In July 2011, the National Industrial Transportation League proposed rules to give captive rail shippers the opportunity to have their traffic switched to another carrier if certain conditions were met. The proposal, to us, seemed reasonable: Shippers would have to prove they could not be served by other modes or another railroad.And the switch would not occur if the originating railroad could prove the practice was unsafe, or if it harmed existing rail service.
This post, though, is not about the proposal's merits. Rather, it questions why, after nearly 3 1/2 years, the Surface Transportation Board, the federal agency that oversee the rail industry, has done nothing with this other than assign the case a docket number and ask for initial comments. There has been no rulemaking, nor has there been a decision by the STB to even determine if one should begin.
The STB's inaction has drawn the attention of Sens. Al Franken (D-Minn.), David Vitter (R-La.), and Tammy Baldwin (D-Wis.), who in early October sent a letter to Chairman Dan Elliott asking to explain its foot-dragging. As of this post, STB has not replied to our request for an explanation, nor has it commented on if it responded to the letter.
We are not fully privy to the robustness of the STB docket. But it's hard to imagine it being so busy as to be unable to render a decision on a rulemaking in 27 months. It even has a model to go by: In Canada, switching rules are required by law and have been in place for decades.
The STB's action only reinforces the perception that it, like its predecessor the Interstate Commerce Commission, is little more than a handmaiden of the railroads. The knee-jerk reaction of the powerful rail lobby, meanwhile, is to warn of re-regulation and, for the most part, give the shipping community the back of its collective hand. The rails have behaved like this for 120 or so years. It was this arrogant attitude, combined with their refusal to give shippers relief from their transport monopoly, that drove President Theodore Roosevelt to ram rail regulation through Congress in the early 1900s.
Our advice for the rails is to tread lightly. Folks on Capitol Hill are well aware of the industry's year-long service problems, and their stubborn refusal to work with NIT League on competitive access rules isn't likely to sit well. The STB may be in the rails' corner, but if Congress decides to act, the support of a small federal agency won't matter very much.