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Privately owned freight railroads are critical to U.S. industry

Michigan Business Beat
July 24, 2017 9:00 AM


Chris Holman talks with Ted Greener, Director, Public Affairs Association of American Railroads about how privately owned freight railroads are critical to U.S. industry.

RAIL 101

• Privately owned freight railroads are a critical U.S. industry that serves U.S. industry:
o Impact: The most recent available data show freight rail generated $274 billion in output and $33 billion in taxes.
o Jobs: Freight railroads employ more than 165,000 fully unionized workers and support 1.5 million jobs nationally. Freight rail employees are highly compensated, averaging $113,000 annually in pay and benefits.
o Integrated: Freight railroads are part of a cohesive transportation network that carries 54 tons of goods per American per year. Rail accounts for roughly 40 percent of intercity freight volume – more than any other mode.
• Freight railroads provide the literal foundation for most intercity passenger rail.
o Other than the Northeast Corridor, Amtrak trains and state-supported route trains operate on tracks owned by freight railroads, as do most commuter railroads.
o Freight railroads support the negotiation of voluntary, case-by-case agreements to host commuter or passenger rail service.

• Elected officials must institute a system that eliminates the practice of transferring money from the general fund to the Highway Trust Fund.
o As a general rule, the various freight transportation modes should pay their own way. The traditional connection in which users of the highway system pay for that infrastructure should not be broken, and policymakers should consider solutions such as a weight distance fee to instill a truly equitable system.

• Pushing freight from rail to roads by increasing federal truck weight limits – as is being discussed in Congress now – is bad policy.
o Any federal program that boosts truck weight limits – including a “pilot” program that increases weight capacity by 14 percent (from 80k to 91k) – further subsidizes commercial highway users at the expense of taxpayers, exacerbates deterioration of crumbling infrastructure and disadvantages a critical freight rail industry.

The Association of American Railroads also has a page specific to Michigan: https://www.aar.org/data-center/railroads-states#state/MI 

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