Across the country, businesses large and small – including chemical distributors – depend on rail service to connect us with our customers. At the federal level, the Surface Transportation Board (STB) is the agency responsible for overseeing our nation’s freight rail network. In the not-so-distant past, staffing and policy issues at the agency meant that many freight rail issues went unaddressed, making it harder, more expensive, and less efficient to move goods across the country by rail.
Thankfully, Congress has taken essential steps in recent years to restore the STB, ensuring the agency is once again fully funded, staffed, and operational. This reinvigorated board has already begun taking on many issues impacting freight rail customers, including finalizing Demurrage Billing Requirements rules, acting on a joint petition for rulemaking around private railcar use, conducting a hearing on the issue of reciprocal switching, and scheduling a hearing for late April to explore the recent deterioration of freight rail service.
While this is great progress, the STB still has some work ahead of it to deliver on the promise of a freight rail system that works for shipping customers. To that end, Congress is moving ahead with reauthorizing this essential agency, and we remain steadfast in our support of the STB. As this reauthorization process unfolds, we urge legislators to ensure the agency continues to receive adequate funding and staffing; both of which are essential to allow the STB to improve data on rail rates and provide remedies for rail service failures.
With reauthorization, the STB can look to implement long-term solutions to many challenges that shippers face. For example, freight rail rates continue to climb, and the STB can reform its arbitration system to ensure businesses and shippers don’t have to waste massive amounts of time and money on disputes over rate increases. The agency should also investigate first-mile/last-mile rail service problems that have disrupted businesses, costing them substantial time and resources.
More recently, over the past year, severe supply chain challenges, due in large part to unfair ocean shipping practices, have affected a wide range of industries and consumers across the United States. Similar to ocean carriers, Class I railroads operate as near-monopolies and can charge whatever rates they want to transport cargo. A competitive, fully functioning freight rail system continues to be an essential priority for NACD and its membership.
Greater freight rail competition along with a strong and engaged STB that can review and evaluate commercial fairness and reciprocity issues can improve the efficiency and effectiveness of our nation’s freight rail system. We remain eager to work with all stakeholders to promote a healthy rail network nationwide and help get our supply chain back on track.
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