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Freight rail investments support vital infrastructure

According to an assessment by the Southwestern Pennsylvania Commission, recently reported by the Post-Gazette, our region can expect a 40 percent increase in freight movement by 2040. Infrastructure is the foundation that supports our state’s economy, and Pennsylvania must shore it up during the coming decades to meet higher demand.

This growth in freight movement is good news for our regional economy, but local, state and federal leaders, who have focused on road and highway infrastructure issues, cannot afford to overlook the freight railroads.

America’s freight railroads haul about 40 percent of intercity freight volume and one-third of U.S. exports — not to mention more than 200 million tons of Pennsylvania’s freight annually. In 2017, freight railroads plan to spend some $22 billion of privately invested money to build, maintain and enhance the network that keeps us moving. This money ensures efficient service for shippers and supports the businesses like Ansaldo STS that produce rail components that are vital for safe operations.

In 2008, Congress mandated the nationwide implementation of Positive Train Control, a safety technology that decreases the risk of human-caused train accidents. Since then, Ansaldo STS’s Pittsburgh Technology Center has worked to develop the supporting technologies, and the rail industry has spent $7.9 billion installing PTC. Ansaldo and other rail transportation companies rely on investments in rail to power important innovations in safety technology and support jobs for area residents.

A recent in-depth study from Towson University emphasizes the national economic impact of the rail industry and the far-reaching “ripple effect” of freight rail dollars. Researchers found that freight rail spending created $274 billion in economic activity and generated nearly $33 billion in total tax revenues in 2014 alone. Additionally, the rail industry supports about 1.5 million jobs across the economy — nine jobs for every single rail job.

However, this success was not always possible because, historically, railroads have not been able to invest at the high levels we see today. Overregulation once brought the industry to the brink of failure, as it prevented rail companies from earning enough capital to make necessary infrastructure investments. Deferred maintenance became the rule rather than the exception, killing the network’s efficiency and bringing trains to a near standstill.

But today, smart public policy has reversed this failing course. Freight railroads now operate under balanced regulations that remove the government from day-to-day operations and enable them to function like other businesses — free to earn enough capital to reinvest into infrastructure and operations. As a result, U.S. freight railroads have been able to achieve consistent and significant gains in safety, efficiency and productivity.

In light of today’s infrastructure woes, here in Pennsylvania and across the country, policymakers must identify sustainable funding solutions for public infrastructure. To prevent the loss of recent gains, they need to provide continued support to America’s private freight railroads and the smart regulations that helped make them successful.