Chemical Shippers Seek Rail Reforms

A coalition of chemical manufacturing, agricultural, and energy interests is urging Congress to move forward on legislation that would reform and reauthorize the Surface Transportation Board. Part of the Transportation Department, the board oversees the railroad industry and adjudicates disputes between shippers and rail companies. Shippers have long complained that as a result of consolidation within the freight rail industry, they are often “captive” to a single carrier and are forced to pay unfairly high rates. In a letter to Sen. John Thune (R-S.D.), chairman of the Senate Commerce, Science & Transportation Committee, the coalition says legislation is needed to improve competition among railroads, such as by allowing shippers “to challenge unreasonable rates or practices.” Rates have increased 76% since 2001, according to the American Chemistry Council, a chemical industry trade group. But the Association of American Railroads, which represents freight rail companies, argues that the shippers’ proposals would result in reduced earnings, which would hamper the industry’s “future ability to make necessary service and safety investments.”