[Congressional Record Volume 141, Number 130 (Saturday, August 5, 1995)]
[Extensions of Remarks]
[Page E1682]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


  INTRODUCTION OF A BILL TO REPEAL THE LOCAL RAIL FREIGHT ASSISTANCE 
                                PROGRAM

                                 ______


                            HON. BOB FRANKS

                             of new jersey

                    in the house of representatives

                         Friday, August 4, 1995
  Mr. FRANKS of New Jersey. Mr. Speaker, today I am introducing 
legislation to repeal the Local Rail Freight Assistance Program [LRFA]. 
As my colleagues may be aware, this small Federal program uses taxpayer 
dollars to subsidize privately owned freight railroads.
  LRFA was established tin the mid-1970's to ease the disruption 
resulting from the loss of rail service due to the bankruptcy of the 
Penn Central Railroad and five smaller carriers. LRFA was originally 
intended as a temporary 2-year formula grant program to assist 18 
States by alleviating the economic dislocation caused by rail 
abandonments. Nearly two decades and over half a billion dollars later, 
this temporary program has been expanded to include 49 States and the 
District of Columbia. LRFA continues to receive funding despite the 
fact that it has not been included in the last 11 budgets submitted by 
Presidents Reagan, Bush, or Clinton.
  The short line industry no longer needs this Government handout. 
Today, the short line railroad industry is expanding and profitable 
overall. Furthermore, short lines already have a $1 billion government 
loan guarantee program--section 511--to help finance their capital 
needs.
  Because this program has outlived its usefulness, the Congressional 
Budget Resolution (H. Con. Res. 67) and the fiscal year 1996 
transportation appropriations bill (H.R. 2002) did not include funding 
for LRFA. LRFA funding for this fiscal year is $17 million, down from 
its peak spending level of $80 million in 1980. My bill would remove 
the authorizing language and thereby end funding for the LRFA once and 
for all.
  Some have argued that termination of this program will result in 
greater truck traffic. I know of no evidence, however, of increased 
truck traffic in the 29 States that did not receive LRFA funding this 
fiscal year. Supporters of LRFA also point out that economic disruption 
could result if the program ended. I remind my colleagues that none of 
my home State's short lines received any LRFA funding this fiscal 
year--and the industry miraculously survived.
  As a member of the House Railroad Subcommittee, I support making the 
short line industry more competitive. For example, Congress should fund 
the section 511 guaranteed loan program and reform the antiquated labor 
laws that apply to freight railroads. These two measures alone would be 
a thousand times more beneficial to the short lines than continuing the 
LRFA.
  At a time when Congress is cutting funding for publicly owned mass 
transit, it is perverse to give a handout to privately owned freight 
railroads. I urge my colleagues to join me in taking the short line 
railroad industry off the Federal Government's corporate welfare rolls 
by cosponsoring this legislation.


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