We Stood Up For Gulf Coast Restoration: STB Hearing Days

By Jim Mathews / President & CEO
(Note: most of the links in highlighted text go directly to particular moments during the Surface Transportation Board’s live-streamed hearings. Click on them to get the full accounting of what was said. At the bottom of this blog post, we’ve also included a convenient list of direct links to testimony throughout the two hearings.)

For much of this week, anyone who cares about passenger rail in the U.S. should have been glued to a day and a half of public hearings before the Surface Transportation Board streamed on YouTube. According to the views counter on YouTube, they were not (around 2,800 views, last I looked). And that’s appalling, considering that what’s at stake goes well beyond restoring trains between New Orleans and Mobile, but could well decide the fate of passenger-rail expansion anywhere in the U.S.

It was especially gratifying to see my fellow rail-advocacy leaders from around the country also appearing on the witness list. We all came together to speak with one voice on the need for CSX to be compelled to stop stonewalling and get out of the way of this long-delayed service restoration. All Aboard Ohio’s Stu Nicholson closed out day one, and his remarks are worth your time to watch. So, too, are those of Richard Rudolph, who has long led the Rail Users Network and Zoomed into the session from Maine to amplify the case.

Indeed, there were many hard-hitting moments, but for my money the hardest came from Transportation for America’s John Robert Smith, and three members of the Southern Rail Commission – current Chair Knox Ross, former Chair Greg White, and current Vice Chair John Spain.

All four of these witnesses were in the room with CSX during the Gulf Coast Working Group’s deliberations, and in a position to know what CSX said – and did not say – during that process. And none of those witnesses minced words, testifying on the record as to CSX’s misrepresentations, omissions, and even their apparent refusal to turn over study data to the Federal Railroad Administration that CSX developed using FRA grant money.

“I take no pleasure in telling you that throughout the effort to restore passenger rail service CSX railroad has been neither transparent, nor completely honest, in dealing with the Southern Rail Commission, Amtrak, or as you heard, with the Federal Railroad Administration,” John Robert Smith, the former Mayor of Meridian, Miss., and also former Chair of Amtrak, testified before the Board. “CSX has withheld even the most basic information about their operations from FRA and their other partners. And CSX has misrepresented the information that they did provide.”

Current SRC Chair Ross echoed this assessment. He, too, has first-hand knowledge of each of the working group meetings and the positions taken by everyone in the group. He described in his testimony several instances in which CSX or the Port of Alabama raised potential issues, and the SRC “went to work” addressing them. “We have demonstrated our willingness to compromise, negotiate, and find solutions to the issues that are presented by the service,” Ross declared, “however we do not seem to get that in return.”

In my own testimony as part of the panel with Smith, Ross and the SRC members, I emphasized that “there is no real public evidence that operation of this service would unreasonably impair CSX or N-S operations, and what little evidence the host railroads have produced has been insufficient and unverifiable.”

I also raised the issue of monster, 15,000-ft. freight trains brought to us by the freight rail industry’s embrace of so-called Precision Scheduled Railroading (PSR), which drastically reduces costs to the railroad but paradoxically also reduces capacity and throughput.

I testified that “our Association has many experienced railroaders among its membership, some with decades of experience in railroad operations and planning and many who physically keep an eye on the railroad every day. Based on what they have conveyed to me, CSX is apparently operating only about four through-freights on the Mobile to New Orleans line, with a couple of shorter local freights serving trackside industry.” The reality of this is that CSX can only move 800 cars a day on that route, compared with the 1,600 cars it was able to handle under its previous, pre-PSR operating model.

Surface Transportation Board Chair Martin Oberman picked up where we left off on that issue during the next day’s continuation hearing, pressing CSX CEO Jim Foote to explain why his railroad hasn’t spent to solve the infrastructure problems outlined in its report and evidence presented to the Board. Foote’s rejoinder was to lay the blame at the feet of the pandemic, which, as Trains magazine’s excellent reporter Bob Johnston noted “clearly didn’t sit well with Oberman.”

Oberman’s response to Foote? “You’ve spent $6 billion less on capital than stock buybacks over the past 11 years.”

Board Member and former Vice Chair Robert Primus observed during the same proceeding that “I want direct answers, and I don’t think we’ve got them.”

I know a few people who watched all of the first day didn’t come back for Day Two, and those folks missed out on Amtrak’s Stephen Gardner laying out in detail CSX’s behavior during this process, further cementing why I have repeatedly criticized CSX for its “bad faith” in the Gulf Coast. A lot of that bad behavior only came to light because Amtrak took them before the STB for a hearing, producing evidence that made clear what CSX has been doing. It has been especially egregious in handling the RTC modeling, refusing to turn over their data or assumptions even to the FRA, whose grant money helped to pay for it.

I testified earlier in the hearing about that modeling, telling the Board that America’s rail passengers are “frustrated that after six years of working alongside stakeholders and producing endless studies, host railroads refused to recognize the Gulf Coast Working Group’s analysis and conclusions, instead commissioning yet another separate study intended to undermine the Group’s work, and then walking away from even that effort as that study’s deadline date came and went.”

In his testimony, Gardner offered a public accounting of what we learned about CSX’s handling of the modeling, and it deserves to be quoted at length:

“First they invented freight trains that don't exist,” Gardner testified during the on-the-record hearing. “Their modeling assumes 257% more freight trains than their own data shows actually operated during the period on which it was purportedly based.”

Next, CSX “assumes that Amtrak would have to mitigate every minute of aggregate freight train delays [that] their flawed modeling attributed to Amtrak trains,” Gardner said, and “they also ignored operational efficiencies to claim that no freight or passenger schedules will be adjusted, even slightly, to minimize conflicts.”

CSX in its study assumes “track capacity would be added until projected on-time performance of Amtrak trains reached 95%,” Gardner said, pointing out that no Amtrak train sustains OTP of 95% and that Amtrak never asked CSX for that level of performance in the Gulf.

It’s also worth noting here that the Customer OTP standard to which the host railroads will be held is only 80%.

CSX also “decided our trains would never be routed through a siding, artificially inflating delays, which caused them to propose building more sidings,” Gardner testified.

“But CSX and NS weren’t done. They then added projections of large future freight traffic increases in 20 years, even though revenue ton miles on Class I railroads are decreasing,” he said. “This led them to demand even more infrastructure investments, which they insisted Amtrak should fund now to accommodate their speculative 2039 freight traffic projections.”

From there, Gardner pointed out that “even with all of those flawed and hyperbolic assumptions, the RTC model only showed that our service, if started without any capital investments, would cause average train freight train speeds to decrease by just 7/10 of a mile per hour.”

In other words, as I noted in my own testimony, even though the law says that it is up to freight railroads to demonstrate that any proposed passenger rail service would “unreasonably impair” freight operations to block new passenger trains, CSX is now claiming to Amtrak, project leaders, DOT, FRA, members of Congress and the general public, with a straight face, that diminishing speed by 7/10ths of a mile per hour on a railroad running only 10 trains a day constitutes “unreasonable impairment.”

This is why I testified that, punctuated by bad-faith arguments, misleading public-relations campaigns, petty withdrawals of cooperation, and wholesale rejection of the consistently expressed will of Congress, the 16-year history of this dispute over restarting passenger service in the Gulf Coast clearly illustrates that this is about much more than 150 miles between New Orleans and Mobile.

If CSX gets its way, this would stop any American passenger-rail expansion in its tracks. Last November, some fifty years of patient advocacy secured a record $66 billion for long-overdue investment in our skeletal passenger rail network. This will improve the lives of more than 100 million Americans and produce long-term and long-lasting benefits of tens of billions of dollars every year. Host railroads now appear desperate to stop it.

Years of stonewalling is costing the U.S. taxpayer millions, and depriving Alabama, Mississippi, and Louisiana of potentially billions of dollars in economic benefits. Some of the poorest communities in America exist in these states, and it is a particular cruelty that these underserved areas are once again having to do without in the service of a cynical opposition to progress and improved well-being.

This modest Gulf Coast service restoration is something that many thousands of local residents want, and many millions of Americans need.

It will produce an overall return on taxpayers’ equity of many times what will be invested to produce it.

There is no real public evidence that operation of this service would unreasonably impair CSX or N-S operations, and what little evidence the host railroads have produced has been insufficient and unverifiable.

Congress has spent millions of dollars over the years to advance this project, and after nearly two decades the Gulf Coast’s economies and the taxpaying public deserve to see it move forward.

And Amtrak has a long-standing legal right to access host railroad infrastructure, for appropriate payment, supported over many years and through multiple iterations of rail-related law and regulation by Congress and policymakers alike.

If the evidence and arguments presented during the past day and a half before the Surface Transportation Board are any indication, CSX’s bad-faith gambit may finally be ending. Let’s hope the STB calls their bluff.

DIRECT LINKS TO SELECTED STB HEARING TESTIMONY

Jim Mathews, President & CEO, Rail Passengers Association

Stephen Gardner, President & CEO, Amtrak

Amit Bose, Administrator, Federal Railroad Administration

John Robert Smith, Chair, Transportation for America

Greg White, Southern Rail Commission

Knox Ross, Chair, Southern Rail Commission

John Spain, Vice Chair, Southern Rail Commission

Rep Peter DeFazio, Chair of the House Transportation & Infrastructure Committee, providing direct commentary to STB on the “legislative intent” of the statutes under discussion

STB Chair Oberman questions Matthew Nicaud, of the Mississippi Center for Public Policy, when Nicaud posited that Amtrak could be expected to charge $150 per passenger on the new service

Testimony of the free-market Pelican Institute’s Eric Peterson, in New Orleans, with questions from Chair Oberman and Member Karen Hedlund

Dr. Richard Rudolph of the Rail Users Network

Listen to Sal Pace, the vice chair of Colorado’s Front Range Rail Commission (where our own Jim Souby is now Chair), underscore for the Board why this case is about much more than just the Gulf Coast

Stu Nicholson, All Aboard Ohio, capped Day One by even more forcefully explaining the stakes involved – the expansion of passenger rail in the United States

John James, All Aboard Arizona