CREATE: Keeping America’s Rail Heart Beating

Key Facts

    • The Chicago Region Environmental and Transportation Efficiency (CREATE) Program is an innovative public-private partnership involving BNSF, Canadian Pacific, Canadian National, CSX, Norfolk Southern, Union Pacific Railroad, Amtrak, Metra, the U.S. Department of Transportation (U.S. DOT), the state of Illinois, the city of Chicago and Cook County.
    • Launched in 2003, the $4.4 billion plan includes 70 projects to improve the efficiency and effectiveness of Chicago’s freight, commuter and intercity passenger rail. As of October 2017, 29 projects are complete.
    • The U.S. DOT expects freight rail traffic to grow 40% over the next 30 years; the CREATE program will allow the Chicago region to handle up to 50,000 more freight trains by 2051.

Chicago’s location in the center of America is as important as the human heart in the body. Each day, nearly 500 freight trains—with over 37,000 rail cars—and 760 passenger trains pass through the region, moving the goods and people that help pump life into the national economy. In fact, for 150 years, Chicago has remained the nation’s busiest rail hub and the world’s third most active rail intermodal hub, moving 25% of U.S. freight rail traffic and 46% of all intermodal traffic that begins, ends or travels through Chicago.

As freight rail volumes and demand for passenger rail service continue to rise, Chicago has become the largest U.S. rail chokepoint. Because freight and passenger trains operate almost entirely on the same regional tracks, an average rail car that may take only 48 hours to travel the 2,200 miles from Los Angeles to Chicago spends about 30 hours moving through Chicago alone.

The Solution: An Unprecedented Public-Private Partnership

To improve the flow of trains through the rail heart of America, the region’s six class I railroads joined forces with Amtrak, Metra, and state, local and county governments to form the Chicago Region Environmental and Transportation Efficiency (CREATE) Program. Launched in 2003, the $4.4 billion plan involves 70 critical rail and highway infrastructure improvement projects in northeastern Illinois to enhance the efficiency and safety of the region’s rail network.

Enhancing Capacity & Economic Growth

The CREATE program will allow the Chicago region to handle up to 50,000 more freight trains by 2051, which is good news because the U.S. DOT expects freight rail traffic to grow 40% over the next 30 years. Improvements to the Chicago regional rail system will help keep freight on trains instead of diverting it to trucks, which operate on increasingly-congested, crumbling highways. CREATE will also help improve the region’s economy by adding an estimated 44,000 jobs and generating $31.5 billion in economic benefits over the next three decades.

Keeping Passengers & Freight Moving

Twenty-four projects will directly benefit Amtrak and Metra by eliminating conflicts between freight and passenger trains in several locations on the south side of Chicago. Most notably, the 75th Street Corridor Improvement Project—the largest CREATE project—will reduce congestion where 30 Metra trains, 90 freight trains and two Amtrak trains cross each other daily. The project is in the final design phase, which is anticipated to take two to three years once funding is secured. With a continuous, adequate stream of funding, this major lynchpin could be untangled as little as five years after construction begins.

Improving Safety & Relieving Congestion

Example of a rail overpass, which allows vehicles to move freely underneath.

Safety is a never-ending pursuit for the freight rail industry. As part of the 70 CREATE projects, 25 will separate crossings with new roadway overpasses and underpasses at locations where pedestrian, auto and emergency vehicles travel over railroad tracks at grade level. Six projects will implement new rail overpasses or underpasses to separate passenger and freight train tracks. These improvements will allow emergency vehicles to move more efficiently, keep pedestrians and drivers off the tracks and save commuters 230,000 hours annually in grade crossing delays.

Driving America’s Global Competitiveness

At least 42% of rail carloads are directly associated with international trade and Chicago is the primary hub where six class I railroads carry billions of tons of goods annually to and from east and west U.S. ports. According to the Chicago Metropolitan Agency for Planning (CMAP), exports from Illinois have more than doubled in the past decade and U.S. DOT predicts the volume of imported and exported goods transported via rail to, from or through Chicago will increase nearly 150% between 2010 and 2040. Infrastructure improvements planned through the CREATE Program are critical to fully unlocking the potential of the national freight rail system to meet this future demand.

Mercatus Center: Rail proposal demonstrates importance of RIA requirement

Independent regulatory agencies could create positive economic outcomes while avoiding harmful actions if they conducted a Regulatory Impact Analysis (RIA) before issuing major regulations, explains Patrick McLaughlin in a recent Hill op-ed.

McLaughlin—a senior research fellow at Mercatus Center at George Mason University—examines the benefits of RIAs in the context of competitive switching, a rail shipper proposal the Surface Transportation Board (STB) is currently considering. Noting concerns expressed by an STB Board Member about the proposal’s unintended consequences, McLaughlin argues an RIA would help regulators make smart public policy decisions by assessing if a problem exists and systemically weighing alternative solutions to costly, burdensome regulations.

Click here to read the full piece on TheHill.com.

 

The Power of Privately Funded Freight Rail

When it comes to the quality of America’s infrastructure, railroads have moved to the top of the class. In a newly released infrastructure report card from the American Society of Civil Engineers (ASCE)*, America’s rail network received the highest grade awarded this year, a B.

The high marks for America’s privately funded freight rail system stand in stark contrast to taxpayer funded transportation infrastructure. Bridges, ports and roads, for example, continue to age and suffer from overuse. Reflecting their poor condition, ASCE respectively gave these systems grades of “C+” “C+” and “D.”

By spending billions of dollars to sustain, modernize and grow the freight rail network, U.S. freight railroads are easing the burden on these transportation systems—and the taxpayers who support them. In fact, since 1980, freight railroads—not taxpayers—have spent more than $630 billion to build the safe and cost-effective network that exists today. The industry is on track to spend more than $22 billion this year too.

These investments have resulted in innovative breakthroughs, including new ultrasound technology and acoustic listening devices that can identify track flaws before an accident occurs. It has also enabled the industry to increase capacity by upgrading existing and laying new track, expanding siding extensions and increasing rail yard capacity.

Huge investments have also been made in growing customer segments like rail intermodal. Tunnel projects, intermodal terminals, track upgrades and other infrastructure projects have made rail intermodal more reliable and cost-effective. For example, tunnel-raising projects allow railroads to utilize double-stacked containers to move consumer goods, greatly enhancing the productivity of each train. Such foresight provided one of the few bright spots in recent years with intermodal shipments on track to set annual intermodal records.

Thanks to freight rail’s private spending, the industry now returns $10 to the U.S. economy for every $1 spent. In fact, in 2014, U.S. freight railroads helped spur nearly $274 billion of economic activity and supported almost 1.5 million American jobs. This included $88 billion in wages and close to $33 billion in tax revenue—more than the annual tax receipts of 30 states. Meanwhile, average rail rates paid by shippers have fallen 45 percent since 1980. And building upon decades of safety improvements, rail accident rates have reached an all-time low.

This incredible record of success is only possible in an environment of smart and balanced regulation. Through the choices made today, Washington can help write another chapter in freight rail’s story of success—or close the book on an era of incredible infrastructure investment and widespread economic growth. 

Misguided Proposals Undercut Important Public Policy Goals

Right now, some powerful freight rail customers are trying to convince the U.S. Surface Transportation Board (STB) to change the rules that have helped to make freight railroads one of America’s greatest success stories. One proposal, known as forced access, would require private rail companies to use their infrastructure—their tracks—for the benefit of competing railroads. Some shipper interests are also asking the STB to regulate the railroads’ return on investment—a measure critical to attracting new capital—by instituting caps on rates. These interventionist, re-regulation proposals stand in stark contrast to the free market principles that have allowed freight railroads to prosper and deliver for U.S. industry.

Ultimately, if adopted, these proposals could result in decreased investment, reduced productivity and a diversion of freight from freight rail’s privately funded network onto trucks operating on underfunded and overused roads.

By rejecting these misguided proposals, the STB can preserve the safe, efficient and cost-effective freight rail network that U.S. industry and consumers have come to rely on while preserving taxpayer funded infrastructure like roads and highways.

Together with tax reform that makes business more competitive, trade policies that both protect American workers and the benefits reaped by trade, and a regulatory environment that empowers private industry to find innovative solutions to shared goals, Washington can ensure that freight railroads have the resources to continue investing in a world-class rail network, and can keep America’s economy moving swiftly, affordably and safely for years to come.

 

*The Rail category of ASCE’s 2017 Infrastructure Report Card assessed both passenger and freight rail infrastructure. More than 70 percent of the miles traveled by Amtrak trains are on tracks owned by other railroads—mainly freight railroads—and many commuter railroads operate at least partially on freight-owned corridors.

 

The Big Cost of Heavier Trucks

For years, trucks have failed to pay enough tax revenue to fully compensate for the damage they inflict on America’s roads – a costly blemish on the nation’s otherwise efficient and cost-effective freight transportation network.

Now, some want to double down on the heavy toll trucks inflict by raising the federal weight limit from 80,000 pounds to 91,000 pounds per truck. Doing so would further increase the wear and tear on America’s roadways and harm the transportation partners who work with trucks to keep America’s economy humming.

An Integrated Network

America’s integrated network of barges, trains and trucks helps move 54 tons of freight for every American each year. This finely tuned network makes modern life possible by swiftly and safely carrying everything we rely upon – from the food we eat, to the clothes we wear and the computers, phones and tablets we use.

Freight railroads are at the heart of this integrated network. America’s privately funded freight railroads are unique in their ability to affordably and reliably move freight long distances before handing off to trucks, who are better suited for short-distance travel to and from U.S. manufacturers and markets. Without freight railroads, shippers could not send goods and commodities across the country as quickly and affordably as they do today.

Increasing truck weight limit would disrupt this network by moving freight from trains to trucks and encouraging more trucks to take to America’s overcrowded and underfunded roads.

A 2010 study showed that a similar proposal to increase truck weights to 97,000 pounds could reduce overall rail traffic by 19 percent as heavier trucks took to the roads. The same study found that trucks would not only be heavier, they would be more common too. Increasing truck weight, the report said, would result in 8 million more trucks on roads and bridges – a 56 percent increase from 2010 traffic levels.

More Crowded Highways and a Bigger Tax Bill

Already, America’s taxpayer-supported roads are overcrowded and underfunded. According to the 2017 American Society of Civil Engineers’ (ASCE) Infrastructure Report Card,  more than 40 percent of urban interstates are already congested. And traffic delays and lost productivity costs the American economy $160 billion a year in wasted time and fuel, according to ASCE.

Heavier trucks will only exacerbate this troubling trend. In fact, a 2016 U.S. Department of Transportation (DOT) study looked at the impact of allowing similarly heavy 97,000-pound trucks and found that increasing weight limits would result in trucks only paying for 50 percent of the damage they cause. The remaining balance would be covered by taxpayers. In particular danger are the nearly 1,500 bridges on America’s Interstate System. U.S. DOT estimates that repairing the damage done by 91,000-pound trucks would cost taxpayers at least $1.1 billion.

Finally, Federal Highway Administration data shows that increasing truck size limits has historically resulted in a steady increase in registered trucks and miles traveled by them. The data is clear: putting more, heavier trucks on our roads is a bad deal for shippers, commuters and taxpayers.

Bigger Trucks Undermine Important Public Policy Goals

Allowing heavier trucks also runs counter to the goal of leveraging private investment in our nation’s infrastructure. Over the last decade, freight rail has invested billions of dollars at the nation’s ports to to quickly transfer thousands of intermodal containers to and from the decks of massive cargo ships. Because intermodal rail decks are not designed to double-stack 91,000-pound containers on freight trains, lawmakers would negate the benefits of billions of dollars of private freight rail investment that has occurred in recent decades.

Moving more freight by rail also helps our nation achieve important environmental policy goals such as reduced fuel consumption and greenhouse gas emissions. Trains, on average, are four times more fuel efficient than trucks. That means that moving freight by rail instead of trucks reduces greenhouse gas emissions by an average of 75 percent.

An Unpopular Approach

Adding heavier trucks to our highways is not only a bad policy; it’s an unpopular one too. A May 2013 public opinion poll by Lake Research Partners found that 68 percent of Americans oppose heavier trucks and 88 percent of Americans do not want to pay higher taxes for the damage caused by heavier trucks.

Congress echoed their constituents’ near-uniform opposition to heavier trucks, when the House of Representatives overwhelmingly rejected a 2015 proposal to increase truck weights to 97,000 pounds. At the time, Pennsylvania Representative Lou Barletta criticized the proposal, saying, “This is bad policy because our local communities cannot afford to spend billions in new damages to our local roads and bridges.”

In the time since, America’s highways and bridges have only become more crowded, highway funding has only become scarcer and the threat from heavier trucks has only become clearer. At a time when America’s integrated transportation network carries freight more efficiently and cost effectively than ever before, Congress should continue to oppose heavier trucks on America’s roads and support trucks, cargo ships and freight railroads as they work together to keep America’s economy moving.

Freight Rail Sets the Standard for Modern American Infrastructure

When it comes to the quality of America’s infrastructure, railroads have moved to the top of the class. In a newly released infrastructure report card from the American Society of Civil Engineers, America’s rail network received the highest grade awarded this year, a B.

At a time when America’s bridges, airports and highways have struggled to keep up with daily wear and tear, freight rail’s high marks provide a valuable lesson to policymakers: sustained investments matter.

Congress enacted a balanced regulatory framework in 1980, and since then America’s freight railroads have been instrumental in delivering for our customers, while generating sufficient capital for record reinvestment.

Since 1980, the industry has spent more than $630 billion to build a safe and cost-effective network and is on track to spend more than $22 billion this year. The results speak for themselves: average rail rates paid by shippers have fallen 45 percent since 1980, and building upon decades of safety improvements, rail accident rates have reached an all-time low.

When it comes to the future of rail, we’ll be striving to raise our high grade even higher.

Washington can help. Through a pro-growth agenda, including tax reform that makes business more competitive and a regulatory environment that enables continued private investment and spurs innovation, America’s railroads will have the resources to make the world’s best freight rail network even better.

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Freight Rail Proves Private Industry Can Deliver Prosperity

Market-based solutions, not overly burdensome regulations, can make America a more prosperous nation.

This belief is a valued principle for the thousands of delegates who are gathering in Cleveland for the Republican National Convention.

Looking at the American economy today, freight railroads are living proof of this idea. Today, America’s freight railroads are the best in the world. The average rail shipper can move nearly twice as much freight for the same price paid 35 years ago.

This story of success didn’t always ring true. That’s because, in the years leading up to 1980, the American rail industry was crumbling – sometimes literally – under overly burdensome regulations. During the 1970s, more than 21 percent of the nation’s rail mileage was accounted for by bankrupt railroads. The consequences were not just economic. By 1976, stationary railcars often fell off poorly maintained track.

In 1980, Congress passed the Staggers Rail Act and ushered in an era of balanced regulation. For the first time in decades, freight railroads no longer had to answer to the whims of regulators. Instead they could focus on serving their customers.

American railroads responded with one of the greatest economic turnarounds in modern history. Since the passage of the Staggers Act, average rail rates, not adjusted for inflation, are up just 24 percent sine 1981, far less than the increase in prices for most consumer goods. In addition, train accident rates are down 78 percent, rail traffic has roughly doubled, and railroads have poured more than $630 billion of their own funds – not taxpayer dollars – back into the network.

The private marketplace delivered. And the benefits aren’t limited to freight rail customers. In 2014 alone, freight rail:

  • Supported nearly 1.5 million jobs across the country;
  • Generated almost $33 billion in federal, state and local taxes;
  • Contributed nearly $274 billion to the U.S. economy, doing its part to help our nation thrive.

Impressive as these results are, private freight railroads achieve them with little to no taxpayer funding. That sets freight railroads apart from other modes of freight transportation like trucks, barges and airlines. Railroads spend billions of dollars every year – an estimated $26 billion in 2016 – to maintain and grow the nation’s freight rail network.

The Federal Railroad Administration estimates a 35 percent increase in the volume of U.S. freight shipped between 2010 and 2050.  Will U.S. taxpayers be asked to foot the bill for moving this freight? With a strong private rail industry, the answer can be “no.”