you have
    described, there is probably a project like that in every State
    across the country, whether it is called the ``Spaghetti
    Bowl,'' or the ``Zoo,'' or the ``Can of Worms''--I can't say I
    have heard that one before.
        You know, there are strategies that States can do to work
    with localities to make sure that they either look for ways to
    operate that facility as efficiently as possible, whether it is
    use of technology, or, in some cases, you know, looking at that
    facility and seeing if there are changes that need to be made,
    from an infrastructure standpoint, to help it operate
    efficiently.
        I think that the biggest problem there is funding. And if
    there aren't the resources that are necessary for a State or a
    locality to take on a major project like that, if you are
    talking about reconstituting that interchange in a way that
    looks significantly different than what it does now, you are
    going to need a significant amount of dollars to be able to do
    that.
        So, having a robust Federal program that will be able to
    fund those types of projects would be extremely helpful in
    having a State be able to tackle something like that.
        Mr. Stauber. So would you say that, in our case, if the
    ``Can of Worms''--and they are working on it--if that was
    fixed, if it was safer and more efficient, what would be the
    timetable that you would see an economic increase? Would it be
    immediate, or over a period of time, in your experience?
        Mr. Tymon. Well, I think you would see both immediate
    impacts as well as long-term impacts for a major project like
    that. You would see probably an immediate impact, from a
    congestion standpoint and from a safety standpoint. But then,
    you are making that area more economically competitive if you
    are able to increase throughput and increase the reliability
    and efficiency of that facility.
        Mr. Stauber. Thank you for your questioning. And to all the
    witnesses, thanks for your testimony. It is greatly
    appreciated.
        And Madam Chair, I yield back.
        Ms. Norton. Thank you, Mr. Stauber. Next would be Mr.
    Malinowski.
        Mr. Malinowski. Thank you. Thank you, Madam Chair.
        Mr. Jefferies, you and I had an exchange the last time I
    was here that I wanted to follow up with you on, and I want to
    say at the outset that I very, very clearly understand the
    essential role that freight railways play in our economy, and
    the profoundly beneficial role that they play in helping us
    maintain a transportation system, while keeping the environment
    clean, and dealing with climate change. It is undeniable.
        I do have concerns about safety, though. And in our last
    exchange you placed a great emphasis on data, on basing
    decisions on data, which, of course, I agree with. And you came
    today with data about falling accident rates in the freight
    rail system. And it was interesting to me that you chose a
    timeframe going back to the year 2000, which is quite a long
    time.
        Well, we actually have data that came out, I think, even
    today on 2019 that allows us to look, I think, at a more
    significant time period, given changes in the freight rail
    industry just the last few years. So let me read you some data.
        Since 2016, from 2016 to 2019, total fatalities are up from
    519 to 617, almost a 16-percent increase. Trespasser deaths, up
    by over 25 percent. The rate of train accidents per million
    freight train-miles, up by around 9 percent since 2016. Hazmat
    cars damaged or derailed, up by over 20 percent since 2016.
        Since you are so focused on data, I wonder if you could
    offer us an explanation as to why things have gotten so much
    worse in just the last 3 years.
        Mr. Jefferies. So, first, thank you for that. Let's start
    with the deaths. You know, you mentioned trespassers. Grade
    crossings, I don't know if you mentioned grade crossings
    specifically, but that is an area of challenge, absolutely.
    Ninety-six percent of rail fatalities are at grade crossings or
    are trespassers. And that is an area where we continue to focus
    on driving that number down. And it is certainly a
    responsibility, it is a shared responsibility with the
    railroads, with the communities, with individuals involved. And
    it is something that we need to continue to work on. And
    absolutely, we will do that.
        That number is dramatically lower than it was,
    historically, but it is not low enough, because it is still
    above zero. So we have more work to do.
        Mr. Malinowski. Well, it is not just that these numbers are
    above zero. Of course, we always want to get down----
        Mr. Jefferies. Right.
        Mr. Malinowski [continuing]. To zero. It is that they have
    been going up.
        Mr. Jefferies. Well, I think----
        Mr. Malinowski. Really, across the board, not just----
        Mr. Jefferies. Every year we want to drive them down, but--
    --
        Mr. Malinowski. Well, since 2016, virtually every safety-
    related statistic looks worse and worse----
        Mr. Jefferies. Well----
        Mr. Malinowski [continuing]. In the freight rail industry.
    And, you know, you are touting this miraculous technology.
    Locomotives are super-computers on wheels, identifying all
    these----
        Mr. Jefferies. Absolutely.
        Mr. Malinowski [continuing]. Problems before they arise.
    And yet things are getting worse. And I----
        Mr. Jefferies. Well, I----
        Mr. Malinowski. And I would stress this----
        Mr. Jefferies. I would challenge they are getting worse. I
    am not looking at the same data you are, but----
        Mr. Malinowski. I am looking--I am happy to share this.
    This is from the FRA.
        Mr. Jefferies. Yes. When we look at hazmat transportation--
    --
        Mr. Malinowski. The category----
        Mr. Jefferies [continuing]. We are in the safest era ever,
    99.998 of hazmat movements move from point to destination
    without any incident, whatsoever.
        Mr. Malinowski. Compared to the early 20th century----
        Mr. Jefferies. That is not 100 percent----
        Mr. Malinowski [continuing]. Perhaps, but in the last few
    years something has happened.
        Mr. Jefferies. That is actually current data, but----
        Mr. Malinowski. And, look, I am stressing this because you
    are up here advocating for certain things.
        Mr. Jefferies. Right.
        Mr. Malinowski. You are advocating that we do nothing on
    the length of freight trains, that we do nothing on crew
    requirements for freight trains. You are advocating that we
    allow increasingly hazardous materials, like LNG, to move on
    freight trains.
        You said something earlier today. It was really an eloquent
    statement in its way. You said, ``Let's not focus on the
    prescriptive way to get there.'' What do you mean by that? Are
    you suggesting we do nothing?
        Mr. Jefferies. No, I am saying let's talk about the goal we
    want to get to, and let's set benchmarks for getting to that
    goal. But let's not set one way and one way only for how to get
    there.
        Mr. Malinowski. So, basically, no way. You want us to
    basically tell you--have safer railways, but allow the industry
    to figure out how we do it.
        Mr. Jefferies. I think that----
        Mr. Malinowski. And no regulation.
        Mr. Jefferies [continuing]. When you prescribe one and only
    one way to get to a desired outcome, you miss opportunities.
        I think we have a shared interest. I mean this conversation
    shows we have a shared interest in maximizing safety. And so we
    can agree on that. Like I said, we may disagree on data
    interpretation, but I think we can agree on shared goals of
    safety. So something I am certainly happy to have more
    conversations with to see where we can----
        Mr. Malinowski. Sir, you know, a couple weeks ago the CEO
    of Boeing was sitting right in that chair. And right over there
    we had families of people who lost their lives because the
    airline industry lobbied us for 20 years for less and less
    regulation. And he had to look them in the eye and apologize. I
    really hope that you don't find yourself in that position at
    some point in the future.
        There has to be a prescriptive way to get there, and we
    have to work together to find it. Thank you. I yield back.
        Ms. Norton. Mr. LaMalfa?
        Mr. LaMalfa. Thank you, Madam Chair, I appreciate it.
        Mr. Mathers, EDF is known for its attempt to use market-
    based policies--its claims on taxing--or increasing costs,
    fines, whatever, on things it doesn't favor, while decreasing
    costs on environmentally friendly vehicles or other energy-
    consuming means.
        So do you support the repeal--for heavy-duty trucks we are
    talking about--of Federal excise tax that has been around since
    World War I--I am carrying a bill on this--that adds to the
    cost of heavy-duty trucks--$10,000, $12,000, $15,000--as a
    means of getting cleaner, more environmentally friendly,
    cleaner running diesel engines onto our roads?
        Mr. Mathers. Thank you for the question, Congressman. I
    think it would be great to target that tax break for zero-
    emission vehicles, zero-emission trucks, and that the focus
    should be on incentivizing a move to the cleanest technology we
    have available.
        Mr. LaMalfa. The diesel engines produced these days are
    much cleaner than the ones that are 10 years old or more.
        Mr. Mathers. And yet there is still significant room for
    improvement, particularly in the low-speed, high-idle duty
    cycles. And that is why the EPA and the California Air
    Resources Board are currently both working on regulations to
    further reduce NOx emissions. And we are happy to see that, and
    it is desperately needed.
        Mr. LaMalfa. Well, there is a time period between now and
    when this technology becomes available, whether you are talking
    all-electric vehicles, or lower NOx, or what have you, that
    people still need to buy and purchase trucks.
        Mr. Mathers. Sure.
        Mr. LaMalfa. And utilize, upgrade the fleet, California
    would see CARB coming down on people right now by January 1.
    Many trucks are going to be unavailable to folks, so they got
    to replace them with something. So shouldn't they replace them
    with the best available technology today? Or do you just want
    to make them have nothing until then?
        Mr. Mathers. I think that there are programs that exist,
    such as the Diesel Emissions Reduction Act, through the EPA,
    that help get dirty diesel trucks off the road, and we fully
    support that. And I think there are lots of opportunities.
        I think the question is, where should we target taxpayer
    money. And I think that is to move forward with really----
        Mr. LaMalfa. You made a good point there.
        Mr. Mathers [continuing]. Cutting-edge technology----
        Mr. LaMalfa. This is taxpayer money. These truckers are
    paying these additional taxes on a vehicle they are trying to
    replace older vehicles with that are achieving 99 percent
    cleaner emissions than one that is 10 or 15 years old.
        So it is, indeed, their money. So why aren't they allowed
    to keep more of their money so they can replace a truck sooner?
        Mr. Mathers. Well, I mean, again, I think it is great to
    incentivize the advanced technology such as zero-emission
    trucks.
        Mr. LaMalfa. We are not talking zero emission. We are
    talking extremely low-emission trucks available right now.
        Mr. Mathers. Mm-hmm.
        Mr. Tymon. Mr. LaMalfa, do you mind if I weigh in on this?
        Mr. LaMalfa. Quickly, please.
        Mr. Tymon. I think you are referring to the Federal excise
    tax on--are you referring to the Federal excise tax on the
    purchase of new trucks and trailers?
        Mr. LaMalfa. Yes, sir.
        Mr. Tymon. I see, absolutely, the merits of your argument
    in saying that if you eliminate that tax, that there is less of
    a barrier for trucking companies to purchase new equipment.
        I would say that is a great argument there. I think the
    concern for a lot of us in the transportation community is the
    loss of revenue associated with that tax. So I don't think that
    a lot of folks in the transportation community are opposed to
    the elimination of it. It is the fact that it would leave a
    pretty large gaping hole in Highway Trust Fund revenue for a--
    --
        Mr. LaMalfa. It is a pretty small percentage of the overall
    Highway Trust Fund, but it is a big barrier for somebody,
    especially owner-operators, trying to replace a truck.
        Mr. Tymon. Absolutely, and----
        Mr. LaMalfa. It is only several billion dollars of a giant
    fund.
        Mr. Tymon. It is----
        Mr. LaMalfa. So you would rather keep that in place to keep
    a barrier for small operators, especially, to buy these trucks?
        Mr. Tymon. No, I am not saying that. I am just saying that
    we need to be cognizant of making sure that, whatever hole that
    leaves, that it is replaced by some other revenue source.
        We are already spending about $15 billion a year more from
    the Highway Trust Fund than we are bringing in revenue. So a
    change like that, if that increases that delta, which--I am not
    saying that folks are opposed to it, I just think that that
    revenue needs to be replaced in some way, shape, or form.
        Mr. LaMalfa. There is a lot of ways to replace revenue. But
    certainly sacking the small--or any of these folks.
        If you all want to talk about wanting to have cleaner
    running trucks on the road immediately, especially with CARB
    coming down on California truckers on January 1, just days away
    from now, and you make it a much higher bar by having this
    World War I-era tax still in place, then you are not achieving
    cleaner air, you don't have the electric vehicles that are
    available in any kind of volume these days, or even seen as
    viable. You know, maybe in short hauls, short-term use, and
    things like that, but over-the-road trucks still need to have
    available the current technology that is improved to 99 percent
    cleanliness.
        And that is what nobody acknowledges around here, is that
    they have achieved much, much cleaner tailpipe, whether we are
    talking trucks or cars, and still we go down this path where
    people are going to have much fewer choices. Instead, you have
    the club of Government saying you have to use this kind of
    vehicle. And that is not going to work for a lot of folks.
        Ms. Norton. The gentleman's time----
        Mr. LaMalfa. I yield back.
        Ms. Norton [continuing]. Has expired.
        Ms. Finkenauer?
        Ms. Finkenauer. Thank you, Chairwoman. I appreciate you all
    being here today, too, and taking all of your time to come and
    testify. It is an important topic. And my first question
    happens to be for Mr. Jefferies.
        In your testimony I know you mentioned how the ongoing
    trade war with China is hurting two industries that are heavily
    served by railroads, both agriculture and manufacturing, which
    we feel pretty strongly in Iowa 1 right now.
        As a result, the demand for rail service has gone down. I
    heard this firsthand when I was visiting Iowa Northern Railway
    in August--one of our short line railroads in Iowa--and learned
    about the problems that the trade war has created very
    specifically for their business.
        With Brazil now having taken over most of our market share
    of soybean imports to China, the railway is moving less grain
    and facing more competition from larger railways for shipments
    to local processors.
        John Deere, one of their customers, a large employer in my
    district, has seen their sales drop because of this ongoing
    trade war with China. When our farmers are not doing well, they
    are not buying new machinery, meaning that Iowa Northern
    Railway is moving less of their freight.
        Mr. Jefferies, how are railroads responding to the reduced
    demand for freight services?
        Mr. Jefferies. Thank you, Congresswoman. You know, you hit
    the nail on the head, just about trade uncertainty in general,
    whether it is China, whether it is north-south trade
    uncertainty right now with the USMCA----
        Ms. Finkenauer. But very specifically, China right now----
        Mr. Jefferies. Absolutely.
        Ms. Finkenauer [continuing]. Specifically when it comes to
    steel, when it comes to----
        Mr. Jefferies. When it comes to grain exports.
        Ms. Finkenauer [continuing]. Specifically our agriculture
    products.
        Mr. Jefferies. Absolutely.
        Ms. Finkenauer. It is devastating our State right now.
        Mr. Jefferies. Absolutely.
        Ms. Finkenauer. Yes.
        Mr. Jefferies. And, you know, when your customers and your
    farmers aren't moving stuff, the railroads aren't moving stuff.
    So it is a chain reaction.
        We feel strongly and have advocated that we need to address
    the tariff situation with China, and we need a positive
    outcome.
        No one says there aren't issues that need to be dealt with.
        Ms. Finkenauer. Yes.
        Mr. Jefferies. But that uncertainty is having a dramatic
    effect. We went from exporting colossal amounts of grain out
    through the Pacific Northwest to virtually nothing now. And,
    like you said, other markets are moving in to substitute U.S.
    grain shippers.
        Ms. Finkenauer. Yes.
        Mr. Jefferies. And it is incumbent upon us to get a deal in
    place to allow those shippers to thrive again. And railroads
    are there.
        I think 42 percent of our overarching traffic is direct
    import-export-related. So----
        Ms. Finkenauer. Yes.
        Mr. Jefferies. It is grain, it is all products. It is
    intermodal. So we----
        Ms. Finkenauer. Well, and----
        Mr. Jefferies. We are with you on that.
        Ms. Finkenauer. Thank you.
        And, Mr. Baker, I know specifically for our short lines,
    one of the things, again, that I heard, you know, they are
    struggling right now because the bigger competitors are coming
    in to markets that they typically aren't in, because of
    lacking, you know, their own markets right now that they would
    typically have. And it has been harder and harder and harder
    for them to be able to continue to compete.
        Are you seeing this in other areas in the country? I know,
    again, in Iowa it is--we are getting hit on all sides of it,
    whether it is the ongoing trade war with China, or whether it
    is the refinery waivers that we saw that have hurt our corn
    growers, our ethanol plants that are struggling right now, as
    well. It is just, again, getting hit on all sides.
        But are you seeing this through the rest of the country, as
    well?
        Mr. Baker. No question, the huge percentage of the U.S.
    economy and then, of course, a huge percentage of rail business
    is dependent on trade--China, Canada, Mexico, all over the
    globe.
        Just to put it as simply as possible, we believe in free
    and fair trade. We desperately need Congress and the
    administration to get to a resolution on the China tariffs
    problem and USMCA.
        And if you wouldn't mind me riffing for 10 seconds on my
    other favorite topic, the 45G tax credit, I have to bring it up
    only because I know that you have been extremely vocal on the
    biodiesel tax credit, which would be part of the same tax
    extenders package. So I just wanted to thank you for your
    leadership on that for Iowa, for the whole country. And you are
    doing the Lord's work, so thank you.
        Ms. Finkenauer. No, it is important for the future of my
    State, which is my home, and I care a lot about it. And I am
    really concerned, as this trade war continues, about how this
    is going to impact our short line railroads, in particular,
    about making those investments that they typically do.
        I understand that short lines invest an average of 25 to 33
    percent of their revenue into their infrastructure. And this is
    something that, again, is hitting my State on all sides. And I
    continue to just listen to folks and make sure that I hope the
    administration is hearing us, as well.
        So thank you for being here, and uplifting the need to get
    a resolution sooner than later, and not after the 2020
    election, when it comes to China. So thank you.
        Ms. Norton. Mr. Babin?
        Dr. Babin. Yes, ma'am. Thank you, Madam Chair. And thank
    you, witnesses, for being here. We really appreciate all this
    valuable information.
        My question is for Mr. Tymon. As this committee prepares
    for the reauthorization of the FAST Act, the growing use of
    technology throughout the entire transportation sector will
    play a huge role in our deliberations and our considerations.
    What are the most critical issues that this committee should be
    focusing on at the Federal level when it comes to the use of
    technology? And how can Congress be helpful, rather than
    getting in the way of innovation in private industry?
        Mr. Tymon. Thank you for that question, Congressman. I
    think you have highlighted, really, the crux of my answer,
    which would be to get out of the way----
        Dr. Babin. Absolutely.
        Mr. Tymon [continuing]. As much as possible, and let States
    be those incubators for innovation that they always have. You
    are seeing more and more States incorporate technology into
    their transportation solutions.
        Again, I think the issue of the day is the 5.9 gigahertz
    spectrum, and making sure that that stays reserved for
    transportation safety. I appreciate that several members of
    this committee have come out extremely strong in pushing back
    against the FCC to make sure that the FCC knows that State DOTs
    and transportation stakeholders in general want to see the 5.9
    gigahertz spectrum reserved for transportation safety.
        Dr. Babin. Right.
        Mr. Tymon. I think that is--as I said before, safety is our
    number-one priority. Our goal is to get to zero highway
    fatalities. The only way we are able to get to zero highway
    fatalities is to incorporate more and more technology into our
    transportation network. A key part of that is utilization of
    the 5.9 gigahertz spectrum.
        Dr. Babin. Yes, sir. Excellent, excellent.
        Also, I represent nine counties--Texas counties, that is--
    from Houston over to the Louisiana line. And that includes the
    Port of Houston.
        As you know, the entire Nation depends on the efficient
    movement of freight and goods out of southeast Texas, which is
    a huge center for transportation, and lots of modes of
    transportation. Could you share with this committee what
    technological innovations State DOTs--you mentioned that a
    little bit in a previous answer, but maybe a little more
    specifically, and what these State DOTs are utilizing to
    address the increasing movement of goods across the country,
    across towns, and in our neighborhoods.
        And if there is any time left, I would like to ask someone
    else, too.
        Mr. Tymon. Sure, so I will be quick in saying that, you
    know, it really varies from State to State.
        But one area that I think you are seeing States utilize
    more often is data. They are analyzing the data that they have
    to be able to better target the limited amount of dollars that
    they have to invest in infrastructure.
        I would say that is absolutely true on the freight side, as
    well. You are able now to be able to take the data on where
    freight is moving, from point A to point B----
        Dr. Babin. Right.
        Mr. Tymon [continuing]. Be able to look at it on a map, and
    be able to tell which facilities need improvement. And I think
    that the utilization of data, and how State DOTs are being able
    to analyze that and then target investments based on that data,
    is really having an impact on how we move freight and people,
    and I think that is only going to improve as we move forward in
    the future.
        Dr. Babin. Absolutely. Thank you so much.
        And Mr. Jefferies, could you add to that?
        Mr. Jefferies. Yes. Certainly, to echo Mr. Tymon's
    comments, on the freight rail side, whether it is in the port,
    en route to destination, that data is driving visibility into
    the system. It is allowing for optimization and how things are
    moved in the port to increase throughput, decrease dwell time,
    increase customer visibility as to where their products are en
    route--not quite to the level of maybe an Amazon yet, but
    working towards that end goal.
        Dr. Babin. Absolutely. And Mr. Baker?
        Mr. Baker. The use of technology in rail is huge, a huge
    focus of the owners and operators of the system.
        I would agree that the data and, essentially, the freight
    transparency, the customers knowing where is my stuff, when is
    it going to get there, when are the empties going to arrive is
    crucial.
        And there is--since the environmental aspect of this has
    also been a big topic, I would also add on the locomotive side,
    TR4 locomotives are the--are sort of the hot, new thing in rail
    rolling stock, and it is a massive improvement over previous
    locomotives. And railroads are implementing them as fast as
    they can. And some railroads, particularly smaller railroads,
    do get some help from the Federal Government through programs
    like DERA, and that is much appreciated in a big way to help
    reduce emissions.
        Dr. Babin. Absolutely. Thank you all for that great
    information. Information is very valuable as we deliberate over
    this important issue.
        So I will yield back. Thank you very much, Madam Chair.
        Ms. Norton. Thank you, Mr. Babin.
        Mr. Stanton?
        Mr. Stanton. Thank you very much, Madam Chair. Thank you to
    the witnesses. Outstanding testimony here today.
        The movement of freight and goods plays a critical role in
    our daily lives by providing us the things we need or want. But
    it is also key to our country's economic future and maintaining
    our global competitiveness.
        Growth over the last 20 years, improvements in the
    manufacturing process, and new technology are placing ever-
    greater strain on the capacity to move goods. And this growth
    is only expected to continue increasing. In fact, the U.S.
    Department of Transportation estimates by 2040 freight volumes
    across all modes of transportation will increase by 42 percent.
        Expanding freight transportation capabilities and working
    towards creative solutions is something we here in Congress
    must focus on.
        In my State of Arizona the Maricopa Association of
    Governments has been working on a regional transportation
    strategy that looks closely at how we prioritize freight-driven
    investments to ensure goods are transported safely and
    efficiently. The effort has brought together a number of
    stakeholders to find ways to expand commerce, strengthen our
    economy as it relates to freight.
        My first questions are for Ms. Aleman. Arizona is a
    significant link in the national freight network. Large volumes
    of freight move by rail from the Ports of Los Angeles and Long
    Beach to Chicago through Arizona. In fact, more than 74 percent
    of all freight entering Arizona, measured by value, is moving
    through my State, meaning that many markets outside of Arizona
    are dependent upon the health of the infrastructure within
    Arizona.
        In my district, residents feel the pinch of this nationally
    significant movement when they are stuck in traffic congestion
    or at rail crossings.
        Likewise, I recognize that Chicago's role as a national
    rail hub means that your residents face many of the same
    challenges. Can you talk a bit about the need for the Federal
    investment in regions like ours that are critical to our
    Nation's economy?
        Ms. Aleman. Thank you, Congressman, for the question. You
    know, freight is a commodity that we need to look at,
    nationally. I think the burden, again, for paying for these
    nationally significant projects can't be shouldered by the
    States that are dealing with sort of the near-term local
    impacts, because they aren't seeing the benefits. This really
    is a global marketplace here.
        And so this is why, from the perspective that we have been
    looking at, the $12 in unique requests for every $1 of INFRA
    available, and it would advocate for a $12 billion program of
    competitive funds.
        Like I said, in the Chicago region our CREATE program is an
    example of how that brings stakeholders together who wouldn't
    otherwise be focused on these issues.
        Mr. Stanton. As we have discussed before, but worth
    repeating, you have called for removal of the 10-percent cap on
    nonhighway funding under the freight formula program, as well
    as a cap under the INFRA program--grant program. Can you
    explain why removal of this cap is important, once again, for
    the national goods movement goals?
        Ms. Aleman. Absolutely. Our freight across this country
    doesn't move on our highways alone. And that is really why we
    need to employ strategies like removing the cap on the
    multimodal dollars given to States. Really, because we need
    States to be able to work together to address their most
    pressing freight needs.
        Mr. Stanton. Thank you so much. In our urban centers, last-
    mile deliveries face regular delays, due to traffic congestion.
        Dr. Goodchild, in your curb allocation change project, you
    suggest that reforming curb space allocation such as adding
    drop-off and loading zones, could improve things. Could you
    discuss this a little bit more, and what else could lessen the
    economic and environmental impact from urban road congestion
    caused by freight?
        Ms. Goodchild. Yes, thank you. So the status quo of how we
    manage curbs is we put yellow paint on it, or white paint, and
    sometimes some red paint. And we haven't updated that approach.
    So there is a lot that we could do, use it differently at
    different times of day, more dynamically allocate that curb,
    and price that curb in a more responsive way. We certainly need
    to do that, and many cities are interested in doing that at
    this time, including Seattle.
        In terms of reducing the impact on communities, there is
    certainly a need to use some low-emissions solutions. So e-
    bikes--some of that is actually very simple. There is walking
    deliveries that happen from--you know, we bring five people to
    a delivery truck, and they can walk with hand trucks from
    there. It is actually a very cost-effective, fast solution in
    dense, urban areas. So using less fuel-intensive modes in that
    last mile reduces the impact on those communities.
        Mr. Stanton. All right. Thank you for your outstanding
    answers. I am just about out of time, so I will yield back.
        Ms. Norton. I thank the gentleman. Mr. Balderson?
        Mr. Balderson. Thank you, Madam Chair. Thank you, panel,
    for being here. And I have got a couple questions. My first
    question is for Mr. Tymon.
        Thank you very much for being here today. In your testimony
    you mentioned the need for Congress to increase flexibility,
    reduce regulatory burdens, and improve project delivery in our
    surface transportation system. AASHTO believes Congress should
    modernize the Clean Water Act, Clean Air Act, and the
    Endangered Species Act to reduce infrastructure and
    construction delays.
        I would like to hear your thoughts on specific ways
    Congress should change these laws. Can you please provide
    examples of how these changes would benefit our infrastructure
    system and help our State departments of transportation?
        Mr. Tymon. Thank you for that question. What I would like
    to request is that I could provide specific recommendations for
    the record. But if you allow me the opportunity to provide more
    of an overview, I can say that the changes that we are looking
    to make to those laws are really updating them. Many of them
    have not been touched in 20 or 30 years.
        And it is not that we are looking to not continue to
    safeguard the environment, far from it. We think that we can
    make improvements and changes to those laws, but still make
    sure we are doing right by the environment. It is the fact that
    many of them have not been changed at all, or changed very
    little in the last 20 or 30 years that we think that it is time
    for Congress to at least take a look at those laws to see if
    there are some improvements or modernizations that can be made.
        Mr. Balderson. OK, thank you very much. The next question
    is for Mr. Jefferies.
        Mr. Jefferies, thank you for being here. In your testimony
    you note that the operations and capital investment of
    America's freight railroads support over 1 million jobs, $219
    billion in economic output, and $71 billion in wages.
        Additionally, railroads generated nearly $26 billion in tax
    revenues in 2017. I know a couple other of my colleagues have
    mentioned and talked about the USMCA, and that is kind of the
    path that I want to go down. But international trade accounts
    for about 35 percent of the U.S. rail revenue, 27 percent of
    the U.S. rail tonnage, and 42 percent of the carloads and
    intermodal units U.S. railroads carry.
        Can you discuss the needs for Congress to ratify the USMCA,
    and what impact the trade agreement would have on the railroad
    and freight industry and their workers?
        Mr. Jefferies. Thank you, Congressman. That is a fantastic
    question.
        You know, I cannot reiterate more the need to move forward
    on USMCA. North-south trade with the U.S., obviously, our
    largest trading partners, and the amount of goods that flow out
    of the country via rail to both the north and the south--grain,
    for example, into Mexico, is our largest export product--it is
    staggering, quite honestly. It is a job creator, it is an
    economic uplifter for our customers.
        And not only that. When you look at the supply chain that
    has been built up over the past several decades, it is an
    international supply chain. So on a lot of products--
    automotive, for example--you will see parts move back and forth
    across the border multiple times. So it is not something that
    can just be ripped up and air-dropped in in another fashion.
        So, 50,000 rail jobs rely directly on international trade.
    A lot of those are north-south movements, again. And so I
    cannot state enough our support for getting USMCA done as soon
    as possible.
        Mr. Balderson. All right. Thank you very much.
        Madam Chair, I yield back my remaining time.
        Thank you, panel.
        Ms. Norton. I thank the gentleman. Mr. Johnson?
        Mr. Johnson of Georgia. Thank you, Madam Chair.
        Passing the USMCA will increase trade. But what direct
    impact will it have on the ability of the Nation to sustain the
    need for increased spending to repair and replace our crumbling
    infrastructure?
        Mr. Jefferies. Well, from the rail perspective----
        Mr. Johnson of Georgia. Mr. Jefferies or anybody. Anybody.
        Mr. Jefferies. OK, I will start, and someone else can take
    it from me.
        But from the rail perspective, we are making long-term
    investments year in, year out, because these are 50-year
    investments. Certainly the same could be said on the highway
    system.
        So it is the certainty that trade deals put in place. So
    you can plan----
        Mr. Johnson of Georgia. Well, I understand that.
        Mr. Jefferies [continuing]. To make these investments.
        Mr. Johnson of Georgia. I understand we want to increase
    trade, and we are projected to do that as the years move
    forward. But my question is in terms of repairing and creating
    new infrastructure upon which freight can move.
        We need Federal revenues in place to do that. Does
    everybody agree with that?
        Mr. Jefferies. Certainly on the highway side.
        Mr. Tymon. Yes----
        Mr. Johnson of Georgia. And would you----
        Mr. Tymon. Thank you, Mr. Jefferies.
        Mr. Johnson of Georgia. Would anyone disagree with me that
    it has been Federal revenues that have enabled the growth of
    our transportation network up to this point?
        Mr. Tymon. Mr. Johnson, absolutely, I agree with you on
    that. We need a robust Federal program in order to be able to
    fund our transportation network. If we are going to make sure
    that we are providing for interstate commerce, both from a
    freight standpoint, but also from a passenger standpoint, we
    need a robust Federal program.
        Right now the program is not meeting the existing state-of-
    good-repair needs that we have, as--the crumbling
    infrastructure reference that you had mentioned. We need
    something to be done to fix the Highway Trust Fund, to provide
    additional revenue, and to increase the size of these programs.
        Mr. Johnson of Georgia. Now, you know, we have been cutting
    revenue, Federal revenues, for decades. We have recently cut
    taxes again. And while we have been cutting taxes for decades,
    the needs for funding have continued to grow.
        And at the same time, my friends on the other side of the
    aisle have signed on to the Grover Norquist no new tax pledge,
    which is one reason why the gas tax has not been raised since
    1993. What impact does this have on our ability to grow our
    infrastructure to accommodate the increased trade that we all
    agree that we want the Nation to experience?
        What impact are our policies of cutting taxes and failing
    to raise revenues with increasing needs having on this Nation's
    ability to sustain our prosperity into the future?
        Ms. Aleman. If I may, Congressman, you know, one of the
    points that I made was that private-sector industries are
    spending approximately $27 billion annually, due to the cost of
    congestion. And that is a cost that I don't imagine that they
    are just taking on and not passing on to the consumer. And the
    consumers, in return, you know, could be getting so much more
    value if we were to put revenues forward to address the
    congestion problems at the forefront, as opposed to seeing
    those fees, those dysfunction taxes, being passed along on the
    back end to consumers.
        Mr. Johnson of Georgia. Yes. So when the recent $5.8
    trillion tax cut passed, 83 percent of which went to the top 1
    percent, then that means that, in addition to consumers paying
    higher taxes, or paying a greater proportion of the remaining
    tax burden that is in place, they are also getting hit with
    increased prices for goods that are incurred by the businesses
    that have to build the infrastructure to move the goods that
    the consumers pay for. So the bottom 99 percent are catching a
    double whammy in this kind of a situation, as our multinational
    corporate friends are able to escape their fair share of the
    tax burden.
        And so, as we talk about these subjects, I think we need to
    look at our policies, the policies that we put into place here
    in Congress, and stop avoiding the fact that we need to deal
    with a revenue shortfall from the Federal Government in order
    to sustain the kind of economic growth that we are going to
    need for our future.
        And with that I will yield back.
        Ms. Norton. Thank you, Mr. Johnson.
        Mr. Perry?
        Mr. Perry. Thanks, Madam Chair. I thank the panel members
    for their attendance today.
        Mr. Mathers, in your testimony you stated zero-emission
    heavy-duty vehicles are increasingly viable. But this
    statement, in my opinion, is not completely based in reality.
    If they were economically viable and provided a lower total
    cost of ownership, as you claim, then the industry would be
    embracing them due to the market incentives, alone.
        However, the high cost of current battery technology,
    combined with its limited energy density level makes EV trucks
    infeasible for long-haul operations, currently, and an
    expensive alternative for shorter operation.
        It is also vital to remind everyone that the phrase ``zero-
    emission vehicle'' is a deceptive and misleading labeling
    practice, as it fails to account for the emissions related to
    energy-intensive battery manufacturing processes, and the very
    power generation necessary to recharge the battery. This
    reality not only limits the net emissions reductions offered by
    a transition to these vehicles, but it requires significant
    amounts of the rare earth minerals necessary for the production
    of the batteries themselves.
        As you know, China has a stranglehold over the component
    mineral supply chains in the battery manufacturing industry.
    Also, China is projected to supply around two-thirds of global
    battery demand in 2020. Not coming from America, they are
    coming from China.
        The extremely energy-intensive manufacturing process will
    be powered largely by coal well into the future in China. Today
    70 percent of China's power is generated at coal-fired plants,
    and they will continue to generate over half of the nation's
    power through 2040, which, according to Mark Mills at the
    Manhattan Institute, quote, ``means that, over the life span of
    the batteries, there would be more carbon-dioxide emissions
    associated with manufacturing them than would be offset by
    using those batteries to, say, replace internal combustion
    engines.''
        It is important to note that these projections likely
    underestimate the emissions in question, as they were published
    prior to China's recently announced plans to massively expand
    coal-generating capacity while simultaneously cutting funding
    for renewables by 40 percent.
        The threat posed by Chinese influence over our critical
    infrastructure has been acknowledged by this very House and
    this committee, as we prohibited FTA funding of projects using
    Chinese railcars and buses.
        I was going to ask you about your justification for the EDF
    support of the significant threat to our national security,
    just by using the vehicles, but also the significantly higher
    consumer cost, the net increase in greenhouse gas emissions,
    and the economic harm that it does to the workers in the United
    States. But maybe I will just ask if the EDF would consider
    including the emissions that are commensurate with the
    production of the batteries, and everything else that goes into
    the production and the use of the batteries into their
    assessment of the economic viability. Maybe that is a better
    question.
        Mr. Mathers. Thank you, Mr. Perry, for the question. And we
    do, right?
        I am not familiar with the Manhattan Institute study, but I
    am very familiar with work that the U.S. Government is
    sponsoring through Argonne National Labs that has looked at the
    life-cycle impact of electrification in electric vehicles, and
    found that the fuel consumption, right, is still, by far, the
    most significant source of emissions, and that the creation of
    the battery is on par with the creation of the vehicle.
        So it is, I think, on the order of about 20 percent of the
    life cycle. I don't have the numbers off the top of my head,
    but would be more than happy to follow up and put those on the
    record.
        I think the questions around China and the life-cycle cost
    all kind of come together in the fact that the direction of
    this industry is clear. You are seeing Daimler putting in $1
    billion to build these vehicles. You are seeing Cummins invest
    half a billion dollars. These manufacturers are doing this
    because they see that is where the future is. And right now,
    China has a head start on us.
        And so I think we, as a country, have a choice to make. Do
    we want to out-compete China and make those vehicles here? And
    I think we are better off if we do. And that is better for the
    environment, that is better for our economy, and that is better
    for our national security.
        Mr. Perry. But the point is we are not making them here
    yet. So the policy that you are advocating for is kind of--the
    cart is before the horse, as opposed to backwards. And I don't
    necessarily disagree that it would be great if that weren't the
    case, but that is not the case now, and I would----
        Mr. Mathers. Let's let----
        Mr. Perry [continuing]. Just like your estimates----
        Mr. Mathers. Let's just let----
        Mr. Perry [continuing]. To include all these other things,
    and don't paint such a rosy picture which isn't commensurate
    with reality. And that is what I am saying.
        Ms. Norton. The gentleman's time has expired.
        Mr. Lamb?
        Mr. Lamb. Thank you, Madam Chairwoman.
        Ms. Aleman, I represent an area outside of Pittsburgh,
    Pennsylvania, which shares some things in common, economically
    and culturally, with the Chicagoland area. I am just curious.
    Your review of the CREATE model since it has been built, it
    looked to me like you said about 40 percent of the revenue was
    Federal, and then, I guess, the 60 percent comes from the other
    partners that you have enlisted.
        So do you think that an area like mine has much to learn
    from CREATE? How would you describe the breakthroughs that you
    have made using that model, or the efficiencies that you have
    gained? Because it must not be just more Federal funding. There
    must also be some efficiencies that you have established with
    that model.
        Ms. Aleman. Yes, thank you for the question, Congressman.
        You know, the CREATE model, while we have seen some very
    significant successes, in terms of getting a Federal match, and
    also substantial matches from our private-sector partners, I
    think some of the benefits that we have seen are being able to
    have a list of projects that we have prioritized and are lining
    up to move forward at any point that funding opportunities
    arise.
        For the projects that have been completed, there are about
    70 projects in the entire program, about 35 of which have been
    completed. We have seen that those projects have come in on
    time, under budget, and I think that that is exemplary of the
    public-private partnership that we have with our railroad
    partners, and leveraging their expertise on some of these
    projects, where, you know, inherently, the State side, and the
    Federal side, and then the private sector are coming together.
    So that is what I would say would be one of the primary
    benefits.
        Mr. Lamb. And at the start of it, who was kind of the
    driver of CREATE in the beginning? Was it more of a public
    project in which you recruited the private partners? Or was it
    the railroads coming to you and asking for it? Or vice versa?
    Or how did it go?
        Ms. Aleman. Yes, I would say that there was leadership
    between the city of Chicago and Cook County, which is the
    county that the city of Chicago sits in, and through that
    strong partnership we were able to get on board the State, the
    railroads, and other partners because it is a mutually
    beneficial program, overall.
        Mr. Lamb. OK, thank you.
        Ms. Aleman. Thank you.
        [Ms. Aleman submitted the following post-hearing correction
    to her preceding remark:]

      Post-hearing Correction of Remarks Submitted for the Record by Erin
     Aleman, Executive Director, Chicago Metropolitan Agency for Planning,
     and Board Member, Coalition for America's Gateways and Trade Corridors
        At approximately 2 hours and 20 minutes into the hearing, in
    response to a question from Representative Lamb, I misspoke about the
    history of the CREATE Program. I stated that the city of Chicago and
    Cook County initially spurred the program. In fact, it was leadership
    from the city of Chicago, the State of Illinois, and railroad partners
    that in 2003 spurred the program. Cook County became an official
    partner in 2018.

        Mr. Lamb. Ms. Goodchild, I was wondering if you could talk
    a little bit more about the University Transportation Centers.
    We have one back in Pittsburgh, as well, at Carnegie Mellon
    University that is doing some really strong work. How would you
    evaluate that program so far? Has it worked well at Washington?
    Are there challenges? Are there things we could do better with
    it?
        Ms. Goodchild. The University Transportation Center has
    sponsored a center at the University of Washington for, I
    think, since the beginning of the program. And, in terms of our
    ability to train transportation professionals, it is essential.
    Without that program, we would have--you know, at a public
    university, the rest of our sort of resources have really been
    stripped away.
        And so, to provide students with opportunities to hear
    additional lectures, to travel to TRB, to participate in any
    kind of professional development is really supported through
    that program. So, in terms of developing the next generation of
    transportation professionals, it is essential, and we wouldn't
    be able to do that without the program.
        Research-wise----
        Mr. Lamb. So, sorry, just to interrupt for a--so would you
    say, then, that the main benefit you are concentrating on is
    the teaching benefit to students, as opposed to, like, external
    work product that it is----
        Ms. Goodchild. Right. No, I was going to speak to the----
        Mr. Lamb. OK.
        Ms. Goodchild [continuing]. To the research outcomes. I
    think also having--you know, really, as a source of
    complementary Federal funding--so those grants, you know, if
    you have a grant from a UTC that has to be matched by some kind
    of non-Federal, local money--so I think that structure of
    matching locally driven and locally motivated projects by
    Federal grant money is also a really essential way to develop
    regional with national benefit work.
        And we don't--there is no substitute. We don't have the
    NCFRP program, we--so it is essential, as well.
        Mr. Lamb. OK. Thank you, Madam Chair, I yield back.
        Ms. Norton. Thank you, Mr. Lamb.
        Mrs. Miller?
        Mrs. Miller. Thank you, Chairwoman Norton, and thank you
    all for being here today.
        Transportation infrastructure is the lifeline that connects
    my home State of West Virginia to the rest of the country. Our
    highways and rail lines are essential for moving products from
    West Virginia, and connecting the country.
        Our inland waterways also ship over 80 million tons of
    natural resources every year. And shipping via waterways will
    continue to play an important role to meeting the growing
    demand for goods well into the future.
        I think that shipping should be a central part of these
    discussions, moving forward. West Virginia is a transportation
    State, and we are proud to work hard to deliver the goods that
    America and the world needs.
        We are all gathered here today because we realize the
    importance of our Nation's infrastructure development, and I
    thank you all for appearing before this subcommittee today to
    help us make some of these tough decisions.
        Ms. Aleman, my district of southern West Virginia was one
    of the hardest hit by the recession, and it is still recovering
    from the war on coal, which caused so many to lose their jobs.
    With the dramatic growth of long-haul freight traffic in the
    United States, how does the freight industry plan to recruit
    new drivers to meet this increased demand?
        Ms. Aleman. I am going to defer to my partner here.
        Mrs. Miller. Fine.
        Mr. Baker. And I would love also for Ian to weigh in, but I
    would say we in the rail industry, we actually are not finding
    a problem recruiting conductors and engineers for the trains.
    It is a well-paying job with railroad retirement benefits, and
    it is typically pretty attractive. We have lots of
    infrastructure challenges, but I would say at the moment
    finding folks to operate freight trains is not one of our
    challenges.
        Mr. Jefferies. Just to add onto that, absolutely, the
    freight rail industry is blessed with folks who are
    multigenerational and 45-year veterans.
        And while there is no shortage because they are very, very
    well-compensated jobs, one area where we are facing challenges,
    quite honestly, is the opioid issue. That continues to
    challenge us, along with every other manufacturing industry, as
    far as--we have a strict drug testing program, and areas that
    are most hit by the opioid epidemic, certainly that impacts the
    number of possible candidates out there, and has certainly
    diminished the potential job pool in certain situations. So
    that is an area where we continue to want to work with Congress
    to address.
        Mrs. Miller. That is a very good point.
        Mr. Jefferies. But as far as the--I don't know, the
    trucking side, I don't know if you have any comments there.
        Mr. Tymon. You know, I would just say that I think
    workforce development issues continue to be a top priority for
    State DOTs across the country, and that includes maintenance
    workers and operators of vehicles. It is becoming harder and
    harder, I think, for State DOTs or, I am sure, trucking
    companies to be able to recruit new entrants into the business.
        You know, I think that there are a lot of other
    opportunities for folks right now, with the economy doing so
    well, and employment rates so low. It is hard, I think, to
    attract people into some of those jobs that aren't easy jobs,
    you know, for truck drivers. You are on the road a lot of days
    out of the year. If there are a lot of other choices to make, I
    can see why it is hard to be competitive in this job market.
        Mrs. Miller. Well, and my point is, in the coal fields, for
    those people who have had good-paying jobs who are now
    unemployed, are you doing anything to recruit them?
        Mr. Tymon. I can tell you that, from a State DOT
    standpoint, recruitment and retention is a top priority. I
    can't speak specifically to what is going on in West Virginia,
    but I will tell you that what I hear more from our members is a
    shortage of workers, as opposed to, you know, trying to--or--
    yes, a shortage is the bigger issue.
        Mrs. Miller. So that could go through some of the community
    college or career teaching that needs to happen.
        Mr. Baker, what role do short line and regional railroads
    play in connecting parts of rural America with the greater
    transportation network?
        And what role can Congress play in making sure that these
    railroads are not left behind?
        Mr. Baker. Thank you. Short lines largely exist as the
    first-mile/last-mile of the freight rail network, and
    particularly in smalltown and rural America. West Virginia is a
    huge State for short lines.
        My written testimony goes into somewhat excruciating detail
    on some of the policy recommendations I have, but just in a few
    seconds here there are programs that the Transportation and
    Infrastructure Committee has supported and championed that are
    key for short lines: the CRISI grant program; the issue that
    has been referenced here multiple times, the idea of taking off
    the multimodal caps on the INFRA program and the State freight
    program would be really effective; our favorite topic, the 45G
    tax credit, would be effective.
        And there is more, too, but those would be great, great
    places to start. And I think you have been champions of all of
    those, so thank you.
        Mrs. Miller. Thank you. I yield back my time.
        Ms. Norton. I thank the gentlewoman. Her time has expired.
        Mr. Lowenthal?
        Mr. Lowenthal. Thank you, Madam Chair.
        Ms. Aleman, you know as well as anyone here that freight
    movement depends upon a complex, interconnected system of
    transportation infrastructures. Deficiencies in any one link of
    the supply chain affect the efficient movement of goods for
    everyone. That is why I appreciate in your testimony and that
    of other witnesses--and you have mentioned it again today, both
    in written and in oral--the need to remove barriers like the
    cap on nonhighway projects under the Federal freight program.
        I am also very appreciative that, especially in your
    written testimony, you mention the coalition support for my
    proposal to establish a multimodal freight infrastructure trust
    fund that would help make these critical intermodal
    improvements.
        But your testimony also mentions a potential improvement to
    the national freight strategic plan, including the addition of
    a comprehensive freight needs analysis. Why is that so
    important, to have a comprehensive freight needs analysis?
        Ms. Aleman. Thank you for the question, Congressman. A
    comprehensive look at our national freight infrastructure is
    really going to help us be more coordinated in Congress' effort
    to provide oversight and guidance to U.S. DOT. It will also
    help Members of Congress shape future programs in future
    Federal reauthorization bills, and make sure that, really, the
    goals and objectives that you set forth in the policies are
    being achieved through a transparent, performance-based
    framework.
        Mr. Lowenthal. I want to follow up on that. And while I
    personally strongly support the INFRA program and agree with
    you that a competitive grant program is better positioned to
    fund large-scale infrastructure projects that improve freight
    movement, I am concerned about the lack of transparency in the
    selection of projects for these funds.
        Would a freight needs analysis allow Congress and
    stakeholders to better evaluate if the Department is directing
    these funds to the most important and urgent projects?
        Ms. Aleman. Yes. So I will reference the recent GAO report
    that stated that merit-based project selection is necessary,
    and also there is room for improvement in the way that projects
    are selected today.
        And I think our region has seen that, and come a long way.
    For instance, the competitive freight program that Illinois DOT
    put together laid out in a transparent way the goals and
    objectives, and how the measures that they were going to use to
    evaluate projects were going to achieve those goals. And
    essentially, we created a tool that said to potential
    applicants, ``You can fill this tool out yourself and evaluate
    your project.''
        I think one of the fears is that it is going to open the
    door to a floodgate of projects coming through and people
    gaming the system. What we found, instead, was that the
    projects that were submitted were better and more oriented
    toward the goals of the program and the program dollars.
        And at the regional level, too, the programming of our
    funds, we make those data, criteria, the scoring transparent so
    that all can see. And while you may not get the project you
    wanted, or the funding you requested, you at least respect the
    process, and you understand where your project could have had
    room for improvement.
        Mr. Lowenthal. Thank you. I want to follow that up and--you
    may have answered it--do you have any additional suggestions to
    increase the transparency in the INFRA evaluation process?
        Ms. Aleman. Yes. Specifically, it is tying those metrics
    that you are going to use to the goals and objectives that you
    are trying to achieve, and then I would say making those
    projects and the scoring publicly available.
        Again, you know, that, in and of itself, making that
    transparent, allowing people to see where their projects fell
    short, is a critical tool to making sure that you are achieving
    your goals.
        Mr. Lowenthal. Thank you. And in my minute left, does
    anyone else want to comment on the transparency, how we can
    improve the INFRA project?
        Mr. Baker?
        Mr. Baker. Well, I was largely just going to agree with
    you, that the importance of increasing the transparency, I will
    say we have quite a few short line railroads that partner with
    State agencies to apply for these grants, and they do find it
    extraordinarily frustrating, how opaque the process is. And it
    is difficult to understand what was selected, or what the
    reasons for the selection were. So I think the transparency
    would help everybody.
        Mr. Lowenthal. Thank you. I concur. As one who represents
    the port areas of Long Beach, Los Angeles, that transparency
    would be great for the process.
        With that I yield back.
        Ms. Norton. Thank you, Mr. Lowenthal.
        Mr. Pence?
        Mr. Pence. Thank you, Madam Chair, and thank you all for
    being here today.
        I hail from Indiana, which is the crossroads of America. I
    have always emphasized the necessity of reliable and safe
    freight in transport options in my home State. I am a
    businessman by background, and I came to Congress to address
    the challenges facing our critical infrastructure.
        We need to face both the short term and the long term and
    put Hoosiers back in the driving seat, as well as all those
    across the United States.
        The 29,600 miles of highway and 4,500 miles of rail track
    in our State contribute to the prosperity of not only Hoosiers,
    but all Americans.
        We are a national leader in intrastates, home to the second
    largest FedEx hub worldwide, and have the third most freight
    railroads, with 41 lines, including 6 short line regional
    railroads in my district, the Sixth Congressional District of
    Indiana.
        We are also very proud that Cummins engine company,
    headquartered just 1\1/2\ miles from my house in Columbus,
    Indiana, is developing world-class, innovative solutions to
    advance cleaner technology. In October of this year, Cummins
    unveiled cutting-edge technology that would use hydrogen fuel
    cell solutions to create a Class 8 heavy-duty truck with zero
    emissions.
        With our Nation's truck and rail freight transport system
    accounting for 74 percent of all movement of goods, it is in
    the best interest of companies like Cummins to embrace fuel-
    efficient alternatives to be profitable and, most importantly,
    reduce the impact on the environment. The American
    Transportation Research Institute cites greater congestion as a
    source of excessive idling and resulting in higher emissions.
        With companies like Cummins modernizing our vehicles, we
    should also consider more solutions for reliable freight
    infrastructure such as increased rail investment and truck-only
    lanes, or critical commerce corridors.
        In 2017, truckers alone lost 1.2 billion hours of
    productivity from nationwide congestion. I firmly believe that
    economic growth in both the trucking and rail industries will
    lead to greater economic, environmental, and societal impact.
        Mr. Tymon, in your testimony you mentioned addressing
    freight corridors in the next surface transportation bill. I
    wish more of the industry would join you to highlight the
    benefit of these corridors, or truck lanes, to physically
    separate cars and trucks in the congested areas. Even though
    truckers already pay more than any other entity in our Nation's
    highways, the industry is coming to the table with creative
    ways to affect these projects.
        At the beginning of November, Indiana broke ground on a
    similar project called the Heavy Haul Transportation Corridor,
    which will pull semi-trucks off the highway with new rail
    connections, providing easier access to State roads and improve
    multimodal shipping. Solutions like these are not only tackling
    congestion, but also create a safer and more fuel-efficient
    freight system for Hoosiers.
        Mr. Tymon, I know AASHTO has done studies in the past
    detailing how truck-only corridors can alleviate congestion and
    promote safety. How would reducing restrictions on State
    multimodal freight network funding to allow, for example, more
    miles for railroad coordination and CCCs help propel our
    economy?
        Mr. Tymon. Well, thank you for that question, Congressman.
    I think the easiest and the best way to promote those types of
    projects is----
        Ms. Norton. Is your mic on?
        Mr. Tymon. It is. Is that better?
        I think the easiest and best way to provide opportunities
    for those types of projects is to continue to provide
    flexibility to the States and to provide funding to them by the
    formula programs. These core formula programs that have been
    the foundation of the Federal highway program for over 50 years
    provide States the predictability to know year in and year out
    how much money they are going to get. And that will enable them
    to take on innovative approaches as you are describing in
    Indiana.
        So I think removing some of the redtape and the barriers,
    and providing States the flexibility to be creative and
    innovative, as they are in Indiana, is the easiest, and it is
    the best thing that we can do to promote those types of
    projects.
        Mr. Pence. Thank you, Madam Chair. I yield back.
        Ms. Norton. Thank you, Mr. Pence.
        Ms. Plaskett?
        Ms. Plaskett. Thank you very much, Madam Chair.
        Mr. Tymon, I agree with you that the formula is very, very
    important. And, as a Member of the Territories, we were taken
    out of the formulas in the late 1990s. And so it is our hope to
    go back in them, because we believe that that is the best way
    for us to plan how we are going to use our infrastructure and
    support. So I am glad to hear you agree that that is a really
    important thing to do.
        I have been harassing the chair of our committee. The last
    time the Territories was on it was the last time a Member of
    the Territories was on this committee. So I am hoping that me
    being on this committee will get us back in there.
        But I wanted to go back to something that one of my
    colleagues, Mr. Lowenthal, was talking with you all about,
    about transparency and the INFRA program as an example, and in
    others, some of the other application and programs that DOT has
    in other agencies.
        We talked about how transparency would be more important,
    and support in predictability for those that are applying. Do
    any of you have any specific examples where--the types of
    guidelines or additional support that would be helpful to
    jurisdictions and municipalities and others that are applying
    for some of these grants?
        Mr. Tymon. You know, one thing that I guess--one thing that
    I would add is sometimes having consistency across years would
    help, I think, the applicants, because I think we are seeing,
    year to year, that the notice of funding availability will
    change kind of what they are trying to emphasize. And I think
    that causes project sponsors to then have to kind of retool,
    year to year, if they are not selected in that 1 year.
        So having, I think, some consistency across the years--the
    great thing about the FAST Act was that, for those
    discretionary programs that were created there, they spelled
    out, I think, specific criteria that provided at least a little
    bit of predictability for the applicant----
        Ms. Plaskett. Right.
        Mr. Tymon [continuing]. So that they could come back to the
    table if they weren't successful in the first year.
        I do think that the administration is doing a good job of
    following up with project sponsors if their application does
    not go through, and then letting them know where the
    application fell short. But having that level of transparency,
    so that everybody knows which projects have been successful,
    and why they have been successful or unsuccessful, I think,
    would help all project sponsors.
        Ms. Plaskett. I know that the Virgin Islands, along with
    some of our private partners, did have that meeting at DOT. And
    I am really grateful that the Department was willing to sit
    down with them and explain what was needed, where they fell
    short.
        Of course, having that on the front end is a better way,
    because then you have to wait another year or so to put in what
    is missing, so that you can have a better application and meet
    the needs of what it is you are trying to grow.
        Does anyone else have anything else that they thought might
    be helpful in there?
        Mr. Jefferies. Just at a very high level, in a prior life I
    worked at GAO, and I think they have been on record, just
    talking about the need for very objective, articulated criteria
    that are then evaluated in a fully transparent manner. So,
    hopefully, you do get that information on the front end, and
    don't have to wait until it is too late to get the feedback
    that----
        Ms. Plaskett. Right.
        Mr. Jefferies [continuing]. That would be helpful.
        Ms. Plaskett. So several months ago--I am also the chair of
    the New Democrat Coalition Infrastructure Task Force, and I
    have had the pleasure of going around the country to some of my
    colleagues' districts to see what is working, what is not
    working. And Mr. Colin Allred invited me to Dallas. I was
    really excited to see the rail that is going on there between
    Dallas and Houston, and the types of goods and services that
    can be moved in that.
        Dr. Goodchild, I wanted to ask you, you know, that is a
    public-private partnership. It is really being driven by the
    private sector. What is the role that you believe that the P3s
    can play in helping to meet freight infrastructure needs
    throughout the country?
        Ms. Goodchild. Yes, thank you. I think it is essential that
    the private sector be consulted and engaged and participate as
    we build infrastructure.
        If you think about building big infrastructure projects
    with no insight as to how it is going to be used, or what
    benefit it might bring, or why it might bring that benefit, you
    can really make huge mistakes, and invest a lot of money in
    projects that don't bring the benefit that you thought they
    were going to to the ones who are using it.
        So I think, as we move forward and we believe that we are
    building infrastructure to serve industries, we must understand
    those industries, and they must be engaged in some of that
    decisionmaking. So I think it is a really important principle,
    particularly in the freight space, to good decisionmaking and
    efficient, cost-effective use of public money.
        Ms. Plaskett. Thank you. And, the Virgin Islands, although
    we don't have freight, we recognize that all of our goods are
    imported, and that, unless the end--those individuals who are
    manufacturing are doing it at a port city, that all of the
    goods that are coming to us are coming through freight. So
    bottlenecks in that system affect those of us who don't
    necessarily have freight going through our districts. And we
    all need to be part of the solution in making sure that this is
    done efficiently, and the best it can get to the end users.
        So thank you all.
        Ms. Norton. Thank you, Ms. Plaskett.
        Are there any further questions from members of the
    subcommittees?
        Seeing none, I would like to thank our colleagues, but
    especially each of our witnesses for your testimony today. It
    has been very helpful to me.
        I have listened very carefully to see how your testimony
    might improve our upcoming bill. I found your testimony to be
    informative and helpful in that regard.
        I now ask unanimous consent that the record of today's
    hearing remain open until such time as our witnesses have
    provided answers to any questions that may be submitted to them
    in writing. And I invite Members who have such questions to do
    so.
        And I also ask unanimous consent that the record remain
    open for 15 days for any additional comments and information
    submitted by Members or witnesses to be included in the record
    of today's hearing.
        Without objection, so ordered.
        If no other Members have anything to add, the subcommittees
    now stand adjourned.
        [Whereupon, at 12:45 p.m., the subcommittees were
    adjourned.]

                           Submissions for the Record

                                  ----------

     Prepared Statement of Hon. Eddie Bernice Johnson, a Representative in
                        Congress from the State of Texas
        Madam and Mr. Chairman, I appreciate the joint subcommittees
    holding this hearing today. The purpose is to explore the importance of
    freight transportation, investments needed to support freight
    transportation, and the ways in which demand for the timely movement of
    goods are growing and changing.
                      Importance of Freight Transportation
        It is without question that freight transportation is critical to
    our economy in the US. I understand that the nation's freight system
    transports, on average, 51 million tons of freight, valued at
    approximately $55 billion, on a daily basis, which amounts to
    approximately 17.7 billion tons of freight, valued at approximately
    $16.8 trillion, annually. Additionally, this demand is increasing each
    year.
                               Investments Needed
        Continuous increases in freight transportation demand across the
    United States requires us to make the necessary investments today. Most
    investments are done at the state and local levels. We know that our
    national highway congestion negatively affects the freight delivery
    system because it impedes trucking's ability to deliver goods on time.
    Reliable and precise scheduling is essential to the freight rail and
    trucking systems.
        In Dallas, we have worked to battle, and are continuing to battle,
    congestion issues. It is reported that more than two out of every five
    miles of America's urban interstates are congested. Congestion costs
    the trucking industry $74.5 billion in 2017, $66.1 billion of which
    occurred in dense urban areas like Dallas.
        Ways in Which Demand for Goods Movement is Growing and Changing
        Investments in new technology are important to the growth and
    development of our national freight delivery systems. As we look to
    grow our markets internationally, we also have to ensure that our
    domestic systems do not impede the international growth of products
    that we sell abroad. As we continue to expand our markets, the need for
    new and improved domestic and international freight delivery systems
    will only increase.
        We cannot stop the development and use of new technology. We need
    it for continued growth and advancement. However, I am concerned with
    the use of new technology displacing our workers. We must provide
    opportunities for retraining and new jobs for people who may lose their
    jobs.
        In Texas, I am also concerned with the shortage of drivers for
    freight trucks. With rising gas prices and increasing congestion on our
    highways, it is clear that we need long term transportation
    infrastructure solutions that meet the current demand for the movement
    of goods, while also allowing for future growth. To help alleviate the
    shortage of truck drivers, I am looking at how we can allow more young
    people to drive trucks and enter into the trucking industry.
                   Environmental Impact of Freight Railroads
        We must seek viable environmentally sensitive solutions to expand
    our nation's freight rail capacity, as we make the necessary freight
    rail investments. Advancements have been made, such as in the freight
    railroads' use of technology systems to help monitor and gain maximum
    fuel efficiency. However, we still have a long way to go.
        Madam and Mr. Chairman, I am excited about the many possibilities
    in helping to improve our nation's freight transportation
    infrastructure. I look forward to working with the committee to
    strengthen our nation's capacity to move goods efficiently and in a
    timely manner.

     Prepared Statement of Hon. Steve Cohen, a Representative in Congress
                          from the State of Tennessee
        Thank you, Chairwoman Norton and Ranking Member Davis and Chairman
    Lipinski and Ranking Member Crawford for holding this important
    hearing.
        I appreciate the opportunity to examine the challenges and
    opportunities of freight transportation, especially since my district
    is the transportation hub of the United States.
        In Memphis, we've got five Class 1 railroads, seven primary
    highways, two interstates, the 4th largest inland port in the nation,
    and Fed Ex's super hub.
        As for trucking, we have more than 400 companies that operate from
    Memphis.
        It's no wonder that we have been dubbed America's Distribution
    Center.
        While it's true that no one moves like Memphis, it doesn't come
    without its challenges.
        As the demand for freight continues to increase, it's important we
    look at how it affects all our road users.

      Statement of Erin Aleman, Executive Director, Chicago Metropolitan
    Agency for Planning, and Board Member, Coalition for America's Gateways
     and Trade Corridors, Submitted for the Record by Hon. Peter A. DeFazio
        During the hearing, several Members of Congress asked questions
    pertaining to the Nationally Significant Freight and Highway Projects
    Program (INFRA). Questions addressed funding levels, award selection
    transparency, and the difference between formula and competitive grant
    distribution approaches.
        While I answered each of these questions during the hearing and
    also addressed these questions in my written testimony, I am taking
    this opportunity to restate the following:
          The INFRA program is underfunded. CAGTC calls for an
    annual investment of $12 billion in multimodal freight investment
    through a competitive grant program.
          To ensure the best and highest use of federal dollars,
    the award selection process must be transparent and employ merit-based
    criteria that identify and prioritize projects with a demonstrable
    contribution to national freight efficiency. Goals should include
    increasing national and regional economic competitiveness, improving
    connectivity between freight modes, reducing congestion and
    bottlenecks, and improving the safety, efficiency, and reliability of
    the movement of freight and people. Likewise, a national freight
    strategic plan that identifies key freight gateways and trade corridors
    should guide investment decisions.
          Competitive grant programs, such as INFRA, are critical
    to large-scale infrastructure projects, which often span modes and
    jurisdictional borders and are difficult, if not impossible, to fund
    through traditional distribution methods such as formula programs.
    Likewise, formula programs play an important role--but there is no
    ``one size fits all'' approach to funding freight projects and formula
    dollars cannot supplant the role of a competitive grant program that
    awards projects through the use of merit-based criteria. A federally
    administered competitive grant program is necessary to advance
    nationally significant freight projects in a timely and efficient
    manner.

    Letter of December 4, 2019, from Catherine Chase, President, Advocates
     for Highway and Auto Safety et al., Submitted for the Record by Hon.
                             Eleanor Holmes Norton
                                                      December 4, 2019.
    Hon. Peter A. DeFazio,
    Chairman,
    Hon. Sam Graves,
    Ranking Member,
    Committee on Transportation and Infrastructure, U.S. House of
            Representatives, Washington, DC.

        Dear Chairman DeFazio and Ranking Member Graves:
        As you prepare for tomorrow's hearing, ``Where's My Stuff?
    Examining the Economic, Environmental, and Societal Impacts of Freight
    Transportation,'' we urge you to prioritize safety in considering
    America's freight transportation system. Each day on average, over 100
    people are killed and nearly 7,500 more are injured in motor vehicle
    crashes. This preventable toll also comes with a serious financial
    burden. Annually, crashes impose comprehensive costs of over $800
    billion on society, $242 billion of which are economic costs--amounting
    to a ``crash tax'' of $784 per person each year. Yet, available
    solutions to the problems that perpetuate crashes continue to languish.
    Moreover, year after year proposals are considered to weaken or repeal
    the minimal safety protections that do exist. We encourage you to take
    action preventing deaths and injuries as part of any legislative
    package advanced by your Committee and respectfully request your
    consideration of our positions during the hearing.
        Truck crashes deaths continue to rise; immediate action is needed.
    In 2018, 4,951 people were killed in crashes involving a large truck--a
    staggering 46 percent increase since a low in 2009. Additionally,
    151,000 people were injured in crashes involving a large truck that
    same year. Commercial motor vehicle (CMV) crashes amounted to $134
    billion in costs in 2016, the latest year for which data is available.
    These grim statistics are unacceptable and more must be done to prevent
    this needless carnage.
        Proven countermeasures that would bring about safer conditions for
    both truck drivers and those with whom they share the road must be
    implemented. Technologies including speed limiting devices, automatic
    emergency braking (AEB), and comprehensive underride guards could be
    saving lives now if they were fully deployed. Similarly, a required
    minimum number of behind the wheel hours should be established as part
    of entry level driver training. We call on Congress to take swift
    action on legislation requiring these crucial upgrades.
        Oppose efforts to weaken or repeal existing truck safety rules. In
    the last few years, special interests have been relentless in their
    attempts to increase truck driver hours of service and evade compliance
    with the electronic logging device (ELD) rule, despite the known
    dangers associated with ``tired truckers.'' It is also alarming that
    efforts have been underway to allow for ``teen truckers'' by lowering
    the age to obtain an interstate commercial driver's license (CDL) from
    21 to 18. This ill-conceived concept is especially egregious because
    truck drivers under the age of 21 are anywhere from 4 to 6 times more
    likely to be in a fatal crash, according to studies of intrastate truck
    drivers. These dangerous proposals pose a direct threat to the safety
    of all road users and should be resoundingly rejected.
        Bigger, heavier trucks would endanger all motorists and our
    infrastructure. Congress should oppose all attempts to further degrade
    safety by increasing truck size and weight limits. According to the
    2017 Infrastructure Report Card from the American Society of Civil
    Engineers, America's roads receive a grade of ``D'' and our bridges
    were given a ``C+''. Nearly 40 percent of our 615,000 bridges in the
    National Bridge Inventory are 50 years or older and one out of 11 is
    structurally deficient. The U.S. Department of Transportation (DOT)
    Comprehensive Truck Size and Weight Study found that introducing double
    33-foot trailer trucks \1\, would be projected to result in 2,478
    bridges requiring strengthening or replacement at an estimated one-time
    cost of $1.1 billion. This figure does not even account for the
    additional, subsequent maintenance costs which will result from longer,
    heavier trucks. In fact, increasing the weight of a heavy truck by only
    10 percent increases bridge damage by 33 percent. The Federal Highway
    Administration (FHWA) estimates that the investment backlog for
    bridges, to address all cost-beneficial bridge needs, is $123.1
    billion. The U.S. would need to increase annual funding for bridges by
    20 percent over current spending levels to eliminate the bridge backlog
    by 2032.
    ---------------------------------------------------------------------------
        \1\ ``Double 33'' is a configuration of a tractor pulling two 33-
    foot trailers, amounting to an eight-story office building on its side.
    Despite being aggressively pushed by certain segments of the shipping
    and trucking industry, this proposal has been rejected on a bipartisan
    basis.
    ---------------------------------------------------------------------------
        Longer trucks also come with operational difficulties such as
    requiring more time to pass, having larger blind spots, crossing into
    adjacent lanes, swinging into opposing lanes on curves and turns, and
    taking a longer distance to adequately brake. And, not surprisingly,
    trucks heavier than 80,000 pounds have a greater number of brake
    violations, which are a major reason for out-of-service violations.
    According to a North Carolina study by the Insurance Institute for
    Highway Safety (IIHS), trucks with out-of-service violations are 362
    percent more likely to be involved in a crash. This is also troubling
    considering that tractor-trailers moving at 60 mph are required to stop
    in 310 feet--the length of a football field--once the brakes are
    applied. Actual stopping distances are often much longer due to driver
    response time before braking and the common problem that truck brakes
    are often not in adequate working condition.
        Increasing truck size and weight will exacerbate safety and
    infrastructure problems, negate potential benefits from investments in
    roads and bridges, and divert rail traffic from privately owned freight
    railroads to our already overburdened public highways. Also, despite
    claims to the contrary, bigger trucks will not result in fewer trucks.
    Following every past increase to federal truck size and weight, the
    number of trucks are on our roads has gone up. Since 1982, when
    Congress last increased the gross vehicle weight limit, truck
    registrations have more than doubled. The U.S. DOT study also addressed
    this meritless assertion and found that any potential mileage
    efficiencies from the use of heavier trucks would be offset in just one
    year.
        Progress to reduce motor vehicle crash deaths has stagnated despite
    available, proven technology. Tremendous focus has been placed on the
    future potential of autonomous vehicles (AVs), also known as driverless
    cars, to eliminate crashes. While it is claimed that AVs may someday
    make meaningful reductions in deaths and injuries, this promise is
    still likely decades away. Further, at least four people have already
    been killed in crashes involving vehicles in the relatively small fleet
    of cars equipped with self-driving technologies. The real risks posed
    by experimental driverless cars must be addressed through strong
    federal regulation--including safety standards and oversight--before
    AVs are deployed on a large scale.
        As AVs are being developed and deployed, advanced vehicle
    technologies, which prevent and lessen the severity of crashes, should
    be required as standard equipment in all new vehicles. In fact, the
    National Transportation Safety Board (NTSB) has included increasing
    implementation of collision avoidance technologies in its Most Wanted
    Lists of Transportation Safety Improvements since 2016. Proven
    technologies such as automatic emergency braking, lane departure
    warning and blind spot detection should be made standard equipment on
    all new vehicles now. We urge Congress to require the U.S. DOT to
    establish minimum performance requirements for these lifesaving
    technologies and require that all new vehicles be equipped with them.
        Infrastructure upgrades will be critical as driverless cars are
    deployed. As AVs are tested and eventually commercialized on our
    Nation's roads, it will be vital that infrastructure improvements be
    made to ensure their safe operation. For example, research shows that
    driverless vehicles can easily be confused by poor infrastructure
    conditions leading to dangerous errors. In one experiment a standard
    stop sign with only a few alterations was interpreted by a driverless
    car as a 45 mph speed limit sign. The potential consequences of these
    types of mistakes could be catastrophic. Substantial investments in our
    infrastructure that benefit human drivers now and help to prepare our
    roads for self-driving cars must occur before driverless vehicles are
    ubiquitous on our streets. Additionally, despite claims that driverless
    technology will improve our congested roads, transportation experts
    have already found that the proliferation of mobility services like
    Lyft and Uber (precursors for mass deployment of driverless vehicles)
    have instead increased congestion and reduced mass transit use. In
    addition, a recent study predicted that AVs could exacerbate clogged
    arteries by constantly traveling at low speeds instead of parking while
    waiting for their next trip. These, and numerous other, issues must be
    comprehensively addressed before driverless vehicles are deployed on a
    large scale. In order to realize the full potential of AVs to be a
    catalyst for positive change, protections must be put in place to
    ensure the safety of all road users.
        As you consider important issues surrounding freight movement, we
    urge you to prioritize efforts that will reverse the high number of
    crash fatalities, injuries and costs from large truck crashes.
    Effective solutions are readily available to save lives now.
            Sincerely,

    Catherine Chase, President, Advocates for   Georges C. Benjamin, MD,
     Highway and Auto Safety                     Executive Director,
                                                 American Public Health
                                                 Association

    Harry Adler, Executive Director, Truck      Jason Levine, Executive
     Safety Coalition                            Director, Center for Auto
                                                 Safety

    Joan Claybrook, Chair, Citizens for         Jack Gillis, Executive
     Reliable and Safe Highways (CRASH) and      Director, Consumer
     Former Administrator, National Highway      Federation of America
     Traffic Safety Administration

    Steve Owings, Co-Founder and President,     Stephen W. Hargarten, M.D.,
     Road Safe America                           MPH, Society for the
                                                 Advancement of Violence and
                                                 Injury Research

    Janette Fennell, Founder and President      Daphne Izer, Lisbon, ME,
     KidsAndCars.org                             Founder, Parents Against
                                                 Tired Truckers (PATT),
                                                 Mother of Jeff Izer, Killed
                                                 in a truck crash 10/10/93

    Dawn King, Davisburg, MI, President, Truck  Linda Wilburn, Weatherford,
     Safety Coalition (TSC), Board Member,       OK, Board Member, PATT,
     Citizens for Reliable and Safe Highways     Mother of Orbie Wilburn,
     (CRASH), Daughter of Bill Badger, Killed    Killed in a truck crash 9/2/
     in truck crash 12/23/04                     02

    Larry Liberatore, Severn, MD, Board         Beth Badger, Columbus, GA,
     Member, PATT, Father of Nick Liberatore,    Volunteer, Truck Safety
     Killed in a truck crash 6/9/97              Coalition, Daughter of Bill
                                                 Badger, Killed in truck
                                                 crash 12/23/04

    Tami Friedrich Trakh, Corona, CA, Board     Sally Greenberg, Executive
     Member, CRASH, Sister of Kris Mercurio,     Director, National
     Sister-in-Law of Alan Mercurio, Aunt of     Consumers League
     Brandie Rooker & Anthony Mercurio, Killed
     in a truck crash 12/27/89

    Rosemary Shahan, President, Consumers for   Andrew McGuire, Executive
     Auto Reliability and Safety                 Director, Trauma Foundation

    Jane Mathis, St. Augustine, FL, Vice        Ed Slattery, Lutherville,
     President, TSC, Board Member, PATT,         MD, Board Member, PATT,
     Mother of David Mathis, Mother-in-Law of    Volunteer, Truck Safety
     Mary Kathryn Mathis, Killed in a truck      Coalition, Husband of Susan
     crash 3/25/04                               Slattery, Killed in a truck
                                                 crash 8/16/10, Sons Matthew
                                                 & Peter Slattery critically
                                                 injured in a truck crash 8/
                                                 16/10

    Ron Wood, Washington, D.C., Volunteer,      Gary Wilburn, Weatherford,
     Truck Safety Coalition, Son of Betsy        OK, Volunteer, Truck Safety
     Wood, Brother of Lisa Wood Martin, Uncle    Coalition, Father of Orbie
     of Chance, Brock, and Reid Martin, Killed   Wilburn, Killed in a truck
     in a truck crash 9/20/04                    crash 9/2/02

    Christina Mahaney, Jackman, ME, Volunteer,  Nancy Meuleners Bloomington,
     Truck Safety Coalition Injured in a truck   MN, Volunteer, Truck Safety
     crash 7/19/11, Mother of Liam Mahaney,      Coalition, Injured in a
     Killed in a truck crash 7/19/11             truck crash 12/19/89

    Debra Cruz, Harlingen, TX, Volunteer,       Laurie Higginbotham,
     Truck Safety Coalition, Injured in a        Memphis, TN, Volunteer,
     truck crash 8/8/08                          Truck Safety Coalition,
                                                 Mother of Michael
                                                 Higginbotham, Killed in a
                                                 truck crash 11/18/14

    Kate Brown, Gurnee, IL, Volunteer, Truck    Peter Malarczyk, Hastings-on-
     Safety Coalition, Mother of Graham Brown,   Hudson, NY, Volunteer,
     Injured in a truck crash 5/2/05             Truck Safety Coalition,
                                                 Injured in a truck crash 12/
                                                 29/15, Son of Ryszard and
                                                 Anita Malarczyk, Killed in
                                                 a truck crash 12/29/15

    Monica Malarczyk, Hastings-on-Hudson, NY,   Randall Higginbotham,
     Volunteer, Truck Safety Coalition,          Memphis, TN, Volunteer,
     Injured in a truck crash 12/29/15, Son of   Truck Safety Coalition,
     Ryszard and Anita Malarczyk, Killed in a    Father of Michael
     truck crash 12/29/15                        Higginbotham, Killed in a
                                                 truck crash 11/18/14

    Alan Dana, Plattsburgh, NY, Volunteer,      Julie Branon Magnan, South
     Truck Safety Coalition, Son of Janet        Burlington, VT, Volunteer,
     Dana, Uncle of Caitlyn & Lauryn Dana,       Truck Safety Coalition,
     Brother-in-law of Laurie Dana, Killed in    Injured in a truck crash 01/
     a truck crash 7/19/12                       31/02, Wife of David
                                                 Magnan, Killed in a truck
                                                 crash 01/31/02

    Cindy Southern, Cleveland, TN, Volunteer,   Jennifer Tierney,
     Truck Safety Coalition, Wife of James       Kernersville, NC, Board
     Whitaker, sister-in-law Anthony Hixon and   Member, CRASH, Daughter of
     aunt of Amber Hixon, Killed in a truck      James Mooney, Killed in a
     crash 9/18/09                               truck crash 9/20/83

    Amy Fletcher, Perrysburg, OH, Volunteer,    Steve Izer, Lisbon, ME,
     Truck Safety Coalition, Wife of John        Board Member, PATT, Father
     Fletcher, Killed in a truck crash 1/24/12   of Jeff Izer, Killed in a
                                                 truck crash 10/10/93

    Sandra Lance, Chesterfield, VA, Volunteer,  Tina Silva, Ontario, CA,
     Truck Safety Coalition, Mother of Kristen   Volunteer, Truck Safety
     Belair, Killed in a truck crash 8/26/09     Coalition, Sister of Kris
                                                 Mercurio, Sister-in-Law of
                                                 Alan Mercurio, Aunt of
                                                 Brandie Rooker & Anthony
                                                 Mercurio, Killed in a truck
                                                 crash 12/27/89

    Bruce King, Davisburg, MI, Volunteer,       Melissa Gouge, Washington,
     Truck Safety Coalition, Son-in-law of       D.C., Volunteer, Truck
     Bill Badger, Killed in truck crash 12/23/   Safety Coalition, Cousin of
     04                                          Amy Corbin, Killed in a
                                                 truck crash 8/18/97

    Kim Telep, Harrisburg, PA, Volunteer,       Marchelle Wood, Falls
     Truck Safety Coalition, Wife of Bradley     Church, VA, Volunteer,
     Telep, Killed in a truck crash 8/29/12      Truck Safety Coalition,
                                                 Mother of Dana Wood, Killed
                                                 in a truck crash 10/15/02

    Ashley McMillan, Memphis, TN, Volunteer,    Bernadette Fox, Davis, CA,
     Truck Safety Coalition, Girlfriend of       Volunteer, Truck Safety
     Michael Higginbotham, Killed in a truck     Coalition, Best friend of
     crash 11/18/14                              Daniel McGuire, Killed in a
                                                 truck crash 7/10/14

    Warren Huffman, Odessa, MI, Volunteer,      Paul Badger, Davidson, NC,
     Truck Safety Coalition, Brother of Tim      Volunteer, Truck Safety
     Huffman, Killed in a truck crash 5/6/13     Coalition, Son of Bill
                                                 Badger, Killed in truck
                                                 crash 12/23/04

    Frank Wood, Falls Church, VA, Volunteer,    Morgan Lake, Sunderland, MD,
     Truck Safety Coalition, Father of Dana      Volunteer, Truck Safety
     Wood, Killed in a truck crash 10/15/02      Coalition, Injured in a
                                                 truck crash 7/19/13

    Santiago Calderon, Arcata, CA, Volunteer,
     Truck Safety Coalition, Injured in a
     truck crash 4/10/14

    cc: Members of the U.S. House Committee on Transportation and
    Infrastructure

       Statement of Chris Spear, President and Chief Executive Officer,
       American Trucking Associations, Submitted for the Record by Hon.
                             Eleanor Holmes Norton
        Chair Norton, Chairman Lipinski, Ranking Members Davis and
    Crawford, and members of the subcommittees, thank you for holding this
    important hearing and for providing the American Trucking Associations
    (ATA) \1\ with the opportunity to submit testimony for the record. ATA
    is an 86-year old federation that represents every sector of the
    trucking industry, with affiliates in all 50 states. Our federation has
    members in every Congressional district and every community. More than
    80 percent of U.S. communities rely exclusively on trucks for their
    freight transportation needs. Trucking is the glue that connects all
    modes in support of the American economy.
    ---------------------------------------------------------------------------
        \1\ American Trucking Associations is the largest national trade
    association for the trucking industry. Through a federation of 50
    affiliated state trucking associations and industry-related conferences
    and councils, ATA is the voice of the industry America depends on most
    to move our nation's freight. Follow ATA on Twitter or on Facebook.
    Trucking Moves America Forward.
    ---------------------------------------------------------------------------
        The trucking industry has made great strides over the last several
    decades to reduce its environmental footprint, and trucking companies
    continually work with their suppliers, customers and other partners to
    improve fuel efficiency. Not only is this beneficial to public health
    and the future of the planet, but it makes good business sense.
    Depending on market conditions, fuel is the highest or second highest
    line item cost for motor carriers.\2\ Therefore it is incumbent on
    trucking companies to do all they can to reduce their fuel consumption.
    Congress can assist in this regard by making the investments in highway
    infrastructure necessary to reduce congestion, which caused the
    trucking industry to consume an additional 6.87 billion gallons of fuel
    in 2016. This represented approximately 13 percent of the industry's
    fuel consumption, resulting in 67.3 million metric tons of excess
    carbon dioxide (CO2) emissions.\3\ Congress can also eliminate a major
    disincentive for carriers who want to buy newer, cleaner trucks by
    eliminating the 12% excise tax on new trucks.
    ---------------------------------------------------------------------------
        \2\ An Analysis of the Operational Costs of Trucking: 2019 Update.
    American Transportation Research Institute, Nov. 2019.
        \3\ Fixing the 12% Case Study: Atlanta, GA. American Transportation
    Research Institute, Feb. 2019.
    ---------------------------------------------------------------------------
        Trucking was the first freight industry to widely use advanced
    diesel engine emissions control systems. In 2002, the industry began
    buying new trucks which incorporated exhaust gas recirculation (EGR)
    combined with other emission control technologies to reduce tailpipe
    emissions of nitrogen oxides (NOx) by half. The additional cost of
    purchasing this new engine technology has been estimated to be as much
    as $250 million annually.
        Beginning in 2007, the new diesel trucks purchased by the industry
    began incorporating diesel particulate filters (DPFs) to reduce
    tailpipe emissions of particulate matter (PM) by at least 90 percent.
    These trucks also achieved the first half of a 90 percent reduction in
    NOx emissions which was fully implemented in 2010. In other words,
    every 10 new trucks purchased today equal the NOx and PM emissions
    produced by a single truck purchased thirteen years ago.

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        To enable the use of these new emission reduction technologies, the
    trucking industry began transitioning to ultra-low sulfur diesel fuel
    (ULSD) in 2006. By late 2010, all of the highway diesel fuel sold in
    the United States contained near-zero levels of sulfur (<15 parts/
    million). The additional cost of purchasing this new low-emission
    engine technology and fuel has been estimated to be as much as $4
    billion annually.
        Today, 43 percent of large commercial trucks registered in the
    United States meet the most stringent NOx and PM emissions standards.
    And with each new truck purchase further expanding the use of NOx and
    PM controls, emissions from heavy-duty diesel engines are projected to
    significantly decrease over the next decade. According to the
    Environmental Protection Agency, these stringent emissions standards
    cut nationwide NOx and PM emissions from heavy-duty diesel trucks in
    half between 2007 and 2015. By 2030, these emissions will be reduced by
    roughly 90 percent.

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

      Achieving Reductions: U.S. Heavy-Duty Diesel Engine Emissions Trends
        Beginning in 2014, new diesel trucks began to incorporate enhanced
    aerodynamics, low rolling resistance tires and other innovative
    technologies to improve fuel efficiency and reduce carbon dioxide (CO2)
    emissions. By 2018, these first-ever standards will reduce fuel
    consumption and CO2 emissions by as much as 23 percent over a baseline
    2010 truck. The additional cost of purchasing this new technology has
    been estimated to be as much $8 billion which is expected to be offset
    through savings in fuel purchases. A second phase of fuel efficiency
    and CO2 standards has been adopted that will achieve an additional 34
    percent reduction from trucks and the trailers they pull by 2027. The
    estimated cost of the innovative technologies which will be used to
    achieve these additional reductions is estimated to be $20-$30 billion.
        According to the Federal Highway Administration, trucks transport
    more than two-thirds of U.S. freight tonnage. By 2020, while trucking's
    share of U.S. freight tonnage is projected to increase, less than 40
    percent of U.S. freight-related NOx and PM emissions are expected to be
    produced by trucks. These achievements in sustainability and cleaner
    air are primarily the result of the trucking industry's investment in
    new trucks with advanced diesel engine emissions control systems, the
    purchase of ultra-low sulfur diesel fuel to power these engines and
    advancements in vehicle design.
        This year, the trucking industry will move 70 percent of the
    nation's freight tonnage, and over the next decade will be tasked with
    moving three billion more tons of freight than it does today while
    continuing to deliver the vast majority of goods.\4\ Some claim that
    large shifts in freight from trucks to an alternative mode--primarily
    rail--would reduce emissions and congestion. This is no doubt true.
    However, it is also highly unrealistic to assume that the 40-year
    trend-line toward the more nimble, reliable and flexible freight
    transportation provided by trucks will suddenly reverse course. Indeed,
    over the past 20 years rail market share has fallen by 42 percent,
    while the trucking industry's market share has increased by nine
    percent.\5\ While pipelines are projected to grow their market shares
    as capacity continues to expand and energy production increases, rail
    carload traffic is expected to continue to stagnate--both in terms of
    market share and amount of volume--and rail intermodal shares will
    remain flat. In fact, the annual growth in truck volumes over the next
    decade is nearly equal to the total amount of freight moved by
    intermodal rail each year. While rail may have a price advantage over
    trucks, shippers show no sign that they are ready to abandon the higher
    quality, more reliable service that only trucks can provide. In fact,
    as e-commerce grows, the trend toward trucking is likely to accelerate.
    Therefore, it would be unwise to redirect money designated for
    highways--particularly funds currently going toward the two freight
    programs created by the FAST Act, to non-highway freight projects when
    it is clear that for the foreseeable future the vast majority of
    freight will continue to move on the highway system.
    ---------------------------------------------------------------------------
        \4\ Freight Transportation Forecast 2018 to 2029. American Trucking
    Associations, 2018.
        \5\ Commodity Flow Survey 1997 and 2017 Preliminary tables, U.S.
    Department of the Census.

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        The federal government has a critical role to play in the supply
    chain. Freight knows no borders, and the constraints of trying to
    improve the movement of freight without federal funding and
    coordination will create a drag on all freight providers' ability to
    serve national and international needs. The critical role that only the
    federal government can play is to look at investment decisions in the
    context of national impacts and determine which investments can produce
    the greatest economic benefits regardless of jurisdictional
    considerations. Only the federal government can break down the
    artificial constraints of geographic boundaries that hamper sound
    investment in our nation's freight networks. Only the federal
    government can provide the resources necessary to fund projects whose
    benefits extend beyond state lines, but are too expensive for state or
    local governments to justify investments at the expense of local
    priorities. This is why devolution of funding highway projects to state
    and local governments cannot and will not address our most important
    national needs.
        A well-maintained, reliable and efficient network of highways is
    crucial to the delivery of the nation's freight and vital to our
    country's economic and social well-being. However, the road system is
    rapidly deteriorating, and costs the average motorist nearly $1,600 a
    year in higher maintenance and congestion expenses.\6\ Highway
    congestion also adds nearly $75 billion to the cost of freight
    transportation each year.\7\ In 2016, truck drivers sat in traffic for
    nearly 1.2 billion hours, equivalent to more than 425,000 drivers
    sitting idle for a year.\8\
    ---------------------------------------------------------------------------
        \6\ Bumpy Road Ahead: America's Roughest Rides and Strategies to
    make our Roads Smoother, The Road Information Program, Oct. 2018; 2015
    Urban Mobility Scorecard. Texas Transportation Institute, Aug. 2015.
        \7\ Cost of Congestion to the Trucking Industry: 2018 Update.
    American Transportation Research Institute, Oct. 2018.
        \8\ Ibid.
    ---------------------------------------------------------------------------
        Most troubling is the impact of underinvestment on highway safety.
    In nearly 53 percent of highway fatalities, the condition of the
    roadway is a contributing factor.\9\ In 2011, nearly 17,000 people died
    in roadway departure crashes, over 50 percent of the total.\10\ Many of
    these fatalities result from collisions with roadside objects, such as
    trees or poles located close to the roadway.
    ---------------------------------------------------------------------------
        \9\ Roadway Safety Guide. Roadway Safety Foundation, 2014.
        \10\ Ibid.
    ---------------------------------------------------------------------------
        The Highway Trust Fund (HTF), the primary source of federal revenue
    for highway projects, safety programs and transit investments, is
    projected to run short of the funds necessary to maintain current
    spending levels by FY2021.\11\ While an average of approximately $42
    billion per year is expected to be collected from highway users over
    the next decade, nearly $60 billion will be required annually to
    prevent significant reductions in federal aid for critical projects and
    programs.\12\ It should be noted that a $60 billion annual average
    federal investment still falls well short of the resources necessary to
    provide the federal share of the expenditure needed to address the
    nation's surface transportation safety, maintenance and capacity
    needs.\13\ According to the American Society of Civil Engineers, the
    U.S. spends less than half of what is necessary to address these needs.
    As the investment gap continues to grow, so too will the number of
    deficient bridges, miles of roads in poor condition, number of highway
    bottlenecks and, most critically, the number of crashes and fatalities
    attributable to inadequate roadways.
    ---------------------------------------------------------------------------
        \11\ The Budget and Economic Outlook 2019-2029, January 2019
    Congressional Budget Office.
        \12\ Ibid.
        \13\ 2015 Status of the Nation's Highways, Bridges, and Transit:
    Conditions & Performance. USDOT, Dec. 2016; see also 2017
    Infrastructure Report Card. American Society of Civil Engineers, 2017.
    ---------------------------------------------------------------------------
        While the cost and scale of addressing highway improvement needs is
    daunting, it is important to note that much of the congestion is
    focused at a relatively small number of locations. Just 17% of National
    Highway System (NHS) miles represents 87% of total truck congestion
    costs nationwide.\14\ Many of these locations are at highway
    bottlenecks that are identified annually by the American Transportation
    Research Institute. ATRI recently released its annual freight
    bottleneck report, which identifies the top 100 truck bottlenecks
    around the country.\15\ The Washington, DC area had two major
    bottlenecks, while Illinois had four. While most of the bottlenecks
    were in large metropolitan areas, the report found trouble spots even
    in smaller cities like Baton Rouge, LA, San Bernardino, CA, Birmingham,
    AL, Chattanooga, TN, and Greenville, SC. ATA's highway funding
    proposal, described below, would adopt a strategy for funding
    improvements at these costly choke points.
    ---------------------------------------------------------------------------
        \14\ Ibid.
        \15\ https://truckingresearch.org/2019/02/06/atri-2019-truck-
    bottlenecks/
    ---------------------------------------------------------------------------
        A recently released report \16\ by the Transportation Research
    Board (TRB) requested by Congress focused specifically on the current
    state and future needs of the Interstate Highway System. This critical
    network binds our nation together and reaps immeasurable economic and
    national security benefits for the United States. Most importantly,
    because interstates are far safer than surface roads, since 1967 its
    construction has prevented nearly a quarter million people from losing
    their lives in vehicular crashes.\17\ The Interstate Highway System
    accounts for about one-quarter of all miles traveled by light-duty
    vehicles and 40 percent of miles traveled by trucks.\18\ The TRB report
    estimates that conservatively, the state and federal investment
    necessary to address the Interstate system's maintenance and capacity
    needs will have to double or triple over today's expenditures in the
    next 20 years.\19\
    ---------------------------------------------------------------------------
        \16\ Renewing the National Commitment to the Interstate Highway
    System: A Foundation for the Future (2018). Transportation Research
    Board, National Academy of Sciences.
        \17\ Ibid, p. 2-18
        \18\ Ibid, p. 2-10.
        \19\ Ibid, p. S-5
    ---------------------------------------------------------------------------
        ATA's proposed solution to the highway funding crisis is the Build
    America Fund. The BAF would be supported with a new 20 cent per gallon
    fee built into the price of transportation fuels collected at the
    terminal rack, to be phased in over four years. The fee will be indexed
    to both inflation and improvements in fuel efficiency, with a five
    percent annual cap. We estimate that the fee will generate nearly $340
    billion over the first 10 years. It will cost the average passenger
    vehicle driver just over $100 per year once fully phased in.\20\ While
    much of the money under the BAF would fund existing programs, we
    recommend that $5 billion annually should be dedicated to addressing
    major highway freight bottlenecks.
    ---------------------------------------------------------------------------
        \20\ Federal Highway Administration, Highway Statistics 2016, Table
    VM-1. Average light-duty vehicle consumed 522 gallons of fuel.
    ---------------------------------------------------------------------------
        We also support a new fee on hybrid and electric vehicles, which
    underpay for their use of the highway system or do not contribute at
    all. We look forward to working with the committee to identify the best
    approach to achieve that goal.
        The fuel tax is the most immediate, cost-efficient and conservative
    mechanism currently available for funding surface transportation
    projects and programs. Collection costs are less than one percent of
    revenue.\21\ Our proposal will not add to the federal debt or force
    states to resort to detrimental financing options that could jeopardize
    their bond ratings. Unlike other approaches that simply pass the buck
    to state and local governments by giving them additional ``tools'' to
    debt-finance their infrastructure funding shortfalls for the few
    projects that qualify, the BAF will generate real money that can be
    utilized for any federal-aid project.
    ---------------------------------------------------------------------------
        \21\ Ibid.
    ---------------------------------------------------------------------------
        Beyond infrastructure needs, Congress can assist in addressing a
    major safety and efficiency challenge facing the trucking industry.
    Research and feedback from carriers and drivers suggest there is a
    significant shortage of available parking for truck drivers in certain
    parts of the country. Given the projected growth in demand for trucking
    services, this problem will likely worsen. There are significant safety
    benefits from investing in truck parking to ensure that trucks are not
    parking in unsafe areas due to lack of space. In addition, locating
    truck parking in strategic areas can help to alleviate congestion by
    allowing trucks to stage their deliveries and get to their destinations
    before peak congestion periods begin.
        Funding for truck parking is available to states under the current
    federal-aid highway program, but truck parking has not been a priority
    given a shortage of funds for essential highway projects. Therefore, we
    support the creation of a new discretionary grant program with
    dedicated funding from the federal-aid highway program for truck
    parking capital projects.
        Once again, thank you for holding this hearing and giving ATA the
    opportunity to submit testimony. The safe, efficient and sustainable
    movement of freight is both critical and attainable. While trucking
    companies work hard every day to achieve these goals, some things are
    beyond their control. The trucking industry cannot determine how much
    money is invested in highways, or which projects are selected. We all
    rely on our elected representatives to make these decisions. ATA's
    members have offered to help pay for improvements to the highway
    system, and we hope you make the right decision by accepting that
    assistance and by investing the money where it is needed most--in
    highway bottlenecks and the expansion of truck parking capacity where
    shortages exist.

    Statement of the Association of Equipment Manufacturers, Submitted for
                    the Record by Hon. Eleanor Holmes Norton
        Dear Chairwoman Holmes Norton, Chairman Lipinski, Ranking Member
    Davis, and Ranking Member Crawford:
        The Association of Equipment Manufacturers (AEM) appreciates the
    opportunity to submit a statement for the record on the hearing
    entitled ``Where's My Stuff? Examining the Economic, Environmental, and
    Societal Impacts of Freight Transportation.'' AEM represents more than
    1,000 members in the construction, agriculture, forestry, utility and
    mining sectors and advocates for an industry that employs more than 1.3
    million U.S. men and women and contributes $159 billion a year to our
    national economy. AEM's membership is dependent on a well-maintained
    and reliable freight network to ensure that raw materials, goods, and
    components are transported efficiently and cost effectively. As such,
    we continue to urge policymakers to pursue sensible legislative
    solutions that target intermodal network bottlenecks.
        Many of our members manufacture products in rural areas, acting as
    important employers for these communities; however, operation in rural
    communities presents unique shipping challenges. For instance, rural
    facilities frequently operate along two-lane highways that are ill-
    equipped to accommodate significant freight traffic, yet raw materials
    need to make their way to the facilities to allow products to be
    manufactured and finished goods and components need to get to
    customers. Poorly maintained roads and those that are unable to
    accommodate freight traffic as well as freight rail congestion
    increases shipment transportation time.
        Likewise, significant freight delays at our nation's ports have
    created additional challenges for our membership. In some cases,
    significant delays and freight congestion have even forced our members
    to divert shipments to non-domestic ports. Infrastructure capacity and
    reliability challenges raise logistics costs which are ultimately
    passed onto customers in the form of higher prices. Transportation
    funding directed towards freight capacity will help alleviate these
    challenges and ensure that equipment manufacturers can retain
    competitive pricing models. AEM supports proposals that would help
    mitigate the challenges that our members face with regard to our
    nation's freight network. We support legislative proposals that would
    establish grant programs dedicated to freight focused projects and
    those that would create a dedicated revenue stream for freight projects
    funded by user fees.
        We appreciate the leadership of the Subcommittee on Highways &
    Transit and the Subcommittee on Railroads, Pipelines, & Hazardous
    Materials on this important topic. We look forward to working with you
    as you develop innovative solutions to our nation's freight challenges.

        Letter of December 3, 2019, from Allen R. Schaeffer, Executive
      Director, Diesel Technology Forum, Submitted for the Record by Hon.
                             Eleanor Holmes Norton
                                                      December 3, 2019.
    Rep. Eleanor Holmes Norton,
    Chairman,
    Subcommittee on Highways & Transit, Committee on Transportation &
            Infrastructure, U.S. House of Representatives, Rayburn House
            Office Building, Washington, DC.
    Rep. Rodney Davis,
    Ranking Member,
    Subcommittee on Highways & Transit, Committee on Transportation &
            Infrastructure, U.S. House of Representatives, Rayburn House
            Office Building, Washington, DC.

        Dear Chairman Norton and Ranking Member Davis,
        On behalf of the Diesel Technology Forum, we would like to submit
    the comment concerning the hearing before the subcommittee titled
    Where's My Stuff? Examining the Economic, Environmental, and Societal
    Impacts of Freight Transportation. Diesel is the prime technology that
    moves many freight conveyances including commercial vehicles,
    locomotives, marine vessels and the wide variety of off-road cargo
    handling equipment. Diesel technology has undergone a significant
    transformation over the past decade and half and the latest generation
    diesel technologies that power heavy duty trucks and off-road equipment
    are now near-zero in emissions. The leaders in diesel technology are
    engaged to refine the technology to further drive these emissions
    closer to zero in the near term while generating significant fuel
    savings and greenhouse gas emission reductions. While emerging zero-
    emission heavy-duty technologies are on the drawing board today, and a
    few are available currently, introducing the latest diesel technology
    will do the most to deliver immediate term benefits to the communities
    where these vehicles and equipment operate. Diesel is also a U.S.
    economic success story as 13 states are home heavy-duty diesel
    manufacturing facilities.
        By way of background, the Diesel Technology Forum represents the
    leaders in diesel technology including engine, vehicle, equipment and
    component manufacturers and biofuel producers. The Diesel Technology
    Forum is a not-for-profit organization that conducts research and
    educational outreach about the economic importance, energy efficiency
    and clean air and climate benefits of diesel technology of all kinds.
    Diesel vehicles and equipment play a key role in 15 sectors of the US
    economy, from agriculture to goods movement and warehousing and mass
    transit.
    1. Diesel is the Prime Mover of the U.S. Economy & Supports 12 Percent
            of Private Sector Economic Activity
        Diesel engines power the overwhelming majority of vehicles and
    equipment responsible for moving freight in the U.S. Three out of every
    four commercial vehicles is powered by diesel with the remainder
    comprised of gasoline and just 2 percent are natural gas. 98 percent of
    the larger Class 8 trucks are powered by diesel while nearly the
    entirety of locomotives and larger marine workboats are also powered by
    diesel. While alternative fuels and all-electric technologies power
    some of the wide variety of off-road cargo handling and warehouse
    equipment, including forklifts and gantry cranes, diesel is still the
    prime technology among off-road equipment.
        Much of these heavy-duty diesel engines and the vehicles and
    equipment they power are manufactured in the U.S., supporting private
    sector economic activity and employment. Over 1 million heavy-duty
    diesel engines were manufactured in 13 states in the U.S. These
    engines, and the vehicles and equipment they power are critical to the
    warehousing and logistics, agricultural and construction industries
    that generated $4 trillion in economic activity in the first quarter of
    2019, or 12 percent of all private sector activity.
        According to the Bureau of labor Statistics, over 265,000 Americans
    are employed as diesel technicians across the country and job prospects
    show signs of continual improvement \1\. The leaders in diesel
    technology sponsor technical programs around the country to help
    guarantee a skilled workforce to keep diesel technology working for
    America.\2\
    ---------------------------------------------------------------------------
        \1\ Occupational Employment and Wages--Bus, Trucks and Diesel
    Engine Specialists. Bureau of Labor Statistics. https://www.bls.gov/
    oes/current/oes493031.htm
        \2\ ``MANUFACTURING PROGRESS: 1 MILLION HEAVY-DUTY DIESEL ENGINES
    ARE GOOD FOR THE ENVIRONMENT AND ECONOMY''. Diesel Technology Forum,
    September 2019. https://www.dieselforum.org/policyinsider/
    manufacturing-progress-1-million-heavy-duty-diesel-engines-are-good-
    for-the-environment-and-economy
    ---------------------------------------------------------------------------
    2. Significant Transformation to Near Zero Emissions in the Diesel
            Platform
        Over the last decade-and-a-half, diesel technology has undergone a
    significant transformation to near-zero emissions. Cleaner fuel along
    with modern engine designs and aftertreatment technologies yield near-
    zero levels of fine particles and oxide of nitrogen. 43 percent of the
    diesel commercial vehicle fleet come with these near-zero emissions
    technologies and generate significant emission reduction benefits to
    the communities where they operate. A single near-zero emissions Class
    8 truck, for example, generates 2.3 tons less oxides of nitrogen than
    an older generation truck. U.S. Environmental Protection Agency finds
    that a new Class 8 diesel truck and an all-electric truck can reduce
    about the same amount of fine particle emissions as most emissions are
    generated by brake and tire wear and not from tailpipe emissions.\3\
    ---------------------------------------------------------------------------
        \3\ https://www.epa.gov/ports-initiative/national-port-strategy-
    assessment-reducing-air-pollution-and-greenhouse-gases-us
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    ---------------------------------------------------------------------------
        Source: U.S. EPA Office of Transportation and Air Quality (OTAQ)

    3. Clean Commercial Vehicles Reduce Greenhouse Gas Emissions
        Transportation sources of greenhouse gas emissions are now the
    leading source of emissions in the U.S. While passenger cars contribute
    the most to transportation emissions, commercial vehicles rank as the
    second leading contributor while rail and marine vessels represent 4
    percent collectively.
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Within the large population of commercial vehicles, the larger
    Class 7 and 8 trucks are responsible for the majority of emissions.
    Efforts to encourage the replacement of older Class 7 and 8 vehicles
    with new cleaner technologies will do the most to reduce commercial
    vehicle greenhouse gas emissions.
    4. Continued Improvements in Diesel Technology Provides Greenhouse Gas
            Reductions
        One of the benefits of the diesel platform is its impressive track
    record for continual improvement. While the current generation of
    diesel commercial vehicles deliver near-zero emissions, truck and
    engine manufacturers are hard at work developing much more fuel
    efficient diesel trucks that will deliver significant fuel savings.
    Fuel economy rules are now required of the large variety of commercial
    vehicles from larger pickups to the largest Class 8 trucks. More
    efficient diesel trucks are expected to save 130 billion gallons of
    fuel and reduce 1.3 billion tons of greenhouse gas emissions between
    2010 and 2030, according to research commissioned by the Diesel
    Technology Forum. These are significant benefits that are equivalent to
    removing all cars on U.S. roads for a year or eliminating the emissions
    generated from electricity used by 22 million homes.\4\
    ---------------------------------------------------------------------------
        \4\ https://www.dieselforum.org/policy/climate-change-and-diesel-
    technology
    ---------------------------------------------------------------------------
    5. Reducing Transportation Emissions Requires a Variety of Clean
            Technologies Including Diesel
        As emerging technologies will be the focus of much attention to
    reduce heavy-duty transportation emissions, significant and near-term
    benefits can be realized by replacing older trucks with newer diesel
    options to help contribute to achieve climate goals.
        While zero-emission technologies are available today in some
    commercial vehicle and bus types, and others are on the drawing board,
    diesel technology is expected to continue to dominate the larger
    commercial vehicle fleet through 2030, particularly Class 8 trucks that
    are responsible for most of the greenhouse gas emissions from the
    entire commercial vehicle sector. As these emerging zero-emissions
    technologies will make in-roads into the fleet, so too will more
    efficient diesel commercial vehicles and their benefits are substantial
    as noted above. IHS Markit estimates that 75% of commercial vehicle
    truck sales will include a diesel engine by 2030.\5\ Meanwhile, the
    work truck industry and the National American Council for Freight
    Efficiency estimate that all-electric technologies may not prove out
    for larger commercial vehicles until at least the 2030 time frame.\6\
    This outlook is shared by the Truck and Engine Manufacturers. As these
    technologies become available in the future, a recent analysis
    conducted by the National Academies of Science concludes that the
    relatively longer turn-over of older vehicles in favor of new trucks
    results in a further timeframe for these technologies to enter the
    fleet in any sizeable number to generate benefits.\7\
    ---------------------------------------------------------------------------
        \5\ https://ihsmarkit.com/products/reinventing-the-truck.html
        \6\ https://nacfe.org/future-technology/electric-trucks/
        \7\ https://www.nap.edu/catalog/25542/reducing-fuel-consumption-
    and-greenhouse-gas-emissions-of-medium-and-heavy-duty-vehicles-phase-
    two
    ---------------------------------------------------------------------------
    6. More Efficient Off-Road Technologies
        Replacing older engines that power marine vessels and locomotives
    may provide greenhouse gas emission reductions. Unlike commercial
    vehicles, off-road equipment including rail and marine that is
    responsible for about 4 percent of transportation greenhouse gas
    emissions, are not subject to fuel economy standards. Engines that
    power these applications must meet stringent emissions standards for
    criteria pollutants including fine particles and oxides of nitrogen.
    New technology diesel engines developed to meet the most recent
    standard required by the U.S. Environmental Protection Agency reduce
    these emission by upwards of 90 percent. While fuel economy is not
    required, replacing these much older and longer lived engines with new
    more modern designs frequently results in fuel economy benefits that
    translate directly to greenhouse gas emission reduction.
        For example, one rail operator in the New York City region replaced
    an old switch locomotive manufactured before emission controls were
    required with the new diesel technology and saved 26,000 gallons of
    fuel per year.\8\ Similarly, a tug boat operator in the Puget Sound
    region replaced an old uncontrolled propulsion engines with new diesel
    models to realize 1,000 tons of greenhouse gas emissions.\9\ These are
    benefits generated by a single project and are equivalent to converting
    thousands of automobiles to zero-emissions technologies.
    ---------------------------------------------------------------------------
        \8\ https://www.epa.gov/ports-initiative/new-york-city-locomotive-
    repowers-collaborative-efforts-improve-air-
    quality?fbclid=IwAR2wUx2848cmG_PDQcrY9IlclL_Q2pTcgXvpfDcO-Q_J5V1y0-
    FNPYpzU5U#outcomes
        \9\ https://www.epa.gov/sites/production/files/2019-05/documents/
    diesel-tech-forum-large-engine-research-2019-mcdi-mtg-12pp.pdf
    ---------------------------------------------------------------------------
    7. Significant Benefits From Advanced Biofuels
        Significant additional and immediate term greenhouse gas reduction
    benefits can be realized through the use of advanced biofuels including
    biodiesel and renewable diesel fuel. These two fuels are considered
    advanced biofuels capable of reducing greenhouse gas emissions by at
    least fifty percent and in the case of renewable diesel fuel,
    greenhouse gas emissions can be eliminated by more than 80 percent.
        Unlike other alternatives, the use of biodiesel and renewable
    diesel fuel can be used in existing diesel engines and does not require
    the purchase of a new engine, vehicle or equipment. The use of these
    fuels also does not require additional and expensive investments in
    refueling or recharging infrastructure.
        These fuels have provided the most greenhouse gas reductions in the
    transportation sector in California, according to the California Air
    Resources Board.\10\ As a result of California's requirement to reduce
    the carbon content of transportation fuels sold in the state, biodiesel
    and renewable diesel fuel have eliminated the most greenhouse gas
    emissions even exceeding the benefits generated by all-electric cars
    and trucks by almost 4:1.
    ---------------------------------------------------------------------------
        \10\ https://ww3.arb.ca.gov/fuels/lcfs/dashboard/dashboard.htm
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Interest in these fuels is growing outside of California. The City
    of New York, with its fleet of 13,000 heavy-duty vehicles and equipment
    announced it efforts to replace 17 million gallons of diesel fuel with
    renewable diesel fuel that is expected to be the leading contributor to
    the City's greenhouse gas reduction strategy.\11\ The Port Authority of
    New York-New Jersey announced its partnership with Neste, the global
    leader in the supply of renewable diesel fuel, to use this advanced
    biofuel in the Port's fleet of heavy-duty vehicles and equipment.\12\
    ---------------------------------------------------------------------------
        \11\ https://www1.nyc.gov/assets/dcas/downloads/pdf/fleet/Press-
    Release-DCAS-to-Expand-Use-of-Renewable-Diesel-in-City-Fleet-
    Vehicles.pdf
        \12\ https://bioenergyinternational.com/biofuels-oils/neste-and-
    the-port-authority-of-new-york-new-jersey-collaborate-to-facilitate-
    the-use-of-sustainable-transportation-fuels
    ---------------------------------------------------------------------------
                                   conclusion
        Diesel technology is the prime technology that moves freight in the
    U.S. Much of this technology and fuel is produced in the U.S. helping
    to provides jobs to communities across the country. Thanks to continued
    investment by the leaders in diesel technology, the latest near-zero
    emissions innovations are ready and able to move freight while reducing
    emissions. The leaders in diesel technologies are hard at work
    developing the next generation of solutions to drive emissions closer
    to zero.
        Please feel free to contact me with any questions or concerns.
            Sincerely yours,
                                            Allen R. Schaeffer,
                                                    Executive Director.

    Letter of December 16, 2019, from David French, Senior Vice President,
      Government Relations, National Retail Federation, Submitted for the
                      Record by Hon. Eleanor Holmes Norton
                                                     December 16, 2019.
    Hon. Eleanor Holmes Norton,
    Chairman,
    U.S. House of Representatives, Committee on Transportation and
            Infrastructure, Subcommittee on Highways and Transit,
            Washington, DC.
    Hon. Rodney Davis,
    Ranking Member,
    U.S. House of Representatives, Committee on Transportation and
            Infrastructure, Subcommittee on Highways and Transit,
            Washington, DC.

        Dear Chairman Holmes Norton and Ranking Member Davis:
        I am writing on behalf of the National Retail Federation to provide
    our views for the record of your December 5, 2019 hearing entitled
    ``Where's My Stuff? Examining the Economic, Environmental, and Societal
    Impacts of Freight Transportation.''
        The members of the National Retail Federation are among the
    country's largest shippers, moving hundreds of billions of dollars in
    merchandise through their supply chains, using America's transportation
    infrastructure--its seaports, airports, rail lines, and highways. The
    condition of the U.S. freight transportation system is vital to
    American competitiveness, and especially the retail industry, which
    must be able to deliver goods to the consumer at brick-and-mortar
    stores, or through direct to consumer options. The freight
    transportation system is of critical importance to the entire U.S.
    economy.
        The National Retail Federation, the world's largest retail trade
    association, passionately advocates for the people, brands, policies
    and ideas that help retail thrive. From its headquarters in Washington,
    D.C., NRF empowers the industry that powers the economy. Retail is the
    nation's largest private-sector employer, contributing $2.6 trillion to
    annual GDP and supporting one in four U.S. jobs--42 million working
    Americans. For over a century, NRF has been a voice for every retailer
    and every retail job, educating, inspiring and communicating the
    powerful impact retail has on local communities and global economies.
        The U.S. freight infrastructure--particularly those segments such
    as the nation's highways that rely on public-sector funding--has
    suffered from decades of underinvestment, leading retailers to fear
    that future growth in global commerce will be stalled because of a lack
    of infrastructure to support it. Your subcommittee's focus on these
    issues is welcomed, and we provide these views on freight issues that
    we see as priorities that need to be addressed when Congress takes up
    surface transportation reauthorization in the next year.
       Sustainable Federal Funding for the Highway Component of Freight
                                 Infrastructure
        Much of the nation's freight infrastructure is privately financed.
    Marine Terminals and U.S. port authorities self-finance water-side
    infrastructure. Similarly, freight rail pays for on-dock and near dock
    facilities and invests billions of dollars to maintain and expand its
    national network. Significant portions of the air freight system are
    also privately financed. However, the nation's highways, which are the
    main intermodal connections between seaports, airports, railheads,
    farms, factories, distribution centers, stores, and consumers are
    publicly financed.
        The federal portion of highway funds is supported through fuel
    taxes, which are a proxy for user-fees. Unfortunately, there has been
    no significant increase in the federal gasoline tax in decades. In
    addition, fuel efficient automobiles have decreased revenues over time.
        In the upcoming reauthorization of the Fixing America's Surface
    Transportation (FAST) Act, we urge Congress to:
      Recommit to public funding for the nation's highways and intermodal
                                   connectors
          Find a long-term, sustainable source of revenue for the
    federal Highway Trust Fund that preserves the concept that the users of
    the system--trucks, automobiles, and busses--should pay for it.
          Limit Highway Trust Fund spending to those projects that
    will improve performance on the nation's key transportation corridors.
    The Federal Highway Administration has developed performance metrics,
    and we strongly believe they should be used as a basis for directing
    federal highway dollars.
          Establish a special freight account within the Highway
    Trust Fund that should be devoted exclusively to projects identified as
    part of the National Strategic Freight Plan. In particular, federal
    dollars should be reserved for key freight infrastructure including:
            ``Last mile projects,'' which are the highways that
    connect seaports and railheads to the interstate system.
            The highway portion of grade crossings that will
    separate motor vehicles from trains. Grade crossings are a good example
    of public private partnerships, because freight rail will pay a portion
    of the cost.
            Projects identified by the Department of Transportation
    as being of national or regional significance. Freight projects are
    very often multi-state or regional in nature, requiring a federal
    presence.
           Fully Fund Freight-related programs in the Department of
                                Transportation.
          Fund Research Identified in the National Freight
    Strategic Plan: As part of the Moving Ahead for Progress in the 21st
    Century (MAP-21) Act, Congress directed the Department of
    Transportation to develop a National Freight Strategic Plan (The
    Strategic Plan), a draft of which was published for comment in early
    2016. The Strategic Plan identifies many areas in need of research,
    among them, better information about truck moves and truck safety.
    Congress and the administration should fully fund this research.
          Fund the research needs recommended as part of the Bureau
    of Transportation's Port Performance Freight Statistics Program's first
    report to Congress. Congress established the Port Performance Freight
    Statistics Program in the Fixing America's Surface Transportation
    (FAST) Act. The program was enacted in response to the 2015 West Coast
    port disruptions that significantly harmed the nation's exporters. The
    first report under the program outlined research needs. Congress has
    provided no funding for this program, which is the first to attempt to
    measure the productivity and performance of the nation's international
    gateways, which are so important to global commerce.
          Reauthorize the National Freight Advisory Committee
    (NFAC). Created as part of MAP 21, The National Freight Advisory
    Committee (NFAC) was created to promote a safe, economically efficient,
    and environmentally sustainable freight transportation system. The
    committee is a resource within the Department of Transportation for
    collecting the views of the freight community. The Committee should be
    reauthorized to continue their work on freight policy. In our opinion,
    the failure to consult freight users is a continuing problem that needs
    to be addressed. Congress should require the federal government to seek
    out and include the users of the freight transportation system as part
    of its policy-making process.
             Create an Office of Multimodal Freight Transportation
        Moving freight across the nation requires the use of many modes of
    transportation. The products that line the shelves at NRF-member stores
    came by truck, but they also may have come by rail, air, and water
    modes. Unfortunately, the U.S. Department of Transportation is
    organized by transportation mode, making it difficult to coordinate
    responses on important multimodal freight projects and issues. For this
    reason, we call on the administration and Congress to create an Office
    of Multimodal Freight Transportation within the U.S. Department of
    Transportation.
    Create a Shippers Advisory Committee at the Federal Maritime Commission
        In recent years, the Federal Maritime Commission (FMC) has gone out
    of its way to foster dialog between shippers and cargo interests and
    ocean carriers and marine terminals. While FMC issues are not under the
    Subcommittee's jurisdiction, we want to call attention to the work the
    FMC has been doing in reaching out to cargo interests to make important
    gains in port efficiency and congestion reduction. The Commission has
    recently suggested the creation of a permanent shippers advisory
    committee composed equally of importers and exporters, to help foster
    greater collaborative efforts that can improve business practices and
    reduce congestion. We urge Congress to facilitate this proposal and
    call your attention to it because it underscores the importance and
    efficacy of seeking out the views of cargo interests.
                     Pursue Common Sense Truck Regulations
        The nation's retailers support safe and efficient trucking, but we
    also believe that many of the regulations affecting commercial motor
    vehicles (CMVs) are not based on sound research with respect to the
    correlation between regulations and safety. For this reason, we call on
    the administration and Congress to undertake an overhaul of regulations
    affecting CMVs. Congress and the administration should:
          Establish uniform truck Size limits that allows longer
    trailers. At present, there is a patchwork of state and federal
    regulations affecting truck sizes that are inconsistent with a
    nationwide freight system. In the recent past, Congress has asked the
    Federal Highway Administration to undertake research that would
    determine the correlation between truck sizes and weights and truck
    safety, but such studies have been inconclusive because the government
    has no data with respect to truck accidents. As noted above, funding
    research on freight is a high priority, but in the absence of hard
    data, it's hard to justify truck and weight limits that vary by state.
    In addition, moving toward larger trailers or the use of twin-trailers
    nationwide will reduce the carbon footprint of the trucking industry.
          Establish a commercial driver apprenticeship program. The
    retail industry relies on a stable system of distribution for our
    supply chains. America's long-haul trucking industry provides the vital
    distribution networks that serve retail and so many other sectors of
    our economy. Even if a larger portion of freight moves via rail, there
    will continue to be a need for trucks and drivers. Right now, the
    industry is facing a critical shortage of talent. For this reason, we
    believe that proposals, such as the ``Developing Responsible
    Individuals for a Vibrant Economy (DRIVE-Safe) Act'' (H.R. 1374),
    represent a sensible approach to this issue.
          Modernize the national twin trailer standard from 28 feet
    to 33 feet. This modest increase in trailer length will improve truck
    safety, efficiency and sustainability. Modernizing the trucking
    equipment would lead reduced congestion with no cost to the taxpayer,
    increased safety, maximized efficiency and increased environmental
    gains.
          Support performance-based goals for achieving lower-
    emission trucks, rail, and dock equipment. NRF members support efforts
    to reduce carbon emissions. Many of its members participate in the
    SmartWay program and have made operational changes that have reduced
    truck emissions. We strongly believe that the best approach toward
    achieving lower carbon emissions, is to avoid prescriptive regulations,
    and focus on performance standards that would provide maximum
    flexibility to innovate and allow for collaborative efforts between
    technology providers, surface transportation providers, and cargo
    interests. Over the last few decades, NRF members have played a
    leadership role in public-private partnerships to reduce truck
    emissions in the ports of Los Angeles and Long Beach. We continue to
    believe that these efforts are valuable and sensible.

        We thank you for the opportunity to provide these post-hearing
    comments. We look forward to working with Subcommittee members on these
    important issues. If you have any questions, please contact Jonathan
    Gold, NRF's Vice President for Supply Chain and Customs Policy.
            Sincerely,
                                                  David French,
                           Senior Vice President, Government Relations.

      Article entitled ``The Significance of Li-ion Batteries in Electric
      Vehicle Life-cycle Energy and Emissions and Recycling's Role in its
      Reduction,'' Submitted for the Record by Hon. Eleanor Holmes Norton
    Energy Environ. Sci., 2015, 8, 158
    J. B. Dunn, L. Gaines, J.C. Kelly, C. James and K.G. Gallagher

        The article is retained in committee files and is available online
    at https://pubs.rsc.org/en/content/articlehtml/2015/ee/c4ee03029j

     Statement of Stephen Gardner, Senior Executive Vice President, Chief
         Operating and Commercial Officer, National Railroad Passenger
     Corporation (Amtrak), Submitted for the Record by Hon. Daniel Lipinski
                                  Introduction
        Chairwoman Holmes Norton, Chairman Lipinski, Ranking Members Davis
    and Crawford, and all the members of both Subcommittees, thank you for
    this opportunity to submit written testimony on behalf of the millions
    of Americans who depend on Amtrak intercity passenger rail service to
    move them across this nation.
        As you may recall, prior to Amtrak's creation in 1970, railroads
    provided both freight and passenger services. Then, because these
    railroads were losing money on their passenger trains, Congress bailed
    out the private railroads and created Amtrak to relieve them of their
    obligation to operate intercity passenger trains. In return, the
    freights agreed:
          To give Amtrak access to their lines in order to operate
    passenger trains; and
          To give Amtrak passenger trains preference over freight
    trains.

        Unfortunately, as a result of some freight companies' practice of
    ignoring federal law, coupled with Amtrak's inability to enforce its
    statutory right for passenger trains to have priority over freight
    trains, your constituents are routinely and unlawfully delayed by
    freight trains. In addition, many freight railroads make it exceedingly
    difficult for Amtrak to add new service to meet the growing and
    shifting demand by many of your constituents for more trains.
        This is an existential challenge to Amtrak as we own only 3% of the
    21,200 route-miles that our 32.5 million riders traveled over in 2019.
    Most of the remaining 97% are owned by freight railroads. Therefore,
    Americans are largely beholden to the freights for reliable, trip time
    competitive service on the national network.
        How does this impact society? Consider that in FY 2019, 6.5 million
    Amtrak passengers, many of whom are your constituents, were
    significantly late on trains largely delayed by host railroads.
        Across the Amtrak long-distance network, customer on-time
    performance (OTP) in FY2019--the percentage of passengers who arrived
    at their destination on time--was only 42%. On one-third of our 15
    long-distance routes, more than seven out of every ten passengers
    arrived significantly late. Customer OTP on some of our state-supported
    corridor routes was just as bad: 34% on the Chicago-to-Detroit/Pontiac
    Wolverine route and just 26% on the Chicago-to-Carbondale Illini/Saluki
    route.
        The principal reason for this dismal on-time performance is freight
    train interference by host freight railroads. Freight train
    interference is caused by dispatching decisions to prioritize the
    operation of freight trains over passenger trains, either putting
    Amtrak trains behind slow-moving freight trains for miles or relegating
    the passenger train to wait in sidings for freight train to pass. These
    delays amounted to more than one million minutes in FY 2019--equivalent
    to two years of passengers waiting for freight.
        Yet, the increase in freight train interference delays is occurring
    at a time when rail freight traffic is declining: more than 10% since
    2006 and 4% in the last year alone. Interestingly, most of the major
    freight railroads have recently adopted new operating practices, called
    Precision Scheduled Railroading, that they claim have made their
    operations more reliable. Freight railroads claim that they provide
    preference to Amtrak, but our customers can attest that this is often
    far from the case. Just ask the 240,000 passengers aboard the Texas
    Eagle, or the 211,000 passengers on the Crescent, who were all an
    average of two hours late to their destination.
        Moreover, substantial public funds that have been invested in
    freight railroad infrastructure to improve passenger rail performance
    have not yielded returns for passengers or state funding partners. For
    example, after nearly $500 million was invested in the freight railroad
    line used by the State of North Carolina-supported Piedmont service,
    host railroad delays increased for the year following completion of the
    project, until delays were twice the level they were prior to the
    investment; host railroad delays have finally fallen, but there is
    still much room for improvement. On the route into Chicago used by
    three train services supported by the State of Michigan, as well as our
    Capitol Limited and Lake Shore Limited long-distance trains, $200
    million of public funds were invested into the Englewood Flyover and
    Indiana Gateway projects. Today, however, passengers traveling on this
    line encounter severe--and eminently avoidable--host railroad delays on
    a daily basis. Taxpayers and passengers deserve a better return on
    investment.
    Some freight railroads follow the law and provide preference . . . And
                                some ignore it.
        There is absolutely no reason why this nation cannot have both a
    world class freight rail network and modern intercity passenger rail
    service. Amtrak wants both freight and passenger rail to succeed, and
    it appears that individual freight railroads agree with us to widely
    varying degrees depending on the railroad and sometimes on the
    individuals making decisions.
        When freight leadership has decided to dispatch Amtrak trains
    according to the law, we have seen Amtrak's on time performance improve
    literally overnight. During these times, there was no evidence of
    negative impacts to the overall fluidity of America's rail network. In
    fact, it has been reported by some freight railroad leadership that
    efficient Amtrak service can be a proxy indicator that their own
    operations are running most efficiently.
        The bottom line is that some railroads follow the law and provide
    preference to Amtrak trains and other freight railroads simply ignore
    the law and choose to delay your constituents. The attached Host
    Railroad Report Card illustrates this point well.
        Congress can help prevent freight railroads from delaying your
                                 constituents.
        Currently, only the U.S. Department of Justice can bring a legal
    action to enforce Amtrak's preference rights, and it has done so only
    once, nearly four decades ago. Meanwhile, continued deterioration in
    on-time performance is driving away passengers and increasing operating
    losses and federal subsidies. The biggest threat to the future of this
    nation's rail network is our growing inability to offer reliable
    service on many routes.
        Congress should also provide Amtrak with the right to bring legal
    action against a freight railroad when such freight violates federal
    law to provide Amtrak passenger trains with preference.
        Legislation was recently introduced in the Senate and Amtrak urges
    the House of Representatives to do the same.
     Some freight railroads are also making it difficult to add passenger
                                    service.
        When Amtrak and its state partners approach host railroads to
    negotiate the operation of additional trains, some freight railroads
    demand unreasonable capital investments to accommodate the Amtrak
    trains. Amtrak and its partners are willing to invest in the host
    railroad, consistent with the law, if we do, in fact, impair the
    freight railroad. However, what we have experienced is that Amtrak and
    its partners will identify the capital projects needed for the
    additional service and some freights will simply create an excessive
    list of capital projects needed, a list that appears to be aimed at
    preventing Amtrak's access to the railroad. The two parties then spend
    years trying to negotiate to little avail, while it is your
    constituents who suffer from a lack of meaningful transportation
    options.
        Congress should provide a fair and expeditious manner for
    determining the cost of adding new and additional trains to host
    freight railroads.
             Intercity passenger rail can do more for this nation.
        As you know, Amtrak's statutory mission given to us by Congress is
    to provide ``high quality service that is trip-time competitive with
    other intercity travel options.'' (49 USC 24101(b)). The need for such
    has never been greater, especially in short-distance corridors between
    major cities that are too far to drive and too short to fly. All the
    trends suggest that demand for such service will only continue to grow.
    This provides a great opportunity and a way for the United States to
    accommodate increased intercity travel demand in a sustainable manner
    without exacerbating congestion in other modes.
        As we have stated for the record in previous hearings, there are
    several key factors that we are considering as we plan for how Amtrak
    can better serve your constituents, including: the U.S. population is
    growing and becoming more densely populated in urban corridors; highway
    congestion is spreading and getting worse; air travel in short-distance
    markets is declining; and sustainability is a growing concern for
    travelers.
        On most of the National Network, we have not even begun to realize
    the potential--and address the increasingly urgent need--for reliable,
    frequent, high-quality service that can attract passengers for whom
    rail could be a preferable alternative to driving or flying. Amtrak's
    growing ridership, strong financial results, and our proven success in
    certain short corridors where we have strong partnerships, demonstrate
    the potential of intercity passenger rail. We know what works well and
    we want to create more convenience and value for your constituents and
    this nation. Doing so will require enhanced tools and increased
    partnership regarding our relationship with host freight railroads and
    support from Congress.
                                   Conclusion
        Freight and passenger rail service can co-exist and provide far
    better service to all customers, both people and products. To do so, we
    believe there must be a stronger federal role in ensuring that the law
    is followed and not abused. This will help improve the overall fluidity
    of the rail network, provide much improved and needed passenger trains
    to underserved communities, and support this nation's economy from
    coast to coast.
        On behalf of Amtrak, we thank you for your consideration of our
    remarks. We remain optimistic that Congress will find a way to create a
    modern and expanded intercity passenger rail system that thrives in
    partnership with a booming freight network--Amtrak is ready to do its
    part.

                                    Appendix

                                  ----------

    Question from Hon. Daniel Lipinski to Erin Aleman, Executive Director,
     Chicago Metropolitan Agency for Planning, and Board Member, Coalition
                   for America's Gateways and Trade Corridors

        Question 1. The Fixing America's Surface Transportation Act or
    ``FAST Act'' established and authorized $6.3 billion in formula freight
    funding through the National Highway Freight Program and $4.5 billion
    in discretionary grant funding through the Nationally Significant
    Freight and Highway Projects or ``INFRA'' grant program.
        As a former state transportation official and current head of a
    metropolitan planning organization, could you speak to the need for and
    benefits of providing national freight funding through both a formula
    and separate discretionary funding program?
        Answer. Freight infrastructure projects vary a great deal in size
    and scope, rendering a ``one-size-fits-all'' approach suboptimal. Some
    freight projects--such as paving an intermodal connector--can be funded
    with relative ease using money provided by a freight formula. These
    projects are relatively smaller in scale and less complex. Freight
    formula dollars provide state departments of transportation a
    dependable and certain funding stream to address small and medium scale
    projects. To improve upon the existing freight formula program, I
    encourage Congress to eliminate the 10 percent cap on multimodal
    investment and increase the overall amount of funding provided.
        Competitive grant programs, such as INFRA, are critical to large-
    scale freight infrastructure projects, which often span modes and
    jurisdictional borders and are difficult, if not impossible, to fund
    through traditional distribution methods such as formula programs.
    Competitive grant programs can incentivize these multijurisdictional
    projects while encouraging applicants to seek creative funding
    arrangements and bring forward the best possible arrangement for the
    Federal Government to consider. Further, competitive grants are
    available to a wide variety of applicants, including state departments
    of transportation, allowing the many types of organizations responsible
    for developing nationally significant freight infrastructure to access
    federal resources.
        While a state department of transportation may, out of necessity,
    place emphasis on intrastate commerce, a federally administered
    approach places focus on interstate commerce. According to a 2019 study
    by the Congressional Research Service, ``discretionary grants may be
    more effective in providing large amounts of federal funding for very
    costly freight-related projects, particularly those requiring
    interstate cooperation.'' \1\ It should be noted that 77 percent of
    freight crosses state lines.\2\
    ---------------------------------------------------------------------------
        \1\ Congressional Research Service, Freight Issues in Surface
    Transportation Reauthorization, January 2019.
        \2\ Tomer, Adie and Joseph Kane, Brookings and JP Morgan Chase
    Global Cities Initiative, Mapping Freight: The Highly Concentrated
    Nature of Goods Trade in the United States, November 2014.
    ---------------------------------------------------------------------------
        For competitive grants to be effective, they must be developed and
    administered correctly. To improve upon the INFRA competitive grant
    awards, I recommend that Congress:
          Remove the cap on multimodal investment and increase the
    amount of funding to $12 billion annually, which aligns with needs
    revealed through previous INFRA funding rounds.
          Confine awards to freight projects only.
          Mandate that USDOT's award selection process is
    transparent and based upon merit-based criteria that identify and
    prioritize projects with a demonstrable contribution to national
    freight efficiency. As Congress included in the FAST Act INFRA program
    (23 USC 117), goals should include increasing national and regional
    economic competitiveness, improving connectivity between freight modes,
    reducing congestion and bottlenecks, and improving the safety,
    efficiency, and reliability of the movement of freight and people.

     Questions from Hon. Eddie Bernice Johnson to Chuck Baker, President,
             American Short Line and Regional Railroad Association

        Question 1. The Association of American Railroads filed comments
    with the USDOT last year urging the agency to extend a pro-innovation
    regulatory approach to the freight railroads. Much of the comments were
    related to the use of automated and autonomous technology in the
    freight rail industry. Such technologies could have major implications
    for workers who perform various crafts in this industry.
        How do the railroads envision using autonomous technologies?
        Question 2. How will this impact the jobs of those who work for the
    railroads?
        Answer (1. & 2.). Short line railroads today operate safely and
    efficiently as we connect thousands of small customers in small towns
    and rural communities to the national freight rail network. However, we
    are always looking for every opportunity to be even safer and more
    efficient, so that we can move more freight more safely by rail, which
    is good for the economy, helps the environment, reduces congestion,
    lowers the need for highway infrastructure investment, and improves
    overall safety.
        Short lines are not yet major users of autonomous technologies, but
    over the years we have made great strides in using other advanced
    technologies (e.g., ultrasonic rail inspection, big data for locomotive
    maintenance, advanced methods of treating wood ties, etc.) and will
    continue to look for ways to improve.
        Technology can frequently help us do what we need to do to run a
    railroad safer. For instance, using drones when possible for bridge
    inspection improves both safety for workers and creates the ability to
    inspect bridges more frequently. Better track inspection (higher
    quality with less risk of worker injuries) can be done with autonomous
    and continuous test vehicles. In general, human factor incidents are a
    leading cause of injuries and fatalities in our industry. The future
    use of autonomous technologies will assist in the reduction of human
    factor incidents, improving safety for both employees and the public.
        On the grade-crossing front, autonomous motor vehicles have the
    potential to substantially improve grade crossing safety by reducing
    human error by motor vehicle drivers.
        The goal of technology is to get better and more efficient--if
    technology advances impact existing jobs, short lines as always will
    work with their employees and customers to adjust. We will employ as
    many people as needed to do the job of railroading safely, efficiently,
    and reliably so that we can continue to provide critical transportation
    services to our customers throughout the country. Overall, our goal is
    to grow, not shrink!

    Questions from Hon. Peter A. DeFazio to Anne Goodchild, Ph.D., Founding
    Director, Supply Chain Transportation and Logistics Center, University
                                 of Washington

        Question 1. Dr. Goodchild, your testimony discusses the potential
    of delivery services to reduce emissions by consolidating many packages
    into one vehicle. Mr. Mathers' testimony points out that we are using
    only 43 percent of the capacity of our freight truck fleets.
        What policies or regulations will help encourage better capacity
    utilization to reduce carbon emissions?
        Answer. While estimates of truck utilization vary, and observed
    values vary by time, place, and truck type, it is true that observed
    truck utilization is lower than desired. There are three main reasons
    for this; first, that product flows are one-directional, second, that
    truck sizes are limited and fixes, while product flows are uncertain
    and varying, and third, that quick, on-time delivery expectations are
    increasing.

    Most product flows are one-directional:
        Most trucks are either dropping off or picking up. This means that
    even a truck that starts its day full, is empty at the end of its
    route, and has a utilization rate of 50%. This is overwhelmingly the
    case for retail delivery.

    Trucks are purchased to provide flexibility to fleet owners:
        This often means they ``buy-up'' when making purchasing decisions.
    A larger truck can handle small loads, and big loads, but this is not
    true smaller vehicles. If you have a large load, it is much more cost
    effective to send it in a single large-truck, rather than 2 smaller
    ones.

    Delivery expectations are increasing:
        As customers, as we demand shorter times between purchase and
    delivery, vehicle loads decreased. Previously, if a delivery company
    offers 2 day delivery, and sends out 5 full trucks every 10 days, when
    they move to same day, they will need to send one half-full truck each
    day. So there are very significant reasons trucks are not fully
    utilized; even though trucking companies have a very strong profit
    incentive to fill them.
        In order to alter these decisions in favor of fuller trucks, we
    need to make transportation more expensive, so that it plays a stronger
    role in the short and long-term decisions of carriers, as well as
    consumers of their services. This could be accomplished through
    increasing the cost of emissions, fuel taxes, per-mile charges, tolls,
    or congestion pricing, to name a few.

        Question 2. Is greater consolidation of deliveries realistic in the
    age of hyper fast delivery speeds?
        Answer. No, I don't see greater consolidation aligning with faster
    delivery speeds. Of course we will still see economics favoring
    consolidation farther upstream in the supply chain, but the last mile
    becomes less consolidated with hyper fast delivery.

      Questions from Hon. Steve Cohen to Anne Goodchild, Ph.D., Founding
    Director, Supply Chain Transportation and Logistics Center, University
                                 of Washington

        Question 3. Dr. Goodchild, in your testimony, you mention that the
    freight system also includes city streets, local highways, sidewalks,
    bike lanes and people's front door steps. As the volume of freight
    increases, I have concerns about how last mile deliveries will
    contribute to increased congestion and traffic fatalities.
        In your opinion, what can Congress do to support infrastructure
    investments that consider the entire freight system?
        Answer. Adopt a gateway or network perspective. Typically
    infrastructure investments are made on a project basis; expansion of an
    individual port, or highway interchange. In reality, goods move through
    a system, passing through a port, onto a highway, for example.
    Individual projects can have close to zero benefit, if the next links
    in the chain are more constrained. To address this, Congress should
    consider developing connected corridors, where investments are not
    planned at the project level, but at the corridor level, allowing goods
    flows to really benefit.

        Question 4. In your testimony, you also mention that cities lack
    freight planning capacity.
        How can we best support cities to plan for the future of freight
    delivery?
        Answer. Cities are unprepared for the future of delivery because
    there has been little investment in capturing data about goods movement
    at urban scales, and they have not historically included freight
    planning in the organizational objectives. They therefore need
    assistance in both of these areas.
        The federal government can play a key role in 1) requiring,
    funding, and setting standards for data collection, 2) supporting
    cities as they develop this capability. This could be initiated
    through:
          a federal grant program for cities and researchers
    interested in collecting data and building knowledge
          federal support for peer exchange programs where leading
    cities and researchers can share their knowledge and practices with
    each other

    Questions from Hon. Peter A. DeFazio to Ian J. Jefferies, President and
           Chief Executive Officer, Association of American Railroads

        Question 1. Your written testimony stated that President Trump's
    ongoing trade war had created uncertainty for many commodity-related
    industries and manufacturers, impacting demand for rail service and
    highlighting that total U.S. rail carload and intermodal units were
    down 4.4 percent compared to last year. Additionally, U.S. originated
    carload and intermodal originations were down 8.1 percent compared to
    that same time the previous year. Since the hearing, the House passed
    the U.S.-Mexico-Canada Agreement (USMCA), and the Senate is expected to
    consider the measure shortly.
        Assuming the Agreement takes effect, what are the industry's
    projections for rail volumes over the next year?
        Answer. Railroads commend Congress for passing the USMCA and are
    hopeful that this agreement--along with the resolution of other trade
    disputes--will lead to reduced economic uncertainty, higher levels of
    business investment, a boost in U.S. exports, and a stronger U.S.
    economy.
        Railroads also hope that the USMCA will lead to higher levels of
    rail traffic. At least 42 percent of the carloads and intermodal units
    that U.S. railroads carry, and more than 35 percent of rail revenue,
    are directly associated with international trade. Many of those
    international movements are cross-border shipments as well. While the
    USMCA can only serve to help railroads and the wider U.S. economy, U.S.
    rail volumes in 2020 will also depend on a wide range of additional
    factors. Changes in U.S. energy markets that have been underway for
    years will continue to impact rail volumes. Large amounts of rail
    traffic are tied to the U.S. manufacturing sector, the near-term future
    of which is cloudy right now. The grain market continues to face
    challenges in global markets and at home. Intermodal volumes in 2019
    were the second highest ever, but growth in that market will depend
    largely on what happens to consumer spending and in the greater trade
    arena. Railroads are hopeful that the parts of the economy that
    generate the most rail freight--e.g., manufacturing, agriculture,
    consumption of goods, trade in goods, and resource extraction--will
    grow in 2020, and, consequently, demand for rail service in many
    commodity sectors will rise as well.

        Question 2. An article published in the Washington Post on January
    3, 2020 entitled, ``Railroads are slashing workers, cheered on by Wall
    Street to stay profitable amid Trump's trade war'' suggested that the
    Class I railroads implementing precision scheduled railroading (PSR)
    are turning away some business that isn't profitable enough,
    eliminating or downsizing some routes.
        How has the size of the Class I rail network in the U.S. changed
    during the years of 2017-2019?
        Answer. Data for 2019 for U.S. Class I rail mileage is not yet
    available, but there has been very little change in total Class I rail
    mileage over the past decade (see chart). Moreover, miles that Class I
    railroads no longer operate are typically operated by non-Class I
    railroads, as opposed to simply abandoned.
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                   Source: Association of American Railroads

        Of course, the U.S. and global economies are constantly evolving.
    Firms, even entire industries, can and do shift rapidly and
    unexpectedly, and railroads must be able to adapt with those changes.
    These broad, often unanticipated economic shifts are reflected in
    changes not only in rail volumes but also in the types and locations of
    the commodities railroads are asked to transport, as well as in the
    amounts and uses of railroad assets. To successfully adapt to these
    challenges, railroads must be flexible and innovative while improving
    the efficiency and productivity needed to maintain their long-term
    financial health.

        Question 3. We know that demand for freight transportation is
    rising at a disproportionate rate to freight system capacity on the
    highways. Yet, you highlight in your testimony that rail traffic is
    down 4.4 percent over the same period last year.
        What is the railroad industry doing to capture some of that demand?
        Answer. The freight transportation market in the U.S. today is
    intensely competitive. When shippers move freight on railroads, they do
    so because the value railroads offer, in terms of cost and service, is
    superior to the alternatives. Railroads know that they must continue to
    work hard to earn this business, which is why they are constantly
    searching for ways to further increase productivity, reduce costs for
    their customers, and improve their service.
        For railroads, these actions take many forms, including:
          Retaining a focus on safety. Recent years have been the
    safest in rail history, but railroads know the safety challenge never
    ends. That's why railroads, in cooperation with policymakers,
    employees, suppliers, and customers, are constantly looking for new
    technologies, operational enhancements, improved training, and other
    ways to better their safety record.
          Recognizing that capacity is key. Thanks to massive
    investments back into their networks in recent years, freight railroad
    infrastructure today is in the best overall condition ever. Railroads
    are working to ensure that the current high quality of rail
    infrastructure is maintained and that adequate freight rail capacity
    exists in order to meet our nation's current and future freight
    transportation needs.
          Focusing on customer service. Railroads know their
    customers face intensely competitive global markets and are
    increasingly demanding faster and more reliable, cost-effective
    service. In response, railroads are continually launching new customer
    service initiatives and alliances with fellow railroads, rail
    suppliers, trucking companies, and others to improve their service
    offerings.
          Advocating for appropriate public policies. For example,
    railroads have emphasized that the existing balanced regulatory
    structure covering rail rates and service be maintained; that outdated
    regulations that unnecessarily hinder rail innovation and progress be
    replaced in ways that continue to protect the public but do so without
    ``locking in'' existing technologies and processes; that modal
    inequities related to infrastructure financing be ameliorated; and that
    more public-private partnerships, in which public and private entities
    each devote resources to projects in proportion to the benefits that
    will accrue to them, be encouraged.

        Question 4. Since 2016, there have been more than 4,340 collisions
    at highway-railroad at-grade crossings, resulting in more than 1,680
    injuries and at least 530 deaths.
        If more funds were made available for the Section 130 program, what
    projects--other than grade separation projects--should states
    undertake?
        Question 5. What types of infrastructure or technologies should be
    pursued that are not eligible under the current program?
        Question 6. Are the freight railroads willing to bring more funding
    to the table to support grade crossing closures or grade separation
    projects?
        Answer (4.-6.). Reducing accidents and fatalities at highway-rail
    grade crossings is of paramount importance given that most collisions
    are preventable. Engineering solutions (such as closing unneeded
    crossings and upgrading warning devices), education, and enforcement
    are key. Thanks in part to the Section 130 program, grade crossing
    collisions are down 37 percent from 2000 to 2018; however, much work
    remains. Railroads believe the following steps would enhance safety at
    grade crossings:
          The Section 130 program, which provides funds to
    eliminate hazards at highway-rail grade crossings, should continue to
    receive dedicated, formula funding out of the Highway Safety
    Improvement Program.
          Funding for the Section 130 program should be maintained
    at current levels ($245 million in fiscal year 2020) or increased.
          The Section 130 program's incentive payments for grade
    crossing closures should be increased from the current cap of $7,500 to
    $100,000.
          Flexibility in the use of Section 130 funding should be
    expanded by eliminating the arbitrary 50% cap on spending for hazard
    elimination projects and by enabling replacement of certain protective
    warning devices.
          Costs incurred by public or private entities for
    preliminary engineering for grade crossing projects should be counted
    toward the non-federal share.
          States should be permitted or incentivized to bundle
    grade crossing projects into single grant applications under applicable
    discretionary grant programs, such as BUILD, INFRA or CRISI.
          Accelerated deployment of navigational warnings for grade
    crossings for motorists (e.g., smartphone apps) should be required or
    incentivized.
          Future fleets of automated vehicles should be required to
    provide grade crossing warnings and/or prevention of incursions into
    grade crossings where gates or other devices have been activated.
          The incorporation of grade crossing safety training into
    driver education curricula should be incentivized through NHTSA.
          Operation Lifesaver should be authorized at a minimum of
    $3 million per year through FHWA, FRA, and FTA.

        Decisions on what types of traffic warning devices to put at
    particular grade crossings are made by state highway authorities, not
    by railroads. Trains often require a mile or more to stop and cannot
    deviate from their course. That's why safety at grade crossings by its
    nature is primarily motorists' responsibility; the warning devices are
    present to protect motorists, not trains. Railroads generally approach
    grade crossing projects on a case-by-case basis and are always willing
    to discuss the individual circumstances of a particular crossing,
    including funding needs, with appropriate public officials.

        Questions from Hon. Eddie Bernice Johnson to Ian J. Jefferies,
        President and Chief Executive Officer, Association of American
                                   Railroads

        Question 7. The Association of American Railroads filed comments
    with the USDOT last year urging the agency to extend a pro-innovation
    regulatory approach to the freight railroads. Much of the comments were
    related to the use of automated and autonomous technology in the
    freight rail industry. Such technologies could have major implications
    for workers who perform various crafts in this industry.
        How do the railroads envision using autonomous technologies?
        Answer. America's freight railroads are safer today than ever
    before. A significant contribution to the industry's strong safety
    record are the annual investments to modernize and improve the freight
    rail network. Indeed, this improvement in safety has been accomplished
    with record levels of private spending on capital improvements and
    maintenance over the last five years--more than $25 billion annually on
    average. These investments have included meeting the Congressional
    mandate that positive train control systems (PTC) be fully operable by
    the end of 2020, and, as of January 2020, PTC is now in operation on
    98.5% of Class I PTC route-miles network wide. In addition to these
    investments, freight railroads have also undertaken a holistic approach
    to rail safety that includes numerous other elements, such as
    infrastructure and equipment; training and operational improvement;
    technology; and community outreach and preparedness.
        As a result, 2018 FRA safety data continues to show that recent
    years have been the safest on record for the rail sector. Based on FRA
    data per million train miles, since 2009, the train accident rate is
    down 10%, the equipment-caused accident rate is down 11%, the track-
    caused accident rate is down 26%, the derailment rate is down 9%, and
    the employee injury rate is down 16%. Additionally, in 2018, more than
    99.999% of rail hazardous materials shipments reached their destination
    without a release caused by an accident, and, between 2000 and 2018,
    the grade crossing collision rate fell 37%.
        However, railroads will always strive to be even safer. That's why
    they are constantly researching, developing, and implementing new
    safety-enhancing technologies and working cooperatively with employees,
    suppliers, customers, and policymakers to find new ways to improve
    their safety record.
        Autonomous technologies are expected to play a critical role in
    rail safety improvement efforts. Autonomous motor vehicles have the
    potential to substantially improve grade crossing safety by reducing or
    eliminating human error by motor vehicle drivers, but automation
    promises to significantly enhance other areas of rail safety beyond
    grade crossings. Automated technologies can detect a wider range of
    defects, respond faster, and provide a larger window for action than a
    safety system that is subject to the limitations inherent in human
    eyes, minds, and hands. Automated track inspections can reduce track
    defects, leading to fewer accidents. Likewise, automated inspection of
    locomotives and freight cars has been shown to reduce the occurrence of
    broken wheels and other mechanical problems.

        Question 8. How will this impact the jobs of those who work for the
    railroads?
        Answer. Like firms in every industry, railroads must manage their
    resources, including their most important resources--their employees--
    based on business needs. The number of rail employees tends to ebb and
    flow based on current and expected future rail traffic levels,
    technological developments, and other factors. Railroads are hopeful
    that freight transportation demand will continue to grow, and they will
    ensure that their equipment, infrastructure, and employees will be
    sufficient to meet those transportation needs.
        Over the years, railroads have adopted a long line of new
    technologies to improve the safety, efficiency, and reliability of
    their operations. Just as the industry transitioned from steam to
    diesel locomotives or from cabooses to end of train devices,
    technological innovation often brings with it the need to evolve
    operating procedures and models. Railroads must have the incentives and
    flexibility to invest and develop new technologies that improve safety,
    increase efficiencies, and allow the rail industry to remain
    competitive and help their customers thrive.
        The implementation of positive train control and other technologies
    could potentially allow for a reduction in the number of crewmembers in
    the locomotive cab without jeopardizing safety. Railroads aren't
    seeking the ability to impose one-person crews haphazardly or
    unilaterally, however. The subject of crew size has typically been
    addressed as part of the collective bargaining process with rail labor.
    As a result, railroads will continue to work with rail labor to come to
    an agreement and find solutions as they have for decades.

    Question from Hon. Peter A. DeFazio to Jason Mathers, Director, Vehicle
                and Freight Strategy, Environmental Defense Fund

        Question 1. Mr. Mathers, your testimony discussed policies that
    Congress should adopt to increase the demand for zero-emission heavy-
    duty vehicles and develop the necessary charging infrastructure to
    support it.
        Without significant Federal investment and strategic planning in
    deploying charging infrastructure, do you think there is any chance of
    achieving a nationwide network of charging stations to support an
    electric heavy vehicle fleet?
        Answer. Transforming our transportation sector, which is a climate
    change and public health imperative, presents a daunting challenge. It
    is also an urgent one.
        Although some states are motivated and are taking their own steps
    to promote electric vehicles, the sheer scale of the needed
    transformation, and the relatively short time we have to make
    meaningful cuts in greenhouse gas emissions, mean that the federal
    government must play a leadership role in planning and implementing the
    build-out of nationwide networks of charging stations.
        There is considerable good news. For example, the technology for
    transforming the heavy-duty fleet, including the growing availability
    of suitable vehicles, is rapidly evolving. And while additional
    investment is needed to achieve electric propulsion for the long-
    distance fleets, there is a lot of cost-effective, low-hanging fruit,
    such as in electric drayage trucks and in regional delivery and
    municipal fleets.
        So, while innovation in truck electrification will continue, and
    costs will continue to decline across all truck classes, true
    transformation of the sector--especially if the goal is rapid
    progress--absolutely will depend on federal leadership. That means, as
    I said in my testimony, favorable tax and regulatory policies. It also
    includes incentives for owners of both private and publicly owned
    fleets to switch to electric trucks and buses. And it means federal
    support for state and interstate charging infrastructure planning and
    installation.
        The result will be a more efficient, more sustainable
    transportation sector with far fewer impacts on public health and
    climate.