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AAR Report: A Healthy Rail Network Critical to the Nation’s Recovery

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Association of American Railroads President and CEO Edward R. Hamberger said that freight railroads are at a critical point in their history as the industry is facing new challenges from over-burdensome federal regulatory mandates that could seriously undercut the industry's ability to aid in U.S. economic recovery

At a press briefing marking the release of a report
titled Great Expectations: Railroads and U.S. Economic Recovery, Hamberger said
that while freight railroads have been able to weather the economic downturn,
they stand to face even more difficult times.

"Freight rail is the only mode of transportation
that is almost entirely self sustaining," Hamberger said, noting that as the
recession continued through 2009, freight railroads invested approximately $9
billion upgrading and modernizing the nation’s rail network. "We sustain a
healthy national rail system with private capital and we also deliver
tremendous public, economic and job benefits to American businesses and

According to the AAR report, freight railroads
generate nearly $265 billion in total annual economic activity, and directly or
indirectly support more than 1.2 million U.S. jobs. Every one freight rail job
supports another 4.5 jobs elsewhere in the economy, the report said.

Additionally, the country’s privately owned freight
railroads provide the literal foundation for the Obama Administration’s vision
for high-speed and intercity passenger rail. Today, more than 90 percent of
Amtrak’s operation moves on track rights-of-way owned by freight railroads;
with the exception of a few express rail lines, the federal government’s plan
for high-speed rail envisions sharing track with freight.

"Railroads face new policy initiatives that could
hamper our ability to meet the great expectations America now has for rail to
aid in our economic recovery," Hamberger said. "Select legislative and
regulatory proposals are creating an air of uncertainty at a time when there is
already too much of that. When so much is riding on freight rail’s ability to
sustain a healthy national rail network necessary to help America through to
economic recovery, now is not the time to undermine our financial viability."

Hamberger pointed out that costly federal mandates
and regulations could have a direct and negative impact on businesses and
consumers in the form of higher costs for goods and services.

"What’s more, policies that weaken the industry’s
ability to attract investors could threaten high-paying American jobs with
freight rail companies, as well as those jobs connected to the railroads in
areas such as housing, manufacturing, retail and agribusiness," he added.

Great Expectations:
Railroads and U.S. Economic Recovery is an AAR analysis report that examines
the freight railroad industry’s contribution to the U.S. economy, and includes
statistical data on the industry’s progress throughout the economic downturn.
It also provides an analysis of key policy initiatives in Washington, their
potential impact on the industry, and possible solutions.

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