Washington, D.C. – The following are the statements of Transportation and Infrastructure Committee Republican Leader John L. Mica (R-FL) and Railroads, Pipelines and Hazardous Materials Subcommittee Ranking Member Bill Shuster (R-PA) from today’s hearing on H.R. 6707, the “Taking Responsible Action for Community Safety Act”. The bill proposes changes to the Surface Transportation Board’s (STB) railroads merger and acquisition review process.
Mica Statement
“I have not taken a position on this issue, and I look forward to hearing the witness’ testimony. The bill would alter the review process and could have a significant impact on future rail mergers. Currently, STB reviews are limited to larger mergers, and this bill would alter that standard.
“At a time when we are concerned with conserving energy, moving goods more efficiently and reducing congestion, we have to look at the public policy implications of this bill, as well as the potential impacts mergers can have on local communities.
“If we do change federal policy on mergers, I don’t want that to have a chilling effect on plans or mergers that do make sense in enhancing transportation in a manner that is more energy efficient, benefits the environment, and improves the movement of goods to and around our communities.”
Shuster Statement
“We are here today to review H.R. 6707, a bill that would make significant changes to the Surface Transportation Board’s merger and acquisition review process. This is an important hearing because demand for rail service is growing fast, and it is in our nation’s interest to ensure that this growth continues in a responsible manner.
“By 2035 we expect that freight rail traffic will increase nearly 90% over today’s levels, and the industry is projected to invest $135 billion in its infrastructure between now and then to meet this demand. The last thing we want to do is discourage the railroad industry from entering into transactions that would advance capacity expansion and relieve congestion.
“Mergers and acquisitions are an important component of this growth because they allow railroads to invest in underutilized trackage, so we should use caution when changing the rules of the game.
“I have questions about this bill because we are altering a longstanding law, and we need to clearly understand the future impacts these changes would bring to the railroad industry. I understand that many of our witnesses today are concerned with the Canadian National acquisition of a lightly used line in suburban Chicago. However, we must be careful to take a broader look at the impacts of this bill beyond this single transaction.
“So far I am encouraged by the effort that has gone into the environmental review in the case that apparently prompted this legislation. I understand that CN will spend approximately $20 million to review the environmental impacts of their acquisition of the EJ&E line.
“The law is clear that the STB has the authority to use the results of this analysis to order CN to mitigate the impacts of an increase in traffic.
“Of course I am sympathetic to the needs of the communities that would be affected by this deal – and I am not in a position to judge whether this transaction should go forward. Our role here is to make sure that the STB has the tools it needs to make the right decisions, so I want to know more about how or whether the bill would improve STB judgments.
“This bill will have a much broader and long lasting impact on the STB and on our nation’s rail industry. It is very important that we clearly understand not just how this bill affects this transaction, but all future mergers and acquisitions.”
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